Digital transformation has begun, and it is increasingly important for enterprises and brands to use changes in the market environment and digital technologies to carry out disruptive innovations and create differentiated competitive advantages. In this regard, CEM (Customer Experience Management) is the practice of creating personalized interactions across physical and digital touchpoints that have been introduced in this digital transformation revolution.
Following the evolution stage of the three economic types of the agricultural economy, industrial economy, and service economy, the experience economy with customer experience as the core comes. In addition to the traditional "4P" Sales strategy - Product (product), Price (price), Promotion (promotion), Place (channel), another element under this economic type is exPerience (experience). The importance of exPerience (experience) has become increasingly prominent, and a new generation of "5P" principles has begun to be used by enterprises. Today, the role of the seller has changed from a seller to a builder that aims to create a unique and memorable experience for customers through interaction with customers. From the buyer's perspective, the customer's role attributes transition from buyer to experiencer. In addition to pursuing the quality of tangible goods or services, the emotional transmission of the entire consumption chain has increasingly become an important factor affecting consumption.
In 2021, the per capita income and per capita consumption expenditure of Chinese residents were 35,000 yuan and 24,000 yuan respectively, and the growth rate will both return to the pre-pandemic level. The growth of residents per capita disposable income will continue to drive social consumption, making residents' purchasing power stronger year by year. At the same time, with the advancement of social awareness, the consumption concept of residents will become more refined and diversified. According to Maslow's five-level theory of needs, consumption upgrade is reflected in the fact that upper-level needs are given a higher priority, people will pay more attention to emotional sustenance, and prefer products or services with high emotional added value. This also indicates that people's consumption concept is gradually changing from material consumption to spiritual consumption.
CEM ModelCEM products can be roughly divided into the following three functional modules. The first is the data acquisition module based on the customer journey. The experience and behavior data related to other external customers are integrated to complete the first step of data integration. The second is the data analysis module. Based on technology and algorithms, CEM supports the governance and analysis of multivariate data and visualizes the analysis results in histograms, matrix diagrams, word cloud diagrams, etc., as well as reports output. The last one is the action module. CEM can directly transmit the data analysis results to the relevant departments of the enterprise, which improves the information negligence and inaccuracy of information that are easy to occur. This can form a virtuous circle of customer data and business optimization.
The peak–end rule is grounded in research conducted by Daniel Kahneman and Barbara Frederickson. The peak–end rule is a cognitive bias that impacts how people remember past events. Intense positive or negative moments (the “peaks”) and the final moments of an experience (the “end”) are heavily weighted in our mental calculus. Understanding these rules of thumb allows businesses to design more memorable products to improve customers’ subjective opinions about a user interface.
CEM helps to promote a virtuous circle between employees and enterprises. In terms of productivity, CEM takes data as the foundation and leverages technology advancement to replace the traditional human management objective. At the same time, CEM ensures compliance with customer data and analysis and improves the work efficiency of employees while reducing labor costs. At the level of corporate culture, CEM is conducive to improving departmental coordination, realizing the precise assignment and connection of work tasks, and promoting the management innovation of the labor force. At the same time, a good customer experience can enhance the brand's reputation and enhance the employee's understanding of the company's sense of identity and pride, thereby stimulating employees' loyalty to the overall corporate culture. Employee productivity and loyalty in turn drive and enable customer experience management.
Among the enterprises that currently using CEM-related products, 30.2% said that they will continue to deploy CEM in the future. Among enterprises that have not yet used CEM-related products, 10.8% are willing to deploy CEM in the next year, and nearly 60% are willing to deploy CEM in the next year. The industry stated that CEM will be deployed in the next 1-3 years.