May 15, 2025 • 30 mins
Join us for a special episode featuring Lou Carbone, widely regarded as the father of the experience management movement. As the founder, president, and chief executive, Chief Experience Officer of Experience Engineering, a Minneapolis-based consulting firm dedicated to customer and employee experience management, Lou brings over 30 years of expertise to the discussion. He pioneered the field with his groundbreaking 1994 article "Engineering Customer Experiences," which may have originated the term "customer experience."
Lou is also the author of the book Clued in, How to Keep Customers Coming Back Again and Again and has worked with major companies like Pizza Hut, KFC, Avis, H&R Block, General Motors, IBM, and Taco Bell. He has lectured and taught at leading institutions like Harvard Business School and Cornell School of Business and is currently a Professor of Practice at Michigan State University in the Customer Experience Management Program.
Why listen?
Lou believes the profession is at a crossroads and will challenge conventional thinking about CX, exploring the current state of the profession and offering insights into moving beyond traditional approaches to create truly distinctive value.
He will discuss how organizations can shift their focus from how customers feel about the brand to how they cause them to feel about themselves after interacting with the brand, highlighting the critical role of emotional imprinting in designing memorable experiences that drive value.
Tune in as we explore:
•What does it mean when we say "customers cannot not have an experience
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Well, this will be a special episode of the Delighted Customers podcast. I'm
so excited to have back on the show. Lou Carbone, who is
the founder, president and chief executive, Chief Experience Officer
of Experience Engineering, a Minneapolis based consulting firm
dedicated to customer and employee experience management. He
is widely regarded as the father of the experience
(00:22):
management movement. He wrote an article back
in way back in 1994 that was printed
in Marketing Management, which is a publication of the American
Marketing association called Engineering Customer
Experiences. And I would argue
that that was probably where the term
(00:44):
customer experience may have originated from. Lou has has
written another book called Clued in, how to Keep Customers Coming Back Again
and Again. And he's worked with great, you know,
legacy companies like Pizza Hut, KFC, Avis H&R Block,
General Motors, IBM, Taco Bell and a number of others. He's
lectured and taught at leading institutions like Harvard Business
(01:06):
School, Cornell School of Business, and currently
is a professor of practice at the same place where I'm
teaching at Michigan State University and the Customer Experience Management
Program. And an honor to be a colleague of Liz Lou, welcome back to the
show. Mark, thank you so much. And it's absolutely, I'm
so grateful to be colleague of yours as we
(01:28):
try to really make a difference in the space and
I admire the work that you're doing the podcast and
I enjoy every moment that we ever chat. It's so,
so exciting to be on the show again and on the podcast. Thank you.
Thank you. Lou and I go back to something we're going to get into a
little bit of today, which is the definition of
(01:51):
customer experience. You and I started off chatting a little bit about that
and you brought up some of the, I guess obfusc,
that's a crazy word that come to my mind. But it's probably fitting for
what's going on with the definition of it. But I want to go back to
your book Clued in because you have a quote there. There's
a few quotes from guests of mine that will stand the test of time.
(02:14):
And to me, this is one of them. You say here, the fact is customers
cannot not have an experience exclamation
point. They'll have one whether you want them to or
not. The question is how random or managed is the experience
you are delivering. Say more about that. Gosh,
that is, it's so amazing that something that wasn't
(02:36):
quite grammatically
right being one of the most quoted elements of
that book and out of my keynotes and I'm
often, I was just at a presentation at an orientation
of New employees at an organization, a healthcare
organization. And up on the screen pops, you cannot not have an
(02:58):
experience. Experience. It's a question of whether it's managed or haphazard.
Yeah. Now, without attribution, which is fine because
I don't really care. I just want to see that awareness
that whether you like it or not, you can't declare a
moratorium on experience. Let me just interrupt you for a second. If
you're out there and listening to this, that is a pet peeve of mine. I
(03:20):
saw one of Those yesterday on LinkedIn where somebody just
totally echoed what Joe Pine had written decades and
decades ago and didn't give any. Took it as credit for themselves.
Please do. If you're using it doesn't hurt anything to give attribution. It
doesn't take away anything from what you're sharing. Please do. All right. That's my
little soapbox. I think that's a malady in the. I don't know
(03:43):
whether it's global mark or whether it's just in customer
experience management. You know, what is powerful is I've
been fortunate enough to have many people that will recognize the contribution the
first article made. Joe Pine read a draft of the article
because he was at the IBM Advances Business Institute where I was an
adjunct faculty member, and Steve had him read it. And from
(04:06):
that Joe began to work on. Actually
originally wanted to write with Steve and I. Steve was busy
doing another book. But attribution and understanding, where ideas
and thoughts stem from, we need to recognize
that. And I see that so often where I'll see stuff
from Joe, stuff from Colin Shaw, and it's not
(04:28):
an attribution of any sort. I think that the. To a great
degree, we don't recognize other people.
It's a. It's a very interesting situation. And there are people that
make a difference in our lives and make a difference in our perspectives,
and recognition of that only makes us look bigger.
And I love your plea. That is awesome. Well,
(04:51):
Lou, thanks. Thanks for saying that. And I. I wanted to kick
off by talking about the sigmoid curve, because you mentioned it to me
in terms of we're being at a crossroads in the
profession. And for those who are listening, who aren't
familiar with. Or you're just business leaders or people
outside of even the mainstream business world, and you're listening to the show today,
(05:13):
you're going to get an education. Hopefully you already heard something about
what customer experience is from the quote that, that I shared that Lou
wrote back. Include in. But tell us about the Sigmoid
curve, the proliferation of definitions
of CX and what it's done or hasn't done for us. Yeah, I think that
we reached back when I wrote Clouden, which was after the
(05:35):
original article. The end of the book quotes one of my
favorite poems, which is Robert Frost, the Road Not Taken.
And what Steve and I outlined, and what was outlined in
Cludin was the road not taken. How to design new emotion,
how to imprint emotion and experiences, how to understand
unconscious thought and a rigorous system for lining
(05:58):
clues in an organization in terms
of value creation. That was distinctive and to me
that was the road not taken and that's the road that I've traveled down and
several others and companies that we've worked with have traveled down.
But by and large people stayed on the road, not the road
less traveled by, but stayed on the road that they knew. And
(06:21):
what they did is did window dressing on that.
Surveys became experience management operating systems. We
relabel things on the old road journey mapping was
literally taking and it ended up looking more like process
mapping, an experience design. And we ended up
fixing broken, which we've been trying to do forever versus creating
(06:43):
distinctive economic value. So what happened is
the velocity of the importance of customer
experience in terms of creating distinctive value in
organizations. People latched onto this idea of customer experience
management that went beyond customer satisfaction
or even what I would call service.
(07:06):
But they renamed everything and continued to do what we always did. And
it grew with incredible velocity. Billions of hits
if you put in customer experience management or experience management
on Google. So what is suddenly happening
is everyone expected different results from doing what we always did
and suddenly it's under great scrutiny. There's a great amount of
(07:29):
debate on whether it's dying. I get really frustrated
looking at LinkedIn posts. I try not to, but to stay
apprised of where the marketplace is. There's a great deal of
frustration, people looking for jobs, jobs disappearing
in experience management. So I believe that the
sigmoid curve, which is when things begin to plateau and
(07:51):
there's no longer rapid growth, is where we are in the
movement and to latch on to what I would call
next practices which deal with emotion. Not
just talking about the importance of emotion, which so many people
do, but the depth of being able to understand
emotion. Neuroscience, psychology, sociology.
(08:12):
And I think that's what's so beautiful about experience management is it's
interdisciplinary, it's cross functional and it deals with so
many different issues. And I think Mark, that's what's so beautiful about the program that
we teach in but what is
hugely difficult is there, there's such
fragmentation in the system and in the industry
(08:34):
that there isn't even a common definition that everyone agrees
to or embraces. So I'm on a crusade. I'm about to
launch a survey that I would love to have people
repost that will look at origins of where people
came from, whether they came out of a call center, whether they came out of
a customer set, whether they came out of research. When
(08:56):
I was asked by a wonderful client, a gentleman named
Bill Donnelly, who is part of a group of companies
that said, what is the definition of customer experience?
So they started to do a search and then Bill engaged me to
look at that space. And as we talked
and as I brought forth academics, because I've written
(09:19):
probably 16 or 17 academic articles in
collaboration with people like Glen Berry, Katherine Braun,
luminaries in the marketing space, I looked and there are
probably at the surface level,
16 or 17 different definitions. One of the original
definitions, even preceding the definition that Steve and I came up with, but
(09:41):
it was more around general, was Bernd Schmidt, who was a
professor at Columbia that talked about experiential
marketing and the value of thinking about what an
experience is generically. And then Steve and I
published a definition that was multi sensory, emotional,
unconscious thought. And then there are probably a ton of others.
(10:04):
So this survey that we'd like to put forth in this research
project, and because Michigan State is such a research driven
institution, it has the number one market research
master's degree in the country. So I think it's wonderful
that we can actually put forth a survey
that tries to create, looking at what existing
(10:27):
definitions there are, what would you define it as?
I'm not going to go through the actual design of the questionnaire,
but ultimately it would be to
synthesize all of that information, understand the distinctions
between people's origins coming into the business, and
try to consolidate a single definition
(10:50):
that can be embraced by the industry. And I think that this
fragmentation is so difficult. Six Sigma clearly defined
what its role was and a definition of what Six Sigma was.
And we have never done that. There are all these conflicting
independent definitions
that some are in conflict with others, some are similar,
(11:12):
but getting one common definition, that. And then we wonder
why even members of our faculty, not our faculty in the
program, but faculty in general and marketing, doesn't understand
what customer experience is. Totally the idea of, I see
this all over the place, whether it's academics or whether it's
CEOs, the clarity around what customer experience is.
(11:34):
And I like to Think of it as experience management. The reason that we
call the company Experience engineering and it wasn't by we
have experiences every day. It's the atomic structure of life.
And if we can master understanding human nature
and embed that in the way we look at experience management, we would
(11:54):
be much more successful. So I think that this need to move to
the next level. What I would call advanced practices
and advanced perspectives on experience management. Starting
with a definition and really have
begin to take the road not taken the road less traveled. Because I think
that's where the future really is. Lou, if you're comfortable
(12:17):
sharing and not to steal any thunder, I think people who would respond to the
survey would get give their own opinion anyway. But what would you, what
would you suggest as a definition of customer experience or experience
management? Yeah, I think there are several, several key factors.
One is what I would call emotional imprinting that in addition to the
functionality of the good or service, emotional
(12:39):
imprinting that we imprint an emotion
that is desired by the recipient of the experience.
And that could be my wife, anybody. But if we become much
more sensitive to what people desire feeling and then deliver
the experience by focusing on those emotions
and those emotions are very base and then they ladder up. There are
(13:02):
basically basic human needs, there are cultural
and then there are individual. And what we talk about
is clues that create that emotional connection embedded
in the experience. So let's, let's play that out. Let's talk about.
Could you share like an example of a real life purchase
situation where this, this happens? Absolutely. I'm going to
(13:24):
use an old example in banking, Mark, that I think you would appreciate.
Yeah. When we did our original, for some
reason when the original article was published, a lot of the interest was in
Canada. I have no idea why Royal bank of Canada
had wanted to buy the bank of Montreal or merge with the bank of Montreal.
The government stepped in and stopped it. Because
(13:47):
Royal bank of Canada was seen as the elite bank. There was a CL
their experience which was there are flecks of 14
karat gold in the glass in their headquarters.
I mean that's a pretty hefty clue that created this
sense of they're better than other buildings and that they're elite,
et cetera, et cetera. So when you begin to look at the unconscious
(14:10):
psychological aspects, RBC couldn't understand why they weren't
liked and why the government and people stepped in. So in our
work, I think one of the most incredible things is often
companies will talk about having customers valued.
They're very, very common. If I God If I looked,
there are probably millions of companies that are like, we need to value our
(14:32):
customers. There's a huge difference between being valued
and feeling significant. Valued unconsciously
has an economic impact or that, that, you know,
they think I'm worthwhile. From a financial perspective,
significant is a human connection. So when we, we
used to do a ton of observational video and back
(14:55):
then, mark, every hour of observational video
required an hour of clue scanning, looking at
clues and signals. So what we realized,
observing the departure. They had developed a customer service
departure after someone came in for a mortgage
application. They wanted to increase that
(15:17):
experience. So they developed five things. One was
walk to the door. The other was thank them for their business.
And I forget the other three. I think one was don't trip them on the
way out. I mean, I don't remember. But what we
observed was facial expression. As the
meeting would wrap up. Here you are, you've just poured out all this personal
(15:39):
information. Back then there was a lot of paper and you've filled
out a mortgage application. It's got all of this personal information.
And we would watch it go onto a stack of paper before
they walk the person to the door. And you'd watch the person and watch
it go on top of a stack that was
in some cases a few inches, but one case in particular,
(16:01):
I don't know how backlogged the individual was, but it was way on
top. And what we began to realize in unconscious thought
as we did interviews using a specific technique to get
at unconscious framing. People didn't feel that they were significant.
They got put into this pile of other work. So we
created a clue called a grasp, which is when you walk them to
(16:23):
the door, you hold that piece of paper in your hand
as though that's your next action item versus I'm putting this
off. And unconsciously the emotional metrics
around feeling more significant increase significantly.
Yeah, so it's the subtleties in an experience. And what
many organizations overlook are what we call the clues. The
(16:45):
subtleties, the unconscious clues that are processed in an experience
that build that emotional imprinting. Lou, you talked
about how companies often think about how we want
to be perceived as a brand by the customer. And before
we got on today, you talked about maybe that's not exactly how we
should be thinking about it. Yes. You know, it's a natural tendency
(17:08):
to want to know how people feel about you. I mean we do this every
day, every way, because it's our low self esteem.
I think everyone has some degree, except perhaps I shouldn't get political
but many people have need that reinforcement. Well, companies
are not any different and that's why NPS and scores
like that become important. I don't think that scores and surveys will
(17:31):
ever go away. I think that they're great for performance metrics.
They are not great for insight in terms
of distinctive value creation. What happens is we're
so focused on the attributes of the organization and
what the organization represents and the emotions
that people attribute to how the organization portrays
(17:54):
its emotions. We need to flip that because ultimately
it's how we cause our customers, our employees, our
spouses, how they feel about themselves, which in turn is
how they feel about us. Yeah, so it's basic
unconscious human nature and it seems somewhat bit
counterintuitive, but that's what leads to how they feel about the
(18:16):
organization ultimately unconsciously, where they process
that, that's the link that emotionally bonds them
to experiences and creates what Jag Seth and
other authors that wrote a great book called Firms of
Endearment talk about organizations that if they went away tomorrow, we
would mourn the loss of them. It would change our lives. It's
(18:38):
because how they make us feel about ourselves ultimately. Lou, can
you think of a good example, either experience or a company that
does that? Well, yes, and I think that what's interesting is Simon
Simic touches on it, but I don't. People, people can't
grasp that. And that's why we talk about an experience motif, which is
what are the emotions that resonate and how do you design the
(19:00):
experience to imprint those emotions? I just sat through an
introduction where a company was talking about its why with a group
of employees and what they thought their why was the
what they do. I'm sorry, how they do it. Gotcha. And it was a
healthcare organization and I challenged that thought,
saying that's not the why. The why is making a difference
(19:23):
in other people's lives. So this idea of
getting to that emotional resonance and what
we've done is actually develop tools that unconsciously can look at
what we call emotional congruency. Once you've determined what those
emotions are, are we achieving that on an unconscious level?
And are people feeling the emotions that we have targeted that
(19:45):
they desire? Feeling. So, Lou, what. What would
you say to the person listening now who's been under a lot
of pressure, a CX leader, for example, to prove the ROI of
cx? And how do you connect those dots from experience
design and designing an experience that makes customers feel good about
themselves and contributing to the health of financial health
(20:08):
of the organization? Exactly. You know, I Can point to situations
where one client and what we did is actually ran
a program alongside it that netted $14
million in savings in the delivery of appliances.
That's an ROI. What ended up happening was greater
loyalty with the customers and more
(20:30):
feedback and positive feedback that they couldn't believe it. And what it
was was actually creating corner protectors, runners that would go
in that you would go over hardwood floors and other things with
that actually cut down on damage. So when you really design
and experience customer back versus company out
and understand what they're feeling because you're damaging their property,
(20:53):
it becomes huge in terms of return on investment.
And I think that there are two aspects to the powers of experience
management. One is return on investment and the other is return on
strategy. About that the two go hand in hand. We'll say
more about that. Yeah, the. That an organization will develop a
strategy. And I believe that we actually created a
(21:14):
certification program in corporate strategy because
people that were in management would leave a meeting where strategy was developed
and then go back and not be able to understand what the strategy was and
they're supposed to execute it. So this whole idea
of as a result of a corporate strategy and
if I can help you accelerate the momentum and the
(21:36):
velocity and the impact of the strategy, it would have an
impact on roi. And the
difficulty sometimes with ROI is there are other factors
that enter in that are disconnected within an organization. Price
increases lately, I hate to bring up, I might
get sued for this one, but someone like, I'm not going to name the product,
(21:58):
but it's a smaller candy bar. And there are these changes that
are taking place that are subtle, especially today in what what
organizations are facing. And we'll probably see even more of this with
tariffs that begin to impact my
loyalty and what they're going to get on the investments that are made.
So when you begin to align those investments strategically
(22:21):
toward a financial goal and monitor those, it's
incredible. That comes down to living the values of the
organization. I've done a lot. My heart
belongs to Mayo Clinic. I'm both a patient there. I've done lectures
there, done all sorts of stuff over the years for 27 years.
(22:41):
And values become so critical because values can
actually impact bottom line. I think the greatest
example is a client of ours, which was La Quinta
Hotels. Michael
Powell, Colin Powell's son, who was the chair at Mayo Clinic,
said, when you live the values of the organization,
(23:03):
you become a virtuous organization. And when you become a
virtuous organization, you're no longer thought of as a
corporate entity. So when we think about Mayo Clinic or even
Disney back in the day, I think Disney is quite different today than
when I was working with them. But back in the day, Disney would
announce the opening of the Grand Floridian Hotel
(23:27):
and Regis and Kathy would be there. Press from all over the
world. This was a corporation promoting a
new hotel and have press from all
over the world because it was considered virtuous.
So when you cross that bridge to virtue. So the example with
La Quinta that I thought was so beautiful is number one, the
(23:49):
COO CEO and the management team there when they articulated
their values with work that we did with them, because that leads to
aligning values with customers desired emotions.
So one of the great things was they felt that you can't do
posters. So the senior management said posters are
ridiculous, little cards are ridiculous. We need to be
(24:11):
reminded every day, but with movement because values are
living. So they developed a series of TV
screens that were throughout headquarters and throughout
the system in various places where they used still,
a still photo. So for example, one of the
was around sanitation and really
(24:34):
intent cleaning of the room with a sanitary
mindset. And this was before COVID So they
developed a whole system for doing that. And one of these values was
portrayed by a housekeeper and that was still.
But what was moving in the background were the curtains. So you couldn't
walk by it without seeing some motion. And I think
(24:56):
that that's what we overlook in experience management is the
importance of this is a way of doing business. And it's
not a reporting system, it's not a process improvement
business. Originally, I think I took the first title of Chief Experience
Officer globally when we started. I went. Actually, I think I
was a Chief Experience Officer in Carbone and company that preceded
(25:18):
Experience Engineering because that's what I was doing at that time. And
I think we lost sight that the Chief Experience Officer in a company
is the CEO responsible for fiduciary
growth and value creation, but also
responsible for the value creation within the organization
for employees and customers. And what happened is
(25:40):
we promoted MBAs that are kind of.
And that was financial management. And then we wonder why we have
difficulty penetrating understanding the integrity and
the power of experience management and contributing to the bottom
line. Well said. So many, so many great thoughts from the
sigmoid curve to the definition of experience
(26:02):
management. And look out for a potential survey that
Lou's going to initiate to help us get some commonality
around the definition. And also thinking about how
customers not so much how they feel about your brand, but how they feel about
themselves after experiencing your brand. Right. And. And, Lou, let
me ask. Let me. Let me kind of close this out by asking you what
(26:24):
delights you since. Since it's a delighted customers podcast. What
delights you as a customer? What delights me as a customer is
I'll take Apple as an example that if it went away tomorrow, I
would mourn the loss of. But I feel emotionally synchronized
with Apple in terms of one of the curses I'm blessed
with if there's such a thing as thinking differently. And
(26:47):
I really align with what Apple represented in the past.
I'm also an early adopter, which is not a good thing. But what
delights me is feeling supported in my
desire to advance things. And if I'm
buying Apple products, I feel I'm advancing my ability
to advance other things, because to me, it represents the most
(27:08):
advanced set of principles that.
That I can live with. I remember when ipod came out, or even
the iPad told my wife it was the dumbest idea I've ever heard. I have
a computer, I have a phone. I go
to Best Buy and I pick one up, and I create an
intellectual alibi, which consumers do based on emotion. And
(27:31):
I said, oh, I've got $85 in rewards.
I think I'll buy this. This is phenomenal feel. And it was
the fact that it was distinctive and different, which I had pooh poohed from a
distance. Y. Going back to Simon Sinek that you brought up, he talks about how
Apple challenges the status quo. Yes. And I think that's
been my life, unfortunately, in some ways. Well, you're a
(27:54):
visionary, and you helped us make breakthroughs in the CX
profession. Lou, thank you so much for being a guest again on the show.
Mark, thank you so much for having me. I love you. And the work that
you do, the way that you think, and the contribution you're making to this space
is. I'm speechless. It's what we need. Thank you so much, Lou.
It means a lot, especially coming from you. Thank you, Mark. All right.
Well, this will be a special episode of the Delighted Customers podcast. I'm
so excited to have back on the show. Lou Carbone, who is
the founder, president and chief executive, Chief Experience Officer
of Experience Engineering, a Minneapolis based consulting firm
dedicated to customer and employee experience management. He
is widely regarded as the father of the experience
(00:22):
management movement. He wrote an article back
in way back in 1994 that was printed
in Marketing Management, which is a publication of the American
Marketing association called Engineering Customer
Experiences. And I would argue
that that was probably where the term
(00:44):
customer experience may have originated from. Lou has has
written another book called Clued in, how to Keep Customers Coming Back Again
and Again. And he's worked with great, you know,
legacy companies like Pizza Hut, KFC, Avis H&R Block,
General Motors, IBM, Taco Bell and a number of others. He's
lectured and taught at leading institutions like Harvard Business
(01:06):
School, Cornell School of Business, and currently
is a professor of practice at the same place where I'm
teaching at Michigan State University and the Customer Experience Management
Program. And an honor to be a colleague of Liz Lou, welcome back to the
show. Mark, thank you so much. And it's absolutely, I'm
so grateful to be colleague of yours as we
(01:28):
try to really make a difference in the space and
I admire the work that you're doing the podcast and
I enjoy every moment that we ever chat. It's so,
so exciting to be on the show again and on the podcast. Thank you.
Thank you. Lou and I go back to something we're going to get into a
little bit of today, which is the definition of
(01:51):
customer experience. You and I started off chatting a little bit about that
and you brought up some of the, I guess obfusc,
that's a crazy word that come to my mind. But it's probably fitting for
what's going on with the definition of it. But I want to go back to
your book Clued in because you have a quote there. There's
a few quotes from guests of mine that will stand the test of time.
(02:14):
And to me, this is one of them. You say here, the fact is customers
cannot not have an experience exclamation
point. They'll have one whether you want them to or
not. The question is how random or managed is the experience
you are delivering. Say more about that. Gosh,
that is, it's so amazing that something that wasn't
(02:36):
quite grammatically
right being one of the most quoted elements of
that book and out of my keynotes and I'm
often, I was just at a presentation at an orientation
of New employees at an organization, a healthcare
organization. And up on the screen pops, you cannot not have an
(02:58):
experience. Experience. It's a question of whether it's managed or haphazard.
Yeah. Now, without attribution, which is fine because
I don't really care. I just want to see that awareness
that whether you like it or not, you can't declare a
moratorium on experience. Let me just interrupt you for a second. If
you're out there and listening to this, that is a pet peeve of mine. I
(03:20):
saw one of Those yesterday on LinkedIn where somebody just
totally echoed what Joe Pine had written decades and
decades ago and didn't give any. Took it as credit for themselves.
Please do. If you're using it doesn't hurt anything to give attribution. It
doesn't take away anything from what you're sharing. Please do. All right. That's my
little soapbox. I think that's a malady in the. I don't know
(03:43):
whether it's global mark or whether it's just in customer
experience management. You know, what is powerful is I've
been fortunate enough to have many people that will recognize the contribution the
first article made. Joe Pine read a draft of the article
because he was at the IBM Advances Business Institute where I was an
adjunct faculty member, and Steve had him read it. And from
(04:06):
that Joe began to work on. Actually
originally wanted to write with Steve and I. Steve was busy
doing another book. But attribution and understanding, where ideas
and thoughts stem from, we need to recognize
that. And I see that so often where I'll see stuff
from Joe, stuff from Colin Shaw, and it's not
(04:28):
an attribution of any sort. I think that the. To a great
degree, we don't recognize other people.
It's a. It's a very interesting situation. And there are people that
make a difference in our lives and make a difference in our perspectives,
and recognition of that only makes us look bigger.
And I love your plea. That is awesome. Well,
(04:51):
Lou, thanks. Thanks for saying that. And I. I wanted to kick
off by talking about the sigmoid curve, because you mentioned it to me
in terms of we're being at a crossroads in the
profession. And for those who are listening, who aren't
familiar with. Or you're just business leaders or people
outside of even the mainstream business world, and you're listening to the show today,
(05:13):
you're going to get an education. Hopefully you already heard something about
what customer experience is from the quote that, that I shared that Lou
wrote back. Include in. But tell us about the Sigmoid
curve, the proliferation of definitions
of CX and what it's done or hasn't done for us. Yeah, I think that
we reached back when I wrote Clouden, which was after the
(05:35):
original article. The end of the book quotes one of my
favorite poems, which is Robert Frost, the Road Not Taken.
And what Steve and I outlined, and what was outlined in
Cludin was the road not taken. How to design new emotion,
how to imprint emotion and experiences, how to understand
unconscious thought and a rigorous system for lining
(05:58):
clues in an organization in terms
of value creation. That was distinctive and to me
that was the road not taken and that's the road that I've traveled down and
several others and companies that we've worked with have traveled down.
But by and large people stayed on the road, not the road
less traveled by, but stayed on the road that they knew. And
(06:21):
what they did is did window dressing on that.
Surveys became experience management operating systems. We
relabel things on the old road journey mapping was
literally taking and it ended up looking more like process
mapping, an experience design. And we ended up
fixing broken, which we've been trying to do forever versus creating
(06:43):
distinctive economic value. So what happened is
the velocity of the importance of customer
experience in terms of creating distinctive value in
organizations. People latched onto this idea of customer experience
management that went beyond customer satisfaction
or even what I would call service.
(07:06):
But they renamed everything and continued to do what we always did. And
it grew with incredible velocity. Billions of hits
if you put in customer experience management or experience management
on Google. So what is suddenly happening
is everyone expected different results from doing what we always did
and suddenly it's under great scrutiny. There's a great amount of
(07:29):
debate on whether it's dying. I get really frustrated
looking at LinkedIn posts. I try not to, but to stay
apprised of where the marketplace is. There's a great deal of
frustration, people looking for jobs, jobs disappearing
in experience management. So I believe that the
sigmoid curve, which is when things begin to plateau and
(07:51):
there's no longer rapid growth, is where we are in the
movement and to latch on to what I would call
next practices which deal with emotion. Not
just talking about the importance of emotion, which so many people
do, but the depth of being able to understand
emotion. Neuroscience, psychology, sociology.
(08:12):
And I think that's what's so beautiful about experience management is it's
interdisciplinary, it's cross functional and it deals with so
many different issues. And I think Mark, that's what's so beautiful about the program that
we teach in but what is
hugely difficult is there, there's such
fragmentation in the system and in the industry
(08:34):
that there isn't even a common definition that everyone agrees
to or embraces. So I'm on a crusade. I'm about to
launch a survey that I would love to have people
repost that will look at origins of where people
came from, whether they came out of a call center, whether they came out of
a customer set, whether they came out of research. When
(08:56):
I was asked by a wonderful client, a gentleman named
Bill Donnelly, who is part of a group of companies
that said, what is the definition of customer experience?
So they started to do a search and then Bill engaged me to
look at that space. And as we talked
and as I brought forth academics, because I've written
(09:19):
probably 16 or 17 academic articles in
collaboration with people like Glen Berry, Katherine Braun,
luminaries in the marketing space, I looked and there are
probably at the surface level,
16 or 17 different definitions. One of the original
definitions, even preceding the definition that Steve and I came up with, but
(09:41):
it was more around general, was Bernd Schmidt, who was a
professor at Columbia that talked about experiential
marketing and the value of thinking about what an
experience is generically. And then Steve and I
published a definition that was multi sensory, emotional,
unconscious thought. And then there are probably a ton of others.
(10:04):
So this survey that we'd like to put forth in this research
project, and because Michigan State is such a research driven
institution, it has the number one market research
master's degree in the country. So I think it's wonderful
that we can actually put forth a survey
that tries to create, looking at what existing
(10:27):
definitions there are, what would you define it as?
I'm not going to go through the actual design of the questionnaire,
but ultimately it would be to
synthesize all of that information, understand the distinctions
between people's origins coming into the business, and
try to consolidate a single definition
(10:50):
that can be embraced by the industry. And I think that this
fragmentation is so difficult. Six Sigma clearly defined
what its role was and a definition of what Six Sigma was.
And we have never done that. There are all these conflicting
independent definitions
that some are in conflict with others, some are similar,
(11:12):
but getting one common definition, that. And then we wonder
why even members of our faculty, not our faculty in the
program, but faculty in general and marketing, doesn't understand
what customer experience is. Totally the idea of, I see
this all over the place, whether it's academics or whether it's
CEOs, the clarity around what customer experience is.
(11:34):
And I like to Think of it as experience management. The reason that we
call the company Experience engineering and it wasn't by we
have experiences every day. It's the atomic structure of life.
And if we can master understanding human nature
and embed that in the way we look at experience management, we would
(11:54):
be much more successful. So I think that this need to move to
the next level. What I would call advanced practices
and advanced perspectives on experience management. Starting
with a definition and really have
begin to take the road not taken the road less traveled. Because I think
that's where the future really is. Lou, if you're comfortable
(12:17):
sharing and not to steal any thunder, I think people who would respond to the
survey would get give their own opinion anyway. But what would you, what
would you suggest as a definition of customer experience or experience
management? Yeah, I think there are several, several key factors.
One is what I would call emotional imprinting that in addition to the
functionality of the good or service, emotional
(12:39):
imprinting that we imprint an emotion
that is desired by the recipient of the experience.
And that could be my wife, anybody. But if we become much
more sensitive to what people desire feeling and then deliver
the experience by focusing on those emotions
and those emotions are very base and then they ladder up. There are
(13:02):
basically basic human needs, there are cultural
and then there are individual. And what we talk about
is clues that create that emotional connection embedded
in the experience. So let's, let's play that out. Let's talk about.
Could you share like an example of a real life purchase
situation where this, this happens? Absolutely. I'm going to
(13:24):
use an old example in banking, Mark, that I think you would appreciate.
Yeah. When we did our original, for some
reason when the original article was published, a lot of the interest was in
Canada. I have no idea why Royal bank of Canada
had wanted to buy the bank of Montreal or merge with the bank of Montreal.
The government stepped in and stopped it. Because
(13:47):
Royal bank of Canada was seen as the elite bank. There was a CL
their experience which was there are flecks of 14
karat gold in the glass in their headquarters.
I mean that's a pretty hefty clue that created this
sense of they're better than other buildings and that they're elite,
et cetera, et cetera. So when you begin to look at the unconscious
(14:10):
psychological aspects, RBC couldn't understand why they weren't
liked and why the government and people stepped in. So in our
work, I think one of the most incredible things is often
companies will talk about having customers valued.
They're very, very common. If I God If I looked,
there are probably millions of companies that are like, we need to value our
(14:32):
customers. There's a huge difference between being valued
and feeling significant. Valued unconsciously
has an economic impact or that, that, you know,
they think I'm worthwhile. From a financial perspective,
significant is a human connection. So when we, we
used to do a ton of observational video and back
(14:55):
then, mark, every hour of observational video
required an hour of clue scanning, looking at
clues and signals. So what we realized,
observing the departure. They had developed a customer service
departure after someone came in for a mortgage
application. They wanted to increase that
(15:17):
experience. So they developed five things. One was
walk to the door. The other was thank them for their business.
And I forget the other three. I think one was don't trip them on the
way out. I mean, I don't remember. But what we
observed was facial expression. As the
meeting would wrap up. Here you are, you've just poured out all this personal
(15:39):
information. Back then there was a lot of paper and you've filled
out a mortgage application. It's got all of this personal information.
And we would watch it go onto a stack of paper before
they walk the person to the door. And you'd watch the person and watch
it go on top of a stack that was
in some cases a few inches, but one case in particular,
(16:01):
I don't know how backlogged the individual was, but it was way on
top. And what we began to realize in unconscious thought
as we did interviews using a specific technique to get
at unconscious framing. People didn't feel that they were significant.
They got put into this pile of other work. So we
created a clue called a grasp, which is when you walk them to
(16:23):
the door, you hold that piece of paper in your hand
as though that's your next action item versus I'm putting this
off. And unconsciously the emotional metrics
around feeling more significant increase significantly.
Yeah, so it's the subtleties in an experience. And what
many organizations overlook are what we call the clues. The
(16:45):
subtleties, the unconscious clues that are processed in an experience
that build that emotional imprinting. Lou, you talked
about how companies often think about how we want
to be perceived as a brand by the customer. And before
we got on today, you talked about maybe that's not exactly how we
should be thinking about it. Yes. You know, it's a natural tendency
(17:08):
to want to know how people feel about you. I mean we do this every
day, every way, because it's our low self esteem.
I think everyone has some degree, except perhaps I shouldn't get political
but many people have need that reinforcement. Well, companies
are not any different and that's why NPS and scores
like that become important. I don't think that scores and surveys will
(17:31):
ever go away. I think that they're great for performance metrics.
They are not great for insight in terms
of distinctive value creation. What happens is we're
so focused on the attributes of the organization and
what the organization represents and the emotions
that people attribute to how the organization portrays
(17:54):
its emotions. We need to flip that because ultimately
it's how we cause our customers, our employees, our
spouses, how they feel about themselves, which in turn is
how they feel about us. Yeah, so it's basic
unconscious human nature and it seems somewhat bit
counterintuitive, but that's what leads to how they feel about the
(18:16):
organization ultimately unconsciously, where they process
that, that's the link that emotionally bonds them
to experiences and creates what Jag Seth and
other authors that wrote a great book called Firms of
Endearment talk about organizations that if they went away tomorrow, we
would mourn the loss of them. It would change our lives. It's
(18:38):
because how they make us feel about ourselves ultimately. Lou, can
you think of a good example, either experience or a company that
does that? Well, yes, and I think that what's interesting is Simon
Simic touches on it, but I don't. People, people can't
grasp that. And that's why we talk about an experience motif, which is
what are the emotions that resonate and how do you design the
(19:00):
experience to imprint those emotions? I just sat through an
introduction where a company was talking about its why with a group
of employees and what they thought their why was the
what they do. I'm sorry, how they do it. Gotcha. And it was a
healthcare organization and I challenged that thought,
saying that's not the why. The why is making a difference
(19:23):
in other people's lives. So this idea of
getting to that emotional resonance and what
we've done is actually develop tools that unconsciously can look at
what we call emotional congruency. Once you've determined what those
emotions are, are we achieving that on an unconscious level?
And are people feeling the emotions that we have targeted that
(19:45):
they desire? Feeling. So, Lou, what. What would
you say to the person listening now who's been under a lot
of pressure, a CX leader, for example, to prove the ROI of
cx? And how do you connect those dots from experience
design and designing an experience that makes customers feel good about
themselves and contributing to the health of financial health
(20:08):
of the organization? Exactly. You know, I Can point to situations
where one client and what we did is actually ran
a program alongside it that netted $14
million in savings in the delivery of appliances.
That's an ROI. What ended up happening was greater
loyalty with the customers and more
(20:30):
feedback and positive feedback that they couldn't believe it. And what it
was was actually creating corner protectors, runners that would go
in that you would go over hardwood floors and other things with
that actually cut down on damage. So when you really design
and experience customer back versus company out
and understand what they're feeling because you're damaging their property,
(20:53):
it becomes huge in terms of return on investment.
And I think that there are two aspects to the powers of experience
management. One is return on investment and the other is return on
strategy. About that the two go hand in hand. We'll say
more about that. Yeah, the. That an organization will develop a
strategy. And I believe that we actually created a
(21:14):
certification program in corporate strategy because
people that were in management would leave a meeting where strategy was developed
and then go back and not be able to understand what the strategy was and
they're supposed to execute it. So this whole idea
of as a result of a corporate strategy and
if I can help you accelerate the momentum and the
(21:36):
velocity and the impact of the strategy, it would have an
impact on roi. And the
difficulty sometimes with ROI is there are other factors
that enter in that are disconnected within an organization. Price
increases lately, I hate to bring up, I might
get sued for this one, but someone like, I'm not going to name the product,
(21:58):
but it's a smaller candy bar. And there are these changes that
are taking place that are subtle, especially today in what what
organizations are facing. And we'll probably see even more of this with
tariffs that begin to impact my
loyalty and what they're going to get on the investments that are made.
So when you begin to align those investments strategically
(22:21):
toward a financial goal and monitor those, it's
incredible. That comes down to living the values of the
organization. I've done a lot. My heart
belongs to Mayo Clinic. I'm both a patient there. I've done lectures
there, done all sorts of stuff over the years for 27 years.
(22:41):
And values become so critical because values can
actually impact bottom line. I think the greatest
example is a client of ours, which was La Quinta
Hotels. Michael
Powell, Colin Powell's son, who was the chair at Mayo Clinic,
said, when you live the values of the organization,
(23:03):
you become a virtuous organization. And when you become a
virtuous organization, you're no longer thought of as a
corporate entity. So when we think about Mayo Clinic or even
Disney back in the day, I think Disney is quite different today than
when I was working with them. But back in the day, Disney would
announce the opening of the Grand Floridian Hotel
(23:27):
and Regis and Kathy would be there. Press from all over the
world. This was a corporation promoting a
new hotel and have press from all
over the world because it was considered virtuous.
So when you cross that bridge to virtue. So the example with
La Quinta that I thought was so beautiful is number one, the
(23:49):
COO CEO and the management team there when they articulated
their values with work that we did with them, because that leads to
aligning values with customers desired emotions.
So one of the great things was they felt that you can't do
posters. So the senior management said posters are
ridiculous, little cards are ridiculous. We need to be
(24:11):
reminded every day, but with movement because values are
living. So they developed a series of TV
screens that were throughout headquarters and throughout
the system in various places where they used still,
a still photo. So for example, one of the
was around sanitation and really
(24:34):
intent cleaning of the room with a sanitary
mindset. And this was before COVID So they
developed a whole system for doing that. And one of these values was
portrayed by a housekeeper and that was still.
But what was moving in the background were the curtains. So you couldn't
walk by it without seeing some motion. And I think
(24:56):
that that's what we overlook in experience management is the
importance of this is a way of doing business. And it's
not a reporting system, it's not a process improvement
business. Originally, I think I took the first title of Chief Experience
Officer globally when we started. I went. Actually, I think I
was a Chief Experience Officer in Carbone and company that preceded
(25:18):
Experience Engineering because that's what I was doing at that time. And
I think we lost sight that the Chief Experience Officer in a company
is the CEO responsible for fiduciary
growth and value creation, but also
responsible for the value creation within the organization
for employees and customers. And what happened is
(25:40):
we promoted MBAs that are kind of.
And that was financial management. And then we wonder why we have
difficulty penetrating understanding the integrity and
the power of experience management and contributing to the bottom
line. Well said. So many, so many great thoughts from the
sigmoid curve to the definition of experience
(26:02):
management. And look out for a potential survey that
Lou's going to initiate to help us get some commonality
around the definition. And also thinking about how
customers not so much how they feel about your brand, but how they feel about
themselves after experiencing your brand. Right. And. And, Lou, let
me ask. Let me. Let me kind of close this out by asking you what
(26:24):
delights you since. Since it's a delighted customers podcast. What
delights you as a customer? What delights me as a customer is
I'll take Apple as an example that if it went away tomorrow, I
would mourn the loss of. But I feel emotionally synchronized
with Apple in terms of one of the curses I'm blessed
with if there's such a thing as thinking differently. And
(26:47):
I really align with what Apple represented in the past.
I'm also an early adopter, which is not a good thing. But what
delights me is feeling supported in my
desire to advance things. And if I'm
buying Apple products, I feel I'm advancing my ability
to advance other things, because to me, it represents the most
(27:08):
advanced set of principles that.
That I can live with. I remember when ipod came out, or even
the iPad told my wife it was the dumbest idea I've ever heard. I have
a computer, I have a phone. I go
to Best Buy and I pick one up, and I create an
intellectual alibi, which consumers do based on emotion. And
(27:31):
I said, oh, I've got $85 in rewards.
I think I'll buy this. This is phenomenal feel. And it was
the fact that it was distinctive and different, which I had pooh poohed from a
distance. Y. Going back to Simon Sinek that you brought up, he talks about how
Apple challenges the status quo. Yes. And I think that's
been my life, unfortunately, in some ways. Well, you're a
(27:54):
visionary, and you helped us make breakthroughs in the CX
profession. Lou, thank you so much for being a guest again on the show.
Mark, thank you so much for having me. I love you. And the work that
you do, the way that you think, and the contribution you're making to this space
is. I'm speechless. It's what we need. Thank you so much, Lou.
It means a lot, especially coming from you. Thank you, Mark. All right.
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