Companies have a lot to gain by doing a better job of customer experience management, including the revenue gains driven by incremental sales from existing customers, revenue saved by lower churn (loss of customers), and new sales driven by word-of-mouth.

 Customer experience management (CEM) is about creating value for customers in the form of experiences. A customer experience is a private event consisting of an intellectual or emotional response to one or more of the stimuli generated by a product or service offering. Properly practiced, CEM goes beyond simply creating one or two entertaining experiences to creating a comprehensive strategy for managing the customer’s experience at every point where s/he interacts with the offering.

 Customers interact with an offering before, during, and after they consume it. In the case of a hotel guest, for example, the pre-consumption interactions include things like visiting the hotel’s web site, being called on by a salesperson, and booking the reservation through the call center. Consumption-related interactions have to do with interacting with the facility and staff during the guest’s stay at the hotel. Post-consumption interactions pertain to follow-on calls, satisfaction surveys, mailings, and so forth.

 At the tactical level, the first step in practicing CEM is to create a customer journey map. A journey map details, along the horizontal axis, each of the points at which the customer interacts with the offering before, during, and after consumption. The vertical axis is used to identify the people, systems, and parts of the offering that the customer interacts with at each point. The result is a matrix in which each cell consists of a “touch point.”

 The next step is to identify the stimuli that are generated by the offering at each of the touch points. A stimulus is anything that is perceived by one, or some combination, of the five senses—sight, sound, smell, taste, and touch. For a hotel, it includes things like the appearance of the staff, the tone of voice of the person answering the phone, the smell of the guest room, the feel of the furniture, and the taste of the food.

 Once you’ve inventoried all the things your customers see, hear, touch, taste, and smell at a particular touch point, you’ll want to design the experience you intend for the customer to have at that point. There are two fundamental types of experience—functional and emotional.

 A functional experience has to do with whether or not a certain function is provided and, if it is, how well it is performed. An example of a functional experience in a hotel is transportation. Does the hotel offer the transportation function (e.g., an airport van)? If so, how well does it perform the function with respect to things like the hours and frequency of operation? A second example of function and performance in a hotel would be whether or not a hotel offers multiple ethnic cuisines (function) and, if so, the number and quality of the cuisines it offers (performance).

 Emotional experiences have to do with how the stimuli emanating from a person or object make a customer feel. There are hundreds of emotions, most of which fall into one of eight families—anger, sadness, fear, disgust, shame, surprise, enjoyment, and love. The goal is to engineer experiences that eliminate or minimize the first five families of emotion and maximize the emotions in the last two families. One can be pleasantly or unpleasantly surprised, so the emotion of surprise is something that is to be maximized or minimized, as the case may be.

 Most organizations fail to manage emotional experiences with the same rigor they manage the functional aspects of their offering.* And that spells opportunity. Continuously searching for innovative ways to generate positive emotional experiences has great potential for gaining competitive advantage. It helps to use the frameworks and tools that are available to carry out the search.

 CEM doesn’t stop with the tactical steps outlined above. There are also strategic issues to consider, including positioning, platforms, measurement, governance, and culture. What’s more, CEM can—and should—be extended beyond individual product-service offerings to customers’ experience of the entire company and its brands.

 (*The comedian Rita Rudner gave a humorous example when she said, “I was going to have cosmetic surgery until I noticed that the doctor’s office was full of portraits by Picasso.”)

Kevin W. Holt, the founder of Co.Innovation Consulting, is a strategic planning consultant and meeting facilitator based in Phoenix, Arizona. He works with commercial, government, and nonprofit organizations to develop innovative strategies and solutions. His strategy consulting and meeting facilitation practice centers on the use of proven processes mapped to collaboration technologies (e.g., electronic brainstorming) and specialized software tools (e.g., the Blue Ocean strategy canvas). The technologies enable him to serve as both an offsite meeting facilitator and a virtual meeting facilitator for strategic planning workshops, innovation labs, brainstorming sessions, feedback sessions, and other types of meetings. Kevin is the author of Differentiation Strategy: Winning Customers by Being Different, published by Routledge in June 2022.