The Role Of Brand In Customer Experience

Fundamentally, your brand is made up of the network of associations among your customers, employees, management, and other stakeholders, as well as the feelings and attitudes your brand evokes when they consider or interact with it.

Your brand is what you stand for in the market, and it sets customer expectations for interactions with your firm. Customer experience is defined as how customers perceive their interactions with your brand. For example, if your brand “stands for” simplicity and flexibility, then that’s what customers expect from their interactions–whether in-store, online, or over the phone. If your customer experience doesn’t consistently deliver on that promise, then you have a problem.

In summary, brand sets customer expectations for experience. Customer experience is how well you deliver on those expectations. Delivering an ideal customer experience is possible only when you understand the link between brand and customer experience.

For Most Companies, The Two Most Important Assets Are Their Brands And Their Customer Relationships

According to the Young & Rubicam Brand Asset Valuator, companies that increase their brands’ differentiation have about a 50 percent higher operating margin on average versus companies that allow their brands’ differentiation to decrease.  Wow.

What about customer experience? Analysis of Forrester Research data shows that over a five-year period (2007-2011), customer experience leaders’ cumulative total returns beat the S&P 500 Index by 27%, and blew the returns of customer experience laggards away by 128%. This is independent of top-line revenue gains enjoyed by companies that deliver an above-average customer experience, which Forrester Research estimates can hit up to $1.4 billion, for example, for a hotel group.

The importance of having a strong brand and delivering a great customer experience seems obvious. It’s also true. There’s plenty of evidence to support the short- and long-term financial benefits of both as fact.

So how do leading companies do it?

Brand And Customer Experience Leaders Drive Outsize Business Growth, Meaningful Differentiation, And Long-Term Competitive Advantage

Companies most successful at defining and implementing truly differentiated customer experience–companies such as Apple, Southwest Airlines, and USAA–are those that start with a clearly defined brand: a brand that’s articulated in a vision everyone in the company understands, and that drives shared meaning for management, employees, and customers.

For Apple, it’s all about product and service differentiation as embodied in “elegantly simple design.” This translates to every aspect of the customer experience, from using an iPad to walking through an Apple retail store.

Southwest Airlines lives its mission (“Dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit”) and its brand in virtually every customer experience interaction.

And consider USAA. Consistently at the top of various rankings in customer service, customer and employee satisfaction, and customer experience, one employee ended her entry on an internal blog post with this comment: “We are the living, breathing symbol of what our organization is all about: serving those who have gone above and beyond to protect our country, however and whenever we can.” “We know what it means to serve” is the title of a short video embodying the USAA brand–a brand so well-delivered by employees that its client retention rate is a legendary near-97 percent.

Each of these companies shares, and relentlessly focuses on, a critically important link: the link between brand and customer experience. As remarkable as their achievements, the underpinnings of their successes can be modeled by any organization.

Define And Connect The Brand And Customer Experience Dots To Lead Your Market

A 2012 study shows that 93 percent of companies say customer experience is among their company’s strategic priorities, and 75 percent of respondents want to use customer experience to differentiate. Yet less than half of these firms have a clear customer experience strategy. If we had to guess, the majority of those without an experience strategy have yet to do the hard work of defining their brands.

That’s because at MCorp Consulting, we work with companies like these every day. After all, defining customer experience strategies and designing experiences is what we do. We’ve seen–time and again–that those who have an articulated brand are those that have the easiest time developing and implementing customer experience strategies.

This is why brand strategy is a critical first step for any company that has hopes of becoming customer-centric, much less differentiating on customer experience. Without a strong brand to support you, your customer experience aspirations will remain just that–aspirations. But once you align customer expectations of your brand with an ability to consistently deliver on these expectations–across channels, touchpoints, and customer segments–you’ll be in a position to enjoy meaningful differentiation and reap the rewards of fierce customer loyalty.

Defining and implementing brand and customer experience strategy is not a simple task. It will touch virtually every aspect of your organization, and often require answering some hard questions.

But the payoffs are always meaningful, and they can be immense. Just think: What kind of value might 97 percent customer retention translate to for your business?

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