Best Practices for Referral Marketing in USA-Based Marketplaces

in a few channels, devices, or applications. In addition to redesigning the discrete touchpoints that make up a customer journey, companies need to take a critical look at their most important customer journeys which could last from several days to several weeks— in order to manage customer perceptions throughout the entire journey. Redesigning the entire journey to incorporate the principles of behavioral psychology listed above has the potential 

yield sustained improvements in customer satisfaction. For example, a leading home-mortgage company has embedded many of these principles in the process of approving mortgage applications. It consolidated all the information it requires from prospective 

borrowers and asks for it up front. This serves to dispatch negative customer experiences early in the 90- to 120-day approval journey. Thereafter, the company schedules regular touchpoints where agents proactively provide positive news to customers as the process moves forward through various steps. This spreads the pleasure or good news over multiple touchpoints. The company also offers customers options for ways to interact with the 

Company Customers can go into an online

system at any time and have full transparency into the status of their application, including the expected lead time before the application moves to the next step, thus preventing surprises and providing a sense of control. Finally, the lender works to finish the process on a strong positive note, as the loan approval is the very last interaction that customers experience during this journey. Obstacles and remedies The field of using behavioral-psychology 

principles in customer interactions by applying sequence, segments, and control is growing rapidly. Applying these often requires little additional investment and enables companies to earn credit for their improvements in service delivery. One issue we commonly see emerge is that many initiatives to harness behavioral psychology in improving customer experience 

prove to be little more than disjointed trials. This is understandable. It is often difficult for companies to move to more systematic interventions at scale and to integrate them with broader transformations of their customer journeys. That’s unfortunate, because when integrated with a broader program and underlying operational improvements, behavioral-psychology initiatives can help ensure customer-service investments have sustained impact. 

In this context they will have an amplifying

effect on improvements made in service delivery. Our work has explored the variety of ways that companies can break down some of these challenges into smaller bits. One critical issue is the inabilityto quantify the impact of customer-experience initiatives (see “Linking the customer experience to value,” on page 82). It’s also a challenge when the existing operating 

model is not solid enough to integrate behavioral programs into, and when siloed functions represent a roadblock to more systematic improvement efforts (see “Leading and governing the customer-centric organization,” on page 64). Finally, company cultures that resist embracing rapid and systematic prototyping of new digital initiatives are likely to find it difficult to refine behavioral elements in their customer interactions to improve service (see “Using 

rapiOnce upon a time, a little girl visited a Disney theme park. Sadly, while there, she dropped her favorite doll over a fence and into a mud puddle. When members of the park staff retrieved the doll, it was a mess. So they made it a new outfit, gave it a bath and a new hairdo, and even took photos of it with other Disney dolls before reuniting it with the owner 

That evening Pure magic was the way

the girl’s mother described the doll’s return. What may be most remarkable about this fairy-tale ending, which has since become part of Disney’s institutional lore, is what didn’t occur. The themepark team didn’t panic, consult a corporate script on what to do in such a situation, or anxiously seek advice from managers so as not to botch their response to a small—but real crisis for one of its customers. That’s because, at least in this case, the team’s 

understanding of what needed to be done for the young customer grew automatically from a systemic cultural emphasis that Disney puts on frontline customer service. Such devotion pays dividends. Our research finds that emotionally engaged customers are typically three times more likely to recommend a product and to purchase it again. With an eye to these benefits, many companies are making customer experience a strategic priority. Yet, in our 

experience, we find that they typically struggle to gain traction with their efforts. Improving customer experience is difficult to get right, because the primary hurdle is translating boardroom vision for a superior customer experience into action at the front line. The additional value that comes from focusing efforts on important customer journeys, rather than individual touchpoints (see “From touchpoints to journeys: The competitive edge in seeing 

Conclusion

complex. Technological advances have made it much easier for companies to understand customers on an individual basis. Even so, engaging with customers is still undertaken largely through personal contact. And there’s no shortcut to creating emotional connections with customers; it requires ensuring that every interaction is geared toward leaving them with a positive experience. That takes more than great products and services—it takes motivated, 

frontline employees. Creating great customer experiences requires having an engaged and energized workforce, one that can translate individual experiences into satisfying end-to-end customer journeys and can continue to improve the journeys to maintain a competitive edge. By appropriately motivating and rewarding such employees, a company will demonstrate its commitment to the employees’ work and will thus align their interests more closely with its 

own customer-strategy goals. There are many ways to build frontline-employee commitment to superior customer experience. In our work with leading players, we have distilled four approaches to worker development and management that repeatedly show up in successful efforts. First, leading companies listen to their employees and seek to tackle their problems and needs. They hire with attitude, not aptitude, in mind and work to build on attitudinal 

strengths as part of employee development. They build motivation by instilling shared purpose in frontline workers rather than by applying behavioral rules. Finally, they tap into the creativity of frontline workers by assigning autonomy and responsibility as a way to stimulate innovative thinking. Putting employees first in practice: One bank’s experience In the past few years, numerous companies around the world have embarked on customer-experienc