Experience – what does it really mean?
Today that should include taking a lesson from the fast casual chain Chipotle Mexican Grill.
Common misconceptions around the word experience have changed in the last 20 years. The term customer experience was first introduced into the mainstream of business, with the original application as a unique type of economic offering emerging. In fact, it was identifying the next level of economic progression.
In recent years, an experience evolved into something slightly different: It shifted from being an offering of greater economic value to an evaluation of the interaction between the provider and the consumer over a duration of time. It has become a replacement term for good customer service — and it became a term for another measurement tool.
Since then, we have tremendously progressed in the eras of commerce. The initial economic offering was commodities, things that were extracted from the earth and sold or traded in bulk. The goods economy then followed this era, an economy where commodities were made and packaged in smaller qualities and sold at higher prices to consumers.
Next came the services economy. In this economy, companies delivered their goods through services to the consumer at an even higher price. Many banks and credit unions are still part of this economic offering, providing financial services to members.
With a plethora of institutions all vying for the member’s wallet, the banking industry must overcome the challenging competition. Every institution attempts to offer everything at competitive prices. This is what is commoditizing the offering and lowering the value.
The latest evolution of economic value is the experience economy. An economy is where consumers — or members — pay a premium to have an experience with the institution over merely buying things. Simply stated, consumers want to experience rather than acquire things. By staging an experience, credit unions can increase their offering’s value while also standing out from industry competitors.
How does a credit union climb up the economic ladder? Shift away from just focusing on saving time through multiple services, to staging engaging and memorable experiences that members perceive as time well spent. The shift is from a growing commoditized industry to being unique and highly valuable to the member — a place and culture that they want to engage with.
Customize the services and products you offer. Make them personal to each member as they want it, not what is easiest or the most efficient way for you to deliver it. By making the offering personal through customization, members begin to see a greater value and a more human approach to interacting with the credit union.
Take Chipotle as an example of this. Their offering is very simple: Five food transports (soft taco, hard shell, burrito, salad, and bowl), six protein options, six bean/rice combos, and six topping options and a few types of extras—a grand total of twenty-seven ingredient options. However, the various combinations equal to over 9,000 ways to have your food order created just the way you want it. By breaking up the packaged offering into selectable components, Chipotle can create a more personalized offering from just a few basic ingredients.
What can you customize by breaking up your organization’s goods or service into parts?
Another way to design a unique and personal experience for the member is shifting from what you’re doing for the member and begin doing with the member. Let the member get involved by engaging them to take part in the financial process. Customizing financial packages through conversation—rather than menu selection—creates a deeper relationship and adds greater value for the member.
Another example of a company who understands the idea of time-well-spent is Wingtip. The interesting thing about Wingtip is that they are both a social club with memberships and a clothier for fine men’s suits. Blending the idea of fine fashion with an elegant private social club, Wingtip is a retailer where you can also gather with other patrons of similar taste and style. Wingtip created a place for showcasing their goods to the customers they serve.
On the contrary, most financial institutions in today’s economy are still tied to the service economy model. For credit unions looking to step up their banking game and differentiate themselves in the marketplace, it will require creating a member experience that generates value, is personalized, and offers customized offerings that match what the member wants and the way they want it. This type of staging is the next level of business—this is what the experience economy is all about.
It’s about creating an engagement with members that are more about time-well-spent versus the traditional model of convenience and efficiency of time-well-saved. This type of engaging experience always comes at premium members are willing to pay extra for.
