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Theoretical foundations on Customer Experience

(customer experience, NPS, CSAT, CES, Service

Balcony, Journey Map)

Sustentos teóricos sobre Customer Experience (customer

experience, NPS, CSAT, CES, Balcón de servicio, Journey

Map)

Carlos Ermel Bourne Gastezzi

Martha María Fernández Rodríguez

Andrés Castillo

ABSTRACT

A result of the Balcony of Services research project

was presented to optimize Customer Experience at

the Tecnológico Universitario Espíritu Santo (TES). It

responded to the problem of failure to identify

opportunities or weaknesses that students face in the

educational and administrative services offered by

TES, which can affect their educational experience,

and was instrumental in understanding and improving

student satisfaction. To this end, the specific

objectives that were desired to be achieved with the

measurement system were defined, among which the

following stand out: general customer satisfaction,

identifying areas of improvement in the service or

evaluating the impact of the improvement initiatives

that are implemented. Based on them, the metrics

that will help measure the customer experience are

determined. Some common metrics include Net

Promoter Score (NPS), customer satisfaction

(CSAT), customer loyalty, and customer retention.

These metrics respond to the industry and specific

objectives and will be supported theoretically in this

* MSc. Instituto Superior Tecnológico Espíritu Santo, con

condición de universitario, Guayaquil, Ecuador,

cebourne@tes.edu.ec, https://orcid.org/0000-0001-9785-9126

*MSc. Instituto Superior Tecnológico Espíritu Santo, con

condición de universitario, Guayaquil, Ecuador

mmfernandez@tes.edu.ec, https://orcid.org/0000-0002-4765-7419

*MSc. Instituto Superior Tecnológico Espíritu Santo, con

condición de universitario, Guayaquil, Ecuador,

afcastillo@tes.edu.ec, https://orcid.org/0009-0004-5300-6761

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article. The research is theoretical based on

theoretical methods such as: analysis and synthesis,

induction and deduction from the abstract to the

concrete.

Keywords: Theoretical support, Customer

Experience, Service Balcony

RESUMEN

Se presentó un resultado del proyecto de

investigación Balcón de servicios para optimizar

Customer Experience en el en el Tecnológico

Universitario Espíritu Santo(TES). Respondió al

problema de la falta de identificación de

oportunidades o debilidades que enfrentan los

estudiantes en los servicios educativos y

administrativos ofrecidos por el TES, lo cual puede

afectar su experiencia educativa, y fue fundamental

para comprender y mejorar la satisfacción de los

estudiantes. Para ello, se definieron los objetivos

específicos que se deseaban lograr con el sistema de

medición entre los que se destacan: la satisfacción

general del cliente, identificar áreas de mejora en el

servicio o evaluar el impacto de las iniciativas de

mejora que se implementen. En función de los

mismos se determinan las métricas que ayudarán a

medir la experiencia del cliente. Algunas métricas

comunes incluyen el Net Promoter Score (NPS), la

satisfacción del cliente (CSAT), la lealtad del cliente

y la retención de clientes. Dichas métricas responden

a la industria y objetivos específicos y serán

sustentadas teóricamente en este artículo. La

investigación es de tipo teórica sustentada en

métodos teóricos como: análisis y síntesis, inducción

y deducción de lo abstracto a lo concreto.

Palabras clave: Sustentos teóricos, Customer

Experience, Balcón de servicio

INTRODUCTION

In the current context, providing a quality educational experience has become a

fundamental objective for educational institutions. In particular, at Tecnológico

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Universitario Espíritu Santo (TES), the need has been identified to improve the students'

experience, both in educational and administrative aspects, in order to guarantee their

satisfaction and academic success.

The main objective of this research project is the implementation of a measurement

system based on the Customer Experience at TES. It seeks to identify the opportunities

and weaknesses experienced by students in relation to the services offered, in order to

improve their educational and administrative experience.

In this article, it is proposed to investigate the theoretical foundations related to

Customer Experience in a way that serves as a support for the implementation of the

Service Balcony.

Customer experience refers to the perceptions, emotions and opinions that a customer

has during all the interactions they have with a company or brand throughout their life

cycle. This includes everything from the first contact with the company to post-sales and

ongoing support. A positive customer experience involves meeting their needs,

exceeding their expectations and providing exceptional service.

The importance of customer experience has been widely recognized in the field of

marketing and business management. Much research and studies have focused on

understanding how companies can improve customer experience to drive satisfaction,

loyalty and business growth (Kalbach, 2016).KPIs (Key Performance Indicators) or Key

Performance Indicators are metrics used to measure an organization's performance and

progress toward its strategic goals. KPIs are specifically selected based on aspects critical

to business success and are used to assess performance and effectiveness in key areas

(Parmenter, 2019). NPS (Net Promoter Score) is a metric used to measure customer

loyalty and satisfaction towards a company or brand. It is based on a simple question,

"On a scale of 0 to 10, how likely would you be to recommend our

company/product/service to a friend or colleague?" Customers are divided into three

categories based on their responses: promoters (9-10), passives (7-8) and detractors (0-

6). NPS is calculated by subtracting the percentage of detractors from the percentage of

promoters (Bahre S. , 2022).

CSAT (Customer Satisfaction Score) refers to customer satisfaction score and is a

metric used to measure the level of customer satisfaction with respect to a given

product, service or experience. This metric is obtained through surveys or

questionnaires in which customers are asked to rate their satisfaction on a predefined

scale.

The CSAT is a useful tool for companies to assess the level of customer satisfaction and

identify areas for improvement. By measuring customer satisfaction, organizations can

take steps to address customer concerns and improve the quality of their products or

services (Manlio Del Giudice, 2018) .

CES (Customer Effort Score) is a metric used to measure the effort that customers must

make to interact with a company, product or service. It is based on the idea that reducing

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customer effort in their interactions with a company can generate greater satisfaction

and loyalty (Matthew Dixon, 2013).

A journey map, also known as a customer experience map, is a visual representation

that shows a customer's complete journey through all interactions with a company,

product or service. It provides a holistic view of the customer experience, from the first

point of contact to the post-sales stage, and allows for the identification of improvement

opportunities and pain points along the journey (Kalbach, 2016).

Detractors refer to customers who have had a negative or unsatisfactory experience

with a company, product or service, and who have a high likelihood of issuing negative

feedback or not recommending the company to others. Detractors can have a significant

impact on a company's reputation and its ability to retain and attract customers (Bahre

S. , 2022).

In the context of Net Promoter Score (NPS), neutral customers are those who have

had a satisfactory experience but are not necessarily excited or engaged with a company,

product or service. They have a neutral attitude and are less likely to share positive or

negative feedback (Bahre S. , 2022).

Promoters refer to customers who have had a highly satisfactory experience with a

company, product or service, and who have a high likelihood of recommending it

positively to others. Promoters are considered brand advocates and can be a valuable

source of referrals and advocacy (Bahre S. , 2022).

In the context of digital marketing, advocates play a key role in promoting a brand and

generating customer loyalty. The circular cycle of promoters refers to the process by

which satisfied customers become promoters of a brand, positively influencing other

consumers and thus generating a virtuous circle of recommendations and loyalty (Diaz,

2019, citing Deloitte, 2017).

The term "service balcony" is used to refer to an approach to customer service that

involves enabling and empowering employees to make decisions and solve problems

quickly and effectively without having to constantly rely on supervision or approval from

superiors.

Rather than following a traditional hierarchical approach, where customer inquiries and

issues are escalated through multiple levels of management, the service balcony concept

promotes autonomy and decentralized decision making in front-line employees. This

allows for a more agile and efficient response to customer needs, providing quality

service and generating greater satisfaction.

MATERIALS AND METHODS

The research is theoretical, guided by theoretical methods related to analysis and

synthesis, induction and deduction and logical history that allowed a theoretical journey

Customer Experience (customer experience, NPS, CSAT, CES, Service Balcony, as a

theoretical background for the design of the Service Balcony to optimize Customer

Experience in the TES.

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Students and teachers of the Gastronomy career of the Instituto Superior Tecnológico

Universitario Espíritu Santo participated. The Net Promoter Score (NPS) has become,

since its creation in 2003, the main indicator of customer loyalty for companies. After

an exhaustive study, Fred Reichheld, creator of the NPS, proved that recommending a

product, service or brand to people close to us is the behavior that best reflects

customer loyalty. When we recommend our loved ones or people close to us, we seek

to enrich the lives of others by sharing a good experience. We do not do it lightly, we

do it with conviction, our own reputation comes into play.

It was thanks to this study that the NPS was born, which consists of a single but powerful

question:

"From 1 to 10, how likely are you to recommend (brand name) to family and friends?"

RESULTS

Those who give a probability of 9 or 10 are the promoters, who will really look for any

opportunity to recommend and speak well of the brand, from their own experience. On

the other hand, those who give a probability of 6 or less are the detractors. They are

also going to talk about the brand, but to highlight negative aspects or share a bad

experience.

Figure 1. Net Promoter Score (NPS)

Source: Authors

What about those who gave a probability of 7 -8? This group is called "passive", they are

not dissatisfied, but they are not enthusiastic either. Do we want passive, lukewarm,

unenthusiastic customers, even if they consider the product or service to be good? The

answer is easy: No! We want enthusiastic promoters who bring new customers to the

company.

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The formula for calculating the indicator is simple

Figure 2 formula for calculating the indicator

Source: Authors

There is a lot to analyze in this equation. Is the NPS the result of many liabilities, which

are not even considered in the equation, or of many detractors that could even lead to

a negative NPS. How many more promoters vs. detractors does the company have, and

how does this change with time and actions taken?

While there are industry NPS against which companies belonging to the same industry

can be compared, this should be a more personal indicator, i.e., it should reflect how

well our company is doing, either improving or sustaining customer loyalty.

Brands with high NPS, I can mention some like Amazon, Apple, American Express,

Southwest Airlines and Jet Blue. What do all these brands have in common? They seek

to enrich the lives of their customers! Yes, that's the same thing we do when we

recommend something to our friends and family.

This is the real purpose of NPS: "To understand how well we are succeeding in enriching

the lives of our customers."

According to a recent survey conducted by Bain & Company it was shown that only 10%

of business leaders believe that the main purpose of business is to maximize customer

value. While there is a lot of talk these days about customer-centric companies, the

reality is that most continue to focus on profit. Not that the desire for good profits is a

bad thing, but when they come from our customer advocates, it is even better because

they are profits that are sustained over time and in times of crisis.

One of the most important roles of the NPS is to help managers or business leaders to

build and foster a customer-centric culture, looking for ways to add value. Loyalty

involves investing time and resources in building long-term relationships.

Properly implemented NPS reveals how consistent the company is in adding value and

loving its customers. It is an indicator that should inspire and motivate, driving the

company to want to serve its customers better.

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As Fred Reichheld himself would say in his most recent book "Winning on Purpose", the

NPS equation should be interpreted like this:

Figure 3. Way to interpret equation.

Source: Fred Reichheld

"Customer experience is an increasingly popular term in the corporate environment,

especially with respect to strategy and long-term planning.

CX, for short, refers to how the customer perceives the brand, depending on what their

total exposure to it has been like. It is the sum total of each person's perception of your

organization. Unlike customer service or customer relationship management, CX is not

directly related to a single or specific sector of the company.

The overall context of each customer's experience is determined by the actions of the

company: it depends on its product or service, the messages it sends, and the

interactions during the sale and in subsequent stages. But ultimately, how those touch

points are experienced is up to the customer. It is not something the company can

control (although it can certainly work to influence it). Instead, it is defined by the

customer and their customer journey.

In this day and age where everything is shared via social media, it is critical to the success

of brands to invest in new technologies and ways to control what is said about them."

KPI's, an acronym for Key Performance Indicators, are metrics used to quantify

objectives that reflect the strategic performance of digital marketing campaigns. They

are indicators directly linked to objectives that are usually defined in percentage values.

Choosing the right KPIs or performance indicators is based on a good understanding of

what is important to the organization and this often depends on the department that is

measuring performance. For example, the KPIs useful for financing will be very different

from the KPIs assigned to sales.

The SMART rule applies to them, as it is considered that they should be specific,

measurable, achievable, relevant and time-bound (a time frame for the achievement of

the target must be given).

NPS

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The Net Promoter Score is an indicator used in customer experience programs. It is

used to determine customer loyalty to a company. It is measured through a survey that

has a single question and is reported with a number ranging from -100 to +100. The

goal, naturally, is to obtain a higher score.

NPS is often considered the gold standard of customer experience. It was created in

2003 by Bain and Company. Today, millions of companies use it to measure how their

customers perceive them.

To measure customer perception, it is based on a single question:

How likely are you to recommend [the organization/product/service] to a friend or co-

worker?

How satisfied a customer is with a company's products or services depends on a

multitude of factors. However, customer satisfaction is primarily determined by

comparing the customer's expectations with the degree to which the company meets

these expectations.

As this is a very important element for the success and stability of a company, it is

essential to measure and evaluate customer satisfaction on a regular basis in order to

obtain information that will enable us to take appropriate action. One indicator that

helps us to do this is the CSAT value. This indicator, whose name derives from

Customer Satisfaction, expresses the level of customer satisfaction in the form of a

percentage.

The CES (Customer Effort Score) is the customer effort rate or customer effort

indicator. This indicator is a key figure that can be determined with the help of a

customer satisfaction survey. The focus is on the degree of effort a customer has to

make in order to clarify a concern or problem with a company. This includes queries,

problems or questions that may be related to products or services or even to the

purchasing process as such (e.g. use of the online store).

The customer journey map is a customer experience management tool that allows you

to map each of the stages, interactions, channels and elements that a customer goes

through during the entire purchase cycle. All the customer's steps on the way to the

product must be analyzed in order to recognize and amplify the positive moments in the

user experience (UX) on the one hand, and identify and eliminate the negative moments

on the other.

A detractor will proactively seize any opportunity to dissuade people from using your

product or service. They tend to speak louder than promoters and can have a very

negative impact on your overall NPS score.

Neutrals

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A passive person is likely to have liked your product or service, but it was not a success.

They may mention it in the right context, but are unlikely to personally endorse it as the

best product available on the market.

Communication becomes an essential strategic element for customer service, as it plays

a key role in expanding the customer base, generating loyalty, motivating employees and

conveying the quality standards that need to be implemented. As stated by (Silva, 2016),

communication is the key means that allows us to occupy a relevant place in the minds

of our consumers

Promoters are highly satisfied customers who act as active advocates and ambassadors

of a company or brand. These customers are so impressed with the experience they

have had that they are willing to enthusiastically recommend the products or services

to others, whether they are friends, family or even through their social networks.

Improving the customer experience through proper investment presents numerous

benefits, such as strengthening the brand, increasing customer loyalty, and reducing

churn and churn. As noted by (Diaz, 2019), this improvement also inspires customers

to become brand advocates, which in turn contributes to increased sales due to positive

word-of-mouth. According to Wen Lou et al. (2018), this strategy of improving

customer experience has a significant impact on company growth and success.

CONCLUSIONS

In conclusion, the "service balcony" is a strategic concept within the customer

experience that represents a company's perspective and approach to providing

exceptional customer service across all touch points and communication channels. The

"balcony" metaphor suggests that the company is positioned in an elevated position to

constantly observe and monitor customer interactions.

From this "balcony", the company has a panoramic view of customers' needs and

expectations throughout their journey, allowing it to anticipate their requirements and

respond quickly and effectively to their queries, problems or requests. The "service

balcony" approach implies a firm commitment to customer satisfaction and seeks to

provide a positive experience at every stage of the customer lifecycle.

To implement the "service balcony," companies must be attentive to customer

interactions, whether in person, through phone calls, emails, online chats or social

networks. This means having systems and processes in place to collect and analyze

customer experience data, identify patterns, needs and opportunities for improvement,

and act proactively to exceed expectations and resolve any issues that may arise.

The "service balcony" is a key strategy for building strong, long-lasting customer

relationships, fostering loyalty and generating enthusiastic advocates. By constantly

observing from this balcony, companies can maintain a customer-centric approach and

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continually improve their customer experience to exceed expectations and stand out in

a highly competitive marketplace.

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