Trends & Insights

Customer Service vs. Customer Experience: Know the Difference

By Julia Stübben - March 26, 2018

Excellent customer service is a fundamental prerequisite for a perfect customer experience. While the popularity of the term ‘customer experience’ is increasing rapidly, terms such as customer service, customer care or after-sales service are fading into the background.

Companies are changing the name of their service organizations to customer experience divisions. The Head of Customer Service has become the Head of Customer Experience. But how are the two terms related – and how do they differ from each other?

Before you continue reading: Do you know the key ingredients that are universally valid for any customer experience? Read the following story to learn more: Key Customer Experience Ingredients: Speed, Convenience, Consistency, Friendliness

Customer Experience Is a Top Priority for Executives

It’s been around a decade since Harvard Business Review provided a convincing definition of customer experience: It is the result of interactions between companies and customers during the entire course of their relationship. In contrast to user experience, which e.g. describes a concrete interaction between a customer and a product, the term customer experience refers to the sum of all interactions – ranging from the purchase experience and product experience to the customer service experience.

Instead of exclusively belonging to marketer specialist jargon, this term has long been an integral part of modern management vocabulary. However, this is more than just mere lip service: In a recent global survey conducted by Adobe and Econsultancy of 13,000 marketing and technology professionals, 45 percent ranked customer experience well ahead of all other topics as their top business priority. 62 percent claim that they have a comprehensive plan and a clear vision.

Customer Experience Affects Stock Prices and Profits

Why is this worth it? Because companies that consistently invest in this area and rank in the top quartile on the Forrester Customer Experience Index record a higher stock market price and faster earnings growth than their competitors in the lower quartile. But what does it mean to invest in customer experience? Is that synonymous with improving customer service?

Customer service is the help and support that a company provides to its customers. The universal goal of customer service is to ensure that all customers are satisfied and to increase their satisfaction levels in the long term. Let’s take an example from our field, the mobile and consumer electronics industry: Customers buy a new smartphone because of the image, innovative features or a company’s quality promise – something we found out in our Smartphone and IoT Consumer Trends Study.

Customer Service Is the Savior of Customer Experience

If the camera does not work as it should after the purchase, or if the battery life is shorter than anticipated, then the customer’s initial emotional reaction is one of disappointment. The provider’s brand promise has been broken and now the job of customer service is to restore the customer’s loss of confidence through fast and competent help. In other words, customer service is responsible for neutralizing the negative impact of this disappointing experience with the goal of improving the overall experience.

The term ‘customer care’ takes this idea to the next level. Rather than focusing exclusively on solving a problem, customer care goes a step further and considers the emotions of the customer during an interaction. This involves looking at what the customer says, what needs can be derived from that and then considering which solution might be the best one. While customer service focuses largely on the technical and functional solution to the problem, customer care seeks to foster an emotional bond.

Good Customer Experiences Are the Result of a Service Culture

Customer experience is the sum of all interactions – this includes gathering information and the selection of a product, the buying process, the first minutes and hours of use, and the ongoing relationship with the product and brand. Customer service is a very important component of the overall experience: Just under 75 percent of all customers who turn their backs on a brand do so because of poor customer service.

We recommend that any organization operating at the interface with customers on a daily basis and thereby making a significant contribution to the company’s success should engage intensively with the question of what each service interaction means for the overall customer experience and thus for the long-term success of the company. From our own experience, we know what impact your own awareness has on the internal culture and thus ultimately on the company’s development in the long run.

Customer Service Today Is Far More Than a Chore

Our industry, the mobile and IoT market, is characterized by rapidly increasing competition. In addition to established names such as Apple, Google, Lenovo, Microsoft and Samsung, fast-growing newcomers are surging into the market – the Chinese shooting stars OnePlus and Xiaomi are such examples. But whether established or aspiring: All providers have realized the importance of customer service for their long-term success in the market.

Or, as Steve Kim, Senior Vice President Customer Care America at Samsung put it: “Excellent service is a key part of our customer experience at Samsung.” It is not only Samsung that has to live up to this promise – customers have been expecting this from all providers for many years now.

The question is whether customer care organizations allow this to happen and consider customer service merely as a matter of duty – or if they want to take an active role by creating a unique customer care experience for their customers. The answer is crystal clear, isn’t it! If you are not fully convinced of the measurable benefits of great customer service, then consider the other side of the coin: Read here about the costs of bad customer service in black and white, with hard numbers, data and facts.


Trends & Insights

About the Author

Julia Stübben

Julia Stübben is Senior Sales Operations Manager at B2X.