What's the Difference Between Customer Experience 

Management and Experiential Marketing?

Many people equate Customer Experience Management with Experiential Marketing.

However, in recent years, "experiential marketing" has become perceptually aligned with "marketing execution." This is because it largely focuses on developing highly visible, stimulating, interactive, and sensory-engaging environments in which products and services are showcased.

Accordingly, experiential marketing is an important component of CEM, but it isn't the whole enchilada.

The environments that experiential marketers focus on are diverse. You'll often find a large emphasis on shaping the walk-in experience of brick-and-mortar environments. This is done with the goal of creating more positive, intuitive, memorable, engaging, and pleasing environments which better engage, entertain, and support customers.

Some examples:

• Museums and galleries. Because they focus on creating a sensory experience, museums and galleries like the Guggenheim, the Smithsonian, and the San Francisco MOMA have always had a high level of focus on how to create the proper experiential environment for visitors and have therefore been proactive in the application of new technology to both enhance experience and preserve works of art for future visitors.
  
• Stores. Retail outlets that sell goods are placing increasing emphasis on developing more experiential environments. Visit REI and spend some time on the climbing walls available for public use. Walk in to a Build-A-Bear Workshop and create a custom toy, complete with a voice chip, for a friend or loved one.

Other, more obvious experiential retail environments include Apple Stores, Niketown, the American Girl stores. More subtle examples include Sephora, Anthropologie, Origins and Libby Loo.

• Restaurants. It's not just about food anymore. Restaurants are getting into experiential game, as well. Almost all of us are familiar with the time-tested experience offered by Rainforest Cafe and Planet Hollywood. My five-year-old niece prefers Sushi Takahashi—a little dive sushi joint with a circular sushi bar and a train that delivers your (really yummy) food.
  
• Nontraditional environments. There are more examples in less-obvious environments, like grocery stores such as Wegman's and Whole Foods. For a nontraditional example of great food shopping experience, visit Seattle's Pike Place Fish Market.

We're also seeing forays into experiential marketing within the financial services (e.g., ING Cafés), healthcare (e.g., Minute Clinic), and other industries.

Experiential Marketing carries with it as strong association with event-driven marketing. In the past, this has been primarily associated with tradeshows, technology showcases, and industry conferences.

But today, event-driven marketing tactics are becoming increasingly popular in nontraditional venues:

• Microsoft's somewhat recent and highly successful multi-venue Tablet PC promotional event. Born out of a partnership between Microsoft and the Jack Morton agency, the event resulted in 125,000 product demonstrations in high-traffic airport terminals in major hub airports across the country.
  
• Another example was featured recently in a recent CMO Magazine article on B2B experiential marketing. The article highlights IBM's Merlin Center, an experiential environment created to effectively demonstrate the future of high technology banking to bank executives. The experience starts in a living-room like environment featuring warm biscotti and coffee. It gradually transitions into an experience that has been described as a "virtual theme park for banking executives."

As marketing becomes increasingly experiential in nature, the lines of demarcation between event-driven marketing and other promotions are becoming increasingly cloudy.

For example:

• Lexus recently drew attention for strategically placed experiential displays positioned in Times Square and a several other key US locations. The displays, placed at sidewalk level in shop windows, featured a "holographic" animation of the Lexus IS in motion—zooming, spinning, turning, and driving within the store window space. Interactive kiosks allowed visitors to control the display features, such as the color of the car. The displays drew substantial attention and shut down street corners successfully as onlookers jammed busy sidewalks.
  
• Experiential marketing promotions were also featured in recent episodes of the hit TV show "The Apprentice." In several shows, the teams were assigned the task of creating innovative marketing campaigns for Dick's Sporting Goods and Tide, as well as innovative product displays for Best Buy's video release of Star Wars III.

Experiential marketing also applies heavily to the online world, where the constant drive to innovate and improve customer experience and dynamic qualities are ever present. Product searching, personal recommendations, reviews, rating tools, list sorting/filtering and wish lists become common features of top retail and/or promotional sites.

Today, companies strive to press the envelope of traditional interactivity further, to improve site and application usability.

In addition to utilizing rich media, flash, DHTML, Java, and AJAX to bring new, more engaging and effective sites to bear, an increasing number of companies are making good use of other techniques. Viral microsites, gaming, downloads, and e-cards are actively used to help encourage site interaction and visitation. Blogs and podcasting are adding a whole new dimension to site interactivity and content. Product customization, enhanced products and services are an emerging trend. Nike allows customers to create and customize their own athletic gear at NikeID.com.

Online stores such as Lands End and The Gap's "Watch Me Change" viral site allow customers to create customized avatars, based on the personal height, weight, and body-style attributes. The avatars can "try on" selected clothing for the customer and allow style and fit comparisons. In the case of The Gap, you can also get them to perform an entertaining strip tease for you, and pass it along to a friend.

In addition to hosting an online car-configuration application, Mini Cooper has an interactive site showcasing a wide number of customized roof wraps that customers can purchase for their cars. The artwork includes the British flag, sci-fi scenes, the Mona Lisa, and much more.

The Converse Gallery offers independent film makers the ability to submit 20-second short films dedicated to the Converse brand. Many of the high quality "shorts" are now serving as part of Converse's national advertising campaign.

It occurs to me that I'm preaching to the choir. As marketers, many of you are highly familiar of the tenets of experiential marketing—and I haven't even addressed how the really great experiential marketers pay incredible attention to the interaction component of CEM, working to refine person-to-person interaction within these environments (e.g., the W Hotel), or engineer product displays to boost the efficacy of merchandising, among other things. However, in the interest of brevity, let's move on to discuss how experiential marketing relates to CEM.

Unfortunately, many executives are being seduced by the flashier side of experiential marketing and can mistake it for CEM in its pure form. A cadre of agencies now purport to have expertise in experiential marketing and readily capitalize on opportunities presented by market shifts, retail expansion, and new technologies. Typically, however, such agencies execute work within a relatively narrow scope, compared with full-blown CEM project work.

Confusion between experiential marketing and CEM often forces attention away from the real value and tangible benefits of CEM initiatives. The differentiation between the two can be succinctly described as follows:

In closing: I'm not a huge fan of buzzwords or hype. It's a simple truth that everything we do as marketers is experiential at some level—from the brand assets we create, to the packaging, collateral, IVR scripts we write, or the stores and Web sites we manage.

We have complete control over how "experiential," engaging, or stimulating we are, and how perfunctory the interactions we design become. At times, perfunctory is better... and at other times, engaging, stimulating, and sensory-involving is better.

Whatever the case, the companies that are faithful in the "little things" will be granted much more. Each little customer interaction is a highly valuable part of a larger set of interactions. The outcomes of customer interactions shape brand perception.

Customer interactions should be strategically designed and executed to work together to collectively lead the customer in an appropriate (and positive) direction, which compliments personal goals and business objectives. This is the core focus of CEM.

The true leaders in customer experience understand these principles. They are adamant about creating customer experiences within channels—and across channels—that are intuitive, consistent, engaging, cohesive, safe, relevant, seamless, memorable, and satisfying.

Experience leaders never get caught up in flash over substance, but instead leverage experiential marketing as an effective tool to gain exposure, attention, and customer mindshare. They focus a great deal of energy on becoming increasingly proficient in the principles of Customer Experience Management.

Read more: http://www.marketingprofs.com/6/duncan4.asp#ixzz2V9YCv4g8