What does Einstein's theory of relativity have to do with customer experience? I don't have a fancy formula, but let's try this: Assessments of customer experiences = Memory of the experience relative to a frame of reference.

That formula is based on two key observations from the world of behavioral economics.

First, the memory of an experience trumps the actual experience. That may seem like splitting hairs, but what we remember, however accurate or inaccurate, is more important than what "actually" happened. The memory of the experience becomes reality.

Second, everything is relative. We evaluate the world through a lens of comparisons to meaningful reference points. An experience is better or worse than expected, more or less than before, different from or the same as promised, best or worst in class. Whatever the experience may be, our recall, reflection, and evaluation of an experience always is relative to some frame of reference. In the world of evaluating customer experiences, absolutes don't exist.

Those two points have significant consequences that companies should consider in the design of customer experiences and the measurement and analysis of experiences—and, by extension, customer loyalty.

Let's leave the memory issue for another day and in this article focus on relativity.

Measurement Relative to What?

People are lousy at visualizing break-through products, imagining new concepts, at de novo thinking. It's not because we aren't smart; it's because we sense everything and process information in a relative context, not in a vacuum. We need context to form opinions, make choices, and even to try to think of something new. That context, for better or for worse, defines the parameters of our thinking and sets our expectations.

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ABOUT THE AUTHOR
image of Howard Lax, PhD
Howard L. Lax, PhD is vice-president of consulting at GfK Customer Loyalty and an expert on customer experience and loyalty programs. Reach him via Howard.Lax@gfk.com.