Did you ever think about where the idea of customer experience comes from? It’s such a simple idea – provide your customers with a great experience so that they will come back and buy again and more.
But as with everything in life, CX’s origin story is messy and not that well known.
Only a few years ago you could say that ‘CX’ is just the current buzzword and that it wouldn’t stick. Yet here we are in 2024, and CX is bigger and more important than ever. So in today’s article, we will break down the evolution of CX and how it morphed into becoming one of the biggest business disciplines in the world.
The late 1800s
In this era, customers had a personalised relationship with the shopkeepers, and transactions were often based on trust and familiarity. The concept of customer experience wasn’t formalised, but personalised interactions were crucial.
1900s – 1950s
At the beginning of the 20th century, “hairdressing salons, followed by courses to learn how to do one’s hair, apply make-up, and walk with elegance” appeared. This attracted wealthier customers. However, after World War II in 1945, people started to become richer. The US government provided returning soldiers with grants to buy homes and attend college. As well as this, advances in production techniques and technology led to increased employment opportunities and economic optimism.
In 1947, the ISO (International Organisation for Standardization) was created and the customer gained more rights and the saying “Customer is always right” was born. (The era of the Customer is King)
Around the same time the Father of Quality Control, William Edwards Deming, and his principal theory dealt with the reason why manufacturing operations were flawed.
“To go with his simple idea of ensuring quality before the product was created, Deming reasoned that the only way operations could be improved was if management was taking immediate action to do so, instead of pinning improvement solely on employees.”
From these new specialised quality control techniques, the Japanese industry post World War II, developed as management practices in the U.S. lagged.
1980s
In 1982 Deming published “Out of Crisis” including his 14 Principles of Quality Management and urged continual improvement over short-term financial goals, aligning with Japanese business strategy.
This was the time when ‘Customer Satisfaction’ also took off along with “conducting large-scale customer satisfaction studies”.
1990s
The term ‘Customer Relationship Management’ gained prominence as technology facilitated better management and analysis of customer interaction.
In 1994, Lewis “Lou” Carbone published his Marketing Management magazine “Engineering Customer Experiences” which introduces businesses to the idea of prioritising repeat business and incorporating customer experiences into their business design.
Shortly after “The Experience Economy” article by Joseph Pine and James Gilmore was published. They too focused on describing a new economic era in which all businesses must orchestrate memorable events for their customers. They explained that by staging the experiences, businesses will transform the value of what they produce.
This was the time when the idea of business differentiation through CX and the possibility of customers choosing to pay more for a great experience was introduced.
2000s
A digital transformation including the rise of the internet, e-commerce and digital communication channels revolutionised customer interactions. This shifted the power from businesses to consumers, enabling online searches for products and allowing the customer to openly share their experiences in online forums.
2010s
It was only at this time that businesses began recognising the importance of delivering memorable experiences. The term ‘omnichannel’ was introduced but it took a few years for it to gain traction.
Business leaders, researchers and marketers dubbed 2010 as the end of the “Age of Information” and the beginning of the “Age of the Customer”. Technology improved at a much more rapid rate and the rise of Social Media platforms like Facebook and Twitter allowed customers to communicate with each other easier and faster. The danger of businesses losing thousands of customers just by someone making one bad comment about them online became a reality.
2015
The term “customer experience” started to be widely used as a formal concept. Companies began establishing dedicated CX teams and strategies to ensure a holistic approach to customer satisfaction and loyalty.
At this time businesses already understood the many benefits of investing in excellent customer experiences and they were all in, with investment in CX growing every year.
2020s
Today AI and machine learning technologies have been increasingly employed to analyze vast amounts of customer data. Businesses are leveraging AI for chatbots, predictive analytics and personalisation, providing more tailored and efficient customer experience than ever before possible on such a big scale.
The future
The future of customer experience involves continuous innovation and a commitment to customer-centricity, adapting to emerging technologies and changing consumer behaviours. We cannot say exactly where it will be in 50 years but based on data that we gathered from many world CX experts we have made our predictions for 2024 which you can read here.
If you would like to learn more about how you can create a CX strategy that will last through many decades and bring you business every day, enrol in our Professional Diploma in CX today.
