Positive customer experience is a key contributor to satisfaction, loyalty, advocacy, and, ultimately, profitability, which makes customer experience management (CEM) — the application of practical and analytical methods to measure and improve CX through better design and delivery of products and services — a key corporate competence. How do you measure customer experience? You’ll want to study customer interactions and also customer sentiment, whether determined via direct approaches such as surveys or via indirect methods that include monitoring online and social media.

To collect and crunch customer-experience data at scale, you need technology. This point is where sentiment analysis and related solutions come into play. To learn about best practices, there’s no substitute for consulting expert practitioners and analysts. A couple weeks ago, I approached Sid Banerjee, co-founder and CEO of “intelligent customer experience” provider Clarabridge, to discover his take on the CX topic. Next up, in this article, a conversation with social-business visionary Augie Ray. (Check out Augie’s blog, Social Experiences that Build Brands.)

Augie is slated to keynote the May 8, 2013 Sentiment Analysis Symposium in New York. His talk is titled “Customer Affinity Meets Brand Vectors: Sentiment That Matters.” The aim is to explore the relationship between sentiment and engagement and how companies must build brand vectors (which I’ll interpret as indicating strength and direction in “the set of expectations, memories, stories and relationships that, taken together, account for a consumer’s decision to choose one product or service over another,” per the other Seth’s 2009 definition) into their social strategies.

(The symposium covers technologies and solutions that harvest attitudes, opinions, and emotions from online, social, and enterprise sources. Application areas include market research, social/media analysis, customer service and customer experience, capital markets, and a spectrum of other uses.)

On to our Q&A with Augie Ray —

Seth Grimes> Augie, in a sentence or two: What constitutes great customer experience?

Augie Ray> A great customer experience is one that furnishes the customer what (or more) he or she wants or expects when they want it with no friction regardless of medium, but responsive customer experiences are becoming the table stakes. Increasingly, great brands will not just respond to wants and expectations but proactively respond to needs, perhaps even ones the customers have not yet recognized. Moreover, brands that have more success will fashion customer experiences that do not merely satisfy customers’ desire for immediacy and ease but also convey something deeper about the brand’s customer relationship, mission or culture.

I think of it this way:  You can order a PC or an iPad online. Both will have essentially the same ecommerce screens and the item will arrive in roughly the same timeframe. But from the moment you unbox the device and launch it, the experience is much different. While PCs are closing the gap, the Apple customer experience conveys something more than just “Here’s the hardware you ordered” and instead says something meaningful to customers about beauty, usability and simplicity.

Seth> A working assumption is that the right data and appropriate analyses are keys to design and delivery of great customer experience. What are “the right data” and “appropriate analyses” for you in your work?

Augie> I’m currently focused on how to create great, brand-building experiences for consumers within social media. For me, it is essential to understand how consumers are using social media today, will use them in the future and how the social media experience will impact brand and financial performance. For example, today many brands are offering little to no customer service in social media, but recent studies show that consumers are increasingly turning to social media to get questions and complaints addressed, and how brands handle these inquiries has an impact on consumer loyalty.  It is vital not just to look at what people say today about the social customer experience but to recognize the trends and use analysis and insight to extrapolate into the future.

This idea of extrapolation is key — the data is one thing, but insight and vision based on the data are another. For example, I look back to year 2000, when many retailers were struggling to consider how ecommerce may or may not impact the bottom line. The data at the time demonstrated that few people had an interest in entering their credit card into a web site and that less than 1% of US retail was happening via ecommerce. The conclusion might have been (and was for some retailers) that ecommerce was not an essential part of the consumer experience. Fast forward little more than a decade, and Borders was put out of business while Amazon is approaching Target’s level of retail sales; Borders relied too much on the current data while Amazon continued to recognize the trends and how customer behaviors and expectations would change.

Seth> What are the most important customer insights that can be derived from attitudinal data, from opinions, emotions, and other forms of sentiment?

Augie> In social media today, too many brands are moving cautiously for lack of ROI data. The problem is that social media is not first and foremost a direct marketing channel–it is a relationship one. Plus, in a world of such complex multi-channel interactions, it is difficult to isolate just one channel, strategy or tactic from the others.  (Coke recently reinforced this when its marketing executive took to the Coke blog to defend a report that social media chatter contributed almost nothing to sales lift.) Perhaps more importantly, social customer experiences can deliver vital attitudinal changes even if direct sales/ROI are difficult to measure.

This is why it becomes important to evaluate brand lift in social media and not merely conversions and sales. One of my favorite examples comes from several years ago when I was at Forrester. I researched a P&G social media program called “Let Her Jump,” a movement sponsored by antiperspirant brand Secret to allow female ski jumpers to compete in the 2014 Winter Olympics. The brand did not just count likes and retweets–it used surveys to uncover that the belief that Secret deodorant works better than other deodorants increased 8 points and purchase intent jumped 11% among those who interacted with the social media program. That’s the kind of attitudinal data that matters!

Seth> Text analytics and sentiment analysis enable intelligent customer interactions via issue alerting, root-cause analysis, pattern and trend analysis, and by bringing new sources into the research mix. Have they delivered on their promise?

Augie> There is healthy skepticism among senior leaders that today’s social analytics tools can uncover deep, insightful knowledge. For example, a brand that launches a campaign with happy tweets about pets may see a substantial improvement in the sentiment around the brand, but is this really impacting a positive change in people’s attitude about the brand or does it merely reflect that people like tweets about pets?  Today, I see a great deal of social media strategy driven by a desire for mere engagement rather than by a desire to drive meaningful changes in brand perception. I am not sure that today’s tools are capable enough to tell the difference.

Seth> Augie, thanks for participating in this Q&A session and, in advance, in the up-coming Sentiment Analysis Symposium. To wrap up for now: What’s the next frontier for customer experience — what techniques will be center-stage a year or two from now — or will attention have moved on from CX to something new?

Augie> In the next few years, I expect that corporate use of social media will increasingly shift from marketing to customer service and business. I’ve already mentioned the trends around social customer service, but I also see changes in how social technologies and behaviors will impact products, services and business models. Look at the growth of car sharing (RelayRides), place sharing (Airbnb) and P2P lending (Prosper and Lending Club), and you begin to see that social will be a medium for far more than just marketing and reputation management. Plus, the smart use of social media data to drive one-to-one, real-time relationship building holds great promise. The increase in digital, mobile and social behaviors and tech will drive significant changes in customer expectations around brand experiences.