Chapter 1: Generation Z
Definition and Delineation
Generation Z is a term used to refer to the people that were born after the generation of the Millennials. Various studies have been undertaken about this generation. This study presents the most recent data regarding the Generation Z and the theories related to the topic. One of the essential characteristics used to define Generation Z includes the fact that they were born “natives” in the current technology filled society (Greenfield, 2008). The high technological improvement characterizes the contemporary modern society. The generation today is surrounded by technology from the time they are born. The technology significantly influences the Generation Z. Technology changes the way they live, perceive information, socialize, and the way they make choices. This is what primarily distinguishes the Generation Z from the other generations before them. With such technological development, Generation Z is also greatly influenced by globalization. Such effect includes the way they think and act. The current Generation Z does not think before they act. A report by Sparks and Honey (2015, p. 46) shows that the generation members are recognized as the most global and multicultural generation. According to the report, this generation is regarded as globalized and multicultural because they were born during the age of internationalism and other social awareness such as quality and climate change. As a result, their altruistic behavior is defined by social responsibility, social advocacy, and caring for the greater good. However, despite that more research has been focused on Generation Y (Millennials), the world is starting to understand the concepts related to Generation Z (U.S. Chamber of Commerce Foundation, 2012). One positive thing is that researchers are beginning to analyze the Generation Z market by examining how its consumers are behaving in the market. Understanding this generation assist in differentiating it from the previous generations. However, this can only be achieved through understanding the personality features and the younger consumer behavior. Therefore, organizations need to a new brand that can be used to distinctively separate Generation Z from the other generations. Report by Sparks and Honey (2015, p. 3) shows data that can be used to understand this generation better. According to the report, Generation Z will be accounting for over 40% of the population by 2020. The report further emphasizes the importance of understanding Generation Z because it will be considering over the US $44 billion of the market value.
Further, understanding Generation Z is essential because it is profoundly influencing the society. For any organization that wishes to succeed, it is critical to understand the Generation Z. Different research shows various ways to analyze and interpret the generational gap. According to Reeves and Oh (2008, p. 296-297), a useful analysis can be achieved through the divisions of five generations. Scientific literature shows various Generation Z definitions as well as theories regarding their period. Oblinger and Oblinger (2005) argue that the generation of “post-Millennials” started in 1995. Reeves and Oh (2008), on the other hand, assert that Generation Z started in 2001. This thesis emphasizes the definition by Reeves and Oh (2008). The studies about Generation Z started in the early 2000s. One of the generational research pioneers, Tapscott (1997), defines Generation Z as “generation next.” According to the author, Generation Z is characterized as the unique because there is no generation before that was more comfortable, knowledgeable and educated with the help of technology and innovation. Don Tapscott’s research is advanced by other 6,000 Generation Z members from all over across the world. Tapscott argues that Generation Z is all about innovation, freedom, and tolerance. As a result, they are encouraged to change the modern life and enhance the future world.
Howe and Stauss (2009) describe Generation Z as more significant, more educated and diverse than the generations before. The authors describe the age as “Found Generation.” According to them, this generation is the greatest because it possesses unique abilities, skills, and mindset that is very different from the previous generations. Despite such optimism, understanding Generation Z is surrounded by controversies, especially regarding the ethics. Zemke et al. (2000) further distinguish the different generations at workplaces. The authors believe that the following features can characterize Generation Z; confident, independent, and educated. Furthermore, they are considered to value diversity, feel comfortable with changes, and admire flexibility.
Lancaster and Stillman (2002) conducted similar research while trying to distinguish the generational differences at the workplace. The authors differentiated between Generation Z and other generations that came before them. They characterized the Generation Z as realistic, confident, diversity, and pragmatic in problem-solving. Martin and Tulgan (2002) also examine the same topic while trying to distinct the generational differences. They note, in their research, the essential characteristics of every generation. The authors achieved the best organizational results due to the diverse skill set associated with every age. Oblinger and Oblinger (2005) describe what they term as “Generation Next” as literate because they continuously access the internet. The authors emphasize the importance of technical opportunities created for the Generation Z by technology. Oblinger and Oblinger (2005) further explain that the Generation Z is literate because of the way they like learning than other activities. The Generation Z prefers learning than other businesses because of their openness towards diversity, differences and their desire to stay connected.
Lastly, Reeves and Oh (2008), further examined the difference between generations. In their study, the authors discuss some of the recent research and theories regarding the ages and the gap that exists between them.
Generational Theories
To define Generation Z, understanding the method used for the generational divide. Reeves and Oh (2008) explain that the only way to categorize the generations is through time categorization. It is believed that birth years may not be sufficient enough to analyze the generation 12 differences. Further, more complex analyses involve analysis of the history, the social factors, and individual character traits. There are different scientific theories and approaches determined to be useful in understanding the different generations. One of such approaches is Karl Manheim’s proposal. Manheim (1952) argued that generic type could be defined by a different series of socio-historical situations and events. According to the author, another critical factor to be considered is the age of the generation. Therefore, a unique socio-historical environment must be determined when the individuals are still young. The influence of the experiences or events that someone has gone through cannot be ignored when trying to understand the generational differences.
Smith and Churman (1997) also examine the inefficiencies of the age gap when trying to understand the generational analysis. The authors highlight the significance of both place and culture that a certain to a particular group of people. According to the authors, the same experiences that people share in regards to a specific group or culture influence the way they make choices, behave, live their lives, and individual values. As they explain in their research, the authors argue that to be able to understand the generational behavior and analyze them, one must identify the group factors. According to the authors, these factors include individual situations, environmental influences and cohort experiences. The different experiences define the personal traits of a person, social status, and economic conditions. The environmental impacts are the external factors that affect the individual’s attitudes, opinion and perception. The cohort experiences are factors that describe the shared experiences among generations that may influence their lives. Therefore, based on these factors, understanding the generational differences can involve dividing people into specific generational gaps.
Howe and Stauss (1991), some of the most respectable researchers, argue that defining generations only based on their birth year is a limited approach. According to these authors, three primary classes can be used to describe generations appropriately and effectively rather than relying on years of birth. The three categories include perceived membership, which refers to the awareness of being part of a particular group. This group begins in adolescence stage and develops into adulthood. The second class involves the shared beliefs and behaviors, which includes the existing attitudes, ideas, and behavioral norms that define a given culture. Lastly, the shared history which involves the historically significant events and experiences that happened during the times of generation member’s adolescence and adulthood that impacted their future lives.
Numerous studies have shown the significance of generational cohort in the overall analysis and generational classification. Therefore, Schewe and Noble (2002) depicted the importance of common behaviors, situations and experiences that provide an interconnection among generations. There is evidence to show that various differing generations have dissimilar cohort experiences which requires analyzing for purposes of recognizing the types of generation. At the same time, it has been referred to that common experiences can have unrelated nature: economic and political situations, socio-historical events, or famous innovations in addition to containing influence from particular trends. Lancaster and Stillman (2002) in their study highlighted how generational differences are important in the workplace. These researchers had their focus on qualitative data that depicted how generations in the workplace could be differentiated through their behaviors. As a result, values, culture, personal traits, leadership style, worth ethics, and other forms of behavioral styles provides an in-depth understanding of dissimilarities between generations in comparison to their years of birth. Further, Lancaster and Stillman (2002) alluded to the fact that generational analysis was critical and had a direct relationship with success in the organization. Similarly, Hammil (2005), conducted a replica study where the generational division was based on analyzing the personality characteristics, core values, communication style, workplace behavior, leadership style, work ethics including other behavioral patterns that correspond to particular types of generation.
Schwartz et al. (2010) investigated the task of political, economic, social, and cultural events in creating division among generations and shaping their differences. The researchers highlighted the influence of geographical factors on generational development. McCrindle and Wolfinger (2010) referred to generations as groups of people that were born during the same historical period. Consequently, they were influenced by experiences that were common and have been impacted by the same history and technology. McCrindle and Wolfinger (2010) concluded the significance of sociological analysis in determination of the generation division. Finally, in his research, Törőcsik (2011) examined the impact of cohort experiences on categorization of generations. The researcher emphasizes that attaining an in-depth understanding and knowledge of the generations concept, it needs analyzing shared culture, common experiences, public enemies, heroes, technology, world events and other aspects associated or creating the cohort and have a strong influence on their lives.
Analyzing Generation Z
According to various generational theories, people can be divided and characterized into groups based on similar patterns of actions, thoughts, opinions, traits and behaviors. Thus, members of Generation Z have common personality characteristics which help them in gaining knowledge on how to behave and for that reason, approach them in a successful and effective manner. Many authors and theoretical framework have explained the analysis of personality traits and characteristics. Wiggins (1996) states that the fundamental distinction is how personality is viewed. Some scientific sources have stated that personality is shaped by the impact of internal encounters and factors. For instance, Eysenck’s, (1950) Big Five personality theory shows that five core traits where their interconnection shapes and individual’s personality. According to this theory, the traits include openness, conscientiousness, extraversion, agreeableness and neuroticism. Nevertheless, other sources contradict this argument by stating that external factors have a strong influence on the personality of an individual and accordingly, personality develops from interactions between the environment an individual (Ryder, 2014). Analyzing Generation Z can be through various ways including their values and personality traits. Below are some of the characteristics that are relevant in analyzing this generation.
Personality traits
Considering that members of Generation Z were born during a period when technology was experiencing radical changes similarly to the climate change and cultural diversity, they possess special features that shape and represent a unique future. One of these characteristics is the fact that this generation is global. Members of Generation Z have no limitation in matters accessing information or getting connection with people around the world. For this generation, geographical boundaries cannot be an obstacle considering the internet has revolutionized how people do communicate. An important factor for globalization is the aspect that it erases borders of individuals that have dissimilar backgrounds. Sparks and Honey (2015) noted that members of Generation Z have freedom of trying different personas, join communities of their choice, sample what interests them and at the same time expand their horizons. McCrindle and Wolfinger, (2010) argues that the presence on the internet affects this generation. Consequently, they are largely influenced by music, movies, celebrities including recent trends. Technology and globalization has made it easier for internet influencers interconnect with members of Generation Z in a more intimate manner than ever before. In the aspect of globalization, the significant factor whose role cannot be undermined is diversity. Currently, members of this generation are growing in what can be referred to as non-traditional social structure. What this means is that these individuals perceive that there is no wrong or right, abnormal or normal. However, this does not mean that they ignore the fact that people come from various economic and social backgrounds, nationalities, ethnicities, and races. Important to Generation Z members is embracing the globe as full of individuals of different sexual orientations and gender identities. For these individuals, acceptance of the incredibly diverse universe is a way of thinking rather than being about tolerance (Sparks and Honey 2015).
The second feature associated with personality traits is technology. One of the significant differences between members of Generation Z and Millennials is that despite the former being largely influenced by technology, their awareness on when there were no devices or access to the internet is still high. On the other hand, for the Generation Z members, they are the first to be surrounded by technology from the initial days. Sparks and Honey (2015) alludes that for the generation of digital natives, being connected is a natural aspect similar to moving a leg or arm. For Generation Z members, being integrated in their lives is normal considering they started at young age. Lenhart (2015) states that 92 percent of members of Generation Z go online daily while 24 percent have constant online presence daily which makes their lives inseparable from technology. One of the major features of this generation is that it has been used to seeing the world from multiple screens. Typically, in a home of Generation Z, there are at least five monitors smartphone, television, laptop, desktop and tablet. Speed is of significance in the life of Generation Z members considering their extensive use of technology allows them to get desires information within seconds. This makes connectivity important and any delays can make them irritated and impatient. Another factor that would differentiate between members of Generation Z and Millennials is the way they behave when online. Vision Critical (2016), noted that member of Generation Z are concerned with their privacy when engaging online because they are aware of the possibilities of current technologies and how easy it can be to access information which makes them control the kind of information they share.
Another character that is considered unique for member of Generation Z is social advocacy and caring for the good of everything. Members of Generation Z are passionate about positive impact in addition to making their contribution worthy. According to Barr (2016) an example of how this generation cares for the world and the future could be demonstrated by the fact that the levels of drugs and alcohol that they consume is the lowest while their engagement in political matters is high. For many members of this generation, equality, human rights, freedom, diversity and justice is the way of life as they are issues they consider important. In addition to this feature, Generation Z are innovative an attribute that can be associated with high number of technical opportunities surrounding them. Many members of this generation are early trendsetters and adopters whose main aim is ensuring they substitute traditional ways of doing things with creative, new, and innovative technologies. The report provided by Vision Critical (2016) emphasized that this generation is developing a future of networked gadgets, job automation, and artificial intelligence. At the same time, this generation is the most entrepreneurial minded where for instance 70% of the teens have their own businesses such as teaching musical lessons or selling on eBay and other online platforms such as Amazon. Johnson (2015) noted that due to this, members of Generation Z have valuable working experience critical in preparing them to become future top innovators.
Apart from being innovative, McCrindle (2012) asserts that Generation Z is the most connected and social generation among all the others. The fact that they are the most global generation, their online network is larger geographically, numerically and can be accessible at any time. The youth of today have a high affinity of following how their lives are fairing online and this has made internet personalities become popular across different social platforms. Sparks and Honey (2015) in their reported noted that 71 percent of Generation Z members were present in at least two social networks. Lenhart (2015) emphasizes that evidence shows that today’s teenagers have acquired a new friend using the internet. Members of Generation Z have also been associated of being realistic. Jenkins (2017) notes that political uncertainty, global recession and the lessons learn from previous generation have contributed to Generation Z members being practical while at the same time conservative. These and other events have made Generation Z members become cautious in addition to being wary of security but this has also served as a catalyst for them to work harder for building a better tomorrow (Forbes, 2013). There is a high likelihood that Generation Z saves money for future operations and as was noted by Sparks and Honey (2015) in their report, 58 percent of teens are already making savings. Claveria (2017) noted that the major saving motivation is security and stability in their finances. Apart from this, Generation Z members are careful when choosing services and products that they spend on. As evidence, there has been an increase in organic, all-natural and vegan products as they reflect conscious purchases by this generation. Another way to evaluate the authenticity of this generation relates to how they seek and value authenticity. For example, Deep Focus (2015) reported that 63 percent of Generation Z members prefer social media and narrative influences that are realistic while the remaining prefers traditional celebrities.
Core Values
Apart from being analyzed using their personality traits, Generation Z members have certain core values which they can be identified with as they are unique to other generations such as the Millennials. Folmsbee, (2017) noted that this generation is highly developed educationally and socially and has the potential of becoming the greatest smartest generation which ever existed. One of the core values of this generation is having the need and desire to create a sense of belonging in addition to a feeling of fitting in the community. For example, Generation Z sees online communities as groups that they share the same mind in addition to being a tool that is powerful enough to create the change they desire. Another core value of this generation is sustainability. A large percent of members from this generation are concerned about environmental and social issues including worrying on how the planet earth will look in the future. Brown, Bridge and Riggs (2015) assert that these individuals are passionate and empathetic about making change that is positive around the globe. Among the social issues that Generation Z considers to be of importance, include hunger, poverty, health, human rights, and environment.
In addition, authenticity is a core value that members of this generation possess. Generation Z values everything that is authentic, personal, individualistic, relatable, and real (Mediakix, 2017). Of significance to this generation is being unique and authentic in what they do. In their report, Sparks and Honey (2015) noted that due to the extensive internet usage, people in this generation have the capability of creating multiple digital personas and hence able to try various roles. Furthermore, members of this generation have been associated with being diverse. Folmsbee, (2017) notes that individuals from Generation Z are least sexist, racist and homophobic compared to other generations. The outcome of the diversity value has been earning respecting from all people with dissimilar backgrounds. For most members of this generation, among the relevant issues include immigration, the rights of women, racial equality and the rights of LGBT (lesbian, gay, bisexual and transgender).
Finally, among the core values that characterizes Generation Z is freedom. While this generation values social, political, and racial freedoms, these were fought by generations that came previously which mean that they grew in a globe that considered these freedoms as a norm. Hughes (2017) notes that the freedoms that members of this generation aspire to achieve include financial flexibility, true self, and among the most critical is having freedom to develop what they desire to live. Being themselves in terms of decision making and presenting their opinion is vital. Generation Z members have the understanding that people cannot be the same and hence the need to accept individuals as they are. Geographical freedom is an aspect that members of this generation seek to attain considering that nothing is any longer attached to physical places as they can work in the comfort of their homes and can rent an apartment in any part of the world with a single click. Generation Z is in constant search of new opportunities and they are ready to travel the world to realize their dreams. Members of this generation value independence and consider that achieving it requires financial freedom.
Shifts from Millennials to Generation Z
One of the critical reasons that Generation Z matter is the fact that they are a representative of today’s global youth as they exceed a population of 2 billion and hence one of the most influential and largest audiences that any brand can target. It has been estimated that by 2020 this generation will have made up 40% of the global consumer (Patel 2017). Among the things that make Generation Z members unique is the fact that they do not only carry a device which could be targeted remotely, but they have more money on them than the rest of the previous generations at their present age. Members of Generation Z have been considered to be material endowed while at the same time technological saturated and the most formal education generation that the world has never witnessed before (Jagaciak, and Fink 2017). Nonetheless, in assessing what motivates Generation Z members, there is an increase in the beliefs compared to the Millennials. They share same attitudes as Baby Boomers in that money, success, and career advancements is traditional. One of the biggest changes from the Millennials is that members of Generation Z have a different way of viewing the world. While the dream of Millennials has always been changing the world, members of Generation Z have been practical in changing it (Future Cast 2017).
Millennials influential years were between 1991 and 2010 but there was much uncertainty due to the negative global trends such as environmental pollution, global warming, natural calamities, fanatic terrorism and school shootings (Jagaciak, and Fink 2017). While in the world of Baby Boomers the future was bright, for Millennials it was discouraging and at times questioned themselves if there will be any future and hence why many value living the present life in full without worrying about tomorrow. On the other hand, the most influential years of Generation Z started from 2005 until now. Members of this generation grew up with a Great Recession which made them acquire a traditional mentality on personal success, financial liability, and lifestyle. Each generation has experienced certain events which caused a change in what they believe and their behavior. Generation Z experienced the failure be Millennials to achieve the higher goals they had set for themselves and realized that making an impact on the world required a practical approach (Jagaciak, and Fink 2017).
There have been noticeable shifts on the way of life of the Millennials and members of Generation Z. First, Generation Z is more concerned about the future rather than enjoying the present. Due to their perception on reality, they seek to think and prepare for the future and wants communities, leaders, parents, and brands to treat them as mature (Jagaciak, and Fink 2017). The second change has been the love for practical products rather than having brand experience. Generation Z values a product that is cool without necessarily having a cool experience which is different from Millennials. Generation Z aspires to connect with products or services that supports their life goals instead of defining their lifestyle. Another shift is related to how this generation is loyal to brands. For Millennials, they had low loyalty that was caused by higher awareness of the brand. However, for Generation Z, un-loyalty to brands is high an aspect that can be attributed to low brand sensitivity (Wood 2013). Other shifts experienced are related to optimism and realism. Millennials had optimistic beliefs while members of Generation Z are practical in terms of fulfilling their needs in life. Thus, they want brands to change to telling them they can help in reaching certain goals rather than they will get the goals. Apart from this, Generation Z has shifted to becoming pragmatic and hence wants to achieve their goals in an orderly way and hates attention which is opposite of the Millennials. Member of Generation Z expect to gain success through hard work instead of luck which many Millennials rely on. In terms of creativity, there is no doubt that Millennials are and this can be witnessed by changes across the world (Jagaciak, and Fink 2017). Nevertheless, the tools that they relied on have been overtaken by events. Generation Z have technological tools whose capability to instill change is higher. There are certain specific attributes among Generation Z that have expanded compared to the Millennials such as world impact. While Millennials wanted to make an impact on the globe, there is a high likelihood that Generation Z will achieve it. For example, 55 percent of Generation Z are likely to start a new business than the Millennials are willing (Millennial Branding 2014).
On the other hand, there is what stays the same and hence no shifts among members of Generation Z from the Millennials. In other words, they have certain values and personalities that they share. Among these similar attributes include self-expression. The priority of both Generation Z and Millennials is pursuing what they considering fulfilling to them. Secondly, for both generations being unique is of importance and hence they have expectations that brands should accommodate who they are (Jagaciak, and Fink 2017). Thirdly, members of both generations are open minded which means that can be tolerant to differences and at the same time embrace it. In addition, due to parenting style which can be referred to as misleading, Generation Z and Millennials have high demands in the workplace and on the society. Finally, both generations are always reachable and continuously connected.

Chapter Two: Consumer Experience
Emergence of Experience
Most of the research on marketing literature history has not examined the concept of customer experience as a separate entity (Verhoef, Langerak, and Donkers 2009). Berry, and Carbone (2007) argue that most of the literature and researches have mainly focused on the concepts related to customer satisfaction, service quality and customer relationship management. Similarly, Parasuraman, Zeithaml, and Berry (1988) also argue that even though most of the market research examines the above-mentioned three concepts, but this does not mean that they have forgotten the customer experience. Holbrook and Hirchmann (1982) carried out a study on consumer experience over 35 years ago. In their study, the authors noticed that consumption was significantly influenced by consumer experience. As a result, they emphasized that there is a need for researchers to emphasize on consumer experience in the future studies. Some of the pioneer researchers on experience economy such as Gilmore and Pine came up with the exhibit of progression of economic value. The principle of the concept of progression value depicts the various differentiations to consumer pricing and wants. According to Pine and Gilmore (1998) this concept opines that there is realization of higher value when more offering is dedicated to ensuring the needs of the customers are met. Consequently, customization of services is done to create experiences while products develop services.
Therefore, for an organization to gain a competitive advantage in the market, it must upgrade its offerings to meet the requirements of the economic value (Pine and Gilmore, 1998). In another study, Pine and Gilmore (2000) examine the concept of competitive advantage based on the customer experience. According to the authors, a competitive advantaged can be created based on the experiences and not the actual products. In their study, the authors argue that there has been a fifth distinct offering, which they describe as “transformation” that has been added to the progression chart (Pine and Gilmore, 2000). However, the new offering has not been explicitly examined; therefore, it has not been given attention in this thesis.
The lack of functional differentiation has become a catalyst for products and services to become increasingly exchangeable. Schmitt (2003) concluded that the needs for customers of trouble-free and memorable experiences have continued to raise a view that had been observed by (Pine and Gilmore, 1998). The results of a research conducted by Shaw and Ivens (2005) demonstrated that approximately 85 percent of significant leaders in business agree that differentiation that only relies on physical elements such as delivery and price cannot be referred to as sustainable business strategy due to the competitiveness in the market. Therefore, the new differentiator is required to determine the customer experience. However, the differences are found in three main organizational aspects; for instance, brand, perception, and feel of the organization. Shaw and Ivens (2005) explain that all these three aspects are primary elements in customer experience in a business. Schmitt (2003) further assert that due to the above factors, companies require to identify their customer experience to create a competitive advantage in the business.
Customer Experience Management
The term “customer experience management” has been defined differently by various authors. However, Schmitt (2003) argue that this concept refers to the process or methodology that is extensively applied by managers to handle the cross-channel experience of consumers with the brand, firm or the services provided. Customer experience management is sometimes referred to as CXM or CEM composes the creating and implementing customer encounters within their journey for purpose of ensuring value development for all stakeholders including the organization (Schmitt, 2010). Similarly, Meyer and Schwager (2007) examined customer experience management and argued that customer experience shows how the customer perceives the organization during all the encounters, which they describe as “touch points.” Further, they argue that customer experience provides the organization’s management a tool to realize the caps in the customer’s journey. Meyer and Schwager (2007) emphasizes that this enables the organization’s management to identify where expectations and the actual experience do not meet (Meyer and Schwager 2007). Therefore, customer experience management could be interpreted to mean a process that firms uses in determining the different interactions that they have with dissimilar consumers within their encounter. Despite all these definitions, there is a need to still consider that an exhaustive definition of the CEM is still lacking in the most literature.
Lack of exhaustive definition does not mean that there is no other definition. Dandridge (2010) defines the term “customer experience management” as a process and discipline that the organization uses to enhance the customer experience factor. Due to the dynamism of the customer experience, Palmer (2010) explains that varied methods of CEM have been developed. Berry et al. (2002), on the other hand, argue that customer experience should be perceived holistically in consideration of complete customer journey, which involves everything regarding customers’ expectations before and after the experience. The holistic perception can be achieved by managing messages or clues that the organization sends to its customers. Also, it can be achieved by developing a competence for the CEM (experience audit) and creating a theme (experience motif) for implementing the customer experience management. Shaw and Ivens (2002) add that a great customer experience can be achieved by constantly exceeding both customers’ physical and emotional expectations. Further, Shaw and Ivens (2002) assert that great customer experiences are designed “outside in” instead of “inside out.” Shaw and Ivens’ explanation means that an organization needs to think of what customers want to experience instead of looking at what the organization wants the customers to experience. Frow and Payne (2008) also, an attempt to promote understanding of CEM, introduced the concept of “perfect customer experience.” Frow and Payne (2008) think that customer experience management should be focused on providing positive day-to-day customer experience. Further, the authors argue that CEM should be used to develop the highest experience to enable the organization to deliver the outstanding experiences. They further emphasize that companies should consider customer experience throughout their customer relationship.
Meyer and Schwager (2007) believe that most of the companies lack strategic customer experience management strategies. According to them, most companies prefer to invest in customer relationship management (CRM) instead of customer experience management (CEM). In their comparison of CRM and CEM concepts, Verhoef et al. (2009) assert that customer experience management gives emphasis to the current and immediate events with the consumers rather than the experience history involved. In other words, Meyer and Schwager, (2007) noted that through customer experience management, organizations can determine the thinking of the consumer in relation to the firm operations rather than the knowledge on the consumer. Nonetheless, other scholars believe that CRM can be helpful (Kumar 2010), but it is still ineffective as compared to CEM. Further, CRM is less effective because it is focused on getting information after the encounter instead of focusing on the actual encounter (Meyer andSchwager, 2007). As already mentioned in the previous section of this paper, most organization leaders recognize the importance of customer experience management, but they still refute the usefulness of its results (Schmitt, 2010). Meyer and Schwager (2007) explain the gap between the concept of customer experience and the managers. According to the authors, there are three main limitations or barriers that inhibit customer experience management in the companies. First, the questionable profitability of CEM is one of the limitations. According to Meyer and Schwager (2007), most of the organizations’ budgets are limited and most of the funds are used in customer relationship management instead of CEM. Even though everyone can agree that better and effective customer satisfaction enhances the value of the services, but does it pay off? Justifiably, the majority of the leaders want to understand how customer experience management is distinct and the value they can get from its data. Most of the executives fail to calculate the ROI of the customer experience. As a result, they fail to grasp the significance of the experiences and its relation to the business outcomes. However, as Meyer and Schwager (2007) assert there is a need to still relate to the concept of customer experience management to the managerial problems and the potential value it can generate for the company.
In addition, Meyer and Schwager (2007) noted that various organizational leaders lack a significant understanding of the consumer needs. Thus, leaders cognizant of the customer-facing functions have a high likelihood of making decisions referencing the experience of the customer compared to those lacking it. However, for managers who have been promoted or risen through engineering, finance, or manufacturing industries, they consider management of customer experience a role of marketing, sales, and customer service where no thorough thought is put.
Finally, Meyer and Schwager (2007) states that customer experience management can face barriers from the aspect that firms might fear the data outcome. In other words, claiming that the customer drives a business is easy without necessarily having data that justifies such a statement. Consequently, Meyer and Schwager (2007) argue that similar corporate leaders who examine the other way when the organization and customer diverge may not be able to understand the gap between forecasted and actual revenues. All these types of challenges have reduced firm’s chances of achieving customer experience management an aspect critical to management and marketing strategies.
Customer Journey
In McKinsey quarterly issued in June 2009, David Court and co-authors introduced a new concept “consumer decision journey (Edelman 2010).” According to the results of this research (Edelman 2010), current consumers take an iterative journey consisting of four stages in narrowing down buying power. In particular, the four stages include consideration, evaluation, purchase, and finally enjoy, advocate, bond (Edelman (2010). In the first stage of consideration, the consumer makes initial consideration of the set of brands and hence the experience is dependent on prior encounter or recommendation. Secondly, the evaluation stage refers to the level where the consumer is actively engaged in seeking information and evaluating options available. The evaluation stage is followed by the point of purchase, which creates the opportunity for the customer to develop an open-ended relation with the brand. According to Edelman (2010), at this stage, the customer can be engaged and share their personal experiences with their friends.
The concept of “customer journey” can be understood as the experiences or “touch points” that the customers have with the company and its brand. Meyer and Schwager (2007) explain that the actual customer experience and customer journey are two concepts that are closely intertwined. Customer experience refers to both direct and indirect contacts existing between the consumers and the organization. Direct contacts depict those emanating from consumers such as use, purchase and service. On the other hand, indirect contacts are contacts that the firm started got from word of mouth or advertising. Both direct and indirect contacts help in creating the customer journey as a whole as well as the counters, which together determine the consumers’ perception of the brand. Therefore, the customer encounters do not solely include the directly controlled ones like advertising, purchase, and service; and neither does it include the indirectly controlled ones such as reputation, reviews, or word-of-mouth (Verhoef et al. 2009).
The ownership of the encounters can be determined through who has control of the touch points. For example, brand-owned touch points are considered to be controlled by the organization. The encounters that are controlled by the organization include the brand-owned media (advertising) and brand-controlled elements such as product, packaging, and service (Verhoef et al. 2016). Other classifications include consumer-owned encounters and partner-owned encounters where the latter represents components collectively controlled and managed by the firm and other stakeholders such as marketing agencies or retailers. On the other hand, consumer-owned encounters include the events or experiences that the organization and its partners do not have control over. Verhoef et al. (2016) stated that some of the consumer-owned encounters include social media, reviews, and word of mouth. In their research, Meyer and Schwager (2007) would further report that while the encounter between the consumer and the brand influence the customer’s journey, the expectations of the consumer also plays a critical role. Therefore, the expectations of the customer are developed from their previous experiences with the organization’s services. According to Meyer and Schwager (2007), ever-new customer experience is instinctively compared with their previous encounters and justified accordingly. Further, customer’ personal situation, market conditions, and the competition are other factors that can influence the expectations and influent the customer journey.
Implementing CEM into the customer journey
Rawson, Duncan, and Jones, (2013) explain some of the requirements that need to be considered when customer experience management is implemented into the customer journey the emphasis being a single touch point are insufficient. Further, Rawson et al. (2013) reports that what is of importance is the fully journey. As an outcome, the focus changes from the touch point to journey orientations. Ironically, despite touch points being considered to be highly significant interaction moments between an organization and consumers, firms still have a tendency of having much of their focus on touch points only. What this means is that concentrating on touch points maximum satisfaction could be critical in developing a twisted image where consumers become more satisfied with the firm’s operations than the reality. Rawson et al. (2013) further assert that it can draw focus away from the bigger, especially to picture the customers’ end-to-journey.
Companies need to manage the cumulative experience across all the touch points and stop emphasizing on a single transaction (Rawson et al. 2013). However, implementing the changes across the company can be significant, but it is also challenging. Rawson et al. (2013) assert that organizations that analyze the journeys of consumers while ensuring they redesign the service processes can increase productivity and competitiveness. Nonetheless, the greatest challenge for firms remains in successfully developing a customer journey from customer service experience management without cross-functional disconnections and lack of consumer journey map.

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