Liquid expectations

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Consumers are setting a different bar for experiences

This article originally appeared in the Economist in May, 2015 and was subsequently named a ‘best of 2015’ article by the Economist editors.

Written by:

Baiju Shah Managing Director for Strategy and Innovation, Accenture Interactive and Global Co-Lead, Fjord @baijushah

John Greene Chief Strategy Officer & Senior Partner, Translation @JSG


Only 62 percent of chief marketing officers think they are doing a good job in delivering relevant customer experiences, and less than half (49 percent) think they are even in charge of the customer experience, according to a recent Accenture study. These findings are particularly disconcerting, as superior customer experience is cited as one of the top drivers for completion of purchase and loyalty.  So why do so many marketing leaders feel that control of the customer experience is slipping from their grasp?

To a large extent, this development has to do with a marketing sea change we call “liquid expectations,” when customer experiences seep over from one industry to an entirely different industry. Consider how customers increasingly check the way their airline flight cancellation was handled against their most recent Zappos return, and compare their physician visit to a visit to the Apple Store’s Genius Bar.

As customer experiences with any product category affect how customers experience products in other categories previously thought to be unrelated, all businesses need to add new dimensions to how they understand and define their competitive strategy.

Traditionally, marketing has been focused on identifying and outdoing direct competitors or companies that offered products or services that were similar to their own. For instance, through this narrow lens, only manufacturers of mobile phones should have paid attention to the iPhone launch. But as manufacturers of point-and-shoot cameras and navigation devices now know, the threat from the iPhone was much broader.

Today, however, the threat of strategic myopia is greater than ever.  With the acceleration of technology convergence over the past ten years, experiential competitors have grown in importance. These businesses offer products or services that, while not physically similar to yours, offer an experience that effectively replaces yours.

Apple created an experience that challenges the entire industry of navigation devices without having actually built one. Similarly, Uber is not launching a physician’s clinic but their pilot of UberHealth, allowing house calls for flu shots, showcases a competitive experience that displaces a key use for walk-in pharmacy medical clinics.

By merely focusing on direct competitors, and even experiential competitors, companies still risk falling prey to the crisis of customer experience currently felt amongst CMOs.  Increasingly, your most important competitors are those we call perceptual: those competing to shape the expectations customers have for experiences in every category. For example, Uber’s checkout, which is as simple and seamless as shutting the car door, will reset consumers’ expectations for how convenient checkout can be in every industry, causing consternation as they stand in a queue at a store or wait for a server to bring the check.

Naturally, digital native businesses are subject to these same liquid expectations. For instance, users of ride-sharing services increasingly expect software-like accuracy from the service.  So when a car shows up three minutes later than it was supposed to, people blame the broker of the service and report a software bug, instead of considering the issue could have been caused by a traffic accident that happened only minutes ago. This is a good example of how the immediacy and accuracy of digital solutions are shaping expectations for even those services operating in the real world.

Across sectors, increasingly Liquid Expectations pose a broad and acute competitive threat. Only marketers who continuously re-shape offerings for shifting expectations can reclaim control of the customer experience, and foster loyalty and even passion for their services.

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