Horizontal Experience: what is it and how can companies benefit from it?
With customers becoming less patient with companies across the world, discover what the 'horizontal experience' is, and how companies can benefit from it.
Last updated May 31, 2023
It’s no secret that customer experience is now influencing the way many companies operate. Adopting a customer-first mindset is no longer an option, but has now become a critical differentiating factor for businesses across the world. And the companies who listen to their customers are reaping the benefits, even in this challenging economy. In fact, according to our CX Trends Report 2023, seventy four per cent of European leaders witnessed a positive ROI after investing in their CX over the past 12 months.
Interestingly, from multiple conferences and roundtable discussions I have attended and moderated over the past few months, I have seen a common trend arise. In fact, business leaders are becoming increasingly more concerned in the perception a customer has of their own experience, and what that means for their future purchases, especially in comparison to their competitors. Because of this, I started addressing this topic at conferences more frequently, which captured the interests of our customers and many businesses across Europe. So, I decided to formalise this concept in this article: the Horizontal Experience.
The horizontal experience is a concept that concerns the perception and expectations of customers regarding the quality of their experience offered by a specific company, and how other companies compare to the said experience. When a customer has a positive experience with a company, they automatically tend to compare other experiences with the said experience, and will require the same level of service in all sectors and areas–if not better.
It’s a phenomenon that has important implications for customer marketing and loyalty strategies, as it requires companies to adapt to increasingly high customer expectations. And for companies who can’t show flexibility to their customers’ needs, it could very well mean that some of their customers’ might switch to other companies. At least that’s the case for sixty eight per cent of customers after experiencing multiple bad experiences.
Higher expectations for online experiences shaped by companies
A great example of horizontal experience is how Amazon, the e-commerce giant, has imposed new standards of efficiency, convenience, and personalisation on the entire eCommerce industry. Customers who buy their items from Amazon know they can expect to receive the product quickly–sometimes even within a couple hours–and can easily return their items if they experience any issues. And, once accustomed to this level of customer experience, many users now inevitably compare every other online purchase experience with those offered by the American giant. So, keeping up with your competition in terms of super customer experiences will be vital for many, if not all, businesses across the globe.
Netflix serves as another example of superior online experiences, as the platform has revolutionised the way audiovisual content is consumed. Those who subscribe to Netflix can access a vast and varied amount of content, such as films, TV series and documentaries. On top of that, consumers can choose when to watch them (uninterrupted with ads), and download them to watch offline. Netflix’s case has set new standards for other streaming platforms and customers won’t accept a lesser quality online experience.
The public sector is catching up with the latest expectations
The same goes for the public sector, where significant progress has been made in recent years in terms of digitalisation and implications of services. For instance, Germany has passed an Online Access Act (OZG), which will allow citizens to have a single account through which they can easily access federal, state, and local services.
And, it’s now possible to book medical visits online, pay taxes with a single click, and request a document without waiting hours in line. These innovations have improved the quality of life of citizens in many countries, but have also raised the level of demand towards public administration. Those who have experienced the convenience and speed of these services no longer accept long lines or being transferred to multiple customer service agents without ends.
On top of that, while we’re used to having easier experiences within the private sector, the public sector’s innovations have set the bar higher for private companies. If a customer can benefit from an easy online experience for a public service, why would they accept any less from private companies?
It’s no longer just about being competitive in one sector
So, we saw that a horizontal experience relates to when consumers compare the positive experiences they have with a certain company to another–even when they belong to different sectors–which often leads them to demand the same standard of quality, personalisation, and satisfaction from another company. And it’s a phenomenon that is changing the way businesses are operating and competing in the market. A business can no longer solely rely on its distinctive characteristics or on the specific expectations of its sector, but must confront the best practices of their competitors and substitutes that offer excellent customer experiences.
This means that companies must be competitive not only with their direct competitors but also with indirect or transversal ones, which operate in different sectors but influence customers’ habits and preferences.
For example, if a customer uses an e-commerce platform that offers fast delivery, easy product returns, and efficient support, they will expect to receive the same treatment from an airline, bank, or insurance company. Even if these companies have different structural limitations due to the nature of their services or current regulations, the customer is not interested in knowing the details of their internal processes or customer experience systems. The customer only wants to have a satisfying and frictionless experience that saves them time, effort and money and gives them trust and security.
For this reason, companies must adopt innovative and personalised solutions that improve the customer experience at every stage of their journey.
The horizontal experience implies both a challenge and an opportunity for companies. On one hand, it requires constant investment in customer experience, in order not to lose ground compared to competitors or new entrants who can exploit their reputation or innovation to attract customers. On the other hand, it offers the opportunity to differentiate and retain customers by offering them a memorable experience that exceeds their expectations.
All this becomes even more strategic during a period of economic downturn. And while customer acquisition gets hard, it’s during these challenging times that customer retention becomes even more important, especially for your ROI. And when customers are satisfied, they become a lot more loyal, and will recommend your brand to their friends and family which will ultimately allow your business to thrive, especially during challenging times.