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This is an MIT Sloan Management Review article. Offering products or services alone is no longer enough: Organizations must provide their customers with satisfactory experiences. Competing on this dimension means orchestrating all the clues that people detect in the buying process. Customers always have an experience--good, bad, or indifferent--whenever they purchase a product or service from a company. The quality of the experience lies in how effectively the company manages it--in all its facets and from beginning to end. Organizations that simply tweak design elements or focus on improving isolated pockets of the customer experience--by providing a quick hit of entertainment, for example--will be disappointed in the results. An organization's first step toward managing the total customer experience is recognizing what the authors call clues: the signals or messages given off by everything involved in the buying process. Clues can include the product itself (Does it work as advertised?), the layout of a retail outlet (Are the signs easy to follow?), the salesperson's tone of voice (Did he really mean it when he said, "Have a nice day"?), and so on. Organizations that orchestrate the sum total of all the clues can create an optimal experience for their patrons. Addressing the clues that speak to emotions is especially important. Emotional bonds between companies and customers are difficult for competitors to sever. The internalized meaning and value that the clues assume can create a deep-seated preference for a particular experience--and, thus, for one company's product or service over another's. Discusses the tools that are available to help organizations rethink the signals they are sending to customers. Presents two case studies in which organizations dramatically improved their customers' experiences.

Molson Canada produced Molson Canadian, Canada's best selling beer. Canadian's previous advertising campaign The Rant had been incredibly popular making it one of the most successful ads for Molson in a long time, and winning numerous international and domestic advertising awards. The marketing team for Molson Canadian had to find the theme for the next advertising campaign, and must decide whether to move towards more traditional beer advertising or maintain the non-traditional them of The Rant. (A 9-minute VHS video is available, product 7B01A025 containing Molson's and Labatt's advertisements.)

Brodie Keast is anxious to understand the sharp contrast between the inertia of prospects and the deep emotional response shown by converted users of TiVo. After an overview of the company's situation and problems, the case focuses on different kinds of data (sales results, satisfaction and usage data, purchase influence, demographics, attitude data, and behavioral data) and explains how that data emerged over time as the company was more and more pressured to explore the essence of its value proposition.

This case reveals the genesis of the Apple Stores, a revolutionary retail concept launched by Ron Johnson, Apple Computer's senior vice president of retail. In January 2002, Apple Computer was at the eve of one of the most stunning commercial successes ever known in consumer markets. The case details how the retail strategy emerged as a keystone of Apple's overall strategy to support the digital lifestyle of its customers. By analyzing the stores' most innovative elements and discussing the implied management challenges, students reach a deeper understanding of the multi-faceted role of distribution channels in contemporary marketing. The case is an ideal vehicle to understand how the different stages of the marketing process (analysis, strategy, implementation) can be tightly integrated for maximum impact. It also raises interesting issues in consumer behavior: the processes of consumer engagement, empowerment, and conversion to purchase.

Molson Canada produced Molson Canadian, Canada's best-selling beer. Canadian's previous advertising campaign "The Rant" had been incredibly popular, making it one of the most successful ads for Molson in a long time and winning numerous international and domestic advertising awards. The marketing team for Molson Canadian must find the theme for the next advertising campaign as well as decide whether to move toward more traditional beer advertising or maintain the nontraditional theme of The Rant.

Microsoft is preparing for the launch of the Tablet PC, which allows users to use a pen (stylus) to run Windows and Windows applications, annotate documents, and create handwritten documents for later reference or even conversion to text. Microsoft's original equipment manufacturing partners are developing the Tablet PC hardware, while Microsoft develops the software (the Windows XP Tablet Edition). The Microsoft Tablet PC team is grappling with two critical issues related to the final marketing plan. The first concerns the positioning of the Tablet PC. One option is to position the device as a radical breakthrough in computing technology that will dramatically change the role of computers in the workplace and home. A much more conservative option is to position the Tablet PC as merely a high-end laptop with several interesting new features. The second concerns the initial target market for the device. Includes color exhibits.

The Museum of Fine Arts in Boston and Fleet Financial Group's sponsored the Monet in the 20th Century exhibition, the world's largest, in 1998. The case chronicles the solicitation of a large corporate sponsor, as well as the growth and development of their partnership. Includes color exhibits.

Consumers are finding it hard to distinguish among competing products. The fault lies partly with marketers and ad agencies, but ultimately it's the CEO's job to stop brand dilution.

In early 2001, makers of AIDS drugs were suing to prevent developing countries from violating their patents. The issue was driven by price. The developing countries could not afford the market price for these drugs. At the same time, the drug companies were reluctant to sell drugs at or below cost in one country and at 10 to 20 times cost in another country. Using a series of published articles, this case outlines the pressures facing the drug companies and asks the question, "How should they respond?"

Emphasizes the gradual, two-dimensional gradients between commodities and specialties. Provides a new way to improve the profit margins of commodities.

Focuses on the coordination of marketing and sales--two functions that seem alike but are, in practice, difficult to integrate. Briefly explains the challenges to coordination and provides some solutions.

Explains the opportunities and limitations of using performance-based pricing in which the price paid is a function of the quality provided. Includes application guidelines.

iVillage.com was a successful Web site that served as a point of entry to numerous sites (or channels) targeted to a female audience. With a solid strategic vision and a network structure that provided consistency and control of the customer experience, the founders were rewarded by the site's favorable online presence. The company's business strategy relied on creating revenue through sponsorship and advertising. As the marketing industry had identified women as their single largest target category, iVillage.com had little difficulty in successfully pursuing innovative sponsorships and creative advertising. The pursuit for women's buying power also meant, however, that iVillage.com faced competition -- for both audience numbers and advertising dollars -- from numerous online and offline businesses. More women were accessing information online, driving the demand for more sophisticated Web sites. At the same time, iVillage.com needed to capture the audience that was currently offline and those who were about to move online. The founders must determine how to proceed in the face of increased competition, and how to achieve profitability.

Jim McDowell, VP of marketing at BMW North America, is debating how to follow up the success of his latest marketing campaign, "BMWFilms." This campaign features five short films for the Internet, directed by some of the hottest young directors in Hollywood. By all indications, the nontraditional campaign has been a huge success. Now the question is, what to do for an encore?

Spreadsheet supplement to case 502-046.

The case examines Adidas' program to improve overseas labor practices, and their handling of the threat of protests at the Euro 2000 football championship. The case is interdisciplinary and incorporates aspects of marketing, organizational behavior, and microeconomics.

Canadian Tire is a large retailer of automotive, hardware, and houseware products. As part of the company's marketing strategy, the executive director of corporate affairs is reviewing four social marketing programs and must decide which program the company will adopt. She must analyze each of the social marketing programs and assess how the program will contribute to the company's competitive position. She also needs to convince the company's independent associate dealers to adopt and implement the chosen program.

H-E-B is a $9 billion grocery chain located in Southwest Texas. This case focuses on H-E-B's private label strategy, a product category that accounts for 19% of H-E-B's sales and one that earns gross margins 50% higher than national brands. A leader in its markets, H-E-B is faced with increasing competition, especially from Wal-Mart, which has aggressively entered the Texas markets with a series of "supercenters." Although the case specifically focuses on H-E-B's Own Brands (private label), it more broadly raises important strategic questions regarding H-E-B's ability to compete effectively in this new market environment. Includes color exhibits.

Set in 2002, this case looks at the potential for hybrid electric vehicles in the United States. Looks at the pressures on the automotive industry to produce a commercially viable, environmentally friendly vehicle and the consumer behavior surrounding purchase of those vehicles. Traces efforts over the years to produce electric vehicles, hybrid electric vehicles, and fuel-cell vehicles. Presents the questions of whether and why hybrid electric vehicles will succeed where other alternative-fuel vehicles have failed.

Customer relationship management is one of the hottest management tools today. But more than half of all CRM initiatives fail to produce the anticipated results. Why? And what can companies do to reverse that negative trend? The authors--three senior Bain consultants--have spent the past 10 years analyzing customer-loyalty initiatives, both successful and unsuccessful, at more than 200 companies in a wide range of industries. They've found that CRM backfires in part because executives don't understand what they are implementing, let alone how much it will cost or how long it will take. The authors' research unveiled four common pitfalls that managers stumble into when trying to implement CRM. Each pitfall is a consequence of a single flawed assumption--that CRM is software that will automatically manage customer relationships. It isn't. Rather, CRM is the creation of customer strategies and processes to build customer loyalty, which are then supported by the technology. This article looks at best practices in CRM at several companies, including the New York Times Co., Square D, GE Capital, Grand Expeditions, and BMC Software. It provides an intellectual framework for any company that wants to start a CRM program or turn around a failing one.