Customer Experience, Sales, and Distribution
Customer experience, sales, and distribution tests how value is delivered after the promise is made. The exam covers journey design, service quality, sales pipeline discipline, channel structure, and the economics of route-to-market choices.
Core rules and concepts
- CX: map the customer journey across touchpoints; measure CSAT (transactional satisfaction), CES (effort), and NPS (relationship loyalty). No single metric is sufficient; link them to retention and economics.
- Service quality: SERVQUAL dimensions-reliability, responsiveness, assurance, empathy, tangibles. Reliability is usually the largest driver of perceived quality.
- Sales: manage the pipeline by stage with exit criteria; qualify on need, authority, budget, and timing; forecast using conversion rates by stage rather than optimism.
- Distribution: channel design balances coverage, control, cost, and conflict. Intensive distribution suits convenience goods; selective/exclusive suits premium or complex offers. Omnichannel requires consistent pricing and inventory visibility.
Worked example
A subscription box has an average order value of $120, four orders per year, a 30% contribution margin, and 75% annual retention. Annual contribution per customer is $120 × 4 × 0.30 = $144. A simple three-year CLV, retaining 75% each year, is $144 + $108 + $81 = $333. If acquisition cost is $100, net CLV is $233. The decision rule: a channel or campaign is viable if CAC stays comfortably below the net CLV after accounting for churn and service costs. A 5-point retention improvement raises the later-year terms substantially, so retention often outperforms acquisition spending.
Traps that cost marks
- Treating NPS as a revenue forecast.
- Optimizing a single touchpoint while the handoff between sales and service fails.
- Carrying “happy ears” pipeline deals without stage exit criteria.
- Adding channel partners without pricing and conflict rules.
- Choosing intensive distribution for a luxury or high-consultation product.