Business growth
Why the last moment matters more than the whole experience
People do not remember an experience as an average of every moment. They remember its most intense point and how it ended, which Daniel Kahneman called the peak-end rule. For a smaller business, that means you do not need to be excellent at everything, only deliberate about two moments.
By David ElliottBSc FCA, Founder & Managing Partner
I read an interesting article in The Sunday Times last week, written by Emma Woods, a former chief executive of Wagamama. She described a trip to Tokyo that had left her unsettled and frustrated by what she saw as the over-adoption of technology. Faced with rocketing costs, Japanese restaurants have automated almost everything: ordering by iPad, seamless payment, and not a single human interaction from arrival to departure. The food was good, she commented, but something else was missing.
By way of contrast, she recounted a recent journey by train, the 7.40am from Redhill to London Victoria to be precise. The guard on the train was a real character, exuding enthusiasm in everything he did. He announced every station with such warmth and humour that passengers left the carriage smiling. It made Emma recall a book she had read, Daniel Kahneman’s “Thinking, Fast and Slow”, and in particular the “peak-end rule”. As business owners, it is worth us understanding that rule properly, because it has direct implications for where we should spend our limited time and money on customer experience.
What the peak-end rule actually says
Kahneman’s research, much of it conducted with Barbara Fredrickson in the 1990s, found that we do not remember experiences as an average of every moment within them. Instead, we remember two points: firstly, the most intense moment, and secondly, how the experience ended. Everything in between is largely discarded by the memory.
A meal with one brilliant course and a rushed goodbye is recalled quite differently from one that was pleasant throughout but tailed off flatly. The middle barely registers. The peak and the end are what we remember, and they are what we base the memory of the whole experience on.
Why this is good news for a smaller business
For a small or medium-sized business, this is genuinely good news, because it means you do not need to be excellent at everything. Emma’s train guard did not need to fix Southern Rail’s punctuality record. He needed one thing, which was to make the final thirty seconds of a routine commute feel personal.
That is a far cheaper problem to solve than “be flawless throughout”, and it is one within reach of businesses that cannot compete with a big retailer’s budget or a hospitality chain’s training academy.
Find the two moments that matter
The practical task is to map your own customer journey and find two points on it.
For a hairdresser, the peak might be the moment a client sees the finished cut in the mirror, and the end is the goodbye at the till. For a business-to-business services firm, the peak could be the moment you solve the client’s actual problem, not just deliver the contracted output, and the end is the handover email or the final call.
Most businesses pour disproportionate effort into the middle bit, the process, the paperwork, the standard procedure, while leaving the peak to chance and treating the ending as an afterthought, a rushed invoice or a generic sign-off. That is precisely backwards, according to Kahneman’s findings.
Be deliberate, not hopeful
It is worth being deliberate about this rather than hoping it happens. Ask your team two questions. What is the one moment in our service that we could make disproportionately good? And, separately, what does the very last interaction with us look like, and does it feel considered, or does it feel rushed, mechanical and delivered without real interest?
You do not need a grand gesture. Emma recalls a chef reopening a mothballed kitchen during Covid so that a dying teenager could have her favourite katsu curry one last time. A gesture like that is a powerful story precisely because it is rare. The train guard’s warmth is the more useful model for most businesses: small, repeatable, low-cost, and done consistently by someone who has been given the space and encouragement to do it.
The hidden cost of automating the first rung
That last point connects to the wider worry in Emma’s article, and it is one that should concern any business owner thinking about automation. As self-checkouts, QR-code ordering and AI-driven service replace entry-level roles, we are not just removing jobs. We are removing the shop floor as a training ground, where people learn to read customers and discover they are good at it.
She argues that many great operators started as an 18-year-old who unexpectedly turned out to have a gift for people. If you automate away that first rung, you also automate away your own pipeline of future managers, the ones who instinctively understand the peak-end rule because they lived it, rather than learning it from a textbook.
It applies to your team, not just your customers
The same logic applies to your staff. Employees remember the peak of their time with you, being trusted with something important, or a moment of genuine recognition, and they remember how it ends, an exit that feels respectful or one that does not. If you want people who care enough to create memorable moments for customers, they need to have experienced a few themselves.
Where to start
Before you invest further in automating friction out of your business, it is worth doing a genuinely honest audit: where is our peak, where is our end, and who currently owns making both of them good? Getting that right costs far less than most customer-experience initiatives, and Kahneman’s research suggests it matters more than almost anything else you could spend the budget on instead.
Frequently asked questions
What is the peak-end rule?
The peak-end rule is the finding that people judge an experience largely on two moments, its most intense point (the peak) and how it ended, rather than on the average of the whole thing. The parts in between have far less effect on what we remember.
Who came up with the peak-end rule?
It comes from the psychologist and Nobel laureate Daniel Kahneman, with research carried out partly with Barbara Fredrickson in the 1990s, and it is popularised in his book “Thinking, Fast and Slow”.
How can a small business use the peak-end rule?
Map your customer journey, identify the single moment you could make disproportionately good (the peak) and the very last interaction a customer has with you (the end), and put your effort there rather than spreading it evenly across the whole process. It is usually cheaper than a broad customer-experience programme and has more effect on what people remember.
Does the peak-end rule apply to employees as well as customers?
Yes. People remember the high points of their time with an employer and how their time ended. If you want staff who create memorable moments for customers, it helps for them to have experienced a few good ones themselves.
Based on an article by Emma Woods, “We may be dismantling a career ladder for young people”, The Sunday Times.