Category Archives: innovation

Big Data, customer experience, innovation

Ten customer experience predictions for 2015

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A crystal ball (with a pinch of salt)

It’s the time of year when people make predictions about the coming year. Here are my predictions about what customers will see differently in 2015.

I have based these on nothing more than some experience and conversations with interesting people, so take them with whatever amounts of salt you like.

Privacy will matter less than trust.

Customers will increasingly accept that companies will know more about us than we would like. But in return, we will want companies to prove even more that we can trust them with our data.

Mobile payments won’t fly in 2015

The new iPhone 6 includes the ‘Apple Pay‘ mobile payment facility. It is due to launch in the spring of 2015.

But it won’t have us all pay by mobile all at once.

Why?

Because the customer experience for card payments is still better than the mobile alternative.

Card out, put in reader, type in four numbers, done. Easy.

Mobile out, tap button to wake up phone, find payment app, confirm amount, confirm authorisation again, await confirmation of payment on phone, give up, take out cash…

And that’s not all. Not enough shops will take mobile payments, but they all take cards. They will need a compelling reason to change.

And, even if we want to pay by mobile, with dozens of payment apps available, the chances are that a given shop won’t take the specific app that’s on our phone.

As Google and many others have found, and as Apple is about to find, the business of payments is hard. This one is going to be slow, people.

Our buying experience will start to be simpler and more relevant

Want to buy something? There’s too much choice.

Any major decision – holiday, car, house, furniture, white goods, television, PC, phone, school – now needs detailed online research, investigation of reviews and trawling of social media.*  It’s so much work that that buying stuff now feels like it costs as much in effort as our research saves in money.

Many sites, such as those in the travel industry, can ask us for some preferences to simplify our journey by filtering choices, it is still a chore.

It is only a matter of time before some sites simply use our social identity, online behaviour, some statements of preference and history of other purchases to predict the best purchase solutions for us and offer a focused choice that’s right for us, based on who we are.

More than a search based on budget, distance from home, type of hotel preference and preferred flight times, this is a search based on what we genuinely want and like, evidenced by our behaviour.

This is, I believe, the kind of thing that will be enabled through the data gathering and machine learning capabilities of facilities like Google Now or Amazon Echo.  I think we will start to see these services being offered in 2015.

Before long, we won’t be typing in “…washing machine reviews…” when we want to think about replacing our white goods. We’ll simply muse out loud, in our living room:  “Alexa?  What washing machine would be best for me?”

We will start to see fresh food delivery online at scale from non-grocers

Building a distributed, refrigerated real-time supply chain to distribute fresh food is expensive and difficult. This has acted as a major barrier to entry for online players. It has kept traditional grocery supermarkets in the game and let them sell us all the other household stuff we need routinely.

But Amazon are starting to trial fresh food delivery and many consumers will begin to use them for their shopping. I think we will start to see the grocers’ monopoly on our weekly food shop starting to erode in 2015.

At least one traditional supermarket will experiment with a alternative models

Of course, traditional supermarkets are no mugs. They will experiment with new ideas to ‘lock in’ our weekly shop and keep it away from online pretenders. Tesco already have a subscription model for online delivery charges. I would be surprised if they, or their competitors, didn’t come up with an alternative. A single monthly subscription that delivers a weekly food shop, for example?

Health insurers will offer discounts for customers to upload their health data activities.

This one is, I think, already happening. Wearables, and the health monitoring facilities offered by the iPhone 6, all gather data about our long-term lifestyles.

Health insurers are beginning to incentivise us to upload this data to the cloud. Health insurers will analyse this data and give us bespoke cover at tailored premiums. And we will like it. (unless we’re fat, or sedentary, in which case our premiums will shoot up).

Wearable tech will cause at least one Big Data / privacy scandal

Wearables are probably the first tech innovation designed from the ground up to enable ‘Big Data. Just by wearing a watch or wristband, our movements yield long-term telemetry data.

Where we go, what we do, who we meet, what we are interested in, when we do things, how we get there, what we buy, how we pay and who we tell – this so-called ‘digital exhaust’ trails behind us as we live.

This data is so complex, so large and so intimate that it will not be possible to protect it fully, certainly not at the start. Sometime in 2015, we will have the first leakage of such data and what it will reveal about what is known about us will be scary.

Buyers of customer experience management software will get wise to the idea that there is no such thing

The notion of customer experience has become polluted by vendors selling ‘customer experience software’. There ain’t no such thing.

Leading, managing and operating an organisation to offer a good customer experience is not about software. It is a matter of principle, strategy, practice and attention. I expect that more companies will understand this in 2015.

Banks will claim to be customer-centric but scandals will continue to disprove this idea

Banks will continue to try and show that they have genuinely changed their stripes. That they have,learned the error of their ways and are driven by the interests of their customers.

But I fear that this hope will founder, for two reasons. First, a typical bank IT system is a messy legacy stack that is hardwired around products, not customers. These systems are too big and too complex to change without eye-watering expense.

Second, the majority of banks continue to reward their people to focus on short-term revenues for the bank, regardless of the interests of the customer. Because these rewards are so big, they will continue to distort banker behaviour away from the customer.

This toxic culture is so ingrained that it will take a generation to fix – so while I have little hope of customer-centred progress in 2015, I feel sure that more banking scandals will emerge.

Some brands will begin to function as marketing algorithms

The lines between ‘pure’ marketing and customer experience continue to blur. Marketers have been trying for years to personalise their messaging to individual consumers. I think this year, we will start seeing the first marketing content, bespoke for individual customers, automatically generated by what marketing systems know about each customer.

What will make these communications different? They will be driven by specific parameters that properly reflect the intent of the brand.

The content of marketing emails may be different, depending on what else they know about us. (Depending on the ethics of the company, this could  be much more than just the information we gave them when we opted in for their marketing – assuming we did at all).

While the content of all these emails may be different for EVERY customer, each will reflect the presentation, tone of voice and content of the brand. The brand will have become an algorithm, driving content.

What are your predictions?

So these are my predictions for the year. Things will, I think, get better in incremental ways for the customer as more companies recognise the competitive advantage this gives them.  We’ll see a few new things, and some ideas will fail (and that’s ok, failure is the overhead of innovation and the cost of progress) and a number of things will surprise us.

What do you think? What do you predict customers will see differently in 2015?

*The link takes you to a cool interactive tool by Google that shows how the purchase journey varies for customers in different market segments and countries. Fun to play with (if you like that kind of thing).

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complexity, CRM, innovation, Management fad, Transformation

Is transformation doomed?

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The very nice folk at HP Business Value Exchange asked to me write a piece on transformation.  What emerged wasn’t really what they (or I) expected – but, very sportingly, they posted it anyway.

Transformation – to take advantage of Big Data or introduce cloud-based CRM or adopt Lean thinking or any of the other fashionable buzzword bingo terms –  is big business.  If we embark on a transformation initiative, we should be clear about whose agenda we are following if we are not to enter a world of pain.

Read more here. I’d really like to know your thoughts, so please add your comments there when you read it.

customer experience, innovation, Stuff I like

Five customer experience lessons from fringe theatre

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Stage set of The Bevellers, Citizens Theatre, Glasgow, 2007

The fringe of experience

A long time ago, I directed a range of fringe theatre productions.

As a training ground for management or innovation, it could not be bettered. Consider what we had to do: select a cast and crew, motivate them around a vision, handle multiple egos under stress, capitalise on a diverse range of talent of every sort, generate and build on new ideas, conduct marketing, PR and sales campaigns and deliver something which we hoped would be wonderful.

And all by a fixed and imminent deadline: first night.

A Brazilian challenge

One production required that we interrogate a reformed murderer in a Brazilian police cell, have a dinner party in a Sao Paulo penthouse, attend a US evangelical revival at a jungle plantation, and have helicopter gunships attack a native village in the Amazonian rainforest.

Did I mention this was fringe theatre?  Our vision may have been limitless but our budgets were trivial. And so we struggled as the scale of our vision foundered on the rocks of penury.

A change in perspective

In first weeks of rehearsal, we focused on the script and tried to think of ways of making the production real.  But we got nowhere.  The cast was frustrated, the crew even more so.  People were fractious and unhappy.

First night loomed like an iceberg in the night, getting ever closer.

Then, in a blinding flash of the obvious, everything became much easier.

What was different? We stopped thinking about making the production real.

Instead, we started thinking about the experience which we wanted our customers, the audience, to have. What did we want them to feel? To think? To take away?

Thinking like this, from the audience in, rather than from the production out, unlocked our creativity.  Suggestion, not realism, became our driver.

  • The prison cell became one man lit by a single light in the darkness, shining through bars.
  • We painted the black interior of the studio theatre – set and auditorium – with foliage and vines like a jungle so that the audience entered the rainforest as soon as they came through the doors.
  • We placed the dinner party table on a dais in the middle of the stage and lit the background dimly so that the rainforest was only hinted in the shadows.
  • For the plantation, we lit both the dais and the rainforest, placing it in the jungle.
  • And we turned the lights of the helicopters onto the audience and played the sound of machine guns with the bass turned up to insane levels so the audience heard gunfire through their ears and felt it through the floor.

Total cost of the set? £200.

We opened on first night with a slick, professional production that was very well received.

Innovating success

Five lessons from my theatre experience have stood me in good stead in business and innovation ever since.

  • The greatest creativity comes from the greatest constraints.
    Three things govern all projects: time, cost and performance.  If time is fixed and costs are limited, then the only way to achieve breakthrough performance is through creativity and innovation.  Having limits drives creativity.
  • Think from the customer inwards, not from the product outwards.
    We only got traction once we started thinking from the audience inwards.  Our only arbiter of success is the effect on the customer, not the features of our product. What do we want the customer to think, to feel, to take away? Having these as our goals frees us to be creative.
  • Recruit for attitude and energy.
    We chose people for our production not only for their talent but for their enthusiasm and willingness to try.  We only succeeded because all of us – cast, crew and production – contributed to the creative process. As a result we generated many more ideas than we could use, so we could pick the best ones.
  • Leadership is about trust.
    The Director may have a vision for a show, even if s/he does not quite yet know how this vision will be realised.  The Director has to trust the cast, crew and production team to come up with good solutions to the many, many unanswered questions with which any production begins.   They in turn have to trust the Director to make the right decisions about which ideas will work. And it is only by trusting each other that they find ways to make them work.
  • Nothing drives creativity more than urgency.
    First night is a fixed and unforgiving deadline.  Such deadlines offer an imperative focus for a team.  Knowing that a deadline is real, and that it matters that the deadline is met, drives the delivery of new ideas better than anything else.

In my experience, when these drivers have been in place, I have only ever seen business innovation projects succeed. Where I have seen innovation failure – or deliver mediocrity, which is worse – one or more of these factors has been missing.

Always.

How about you?  If you are innovating for customers, do you recognise these? Let me know what you think.

(Image credit:  Blurredyvonne at en.wikipedia, under the Creative Commons Attribution-Share Alike 3.0 Unported license).

Big Data, complexity, customer experience, innovation, Marketing, Strategy

Big Data is already here

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vorratsdatenspeicherung-540x304In my earlier post, How Big Data will Change Marketing (part 1),  I offered a definition of Big Data.  Here is a brilliant example of what it looks like.

A life revealed

Malte Spitz is a member of the Bundestag, the German parliament.  He sued mobile operator T-Mobile to get their records of his cell phone activity for a six month period in 2009.  It came in an Excel spreadsheet with 35,851 rows.

Zeit Online, the digital imprint of Germany’s top-selling weekly newspaper, Die Zeit, combined this data with other information about Hr. Spitz’s life which they gleaned from social media and publicly available online sources.

The result was illuminating.

To quote Die Zeit:

“Each of the 35.831 rows of the spreadsheet represents an instance when Spitz’s mobile phone transferred information over a half-year period. Seen individually, the pieces of data are mostly inconsequential and harmless. But taken together, they provide what investigators call a profile – a clear picture of a person’s habits and preferences, and indeed, of his or her life.

This profile reveals when Spitz walked down the street, when he took a train, when he was in an airplane. It shows where he was in the cities he visited. It shows when he worked and when he slept, when he could be reached by phone and when was unavailable. It shows when he preferred to talk on his phone and when he preferred to send a text message. It shows which beer gardens he liked to visit in his free time. All in all, it reveals an entire life.”

To model what they mean, Zeit Online produced this interactive map.

This is Big Data in practice.

I will leave it to other commentators to discuss the political, legal and ethical issues raised by Big Data.  I am going to assume, instead, that it is here to stay and that it will increasingly affect our lives.

In my next post, I will develop further some ideas about how Big Data will affect Marketing.

Tip of hat to Roland Harwood of 100% Open for the original Die Zeit article.

Image credit: Zeit Online

CRM, customer experience, customer strategy, innovation, sales, Strategy

CRM can be fun. No, really.

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Finish line.Thinking about CRM (Customer Relationship Management) from the sales team’s point of view has stimulated some interesting new possibilities.

I once oversaw the transition of a B2B CRM system from a locally installed brand name system to a market-leading cloud-based competitor.  The old system had limped along with inaccurate data, incomplete records and resentment by the sales team.  People saw it as something that could not be trusted, an overhead that  got in the way of sales and marketing.

We were not alone, as Ben Meredith points out in a recent post.

When we came to implement the  new system we had one primary principle: it had to work for the sales team.  This meant that it had to be exceptionally easy and attractive to use, relevant to their roles, with clear triggers for when and how it was to be updated. All other requirements were secondary.

The outcome? An almost seamless transition within six weeks and excellent adoption.

Results? Better accuracy of data, trustworthy analytics and sales forecasting. Better marketing, easier sales, improved customer relationships. Everything we wanted our CRM system to deliver.

These results happened only because we paid attention to the core challenge: whose job are we trying to make better?  For most CRM implementations, this will be the sales team. Get it right for them, and things will get better for the customer too.

Which is why I like the thinking of app developer LevelEleven. Their newly rebranded Compete app adds game elements to Salesforce.com to help drive sales team performance. Their real trick, of course, isn’t the app, but the psychology: good sales teams thrive on competition.

CRM as fun? That can’t be bad.

customer experience, customer strategy, innovation

Clayton gets it right

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Clayton_Christensen_World_Economic_Forum_2013In this interview, Clayton Christensen spells out some ideas which are so right that they almost have the force of Laws for Business.

Clayton Christensen is the godfather of innovation. His books define how people think about innovation, education and disruption (and more recently, values).  Strategy + Business, the management journal from Booz and Co., published a great interview with him here.

In it, he says two things that ring so true that I think they deserve to become laws of business, especially when looked at through a customer lens.

The first concerns decision-making:

“When you make a decision based on expediency—because you think you can get away with paying only a smaller, marginal cost—you always pay the full cost in the end.”

He’s talking here about our personal lives, but it applies in spades in the customer world.  The contact centre which drives agents to keep calls as short as possible for cost purposes almost always pays a higher eventual cost in terms of customers calling again, customer dissatisfaction, agent retention and customer churn.  The website which skimps on early customer testing during the design phase will almost certainly have to spend a fortune in redesign once it goes live and customers don’t like it.

So, if I may, Christensen’s First Law:

If you skimp on things early, you pay much more later. Every time.

The second quote is more substantial, but even more fundamental:

“You might also ask, “What is the job to be done?” Every company needs a robust theory of the job that it’s facing. At the fundamental level, most jobs don’t change very much, even though the technology does. When he was the emperor of Rome, Julius Caesar had to exchange messages rapidly with his far-flung governors. He used horsemen with chariots. Today, we have FedEx, but the job hasn’t changed. If you’re focused on the job that has to be done, you’ll be more likely to catch the next technology that does it better. If you frame your business by product or technology, you won’t see the next disruptor when it comes along.”

Who is doing “the job?” The customer.

And so to Christensen’s Second Law:

Focus on the job to be done or you’ll be beaten by someone who does. 

It’s a short interview, but full of good things.  Read and enjoy.

(Tip of hat to Petrina Alexander, who first drew my attention to the article).

(Image credit: Remy Steinegger, World Economic Forum under Creative Commons License)

Ambition, customer experience, cycle time, innovation, Lean, Stuff I like, Transformation

The customer revolution begins…at start-up

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Customer rockLean Start-Up methods offer an overwhelming case for working with customers as early in the product cycle as possible. This lesson applies to all of us, not just start-ups.

Eric Ries, the author of Lean Start-Up, worked with Steve Blank while he was forming his ideas.  Steve has just posted on the HBR blog a phenomenal summary of the lean start-up approach and why it, as he says, “…changes everything.”

Lean start-up relies on a number of tools – experimental design, minimum viable product and so forth – but if I read him right, one of the central concepts which makes it work is this: the only authority is the customer.

This idea runs through the process like a name through a stick of rock.  Involving the customer in the design process, getting to customers early, behavioural (A/B) testing – the whole lean start-up gamut begins with the customer and how propositions can only succeed if they are designed with and for the customer from the get-go. At all stages, the primary decision driver is what the customer tells us (or better, shows us).

Build it like this, and the customer experience is not an overlay to be applied afterwards, nor is it something ‘fluffy’ or intangible or unimportant – instead, the proposition and the customer experience become the same thing.

Even more interesting is the lean start-up promise that doing things this way will get our propositions to market MUCH more quickly and (probably) more cheaply than the alternatives.

Thinking this way changes everything.

Does it apply only to start-ups?

I don’t see why. Are there really any barriers stopping the rest of us from applying these ideas in our organisations right now?

I didn’t think so.

customer experience, innovation, Multi-channel, Stuff I like

The Case of the Cashless Customer

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ImageAs some of you may know, I have spent a little time in the arcane world of mobile payments.  Dave Birch is one of the good guys in this space (an excellent mix of enthusiasm and scepticism in equal parts).  In this piece, he shows (with tongue firmly in cheek) what happens when new technologies hit the market but the preferred customer experience is still being worked out.

All you need to know is that he doesn’t want to pay with cash. If you like this kind of thing, read on…

 

customer experience, innovation, Multi-channel, sales

What’s the difference between sales and service? Nothing.

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Call centreWhen a customer expresses a need, then a failure to sell to that need is a failure of service. Thinking about sales as a service opens the door to genuine alignment of customer experience.

A long time ago, I spoke to someone who helped set up the contact centre for a new retail bank.  He explained that the philosophy of this bank was different from any other than in operation in the UK. Its aim was to help customers and give them a good experience.

I was intrigued when he explained that for the contact centre this meant not distinguishing between sales and service. The same agents handled all customer queries, including selling new products to the customer .

“Surely,” I said, “this has to compromise the customer experience?  When I, as a customer, need help, if agents try to sell me stuff when I call I will get annoyed very quickly.”

“Not at all,” he said. “Our agents are bonused on customer retention and advocacy, not sales.”

I said, “So won’t that mean, instead, that your agents won’t sell to customers for fear of hacking them off? Won’t that damage your revenues?”

He smiled. “Just the opposite. We train our agents to understand that their role is to help customers with their needs as much as they can. Each customer who calls us needs help – or else they wouldn’t pick up the phone. Most of these needs we can help directly: make a payment, check a transaction and so forth. But sometimes a customer’s need can only be helped with a new product.

“For example,” he continued, “a customer might want a better return on the surplus money sitting in their zero-interest current account. The best way we can help them is to explain the kinds of additional services we can offer such as savings accounts, bonds or ISAs. We then give them a chance to buy.

“If we don’t have this sales conversation, we will have had a customer with a need and we have not helped. That failure to sell is a failure of service.”

This philosophy seems to have worked. From its founding, this bank has balanced solid customer and revenue growth with a reputation as the UK bank with the most satisfied customers.

This principle seems to me to lie at the heart of the term ‘customer-centric’.  It connects sales and service with the same goal: helping the customer.

It means that agents have to believe that what they are selling is of genuine value to the customer: as they have to service the customer afterwards, there is no incentive to sell them a pup. And it properly positions sales as part of a positive customer experience – which is as it should be.

For those of us who are striving in our organisations to make things better for customers, this story poses two challenges.

First, how is the way we sell genuinely part of a joined-up philosophy of customer service – or are sales ‘pushed’ on customers regardless of value?

As for the second challenge? Customers now have many more channels for service. These include email, chat, forums, web sites, mobile or social media.

This challenge, it seems to me, is not the technology. Nor is it the need to design for the interactions we might have with customers (and which customers might have with us) (and with each other).

It is instead to do with how well, when trying to give customers a consistent, seamless, multi-channel experience, we apply a key principle:

How do we make sure that every customer touch point adds value to the customer, helps them with their needs and, yes, sells to them as part of the service?

As my friend with his contact centre showed, if we can meet this challenge and begin with this principle, the results, for our customers, and for our business, can be phenomenal.

customer strategy, innovation, Stuff I like

Seth nails it

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Sinclair C5Only when we build for our customers will they come.

Seth Godin’s blog offers profound, sparse and almost haiku-like wisdom about the new marketing.  If you don’t follow him yet, you should.

In this post, Choose Your Customers, he explains, in very few words, what in my experience is the most common problem leading to product and market failure: when we begin with the product, not the customer.

When we begin with our great product and try to sell it, we are doomed to fail.  If we want people to buy what we do, we have to begin instead with what they need and want, and build (and sell) (and service) from there.

Simple, really – but so easy to forget in the daily muck and bullets of business.