How Do You Understand What Customers Will Want In The Future?

IBA Group
Mark Hillary

It was great to read the article published on the IBA Group website about the CXOutsourcers Mindshare event in Windsor, UK. This was a very interesting event hosted by Peter Ryan and Mark Angus connecting together the service providers from the BPO (Business Process Outsourcing) and CX (Customer Experience) industry.

The IBA team was there at the event because their expertise in areas such as Cloud Computing and Robotic Process Automation is highly in demand from the CX companies – hopefully they managed to strike a few new partnerships!

As mentioned in the IBA article, I was speaking at the event about the future of the customer experience – how can you profile and understand the customer of the future?

What I tried to do with this talk was to initially frame expectations. It is easy for people to make wild predictions about how customers will behave in future, but what they often forget is that social and technological progress is not always gradual. Sometimes an invention or innovation can completely change the way that people behave.

A good way to think of this is by considering how railways changed society. Before railways people were forced to live within walking distance of their workplace. Railways created the freedom for people to travel to work and this in turn created the concept of the suburb.

We have seen a similar change in the past decade. Since the launch of the Apple iPhone in 2007 and the subsequent explosion in the use of social networks, the way that people communicate with each other has dramatically changed. This has led to a radical change in the way that people communicate with brands and an evolution in the way that the customer journey works – this is the journey from first hearing of a product to learning more and then eventually buying it.

That customer journey used to be quite simple and was focused on advertising or marketing to create awareness and then a sales process followed by customer support. Now we can see brands that are not building customer service contact centres, they are building customer experience hubs. They are using a mix of human and digital technologies and building an ongoing relationship with customers that can last for half a century or more.

What is so interesting about the present day business environment is that there is so much potential for dramatic change in so many ways. A retailer planning strategy in the era of my parents would only ever be planning new store locations and sales promotions – nothing in the future was dramatically different to the past.

Look at the retail environment today. Not only is online retail creating a new era of competition, but the way that town centres are featuring retail is changing. Other huge factors may also change how society interacts with business, such as climate change, geopolitics and the dramatic rise of China, the creation of social inequalities, and the preference to rent experiences rather than owning products.

You can click the link to read through my slides for some more of the ideas I presented at CXOutsourcers, but I think that what we will see more often today is emerging business models and services driven by the online economy and the desire of the customer for greater convenience. Go-Jek in Indonesia started out as a ride-hailing service with motorbikes – like Uber with two wheels. They expanded into offering services such as medicine or food delivery by leveraging their network of riders and eventually they created such a wide array of services that they introduced their own in-app payment system. They now process more payments than any major credit card brand… they are now a financial service brand and they started out offering rides on scooters.

How might this happen in your industry? Think about it, your competition in 2020 may not even exist today or they may be working in a completely different industry. Now that’s scary because it means that we are moving faster than ever to stay ahead of business trends, but we are never going to be going this slow again in future.

Mark Hillary for CxOutsourcers
(c) Mark Hillary

How Tech Plays An Important  Role In Delivering A Great Customer Experience

IBA Group
Mark Hillary

I recently visited IBA Group in Minsk and I had the pleasure to speak with Andrei Lepeyev, the director of software development at IBA Group. As someone who studied software engineering at university myself, I’m always fascinated by the way that platforms such as cloud computing and the app store have changed what it means to deliver software, so it was really great to catch up with Andrei.

You can hear our conversation on the CX Files podcast by clicking here or search your favourite audio podcast provider, such as iTunes, Spotify, SoundCloud, or Stitcher. Because we were focused on CX we talked about some of the technologies and systems that Andrei is working on that have a direct impact on the quality of CX for the clients of IBA Group.

I had initially asked Andrei about how Artificial Intelligence (AI) is being used to predict customer behaviour, but he explained to me that IBA has gone further and created a product called APPULSE that offers a complete Level 1 and 2 support service for mainframe computer systems.

Andrei said: “APPULSE not only detects the system and finds problems, it uses Machine Learning to learn about the solutions so in many cases it can create a self-healing mainframe system. Mainframes are still really important and unbeaten in the range of directions they are deployed. They are the most stable and virus-free systems, but their user-interface is not usually so good.”

Andrei was talking about the importance of keeping mainframes running because they are often overlooked by most customers, yet your bank will be relying on those systems to be running if they want to offer a 24/7 online banking platform. Ensuring that the system can heal itself before problems even happen is an enormous improvement in the way that a traditional IT support operation would run – fixing problems only after they have caused a problem. That’s always a disaster for customers who need service now.

One of the big trends for 2019 in CX will be Robotic Process Automation (RPA). Andrei explained to me that IBA Group has delivered implementations all over the world using the top four RPA platforms so they are not just riding a wave of RPA hype, they have real customers and case studies from numerous countries. But I asked Andrei how they choose the best platform for different customers – is the software really very different?

He said: “First we think about the support level of each supplier. Can they provide education or trial systems? Can they add specific requests to the software? Can they give extra information to a company like ours that may be implementing the solution?” However Andrei also added an interesting point which is not often discussed in the industry – sometimes it is just which software system is seen first by the customer. He said: “It is also important to see how each of the companies is marketing their product to the client. Often we will be approached by a potential client who already has a pilot system – developed free by the software vendor – and it can be very hard to move them to another system even if we think it could be better.”

Andrei mentioned Machine Learning when describing the mainframe support system and I asked him about the popularity of this in 2019. Are more and more customers asking how to make their systems learn about customers and systems automatically?

Andrei said: “Yes, many more clients are asking about it. The main reason is that there has been an evolution of hardware. A simple mobile phone allows almost every standard machine learning platform to work. Ten years ago this was impossible. We are not talking about huge brands like Google and Amazon – even smaller companies can deploy a machine learning system today – there is a very low barrier to entry now.”

When I asked Andrei about his priorities for 2019 he said that he wanted everyone in the industry to remember that none of these technologies exist in a vacuum – they all need to interact with other technologies and business processes. He said: “When we are talking about AI we cannot talk about it alone, it should be the business application of AI. We can’t talk about RPA without Machine Learning. We can’t talk about Cloud Computing without talking about the solutions that are built and deployed on the cloud. I’m looking forward to some projects in 2019 that involve AI using RPA and are delivered on the cloud.”

My conversation with Andrei provided a great insight into how some of these technologies are really affecting the customer experience. A large amount of media coverage is just hype, but as Andrei demonstrated, there is a great deal of substance here. These technologies can deliver game-changing systems, but the companies using them to interact with their customers need to have great products and services – it is not the use of an RPA or AI platform alone that will help them to be more successful.

To listen to the CX Files podcast featuring Andrei Lepeyev from IBA Group, click here.

IT Companies Globally – Your Future Is In CX

IBA Group
Mark Hillary
Customer Experience (CX) has become an important topic for IT companies in recent years. Technology that helped customers used to be restricted to little more than Point-Of-Sale (POS) systems in retail stores, but now there is an enormous industry focused on CX and technology underpins most of these services. For example:

  • CRM; Customer Relationship Management systems are increasing automated and help brands build a better relationship with their customers by having a better understanding of customer needs.
  • ERP; Enterprise Resource Planning has become increasingly important as complex supply chains need products to be delivered just-in-time to the right place.
  • RPA; Robotic Process Automation is allowing companies to automate large groups of processes – especially in the back office.
  • Contact centres; the traditional link between brands and customers is increasingly complex now that omnichannel service is becoming a customer expectation.
  • Data analytics; Big Data and expertise in studying customer behaviour is becoming an important way for brands to personalise the service they deliver.
  • AI; Artificial Intelligence is helping many brands to predict what customers will want, either to help improve the supply chain or to create a more personal service.
  • VR and AR; Many brands are exploring how Virtual and Augmented Reality can help customers locate more detailed information on their products.

This is just a short an immediate list, but the implication is clear. The customer to brand relationship is far more complex than ever before and it is increasingly these technology systems that are providing the ammunition for brands to improve their customer experience. IT service companies and advisors need to be increasingly aware of how important their role now is in creating a great experience for customers.

Many of these technological changes are helping smaller specialist companies to compete with the major players. Look at the Facebook Messenger and it’s automated bot system for one good example. Even a very small brand can configure the system to offer 24/7 customer support using automated bots – something that would have been unthinkable for a small company to offer just a couple of years ago.

Several major technology systems, such as CRM and ERP, have driven large parts of the technology industry in the past, but I believe that now the main driver is CX. Customer expectations on brands are increasing constantly, leading major companies to explore how they can deliver a better service than their competition. Likewise, many of these technologies are moving from just being used by early adopters to being more universally accepted – look at how Ikea now allows customers to view furniture using an AR system before purchasing.
The message is clear for IT experts – CX is going to drive your business for the next decade. Make sure you are tuned into what the CX experts are saying and what the upcoming CX trends are going to be, because many of them need IT expertise and that will not come directly from companies with experience of customer service.

The IT Customer Is Changing Fast, But Are They Happy?

IBA Group
Mark Hillary

I have read several studies recently that explore the strengthening connection between how companies use technology and how satisfied their customers are. Traditionally the CIO in a large organisation might be focused on processes, supply chain technology or managing systems used by employees – this is changing fast because of three important trends:

1. Consumer tech; look at the mobile system consumers are used to using today. They can compare prices, talk to friends globally, check customer reviews, and do all this while in your store or on your website. It’s not possible to charge more than the competition today because customers will see it immediately.

2. Tech platforms; the major systems applied inside companies used to be custom-built. Armies of analysts would design the workflow and another army of developers would build the system. Now it’s far more common to buy a system that can be deployed in the cloud and paid for only when it is used. This means that business divisions inside companies are buying major IT systems and deploying them possibly without even involving the CIO or IT team.

3. Blending customer responsibilities; all those clearly defined departments like sales, marketing, customer service, advertising, or PR, forget it. They need to start working together because customers have redefined how they interact with organisations and the companies need to reform and catch up – customer service IS now marketing.

There is a connection here. As the various research studies suggest, companies need to review how they are using technology, and in particular how this improves their connection to customers. Whether you are involved in IT department tasks or CIO-level decisions, or you are part of the business function within an organisation, there is a revolution taking place in the way that customers interact with your business and it is being driven by the technology being used both inside your company and by the customers.

Big Data Is Becoming Big Marketing

IBA Group
Mark Hillary

It’s fascinating to see how quickly different technologies can move from the world of the technology expert to the mainstream. Think back ten years and it was quite rare to be using the mobile Internet. Some people were struggling along with a very slow connection and an old Nokia handset, but it really wasn’t until the iPhone came out in 2007 that it started becoming easy to use the Internet when on the move.

More recently look at how everyone suddenly understands Augmented Reality (AR) because of the Pokémon Go game. AR has been around for years as a way of overlaying information onto live images, but it has never caught on in a mainstream way until now.

I think we are about to see a similar shift in the way that Big Data is accepted in the enterprise environment too, because it is moving on from just being important to the technologists.

Companies are finding that their customer journey is changing dramatically. This is the route that customers use to find out about products and then buy them. Instead of seeing adverts or marketing materials and then making a purchase, there is a much more complex two-way information flow that can be spread across many channels.

Many organisations are finding that they need to blend all their customer-facing activities together so they can be coordinated. This means that the Public Relations, Advertising, Marketing, Sales, and Customer Service teams all need to be working together because all of them are involved in the customer journey to some degree.

Making sense of all this change requires data and analysis. Smart companies are finding that they can develop better strategies by analysing patterns of customer behaviour, but this requires the analysis of very large data sets. Suddenly Big Data is moving into the world of the marketing team and becoming a valuable tool.

So for any company to succeed in this more complex customer environment, more knowledge about customers is essential and I believe that strong data analysis skills will be needed more than ever. Watch out for this as Big Data skills are going to become a mainstream part of organisational strategy in the very near future.

How Could Big Data Let Us Down?

IBA Group
Mark Hillary

I have often written here about the potential for Big Data to fundamentally change the way that many companies do business. It cuts across industries and is not just a single strategy, it can change the way that existing companies perform and create opportunities for new market entrants.

This cross-industry application of Big Data is where I think there is the most potential for it to become a game-changer. IT experts rarely got to delve so deep into their industry of choice in the past; they focused on the technology and systems that assisted a company.

Now, with Big Data analysis helping doctors to diagnose patients and helping bankers to fight fraud there is a much greater connection between the industrial application of technology and the technology itself. The technology teams need to really understand the business they are working in.

But this is where the peril also can be found. As companies depend more and more on huge data resources and the ability to intelligently analyse this data we are entering a world where data has an enormous value.

Just look at the Panama Papers data leak. A huge amount of secret customer data from the law firm Mossack Fonseca was leaked by a secret source to journalists and it appears to show many wealthy and powerful people using companies in Panama to hide their wealth – and therefore avoid taxes.

Of course, it could be argued that it’s a good thing that this data was leaked. All those powerful people should pay their tax correctly rather than hiding their money, but imagine Facebook was hacked and every online conversation was leaked, or Google and every private gmail message were posted online? Imagine if another law firm were hacked and details of every divorce settlement they have handled were posted openly online?

It’s almost impossible for most customers to now avoid giving out their personal information when dealing with companies and the data is being collected into enormous databases profiling purchases, preferences, and behaviour. Companies in all industries are now wedded to the possibilities presented by the use of this data, but so few are acknowledging that if they ever lost control of the data it could be an existential threat for their business.

Big Data certainly has benefits, but it’s time for companies to acknowledge that with these big data sets come big responsibilities. The companies that fail to protect their customers will not survive.

The future for IT – apps in the cloud?

IBA Group
Mark Hillary

Technology is continuously evolving at such a rapid rate – it is impossible to predict with any certainty how it will impact on our lives in coming years. When people make predictions about how technology will evolve, try this exercise. Look back ten years and think of all the technologies you take for granted today: social networks, smart phones, mobile Internet, tablet computing. None of them existed even a decade ago – or were so nascent an elite few were the only users.

Think back a decade more and you will find yourself at the birth of the web. Adverts for major consumer products did not even feature URLs until the late 1990s. Now you see how difficult it is to predict what technologies will be common by 2015.

There will always be winners and losers in the search for new ways to use technology to achieve business success. The downfall of companies such as Nokia, Kodak, and Blackberry illustrate the consequences of not understanding how society is changing and using new technologies.

But one development that is likely to evolve further is technology outsourcing. As the world becomes more complex, it is even more unlikely that companies will retain the right kind of expertise internally. IT services will be outsourced more often because only the IT companies understand the complex technological solutions – rather than some of the drivers we saw a decade ago, such as labour arbitrage.

The globalization of IT is itself becoming more complex anyway. There are still IT service companies all over the world offering their services, but now they don’t always need to directly contract with a customer to provide a specific service. The cloud-based model allows service providers to offer a specific service – storage or computing power – that can be turned on and off as desired. The app store model many people use on their phone can also be used in the enterprise to create an environment where end users on the business front-end (not the IT department) can choose and install technology solutions themselves.

Change is taking place fast in the IT services market and nobody can predict how it will look in ten years, but one thing is for certain, IT experts need to offer a variety of delivery methods because enterprise IT is borrowing many of the ideas that consumers are already familiar with.

Will Social Networking Transform Customer Loyalty?

IBA Group
Mark Hillary

In my last blog, I mentioned that social networking technologies are changing how many companies use CRM. Opportunities are created to have a much deeper relationship with customers than was ever possible before and this goes far beyond just CRM alone.

But what is it that any company really wants? Why do they invest in all these technologies in the first place? There are many reasons, such as improving the customer experience, but possibly the most important is to generate customer loyalty. It costs far more to attract new customers to your business than to just keep the existing ones happy, so managing loyalty is important.

And as customers we all know about loyalty schemes. You probably have loyalty cards for your favourite hotel chain, airline, coffee store, bookstore, and supermarket. Every type of business tries giving away points and prizes to encourage loyalty.

The problem is that academics now believe that our present focus on loyalty through loyalty programmes doesn’t work very well. Take airlines for example. There are really only three major airline alliances, Star Alliance, One World, and SkyTeam. Serious business travellers just take a membership with all of them so they always collect points regardless of the airline used.

Most people use the supermarket that is closest to their home rather than travelling much further because they have a loyalty card from another store. Most of the time these loyalty cards don’t really create very much brand loyalty.

Smart companies today are looking at their CRM data and using a ‘buzz monitoring’ platform to analyse the social networks and then interacting with customers based on the information they can glean from the customer behaviour data. In effect, what is happening is that companies who know their customers well are able to use the data to create customer loyalty gifts and rewards that are targeted at the individual customer – not just points that every customer earns.

This is a big change in behaviour for many companies and it will be the back office technology that drives the information for this to work, but it is a natural shift. Customers have greater expectations on brands today and the first time a brand responds and rewards you in a unique and individual way will create a ‘wow’ moment for many customers.

It is these interactions based on data that will drive customer loyalty in future, not loyalty cards. Has any major brand ever rewarded you based on their knowledge of behaviour and how did that make you feel?

The Big Picture on Customer Service, CRM, and Big Data

IBA Group
Mark Hillary

Last month I was in London, invited to speak at an event hosted by the IBA Group. The theme of the event was the resurgence of CRM and how it is being combined with Big Data and becoming an important part of corporate strategy today – particularly for companies planning how to improve their customer service.

The analyst Peter Ryan from Ovum was up before me. He talked about the strategic use of CRM and how the improved use of information feeds into a customer service strategy. Ovum has predicted that improving the customer experience will be even more important than improving revenues for companies in 2015 therefore this theme is taking on a new significance.

The director of Internet Solutions at IBA, Aliaksei Minkevich, was also speaking. He described some case studies and drove home the real importance of thinking about technology projects and how they can improve the way a business uses data. Aliaksei was particularly focused on describing how a technology solution is no longer as simple as it used to be. Much of the business benefit from processes and systems today comes from the opportunities to use information in a smarter way, rather than just reducing cost or aiming for efficiency.

I started talking about the connection – as I see it – between modern day CRM and Big Data. The way customers interact with companies in all industries has changed in the past decade and this wider social change in how people communicate has to be appreciated by corporate executives.

The two big drivers of this change were the launch of the iPhone in 2007 and the explosion in the use of social networks from 2008 – both very recent dates. Of course it was possible to use the mobile Internet before the iPhone, but Apple made it so much easier and easy access became the expectation from consumers.

And, of course, people were using social networks prior to 2008, but this was when it really went mainstream. Facebook started maturing and Twitter became commonly mentioned in broadcast media, such as radio and TV. 2008 was really the tipping point when social networks became normal for everyone.

These developments have changed the way customers interact with companies. It is now fairly normal for any customer to use at least six different channels when interacting with brands – email, voice, chat, Facebook, Twitter, and review or rating websites like Tripadvisor. There are more and this changes all the time, but this is already a very different environment when compared to those days before social networks and the mobile Internet were common.

So companies should no longer be exploring how to improve customer service as an activity, they need to be working harder at Customer Relationship Management – back to CRM again. This is because the real measure of success with customers in this multichannel environment is the quality of the engagement between the brand and the customer.

Getting this right demands the use of some serious technology. Running a customer service team no longer means just answering the phone, it needs data analysts, knowledge of Big Data, and a CRM system that allows the customer to engage and enjoy interacting with the brand.

Companies that can deliver this kind of technology in a way that improves the experience of your customers are going to lead the way. Tech players will become customer service experts as the use of technology underpins how companies interact with their customers.

Underneath all this remains the fact that how we all communicate has changed. If you want any executive to understand why this is important, then just ask them about the last time they needed to select a politician to vote for, a restaurant to eat in, or a hotel to stay in. If all these decisions are now being shaped by data, then don’t you think that the relationship between your own customers and your company are also about to be shaped the same way?

 

The Return of CRM Technologies

IBA Group
Mark Hillary

Last month eConsultancy asked their readers which digital marketing technologies they have increased investment in during 2014. The number one response, at 49%, was CRM and number two was business analytics.

It is like CRM is undergoing a renaissance, an acceptance that after all the failed projects and strategies, it is really important after all. But why has this happened now?

The eConsultancy article does list several points, but in my view the top three are:

1. Customers are defining how they interact with companies. They choose the channels and companies need better analysis tools to find where customers are talking about their products, and how they prefer to interact. Customers do not just call a pre-determined phone number today.

2. Access to mobile Internet means that customers are engaging far more often. They want information before, during, and after a purchase.

3. Knowing your customer is vital for loyalty. Traditional loyalty programmes are dying out and being replaced by better engagement. Customers want a real relationship with companies, not just some points.

This change in CRM technologies strikes at the heart of how modern companies are organised. Many companies will need to change their internal structure to meet customer expectations, but one thing is clear, CRM is making a comeback.