The Future of the Customer Experience
Within the next two years, you will design customer
experience into every product or solution that you
develop. That means when you are at the early stage
of defining the product requirements, you will have
the help of people who are very experienced in
customer experience, as well as the customers
themselves.
—PATRICIA SEYBOLD
Reza Soudagar, Vinay Iyer, and Dr. Volker G. Hildebrand
WHEN IT COMES TO CUSTOMER EXPERIENCE (to borrow a sports and management analogy), it pays to skate to where the puck is going, not where it has been—or at least, to try to do so. No one can predict the future, but keeping an eye on what lies ahead will inform you of how well your present-day plans will hold up to the needs of the future. Evolving the customer experience edge is guaranteed to be a continuous journey that (barring a major career change) will keep you busy for most of your professional life, whether that be five more years or five more decades. So, what sorts of changes can you expect to see in the coming months and years?
It is certain that people will look for companies that will help them make their lives easier—through the four customer experience (CE) essentials of reliability, convenience, relevance, and responsiveness—so that they can recoup some of their ever-shrinking amount of personal time. Customers of all types will also expect the companies and vendors that they patronize to understand them and cater to their individual needs. Everyone wants to feel understood, and in the future, this will no longer be a “nice to have,” but will be one of the core components of the customer experience edge. And there will be ever more sophisticated ways to get inside customers’ hearts and minds. Twitter, Google, and Facebook are just the beginning of customer interaction channels; as others emerge, they might be adopted at an even faster pace.
The advanced customer experiences of today point the way to those of tomorrow. Let’s say, for example, that you’re in the market for a new car. The traditional approach to car buying used to be to drive over to your local dealer, test-drive a few cars, listen to the salesperson’s spiel, check with a few friends, and make a decision. It is amazing how this behavior, which went on for 80-plus years, has been transformed in just the last 10. Today, you are very likely to spend some time checking out Cars.com, ConsumerReports.org, or one of the many other online resources available. Even better, you could tap the ShopSavvy mobile app on your smartphone and get instant access to everything from dealer and model reviews to special offers, Blue Book information for your trade-in, comparative safety records, fan sites, and even directions to the nearest dealership. Via location-based services, the dealership can even push a special offer on the exact model you’re interested in to your mobile app while you’re standing in the car lot. This experience hints at what will be possible in the customer experience across many industries in the near future.
Rather than a car, for instance, let’s assume that you want to explore the nagging feeling that $100 is too much to pay for that sea-algae-based face cream that the saleswoman at Sephora encouraged you to buy. Does someplace else sell it cheaper? Is it even worth spending the dough—has it been shown to work? Again, using a mobile social shopping application and technologies such as quick response (QR) codes—two-dimensional codes that transfer information to the mobile device when scanned—these answers are readily obtained. Using your smartphone, all you have to do is scan the code on the back of the jar, and up will pop a plethora of information about this face cream—a veritable library of data. You can check everything from clinical study information to all the available online and offline outlets that sell the cream, sorted from low price to high. Even better, you can set up the system to receive an alert should the item go on sale.
All of this is possible today, and according to the ShopSavvy website, more than nine million consumers have downloaded this particular application. But let’s take this one step further. Imagine that a company representative were able to interact with you via phone or videoconference and act as your personal sales consultant, sending you exactly the information you want to know, in your preferred format. It’s not too much of a stretch to imagine future mobile shopping applications being linked with Facebook or a social shopping site, so that you can immediately see who among your friends bought your target item, where they bought it, and for how much. Younger generations are way ahead on this; they are already eschewing traditional shopping methods and relying instead on what their social network peers are buying for their own purchase decisions. Soon, shopping will be “social” for the population at large, as we all check out what our friends are buying, compare prices and reviews, and post photos and videos.
On the business-to-business (B2B) front, imagine a scenario where rather than having to fly out to the vendor’s site to make a final quality inspection of a costly piece of capital equipment that you’re purchasing, you can use voice- and data-annotated video to take a virtual tour and even make any final arrangements or conduct sensitive negotiations via PC or mobile-based videoconferencing. Another possibility: while you’re visiting an existing supplier’s website and checking on the availability of products that you’ve bought in the past, a window opens with a limited-time offer— 10 percent off of a purchase made within the next 15 minutes. The vendor’s integrated databases and analytics have determined that, as a prior good customer who hasn’t bought in a while because of a slowdown in your industry, you will probably respond positively to a little price motivation.
It’s hard to believe that not long ago, such capabilities were the stuff of science fiction. New technologies are appearing on the scene, being adopted en masse, and then morphing into unrecognizable forms—all in a few years or less. A mere decade ago, for example, there was no Facebook, no Skype, no Twitter, no iPhone, no iPad, no YouTube, no Groupon—these staples of everyday life had not even been invented yet. In fact, daily deal provider Groupon, which did not exist until late 2008, was valued at at least $15 billion as of mid-2011. Meanwhile, digital cameras, which were fairly new on the scene 10 years ago, have all but replaced film cameras, but now face obsolescence themselves, as people can use the cameras on their cell phones and smartphones rather than bothering with carrying a separate device. As much as we have been whipsawed by change in the last decade, the pace is likely to accelerate, making it difficult to anticipate not only what is coming next, but what form it will take.
Many different elements will combine to create the future of the customer experience, based on what we and others see.
1. The Future of Real-Time Computing
According to the market research firm International Data Corp., the amount of electronic data that exists in the world doubles every 72 hours, as of 2010. The world is already grappling with the massive proliferation of unstructured data—how to transport it, store it, manage it, secure it, and leverage it—which is partly attributable to user-generated content. The Internet must change to keep up. This expansion in network bandwidth is often called Web 3.0 (and there is no telling what future iterations will be called). According to a popular YouTube video posted by STI International and the Future Internet project, the next generation of the Internet will be mobile, ubiquitous, and pervasive. Dr. Vinton Cerf, who is often called the “Father of the Internet” and is now chief Internet evangelist for Google, concurs, saying in a video that the Internet will be more mobile and higher speed than anyone can imagine today.
As a consequence of these developments, the customer experience will become more and more real time. Today, most customer experiences have a great deal of built-in lag time. It might take you 30 seconds to sign up for a magazine subscription online, but it still takes several weeks, if not months, to see that first issue. The lag time that is built into traditional processes will disappear, as consumers who grew up downloading music, books, and video for immediate consumption will not tolerate delays that, from the outside, at least, are inexplicable. Print magazine publishing has indeed been struggling for the past several years as real-time forces are at work, along with the explosion in user-created content. No one wants to wait six weeks to read an issue that can be pulled up on an iPad in seconds.
Traditional business processes will also undergo a transformation. Today, for example, while you can apply for a mortgage online and obtain fast credit approval, the mortgage approval process is no faster than it ever was. In the future, bigger “pipes” will speed the flow of data, and an emerging technology called “in-memory” databases will allow much faster data analysis, enabling virtually instantaneous decision–making—think actual approval of a mortgage on a specific piece of property, including underwriting and property/market valuation (not just “preapproval” based on your creditworthiness), in 30 seconds. Taking this a step further, imagine that 10 banks (with your approval) can review your data in a split second and offer you competing approvals and mortgage terms on that piece of property. You will no longer have to shop around—the offers will come to you.
Or, imagine that your basement gets flooded, or your house burns down. If your insurance provider had instant access to a full listing—complete with photos and video—of every item in your home that was covered by insurance, the claims process would be speeded immeasurably.
The life cycle for all types of decisions will shrink, increasing the gratification of customers whose daily lives depend on those outcomes. Both companies and their customers will be able to take mountains of data and quickly turn them into insights and value. Data transparency and data sharing will become more pervasive through-out the customer value chain. Advanced database management techniques, including in-memory, will aggregate data at the point of decision, making analysis much more fluid. So, for example, the time it takes to process a customer invoice will decrease from a few seconds (a veritable lifetime in the future of the customer experience) to close to zero.
2. The Future of Social Media Use
Although this is already happening, we predict that social media will merge even further with mobility. Both consumers and business users will look to their smartphones and other mobile devices to see what their friends and colleagues are buying or selling. Not surprisingly, Apple is ahead of this curve: it recently published a patent describing a shopping-oriented social network that would allow users to solicit feedback from friends while they were in a store. As envisioned, the system involves image sharing, enabling iPhone and iPad users to send photos of a potential purchase to a friend, colleague, or group and receive comments, votes up or down, or other types of feedback.4 One can expect B2B uses of social shopping to involve their peers in recommendations and pricing reality checks. E-commerce giants such as Amazon are already working on allowing shopping within Facebook (with other social media sites being presumed to follow). There is every reason to believe that social media and mobility will merge so as to become virtually indistinguishable.
Though social media to date are used largely in consumer applications, the borders are beginning to disappear. Business users’ experience is already informed by the consumer experience, and this distinction will completely fade over time. In the meantime, though, B2B marketers must become much more savvy in their use of social media.
According to a survey of 2,100 companies in July 2010 by Harvard Business Review Analytic Services, 69 percent of businesses will increase their use of social media significantly over the next five years. That’s no surprise, considering that two-thirds of respondents currently have no formalized social media strategy in place. Once they understand how social media can support their business objectives, their use will skyrocket. And before long, there will be no way to provide a customer experience of any kind without the use of mobile social media. Looking to the future, 41 percent of survey respondents said that a primary goal will be to integrate social media monitoring solutions with other marketing solutions, so that they can understand not just what is being said, but who is saying it and its impact (see Figure 13.1).
FIGURE 13.1: Social Media Analytics Usage: Current vs. Future Intentions
Source: Harvard Business Review Analytic Services, July 2010.
3. The Future of the Mobility/Online Customer Experience Anyone who has given any thought to the future of the customer experience agrees that mobility will be its key characteristic going forward. As discussed in "Emerging Economies: Exporting a Profitable Customer Experience", short message service (SMS) is already the central tool for delivering the customer experience in emerging markets, and this technology—along with other messaging technologies—is expected to be increasingly adopted in mature markets as the more sophisticated SMS techniques developed in emerging markets cross into established markets. Banks and financial institutions, retailers, and transportation providers will look to SMS and other messaging technologies to deliver alerts, information services, mobile marketing campaigns, appointment reminders, tickets, coupons, payments, and loyalty programs. Mobile payment—from consumers to businesses, consumers to consumers, and even businesses to businesses—are poised for takeoff. According to In-Stat, there will be as many as 375 million mobile payment users worldwide by 2015. Examples of mobile payments range from an individual paying bills on his smartphone, to an employee in a retail store helping customers check out via an iPhone, to a retailer zapping coupons to customers while they are in the store. Contactless payment is an especially fast-growing area in emerging markets.
According to a blog post by Forrester vice president and research director Moira Dorsey, Web-based applications and experience are evolving away from their initial format, the Web “page,” which was an attempt to mimic familiar paper in the earliest days of the Web.5 Additionally, today’s default Web platform (a browser running on a PC) is rapidly giving way to diverse online environments, she writes. The types of devices used to connect to the Web today range from PCs to laptops to netbooks to nowexotic form factors like Internet radio and even Wi-Fi appliances. There is no telling how these devices will evolve. Portable devices are rapidly getting more powerful; as a result, the trade-off between mobility and capability is shrinking, according to Dorsey. And as the hardware evolves, the interfaces on the devices we use to connect to the Web are becoming more and more customizable.
According to Dorsey’s blog post, the future of the online/mobile customer experience can be handily summed up by the acronym CARS:
- Customized by the end user. Not only will consumers control what they get online, but they’ll control the form that they get it in to a much greater degree than they do today.
- Aggregated at the point of use. Content, function, and data will be pulled from different sources and combined at a common destination to create a unique experience.
- Relevant to the moment. This customized, aggregated content will appear on the device that’s best suited to the customer’s context at a given point in time.
- Social as a rule, not an exception. Social content will be integrated into most online experiences, not segregated into today’s blogs, microblogs, and wikis.
According to Jonathan Zittrain, author of The Future of the Internet— And How to Stop It, people will begin moving away from PCs as their platform of choice in favor of what he calls “contingently tethered” devices like the iPhone because of the specter of increasing security vulnerability. Because smartphones and tablets are relatively closed platforms, unlike the PC, they cannot be compromised as readily, he says. “Generative” technologies, like the Internet combined with a traditional PC, unleash an enormous amount of creative force as people use them as a means of expressing their own individuality and ingenuity. This compares sharply with what Zittrain calls “sterile networks,” which means that they work the same way on their last day of usage as on their first day (the earliest computers, for example). Zittrain predicts that the use of semi-closed devices like the iPhone and iPad will increase exponentially as data security and privacy threats burgeon. This message is in line with other predictions that mobile devices will become the preeminent delivery mechanism for the customer experience, both for consumers and for business customers.
Some futurists, such as Dr. Michio Kaku, a theoretical physicist and author of Physics of the Impossible, see mobile computing expanding to even more unexpected delivery mechanisms, such as your eyeglasses, an eyepiece, or even a retinal implant. Kaku foresees the day when we’ll be able to download information and images and view them on a tiny LCD display right on the eye’s surface. The final image would appear to float in front of your nose. Imagine that extended to an array of products that you are interested in, along with their price and availability.
Others see the friendly, intuitive interfaces made ubiquitous by smartphones and tablets beginning to appear in entirely new places. Volkswagen’s Bulli concept van features an iPad mounted on the dashboard, allowing the user to control everything from the interior lights, to the heating and cooling systems, to the entertainment system—even receiving alerts when maintenance is needed. There is every reason to believe that tablets or their next iterations will come to control everything from your refrigerator to your alarm system. Tabletlike interfaces will also figure for B2B in industries like oil and gas and manufacturing, which rely on controls of various sorts.
4. The Future of Customer Service
From the earliest days of Twitter, companies have been using the microblogging site as a means of delivering better customer service. The specter of harm was clear enough: if someone with lots of followers complained about your product, the damage could be incalculable. Companies, especially those serving consumers, got a crash course in how to use social media to discover consumer problems and help fix them. Now, companies of all types and sizes have been learning how to do customer service on social media. That’s good, as these platforms will become a premier forum for customer service in a few years.
For some companies, that future is already here. Gatorade, for example, has the edge with its Gatorade Mission Control Center. As part of its mission to interact with “millions” of athletes and influencers, the company built an Internet command center in which a room full of people track brand mentions and online consumer sentiment in real time, monitoring the pulse of the Gatorade brand, according to a YouTube video. Their task:
- Monitor online discussions.
- Monitor sporting events.
- Track media performance.
- Be proactive in social media outreach.
- Track campaign analytics.
- Track website analytics.
- Track social media analytics.
The information gathered at Mission Control influences not only Gatorade’s communications, but its product as well. Observers like Altimeter Group analyst Jeremiah Owyang insist that the traditional call center will give way to a social media command center like Gatorade’s. The next generation of customer service will proactively go out and help customers in their native environments, rather than expecting customers to call in to a call center, says Owyang. But social media are not just another channel for interacting with customers, he cautions. Characteristics of customer service in the future will be that it is outbound rather than inbound, real-time rather than post-issue, based on lifestyle content rather than incident-resolution scripts, long-term rather than one-off, and socialmedia- oriented rather than support-oriented. Measurements will be equally as critical to the customer service organization of the future as they are today, focusing on customer satisfaction and issue resolution rate, Owyang adds.
A few other organizations have geared up to monitor what customers are saying about their products more closely. Dell’s Social Media Listening Command Center, established at its Texas headquarters in 2010, is listening to its computer users around the world. “A team of Dell employees monitors the thousands of conversations about Dell that occur on all social media platforms around the clock, delivering the company’s systemic early warning system, ensuring listening consistency across Dell’s business, and coordinating best practices across the company,” according to Adam Brown, Dell’s executive director of social media, at an electronics industry conference sponsored by Microsoft in February 2011.
5. The Future of Product Development
Leading-edge companies already develop their next product and service offerings in tandem with their customers. The customer experience piece will no longer be tacked on at the end, as with classic R&D processes, Patricia Seybold tells us. “Within the next two years, you will design customer experience into every product or solution that you develop. That means when you are at the early stage of defining the product requirements, you will have the help of people who are very experienced in customer experience, as well as the customers themselves.” Customers know what they need. They know what they want. Customers will lead product design and development from the inception of an offering to its release. “The whole development cycle will be done intertwined with customers,” says Seybold. “They will be co-designing the products and co-designing the entire experience around the new product or service.”
A by-product of these close working relationships between the customer and the company will be greater trust. As customers feel more open to telling companies what they need in order to get to the next step of their own evolution and experiences, companies will better be able to fill those needs. There is the potential for a productive symbiosis between the two in which customers and companies coexist and have a mutual dependency. There will be organizational and other types of ramifications to this development. For example, there may no longer be a need for a traditional marketing function. Demand-led companies will not have to do much marketing, as they will provide only what customers have already requested. An organization’s central focus will become creating the product and supplying it to customers that need it. Demand generation will happen in e-communities and on social media.
Ideally, customers will become evangelists, significantly changing the role of both sales and marketing. When your best customers bring their needs directly to you and evangelize your company to others, traditional marketing campaigns will become all but obsolete. Marketers will no longer push information to prospects and customers—their role will be to understand customers’ perspectives, sense what is being said, and then influence, enable, engage, and nurture evangelists. The new marketer will be an orchestrator, listener, and analyzer. The days of disseminating an annual or quarterly marketing campaign and then sitting back to make your own projections will end, and the communication and interaction with customers will resemble a natural conversation rather than a broadcast in its fluidity and immediacy.
For years, across industries, the sales function has been evolving into an exercise of building trust as opposed to getting a deal. We see sales shifting to a largely consultative role, in which the company representative helps customers figure out the solution or service that will best help them meet their own objectives. Building and retaining trust will be crucial to survival. Salespeople and the companies they work for will align with the customer’s needs and those of the larger supply chain. In many industries, competition will rise to the level of Supply Chain A vs. Supply Chain B as opposed to Company A vs. Company B. The new salesperson will be given incentives for listening, gathering insights, and creating personal connections with customers.
6. The Future of Business Models
A few innovative start-ups are already using an entirely consumer-driven business model in which everything from new product recommendations, to pricing, to customer support is determined and handled by consumers. For example, the U.K.-based virtual mobile network operator giffgaff.com provides free texting and mobile Internet service while selling SIM cards. Customers participate in various aspects of giffgaff’s operation, including sales, customer support, and marketing. The community is officially (rather than informally, as in other organizations) the first line of customer support. This is a new type of corporate business model, one in which the voice of the customer governs all.
As we said at the very beginning of this book, the customer experience will become an increasingly critical differentiator for all companies. Truly, there is no future for companies that fail to find their customer experience edge by providing customers with an experience that is difficult to replicate in a profitable way.
Notes
Quoted material that is not referenced is from personal interviews.
1. “I skate to where the puck is going to be, not where it has been,” Wayne Gretzky, NHL hockey player.
2. “The Future Internet: Service Web 3.0,” YouTube, October 15, 2009,
http://www.youtube.com/watch?v=off08As3siM.
3. “Vint Cerf’s Top YouTube Videos,” YouTube, May 9, 2010,
http://www.youtube.com/watch?v=zulDYxyv4KQ.
4. “Apple Planning Mobile Shopping Social Network for iPhones?” PocketNow.com, December 30, 2010,
http://pocketnow.com/iphone/apple-planning-mobile-shopping-socialnetwork-for-iphones.
5. “Forrester’s Moira Dorsey: The Future of Online Customer Experience,” 1to1 Media, February 3, 2010,
http://blogs.forrester.com/moira_dorsey/10-01-29-future_online_customer_experience.
6. “Jonathan Zittrain, The Future of the Internet,” YouTube, April 15, 2008,
http://www.youtube.com/watch?v=o7UlYTFKFqY.
7. Michio Kaku, “This Is Your Future,” Newsweek, March 13, 2011,
http://www.newsweek.com/2011/03/13/this-is-your-future.html.
8. Robert Anthony, “No Bull: Volkswagen Bulli Concept Electric Van Powered by iPad,” PC World, April 21, 2011,
www.pcworld.com/article/225894/no_bull_volkswagen_bulli_concept_electric_van_powered_by_ipad.html.
9. “Gatorade Mission Control,” YouTube, June 15, 2010,
http://www.youtube.com/watch?v=InrOvEE2v38.
10. Jeremiah Owyang, “Social Media Mission Control, The Contact Center Must Evolve,” Web Strategy, October 14, 2010,
http://www.webstrategist.com/blog/2010/10/14/social-media-mission-control-thecontact-center-must-evolve-socialsupport/.
11. “From Social Media to Social Commerce,” Journal of the Microsoft Global High Tech Summit, Spring 2011,
http://download.microsoft.com/download/9/4/A/94A04B64-7EB4-4754-BD82-A148D341549D/MSGHT%20Summit%2011-From%20Social%20Media%20to%20Social%20Commerce.pdf.
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The author offers advice to companies that think they’ve committed to customer experience but haven’t.
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