According to the Forrester report: Predictions 2018, A Year of Reckoning, customers’ expectations will outpace the ability of companies to evolve or invest in experiences this year
It points to the resulting churn and how the lack of digital transformation gains will translate to losses in market share.
Research from Qualtrics in October 2017 showed that despite 90% of marketers claiming that they are “customer centric” in their approach, only 17% of consumers feel valued by the brands they interact and buy from.
There’s a clear gap between the experiences that marketers are delivering and what today’s customers expect. However, emerging tools and techniques promise organisations new and insightful approaches to understanding the customer and closing that experience gap in 2018.
Here are five technology advances that will help companies create engaging, compelling customer experiences:
1. Predicting churn to stop brand detractors in their tracks
Brands spend a huge amount of money and effort on attracting new customers but it’s well known that keeping hold of your existing customers is just as valuable AND requires less investment per customer.
That’s not to say it’s a choice of one over the other – profitable growth requires a good balance of new customers and a good retention rate. Smart companies are spending time and money figuring out how to make sure their customers never leave, and technologies are now available to identify potential defection through behaviour or interaction so brands can act fast – perhaps even before the customer themselves knows they might go elsewhere.
2. Improved anomaly detection for better marketing
Identifying anomalies in behaviour is very easy to do, but understanding the meaning behind them isn’t. If a customer doesn’t have a history of buying expensive items of jewellery, then it’s not hard to identify a diamond necklace when it appears in the customer’s past purchase information. But was this fraud? Or has the customer found themselves a new significant other? Or perhaps they received a bonus at work and wanted to splash their new-found cash a little.
Advances in machine learning and artificial intelligence will enable more complex anomaly detection in 2018 and this in turn will lead to greater insight into the customer and their buying habits – and potential. Brands can reduce the span of their marketing campaigns and focus in on delivering offers and content that are both relevant and timely to induce a purchasing decision.
3. The Internet of Things gets personal
In 2018, the Internet of Things (IoT) will get smaller and more personal, extending to a micro level that involves everyday products integrating “smart” features. This is a step beyond an internet-connected fridge with a camera, to looking at a specific item in the fridge or cupboard and understanding how quickly the product is being used up, when it will run out, then adding it to an automated delivery list.
The aspect of “customer awareness” will cease to be a part of the process altogether, as a carton of milk will determine it runs out on a Sunday and pop itself on a consumer’s shopping list for the Saturday before. It can also be applied to restaurants and fast-food outlets, ensuring ultimate freshness in ingredients and optimum choice for the customer when ordering.
4. Accelerating consumer-to-manufacturer feedback
Consumers expect to be able to feedback issues or suggestions on products, but often do not expect to see any improvements or fixes for months — if at all. One of the biggest challenges is the feedback process or “knowledge chain”, due to its complexity. Feedback needs to be taken, then the problem or concern understood, before being passed through numerous points in the chain until it reaches the person who can influence the manufacturing stage.
From 2018, we will see a rise in feedback mechanism on the product itself, so customer problems and defections are sent directly to the manufacturing plant and product manager in real time. This creates a new type of connection between consumer and manufacturer, with an urgency and transparency between these groups. This will improve the speed of production and marketing, enabling a new shortcut between feedback and innovation.
5. Better personalisation through enhanced data
Personalising the customer experience is nothing new, but 2018 will see significant developments in this area, as organisations look to enhance existing systems with more advanced experience measurement and experience management platforms.
The key to unlocking the next phase in personalisation lies in combining data from operational activities — such as how many emails were opened or what a customer previously bought — with attitudinal and ‘experience data’ that tells them why this happened and, perhaps more importantly, what this predicts the customer will do next.
About the Author
Luke Williams is Head of Customer Experience (CX) at Qualtrics and is an award-winning researcher and author of a New York Times and USA Today bestseller (“The Wallet Allocation Rule”), and a Bookscan bestseller (“Why Loyalty Matters”). A statistician and methodologist by training, Luke is a thought leader in the space of customer experience, client satisfaction, client loyalty, client ROI, strategy, and analytics. His work has appeared in many academic and trade publications, including co-authorship of a Harvard Business School Case Study.
Prior to Qualtrics, Luke was Corporate Vice President of the Client Care Program at AECOM, where he was responsible for the global client feedback measurement, analytics and insights team. Luke previously held multiple roles at Ipsos Loyalty, including Head of Research Methods & Head of Consulting, and Vice President, Financial services.
Luke is a member of the Market Research Association (MRA) and CXPA. He holds a M.A. in Research Methods from Durham University in England.