Trends and Opportunities in Customer Experience Management

EPiServer Update, Copenhagen

02 October 2014

@tim_walters

A Conversation with Univision A conversation with Univision October 22, 2013

Trends and Opportunities in Customer Experience Management

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The DCG team Scott Liewehr Cathy McKnight Tim Walters Mary Laplante

Robert Rose Jill Finger Gibson Kyle Dover Hollis Thomases

Chris Walter Connie Moore Marianne Kay Tiffany Elliot

DCG helps business leaders navigate the digital transformation and create competitive advantage from disruption.�

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June 28, 2007

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The compression of time and space

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Each improvement or innovation literally compresses time and space by progressively

reducing the delay and/or the physical distance (or activity) between the

expression and the satisfaction of a desire.

16"#epiupdateCPH"|"@9m_walters"

!  Accelerated flow of information

!  Democratized production of information

!  Dissolved monopoly over information

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The deformation of information #epiupdateCPH"|"@9m_walters"

“As the industrial revolution was defined by radical efficiency in production, the digital

revolution is defined by radical efficiency in information transmission”

- Mike Aruz

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Twitter trumps condiments

19"Source:"hEp://www.newmediaandmarke9ng.com/brandsLhaveLtoLmasterLcomplaintLmanagement/customerLcomplaintsL561"

Only"

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1%"

feel"their"expecta9ons"for"good"customer"service"are"always"met""

Source:"Haaris"Interac9ve"survey"of"North"American"consumers,"2011."Commissioned"by"RightNow."

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Say they have switched business to a competitor due to poor

customer experience Source:"Haaris"Interac9ve"survey"of"North"American"consumers,"2011."Commissioned"by"RightNow."

22"Source:"Okeeffe"&"Company"survey"of"1,342"senior"execu9ves,"2012."Commissioned"by"Oracle."""

Global executives say the cost of not providing “positive, consistent, and brand relevant experiences” is

20% of total revenue

How much is at stake?

$5,900,000,000,000 ($5.9 trillion)

23"Source:"Accenture,"2013"Global"Consumer"Pulse"Research.""Photo:"hEp://www.tLna9on.com/free_online_ar9cle/most_recent/train_like_a_man_5_the_real_paleo_exercise"

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The only graphic you need #epiupdateCPH"|"@9m_walters"

#CEM isn’t the Next Big Thing. It is the Next Only

Thing. #provocation

25"#epiupdateCPH"|"@9m_walters"

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What do consumers want from us?

79% Companies"“asking"same"ques9ons"or"marke9ng"same"offer”"across"channels"

Sources of consumer frustration

65% Inconsistent"offers"or"content"

79% Companies"“se^ng"false"promises”"

Source:"Accenture"Global"Consumer"Pulse"Report,"2014." #epiupdateCPH"|"@9m_walters"

of consumers are frustrated by site content that has nothing to do with their interests

28"Source:"Harris"Interac9ve"survey"of"2,091"U.S."consumers,"2013." #epiupdateCPH"|"@9m_walters"

of consumers say that personalization influences what they purchase – 25% say

the influence is “significant”

29"Source:"Vanson"Bourne"survey"of"US"consumers,"2013." #epiupdateCPH"|"@9m_walters"

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Consumers expect insight

Source:"Dynamic"Markets"study"for"Experian,"January"2012."

“Understanding” means, e.g., “taking account of preferences, purchase history, and other provided information.”

84% said they would no longer buy from a company that failed to “understand.”

@9m_walters"

We are anxious about privacy . . . but we want

companies to offer relevant experiences based on our wants, needs, and tasks.

31"#epiupdateCPH"|"@9m_walters"

Personalization isn’t about getting personal. It’s

about being personable.

32"#epiupdateCPH"|"@9m_walters"

The point of BIG DATA is not to expose the consumer’s every desire. It is to make

your responses less pathetic and more empathetic.

33"#epiupdateCPH"|"@9m_walters"

It’s very easy to be too personal. But almost impossible to be too

relevant 34"

#epiupdateCPH"|"@9m_walters"

#CEM means: Embracing the shift from #CRM to

#CMR 35"

Source:"hEp://sapinsider.wispubs.com/Assets/Ar9cles/2014/January/SPI_Feature_FromLCRMLtoLtheLCustomerLManagedLRela9onship"

#CMR=customer managed relationships. (Thanks to

@collsdad)

36"Source:"hEp://sapinsider.wispubs.com/Assets/Ar9cles/2014/January/SPI_Feature_FromLCRMLtoLtheLCustomerLManagedLRela9onship"

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Strategic inflections Source:"Based"on"Andy"Grove,"Only"the"Paranoid"Survive,"1996"

Status Quo Strategic Inflection Point

New Paradigm

Old Paradigm

#epiupdateCPH"|"@9m_walters"

“Strategic inflections can come from anywhere: new technologies, new competition, new regulations, new customer values and habits, etc. – anything that has a significant impact on the business itself or the industry as a whole.”

– Andy Grove

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CEM is a “fundamental” SI Source:"Based"on"Andy"Grove,"Only"the"Paranoid"Survive,"1996"

Status Quo Strategic Inflection Point

New Paradigm

Old Paradigm

!  Digital disruptions

!  Era of empowered consumers

!  Basic shift in the business environment

!  Impacts every firm, regardless of industry

Impact:"Failure"to"provide"superior"customer"experiences"leads"to"irrelevance"and"business"

decline"

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!  In Forrester’s 2014 CX Index, 11% of companies received a top grade

!  Accenture surveyed over 13,000 consumers in 33 countries about 10 industries –  Despite investments and initiatives, no CX metric

“has improved consistently in the past five years.” –  All metrics “lost ground in 2013” –  Companies “have been playing not to lose”

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Answer: You suck

Source:"Accenture"Global"Consumer"Pulse"Report,"2014."hEp://blogs.hbr.org/2013/06/newLresearchLyoureLdoingLcusto/"

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“Dissonance gap” Source:"Based"on"Andy"Grove,"Only"the"Paranoid"Survive,"1996"

Status Quo

New Paradigm

Dissonance Gap

#epiupdateCPH"|"@9m_walters"

#CEM means: Navigating the “dissonance gap.” Time is running out..

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You can’t do it alone.

Source:"hEp://silenceLwithout.blogspot.de/2010_12_01_archive.html"

“CEM is so new, hard, and complex that nearly all organizations must draw on third-party service providers to provide or supplement skills in research, strategy, design, technology, operations, and much more. In short, service provider partners increasingly provide an indispensable ingredient in any CEM endeavor.”

45" @9m_walters"

It’s more than implementation The “Three I’s” turn software into a solution

!  Implementation

!  Integration

!  Incorporation into ongoing CEM processes

#epiupdateCPH"|"@9m_walters"

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By 2020, consumers will favor “nearly perfect execution” of “unified

omnichannel experiences” - PwC

48"Source:"hEp://www.pwc.com/us/en/retailLconsumer/publica9ons/retailingL2020.jhtml" #epiupdateCPH"|"@9m_walters"

But . . . Marketers should avoid chasing the latest cool touchpoint, or trying to pull a fully mature omnichannel rabbit out of a siloed hat.

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Source:"hEp://www.pwc.com/us/en/retailLconsumer/publica9ons/retailingL2020.jhtml" #epiupdateCPH"|"@9m_walters"

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Time

Cus

tom

er E

xper

ienc

e Q

ualit

y

Improve today’s experience

Transform the organization

Sustain cultural change

Customer-focused transformation #epiupdateCPH"|"@9m_walters"

The #CEM Imperative:

Accepting that business

reality has changed. (And acting like it.)

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fundamentally""> forever"">

#epiupdateCPH"|"@9m_walters"

What it means !  Firms must act now: Consumers expect rich experiences

today, and they are growing ever less tolerant of deficient engagement – and of disengaged brands.

!  Resistance is futile – but pervasive . . . and fatal: If you wait for best practice to emerge, you won’t need them. New ways of working – among clients, vendors, and other service providers – are unavoidable and advantageous.

!  CEM is not design-build-deliver. Consumer expectations are insatiable. Change is the only constant. Unpredictability is the only reliable forecast. Adaptability is the only sensible five year plan.

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“You may hate gravity, but gravity does not care.” -- Clayton Christensen

Tim Walters | Partner, Principal Analyst @tim_walters twalters@digitalclaritygroup.com www.digitalclaritygroup.com