Digital transformation and the customer experience

The traditional sales maxim always used to be ‘the customer is king’. That is still broadly true today, but like pretty much everything else that digital technology touches, it has evolved. In the digital transformation era, it is customer experience that is now king.

Forrester Research defines customer experience as: “How customers perceive their interactions with your company.” This is quite a good explanation, since it breaks down a very complex and multi-layered exercise, which includes physical, virtual, emotional and even psychological interactions, into an easily understandable concept. Perception and interaction are central to any customer experience definition.

Today’s customers are more sophisticated than ever, and today they have also become accustomed to engaging with companies on a continuous basis. Today, 56 per cent of modern customer engagements take place over multiple days across multiple channels, underlining that customers are comfortable with an ongoing relationship with suppliers – but only as long as they feel they are getting a good experience from it. Further research shows 93 per cent of brand managers believe digital technology reinvents the customer experience, making the outcome clear: companies need to focus on the customer experience if they want to be successful.

Data, data everywhere

Thanks to these continuing, multichannel engagements, the relationship between data and enhancing the customer experience has gained great significance: more data analyzed using state of the art analytics tools enables more personalization of the customer experience, and mining data to deliver a more personalized experience works. Over 85 percent of mobile marketers reported increased success using personalization, including higher levels of engagement, increased revenues and improved conversion rates.

But how do organizations now fully exploit all this data? In my view, it must be done at a granular level and address every touchpoint, but also start from a ‘human’ perspective. At Orange, we focus on digital technology as the enabler to a great customer experience, but our actions and strategizing are always framed within an understanding of the human side of the process.

That said, data is of no real value if you do not make use of it, so I like to think in terms of turning data into smart data. Research by Bluewolf reveals that 80 percent of data is “dark and untouched”, or rather never actually used to address customer concerns or to improve their experience. Similarly, cross-industry studies show that less than half an organization’s structured data is actively used in decision-making, and less than 1 percent of its unstructured data is analyzed or used at all.

Amazon is one of the companies to emerge from the digital era and really drive forward off the back of a great customer experience. CEO Jeff Bezos has spoken about the “customer obsession” approach, and I agree with his philosophy. Amazon was originally an online retailer, but today it is the world’s largest cloud service provider too. When he was asked what Amazon “is”, Bezos replied that it is neither, it is an organization based on customer obsession. In Bezos’ own words, “You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused. But in my view, obsessive customer focus is by far the most protective of vitality.” Progressive thinking of this kind with the customer as the focal point is at the root of Amazon’s success.

Give customers more than they expect

Enterprises that put customer experience front and center need to remain focused though; in the digital era, the disruption that technology has had on traditional ways of doing things has also impacted customer churn. 67 percent of consumers today cite bad customer experience as their reason for going elsewhere. I’ve also heard CEOs state that customer experience is a boardroom topic all across the US: 65 percent of Fortune 500 companies have reported ‘losing touch with their customers’ and that it was likely down to poor omnichannel communications, emphasizing the need to communicate and engage with customers via any mechanism, any device and in any location.

Nespresso, an Orange customer that understands this new paradigm, is a premium consumer brand whose major threat today comes, in my opinion, from the digital-only players. So to mitigate that threat, what Nespresso did was to marry its premium high street brand, which has shops and boutiques in the most fashionable and stylish locations, to a digital side which combines difference customer engagement channels while also providing that all-important human touch.

Another Orange customer, luxury brand LVMH, has put customer experience front and center. We have heard about a customer being in a Sephora store in Paris who struggling over a color choice and was able to make an ad hoc video call to his wife in New York to ask her about it. That kind of technology use is inspiring and shows the possibilities if you focus on the customer experience first, if you, like Amazon, be ‘obsessed’ with your customers. LVMH is also using data at a granular level to enhance the in-store customer experience. Using in-store Wi-Fi or cameras and video analysis, the company is figuring out why people turn left or right when they leave an escalator or elevator. From this the store can create ‘heat zones’ which boast higher sales numbers than other areas, and plan store layouts accordingly to give customers an enhanced, personalized experience.

Customer experience is about paying attention to these details and putting the human element at the center. According to Verint research, 79 percent of consumers say they want the human touch to remain a part of customer service.

Customer experience is the new way ahead

Delivering on all of this however takes progressive thinking. I like the idea of creating a digital platform that will let companies reach digital customers, things and ecosystems intelligently. It makes sense to me and is a logical step forward. 90 percent of large enterprises are now at varying stages along the road to digital business, and real-time analytics will become 30 per cent of the market by 2020.

A central factor for me now is that as customer experience comes more and more to the fore. But the decision-making power to address it sits in the business, not with the CIO. Successful customer experience projects are now vital and are the new way of things. Let’s get to know our customers better.

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If you would like to talk further about the customer experience and its vital role in engaging successfully with the digital consumer, please drop me a line.

To read further about Orange’s vision for the customer experience and for further real-world success stories, please see: http://www.orange-business.com/en/customer-experience