I have been reading a lot of interesting developments about IoT(Internet of Things) and some recent trends on the kind of devices that will pop-up soon to influence a customer's life which were showcased in CES 2016. I often wonder how ready are enterprises to transform themselves in a way to anonymize this data yet deliver compelling customer experiences.

I came across this lovely article in HBR on "Customer tracking can work without being creepy". Smart CRM as HBR puts it, talks of some interesting steps that companies need take to balance data being collected & not getting too up-close & personal!

There is a very big difference in companies controlling the data and allowing customers having control over their own data. When customers feel value is being created in their interactions with the company using this data, then there is no issue. The key question here is - "Definition of Value". The irony here is what companies think is value out of this data for them, may not be valuable to customers and value may be different across different customer segments & types. Companies need to understand the concept of "value tiering" when it comes to managing individual customer relationships and using this data out of these devices.

The importance of mapping customer journeys with this data is a critical component companies need to develop quickly.The need to have a "Pilot & learn" mindset is critical. Mapping end-to-end customer walk-thro's and discovering 'data-holes',  is a good way to create previously impossible customer experiences now enabled thro' such IoT devices.   

There is also a huge need to integrate "Brand values" with "Data lakes" that are getting created due to IoT devices. If you were a bank, which  focuses on efficiency more than convenience, then the " data experiences" have to be linked to those brand values. However, if  you are a retailer focusing on "Intelligent Shopping", then how will these devices & data deliver similar values need to be worked on. Amazon's dash button is a great example of this. 

IoT devices have the ability to create 'data overload' and can lead to 'Relationship Tripping' - companies must learn to use it selectively, effectively and intelligently. They need to develop their own IoT vision and have a clear road map of which customer experiences would they like to influence and drive value will be important.

Whenever I talk to companies about customer experience, the discussion always is steered towards technology, process and scalability but sometimes first principles are forgotten.

There is very little discussion around what is stopping them to deliver the customer experience today. Surprisingly, what is always stopping great customer experience is  people-centricity..  I came across a very interesting quote by  David Cooperrider from Case Western University:

“Human beings are not a resource that gets used up, but are a source that can intensify and increase in value and contributions.”

So, how people, who interact with customers in your company, are managed makes a huge difference to customer experience. If they are treated as a resource, energy is only finite in them! They end-up doing what is told to them. They end-up performing a task. Funnily, the customer sees them through!  But, when they are seen & recognized as value-adding contributors, the customer experience takes a leap.

Therefore, software, platform and tools only act as mere catalysts to customer experience. When this is combined with people-centric drivers, the multiplier effect is enormous.

I was seeing this interesting video from MITSMR on Building capabilities for Digital Transformation.

What stuck me was to effect a successful digital transformation of business, should they practice digital transmigration - which is taking customers from one stage to another - which is building a path of planned digital transmigration. 

My belief in this comes from the fact that big transformation does not happen overnight - especially when businesses really want a mass movement of customers shifting their behaviour - the way businesses want them to. But, when we take  customers stage-by-stage, my instinct tells me transformation is rapid and happens quickly too.  Else, it becomes too much of a rapid disruption for customers which either leads to poor adoption and lesser regular/repeat usage behaviour, ultimately leading to failure of such initiatives. What we may find interesting is that when a first set of ' large' early adopters see the benefit, they act as catalysts to get the rest to move in that direction by sheer word-of-mouth & conversations. The transformation is phenomenal and impactful.

For example, imagine if a retailer starts to send digital invoice to every customer who purchases offline at the store. Let them know the product benefits and provide a digital purchase box( storage) which stores all digital invoices for them because it really helps customers to access and print them in case they want a replacement, claim warranty or refund in case there are product issues. Most often, customers misplace invoices, find out quality of ink is pathetic in physical invoices as the print turns invisible or just realize it becomes too difficult to do these things physically.

As customers become comfortable and appreciate the benefits of this, just building a digital product warranty registration proactively as a convenience, may help them adopt the digital channels faster due to sheer convenience and ease of use. Then, moving them into digital product feedback, usage tips, digital reminders, digital chats for customer help/service support etc. may take them to higher levels of engagement with the digital world. Then, ultimately moving them to online purchase, support etc. over time. 

What this also does is that businesses are able to differentiate customers by " physical/emotional state of digital adoption" in their path to digital adoption and usage.

Therefore, in my view, if businesses want to effect digital transformation rapidly, they need to build multiple paths of digital transmigration in their execution strategy, keeping in mind how their customers will adopt them easily & quickly.

To me, it looks like a digital transmigration plan seems to be a very critical aspect in the digital transformation journey.

Most often enterprises struggle with siloed data. It's no surprise that integration of data across enterprise is a nightmare. PWC technology report provides some interesting perspective on how semantic web can make it real and ensure it can be done easier than ever before.

Here are some interesting facts contained in the report:

How is semantic web a game changer for data integration?

The disparate data feed into a mashup—a Web application with highly configurable data display capabilities—that updates each time you add a new store site or remove an old one. Other data in the mashup arerefreshed whenever the original sources are updated. By combining various data, regardless of their formator source, you have a wide range of possibilities forgreater insight and context.

The challenges with traditional data integration vs semantic web:

Generally enterprises don't make the best use of their data.

Given the disparate systems and multitude of vintage of technologies( old and new), it is always very difficult for business managers to use multiple source of data for decisions.

Getting internal and external to handshake with each other can help trigger power decisioning within organizations

.....empower your business users...

with exploration tools that they could use with existing internal data and with external data of their choosing. These tools would let them find the best business cases and make immediate use of the Linked Data technologies at a low cost to IT, since most of these tools are reasonably priced.

Read more

In an interesting post Jay Budford writes:

At the DMA Conference in Las Vegas this week, I heard a common question.  "Why set up a Marketing Database?  We have a CRM platform." 

Then I begin to ask the questions.  How long does it take to get data from IT to complete the data processing for your marketing campaigns?  How difficult is it to utilize business intelligence to develop campaign triggers or report on marketing results? Where does the marketing information reside in your CRM platform?  I often hear "by the time our business intelligence group receives data and completes data analysis the relevance of the marketing opportunity discovered by our market research has passed!"  The reason this is happening is simple;  you have data management occuring at the enterprise level in order to run the back-end of the business, not specifically marketing data that captures the essence of the customer interaction required for integrated marketing activities. We service several Fortune 500 clients, those with a true marketing database are able to successfully execute campaign management, triggered marketing and deliver great marketing ROI.  Those of our clients that rely on enterprise level information management are only able to manage campaigns as "one-offs,"  the results often a fraction of those with a true marketing database.  It is a simple question with a simpler answer, in order to optimize marketing ROI you must have a database built for that purpose.

My View: I can't agree more with Jay. Many of the clients we work with have similar issues and have found solutions similar to what Jay has written about. If companies want to really do customer-focussed marketing right from prospecting to acquisition to retention to growth, you need a marketing database.

Else,  they will pay only lip service to such an intention and will never really execute them at all.

Most often when I interact with clients, I am always amazed that they have data and information about customers, products,  promotions, distribution, sales etc. in islands. At the other end, I meet clients who say they have done all the mining on this data and haven't got the impact at the right time for them to pursue it with the same vigor.

They do all the analytics in the world with the data that they have but most of the real power of these insights is felt only when employees are empowered with this information to take decisions on a day-to-day basis. No amount of advanced data mining can help if this is not available across the company.

Here's my belief on making data-driven analytics & marketing count. Here is a 10 step plan:

1. Start Small - Don't do a big bang approach
2. Show quick wins - can you show impact in 4-6 weeks?
3. Keep improving the analytical process continuously
4. Involve business heads at every stage - Get them to buy-in
5. Show proof-of-value with the right interventions & initiatives
6. Don't control information flow of analytical projects - make it available to as many employees as possible
7. Make it simple to understand and act - across the enterprise
8. Grow the complexity of analysis over time but maintain the simplicity of output and action all the time
9. Remember technology and statistics are just enablers
10. Measure and refine continously

Here's an interesting article, Alberto Roldan of HP which provides a great analogy to making this happen:

Toyota has shown a different approach to innovation, kaizen or continuous improvement approach rather than a technology leap approach. Instead of great technological breakthroughs, this approach goes for involving the entire workforce in a continuous improvement process. Hence, most of the improvements are small and process oriented (like making shelves more easily to reach) but the involvement of the entire workforce rather than a selected few keeps a vibrant and innovative enterprise. The best measurement of how this work is that the Toyota workforce gives managements one hundred times more suggestions for improvement than other auto manufacturers.

Businesses that want to improve their analytics capabilities should follow the kaizen approach and make business analytics available throughout the entire organization. It seems that in some companies analytics is only within the purview of the few like statisticians, physicians, molecular engineers, and actuaries. The concept behind this thinking is that analytics technology is expensive and difficult to interpret. This premise is no longer applicable since in the last three years mathematical science and computer technology have advanced to such a degree that this technology is now inexpensive and available to interpretation to anyone within an organization.

This technology is the work of dedicated professionals and scientist that over many years have worked to make this possible. The issue now has become whether companies want to institute a continuous improvement process that includes enterprise analytics or whether they want to leave business analytics in the hands of the few.

Charles Green has  a brilliant post on this topic( thro' Tom Hines of Monitor Group):

"My question to you, Charlie, is simple, but something that I've been struggling with for some time now. If every CEO or other senior leader (or at least the great majority) seems to agree that success in selling is in some part attributable to trust based selling concepts, then why do they spend virtually all of their training $$ on sales process, closing techniques, etc. It seems like a dirty little secret that this is nothing but a waste of money."

"I have worked with literally hundreds of sales people over my career and no process, qualification questions or closing technique ever works without establishing trust as the foundation of any client relationship. So the question then is why don't organizations prioritize and invest in helping their organization understand the dynamics of trust and use that as the foundation of any other program they try to implement? It seems to me that they spend a great deal of money on "quick fix" programs that do nothing to change behaviors and belief systems about the importance of trust and how it is the only way to improve performance."

Well, Tom, no surprise, you’re preaching to the choir. But I know you mean the question seriously too, and I too take it as a serious question.

Why is it that things are that way?

Here’s my Top Ten list for why organizations, especially sales organizations, don’t invest more in trust. 

10. Fear--of looking wussy, as in Real Men Don't Play Trust Games.

9. Thinking that business is about competition. It’s not. It’s about commerce.

8. Fear—of someone taking advantage of us; hence do unto others before they do unto you.

7. Bad long-term logic. We are dominated by financial logic, internal rates of return and present-value discount rates. That belief outlaws any investment beyond about 25 years. The parent of a child operates on a longer timeframe, not to mention entire nations in Asia.

6. Inability to defer gratification.

5. A Hobbesian hangover. The continued belief, fostered by ideologue economists and politicians, that the world is an evil place—life is nasty, brutish and short--and therefore the best defense is a good offense. Even if the premise were true (I have no position on it), the conclusion certainly is not.

4. The cult of rationality. Belief that only “scientific” management works; forget passion, belief, relationships—and trust.

3. Over-emphasis on measurement. The belief that “if you can’t measure it, you can’t manage it.” Just think about that. False on the face of it.

2. The cult of short-termism. Here-now, bird-in-hand, payback time, fees-not-interest, outsource, monetize—it all adds up to transactions, not relationships. Not good for trust.

1. Fear—that someone will find out who you really are if you don’t manage your image. So tighten up, spin everything, and get out of Dodge before they can spot you for who you really are.

What's your answer to Tom's question?

Ron Shevlin makes an interesting point on this topic. He writes:

...in my inbox, comes an article from a company called Vox that poses the question “Is customer loyalty a thing of the past?”and claims that “old business tactics don’t work on today’s savvy customers.” The article goes on to say: Today’s customers don’t hesitate to switch where they do business if they feel their expectations aren’t being met. In fact a recent survey conducted by Thunderhead, found that 61% of insurance, and 63% of banking customers polled planned to switch providers during the next year. The reasons? 76% want more personalized options when it comes to how providers communicate with them.

The reason, in my opinion, is impacted by — but not caused by — the Internet. No, the root cause of this goes back well before the advent of the Internet, and social media, and all the other so-called “disruptive” technologies that some people like to rant about.

Instead, the reason is rooted more in societal changes and globalization. As we’ve become a more affluent and highly educated society, we’ve had an increasing desire to have more control over our lives. It’s an insult to our intelligence to think that we can’t make decisions for ourselves and that someone else has to tell us what products and services to use. Globalization, however, has had a negating impact on that feeling. As news from around the world reaches us daily, hourly, and now on the minute, we’ve increasingly felt that things are happening so fast that we’re losing control of what goes on around us.

Switching providers — whether it’s banks or firms from other industries — is an act of independence. We switch because we can. We switch to make a statement. We switch to demonstrate that WE are control of our lives and our business relationships.

Successful firms approach customer relationships as just that — relationships. A two-way street. It goes far beyond “customization” and “personalization”."

My View: I had a client, B.S. Nagesh of Shoppers' Stop, a leading retailer in India. telling me once( I used to run their very successful loyalty program - First Citizen) - "we need to be loyal to our customers more than they being loyal to us!" . That's the truth about loyalty. We need to create enough value, stay true to building relationships which is a two-way street, build enough reasons for our customers to "feel cared", then customers show their loyalty to companies!Loyalty is not dead. Loyalty has to be earned!

Marty  Mosely, in her expert opinion in Peppers & Rogers  writes about the importance of organizing customer information.

Master Data Management (MDM) software or systems enable organizations to strategically leverage and share those critical data assets. Deployed properly, MDM can provide organizations with complete, accurate, and real-time views of data spread across multiple systems or databases, even outside the firewall. This allows businesses to unlock the value of their data assets for competitive advantages or operational improvements.

Exactly how are businesses using MDM? Here are some quick, real-world examples of how organizations in the hospitality, retail, and technology industries are using MDM solutions to manage their most important data while adding to the company bottom line.

Increasing customer recognition and loyalty

Although an international hotel chain was using multiple systems to track guests, the company was only able to follow those enrolled in its loyalty program—about 10 percent of its customer base. This meant the company was potentially under-servicing 70 percent of frequent guests who did not have a loyalty program number. With mountains of complicated data from multiple systems, representing 5,000 global properties across eight brands, getting a handle on the data was a daunting task.

The company chose an MDM system that aggregated complex customer data without disrupting source systems, and seamlessly integrated with its loyalty program system. Once the MDM system was deployed, it was no longer a problem to identify frequent guests, even if they registered under different identities (variations on names and addresses without a consistent identifier), did not use their loyalty program number, or stayed at a number of the company's brands for a variety of reasons. By accurately matching guest information according to demographic and historical information, the company is now able to recognize guests across all brands in its portfolio in real time at the point of service.

Improving customer experience and top-line growth

Plagued by redundant records and an inability to properly recognize customers at any touchpoint, a massive retailer with a huge online presence and hundreds of brick and mortar stores knew it was essential to get a grip on customer data to help the company interact with customers in a more meaningful way. With its new MDM system in place, the retailer has created an accurate, real-time view of its approximately 40 million customer records from three disparate data sources. It can now recognize individual and household relationships, and has identified more than 11 million redundant records.

The retailer can now provide a complete view of transaction and customer history at the point of interaction, fulfill online orders at physical stores, better reconcile customer preferences, eliminate duplicate and inconsistent marketing campaigns, and remove the need to repeatedly ask customer loyalty program members for their personal information.

Understanding customer relationships and improving revenue and service

One of the world's largest technology companies was losing significant revenue due to incomplete software licensing information and territory assignment issues. The company needed to access composite views of all individual and organization data about customers, partners, and suppliers along with advanced B2B hierarchy management. The company used an MDM system to create a single view of customer and hierarchical data to help the organization address its licensing problems and operational inefficiencies, define the true and total value of every customer, identify the most valuable customers within an organization, and even know when a customer purchased through multiple channels.

The results were enormous. By properly managing organizational-level data, the company has found $139 million in new licensing revenue and recouped $47 million in operational cost savings. The MDM solution also helped improve field productivity since sales reps now can access synchronized data from across the entire organization (CRM, software licensing, and financial accounting applications) and gain a better picture of existing relationships and potential for cross- and upsell opportunities.

At the end of the day, what you sell or service doesn't matter. It is imperative to better understand your customers while improving the bottom line. With an MDM solution in place, it turns out that these two goals do not have to be mutually exclusive. Knowing your customers is the key.

My take: I  certainly think organizing customer information is the first step towards building consistent customer experience. This is the basic platform around which the rest of the customer marketing initiatives like segmentation, understanding customer value & profitability, analytics need to be built. Hence, getting this right is an important first step.