Apple launched the iPod in 2001 with the mission to “put 1,000 songs in your pocket.” Twenty years later, L’Oreal has taken a step towards transforming cosmetics by allowing a woman to carry her 1,000 shades of lipstick in her purse. The key is her Connected device that prints the Yves Saint Laurent line of lipsticks. A customer uploads a photo of her outfit to her YSL app, and some matching colors are generated. After using augmented reality to tweak the colors to get just the right shade, the customer presses a button and the device prints a few drops of lipstick.
What L’Oréal has achieved reflects more than engineering prowess. This is the intersection of advanced technology and customer touchpoints to create a powerful customer experience (CX) that enhances satisfaction in ways most businesses could not have imagined or could have achieved 10 years ago. It reflects a deep understanding of how we create
Rethink customer touchpoints
Despite the buzz around the concept of omnichannel, most businesses still see the customer journey as a linear sequence of standardized touchpoints within a given channel. But the future of customer engagement transforms touchpoints from nodes along pre-defined distribution channels into full-fledged portals that can serve as pathways to point-of-sale or many other digital and virtual interactions. They link to chatbots, kiosks, robo-advisors, and other tools that customers (especially younger customers) want to engage with.
But the mere existence of these groundbreaking interactions is only part of the story. One CX factor was identified. The first four – convenience, choice, navigation and payment – are essential. In other words, the presence or absence of these factors determines whether customers will judge a particular experience as good or bad. Think of them as table stakes. The rest – ambiance, expertise, touch – amp up the baseline level of satisfaction. Their presence increases satisfaction from good to very good 70% of the time, but their absence 89% of the time turns a ‘bad’ experience into a ‘very bad’ experience.
Alibaba’s Freshippo chain, which consists of over 300 high-tech grocery stores, demonstrates these effects. Launched in China in 2015, Freshippo offers fully automated stores that combine physical and digital experiences in a single environment. In-store shoppers use their smartphones to “add” items to their “shopping cart”. Within the cart, users can access product information and pay for products without the assistance of a store associate. Stores are also fulfillment centers for orders that are made entirely online. About 36% of young consumers gave this store the highest satisfaction rating, compared to the overall grocery store average of 16%.
Take another look at L’Oreal’s lipstick tools to see how touchpoints and technology work together to improve your CX. Each screen tap, each tweak, and each customer action is a touchpoint. L’Oréal captures data on all such interactions and infuses that information into product development, marketing and other functions so that we can see what works and what can be improved. The amount of real-time data is enormous. Each physical, digital, augmented, or virtual interaction links an information-rich network that recognizes customers and guides them along their purchase path. These interactions give some agency to what the customer receives, resulting in a deeper, richer and more personalized experience.
B2B companies are also using connected touchpoints to increase customer value. John Deere’s smart ecosystem of devices and intelligence helps farmers improve yields and profitability. The company’s cloud-based machine management system infuses telematics into its AI platform, allowing farmers to monitor equipment in real time, work with ecosystem partners to gain insights, and use analytics to determine which crops grow where. Helps you decide when to plant and when is the best time to plant. A convenient smartphone app keeps everything under control.
These perks are especially important for young customers under the age of 40. Their turnover rate is twice that of the average population, highlighting both the upside of meeting expectations and the risks of falling short. One key point is that young customers value autonomy when shopping. This means that we increasingly prefer interacting with technology over people. For example, in retail, nearly 60% of younger buyers would rather self-service “scan-and-go” than a human cashier when given the choice, as opposed to 30% of older customers. ” said he prefers to use kiosks. Our research found that 50-year-olds are nearly twice as interested in technology-enhanced CX and 60-year-olds are nearly three times as interested.
However, in some situations young people cannot distinguish between human and virtual interactions. When Jill Watson, her assistant teaching at the Georgia Institute of Technology, found her computer in 2016, no one recognized her true nature when she began offering valuable support and advice to science students. bottom. She wasn’t the bright and friendly graduate student that some assumed. She was the embodiment of IBM’s Watson AI Her platform, created by a team led by Georgia Tech professor Ashok Goel.
One of the inherent advantages of these high-tech touchpoints is their ability to be rapidly and scalable trained. Jill Watson served as a teaching assistant for 17 classes, something no human would be able to do. According to Goel, Jill’s original version of Watson took about 1,500 hours to build, while the more recent version takes him less than 10 hours. This is just one example of a broader trend. Until recently, tools for next-generation interactions were either not commercially viable or too expensive for enterprises to deploy at scale. Today, the cost of creating an AI-based image classification system is about 33% less than his four years ago, and training time is 94% better than his. Cloud usage has increased dramatically, making it easier to access critical functionality. These changes enable more and more businesses to engage with their customers in increasingly sophisticated ways.
What Business Leaders Can Do
We believe there are three opportunities for business leaders looking to enhance their company’s CX and increase satisfaction.
First, focus on frictionless commerceAn Amazon Go store serves as an integrated, highly integrated touchpoint that enables customers to complete their entire shopping journey by simply striding, picking up their favorite items, and walking home. can. Biometrics, QR-enabled payments, and smart carts that automatically scan items are just a few of the many technologies that make this kind of journey possible.
Second, consider Extended experienceH&M has equipped some of its fitting room mirrors with RFID technology, which allows it to recognize the items, sizes and colors of clothing customers bring into the fitting room. Then display personalized product and styling information in the mirror. As augmented and virtual reality tools become more mainstream over the next few years, expect to see more innovative ways to incorporate these capabilities into the customer’s journey.
emphasize at the end intuitive interactionAt Nike’s flagship store, customers can try on gear in an activity center complete with basketball hoops, treadmills and other fitness options. Cameras capture the steps and movements of customers, enabling store sales staff to make more specific suggestions. Through apps that allow customers to view and share videos of them playing basketball, bots that provide customized communications, and automated push notifications that send individuals special offers designed specifically for them, digital assistants Maintain empathy.
But more broadly, there are at least six actions business leaders can take today to confidently enter the future of customer engagement.
understand the impact.
Our research reveals that companies with the highest customer satisfaction scores have generated twice the shareholder value over the past 10 years compared to average scores. As well as the benefits of investing in modern CX, the risks are substantial.
Aim higher.
Many CEOs have already invested in improving their CX, but admit progress is slow. One reason for this is that companies have invested considerable scarce resources in pursuit of incremental improvements. Solving pain points, eliminating inefficiencies, and making small CX improvements has a small impact. These resources are better invested in bold moves.
don’t underestimate the basics.
Companies should initially focus on two or three touchpoint initiatives at most. These initiatives should be strategically aligned with the company’s brand and targeted to high-value customer segments. For example, a company may choose to be a ‘Convenience Leader’ or ‘Experience Leader’ and focus on the touchpoints where that ambition can best be realized.
test, learn, adapt.
As Jeff Bezos once said, “Success at Amazon depends on the number of experiments per year, month, week, and day.” No, but you should set aside an annual budget and use those resources to incubate new use cases and improve, extend, and scale existing use cases.
For example, direct-to-consumer company Interior Define increased its experimental budget from 5% to 15% of total digital marketing spend. Not knowing which platforms and technologies will have an impact in the years to come, they wanted to be prepared for what would come to fruition.
Trying out new ways to attract customers can pay big dividends, especially during a recession. Leaders can look for actionable “no regrets” moves based on business strategy and positioning and begin actively testing and learning from other youth her cases. This process ensures that you have an initiative that can be started quickly when commercial and investment conditions improve.
Power your data architecture and AI.
Companies can pursue two or three touchpoint use cases in parallel, but should not move forward until they have built the right data and analytics core.
For example, a large telecommunications company built a consolidated master customer database in the cloud. This provided a single source of truth for each customer and access to powerful cloud-based AI applications. One of his first campaigns focused on the prepaid SIM card segment. Customer data and her AI analysis showed that they were more likely to top up their cards that day, so she began sending offers to customers the day they received their paychecks. Over time, the AI engine’s self-learning capabilities have enabled telcos to send communications using customer-preferred touchpoints and formats at times when customers are most likely to respond.
Adapt your go-to-market plan.
Companies should experiment with different go-to-market structures that provide the necessary agility and knowledge sharing. Examples include shared knowledge and analytics centers and hub-and-spoke structures that feature touchpoint-centric team combinations. Strategies should also take into account the enhanced role that human assistants can play. Digital and virtual interactions can automate many mundane tasks. This allows companies to rethink how humans can add value to their customers’ journeys.
The future of customer engagement looks bright. As enabling technologies become more powerful, more desirable, and more affordable, the biggest limiting factor in how companies can satisfy their customers is their own imagination.
