When news about the Heartbleed bug captured worldwide attention last month, consumers learned that their personal information, initially thought to be secure, had in fact been vulnerable to hackers for years. Arguably the worst Internet breach of all time, the revelation left many questioning what to do next.
To understand how consumer reaction to Heartbleed unfolded, we tuned into online chatter and engaged Forrester’s ConsumerVoices market research online community immediately after the news broke. While Forrester’s social listening data reveals that sentiment of consumer conversation about Heartbleed was consistently negative, online community response tells us that the negativity doesn’t stem purely from shock – rather, from a sense of helplessness and jadedness.
Do you approach data analytics with the same enthusiasm as a big pile of leafy vegetables? You know you need to consume more of it, but, man, that steak, fries, or big piece of chocolate cake just seem so much more appealing.
Recently I asked Forrester webinar listeners (mostly marketing folks) to rate how they approached data analytics. It's a small sample, I know, but bear with me for a second.
Of the 16 people responding to the poll, six said that they were somewhat effective, and nine said that they were not effective or didn't use data analytics at all (the figure here shows the actual results). Taken together, that's more than 90%.
I found this fascinating because, just about a year ago, I teamed up with ITSMA and VisionEdge Marketing to explore the state of marketing’s performance management. While quizzing participants about reporting and dashboards, we slipped in a question or two about data analytic effectiveness, and the distribution of responses in 2013 are similar to this poll: Only 10% of those surveyed gave themselves a “thumbs up” for data analytic proficiency. What’s going on here? Do marketers really approach data with the same gusto as a large plate of kale?
It’s no longer just your marketing team that uses social media for business purposes. Employees across the entire organization use social media for personal and professional reasons, leveraging social to drive real business for your company. The opportunities to enhance your brand, deepen customer relationships, and glean new customer insights are all too valuable to ignore -- but the risks are real too.
Moreover, the legal and regulatory landscape is evolving rapidly, complicating the ways in which you can manage social media and the myriad reputational, security, and privacy risks (among others) that expose your organization. To take advantage of these opportunities and still protect your company, you need new tools and technology to do this effectively.
The first email I received at work in 2014 was from a bank; along with a festive new year’s greeting, the email touted the bank’s new mobile app and a new feature that let customers set up travel notifications directly from the bank’s website. Later that day, I was in an airport reading a friend’s Facebook post about how she wished “more apps were like Uber.”
These are just a few small anecdotes about ongoing digital trends impacting businesses and banks both large and small. I recently spoke with a banking executive who put it simply: “Digital is what we do now.” (This quote is now the header of my Twitter feed.)
Forrester recently published our Trends 2014: North American Digital Banking report, in which we identify major forces impacting banks and lay out five actions that we recommend digital strategists take to prepare for the future of digital banking. Here’s a sample of some of our findings:
Banks will face a sustained – yet unclear – regulatory environment. In both the US and Canada, banks are confronting an uncertain regulatory future. The Dodd-Frank Act was signed into US law on July 21, 2010, but a large number of the rules and regulations remain unwritten. It's unclear when they'll be finalized, and the fact that 47% of deadlines have already been missed – according to the law firm Davis Polk & Wardwell – doesn't bode well.
Social lending, or peer-to-peer (P2P) lending, is not even ten yet, but it has caused a great deal of commotion already. Consumers, regulators, and banks continue to be perplexed by a business model which is so emblematic of the digital economy, or of digital disruption. Thanks to digital tools, potential lenders and borrowers can interact with each other online without the involvement of banks, credit unions, and other traditional financial institutions. And nothing epitomizes the confusion about how banks should respond to the phenomenon better than the initial ban of Wells Fargo on its employees investing in P2P loans, lifted only a few months down the line. So is P2P lending a threat to banks or not? We think it is.
Forrester first wrote about peer-to-peer lending in 2006, soon after the launch of the first P2P lending marketplace Zopa. We argued that lending would never be quite the same again and indeed, it hasn’t been. As we write in our new report, a lot has happened in those eight years:
The chief marketing officer’s (CMO’s) role is shifting from a two-dimensional world of outbound marketing communications vehicles to a multidimensional world that encompasses every interaction a customer has with a brand. These CMOs must not only craft the perfect marketing communications message but also ensure that their customers’ experience is consistent with the brand promise.
Why does this matter? Because Forrester’s TRUE brand compass research shows that having a consistent experience across all brand touchpoints is a key driver of brand trust. For example, consumers tell us that both Microsoft and Amazon.com deliver a consistent experience every time they interact with those brands. This helps both brands secure high levels of brand trust, which in turn drives strong brand resonance.
To build a trusted brand, marketing leaders must ensure that brand messages sync with achievable expectations to deliver the brand promise. Many airlines now routinely offer a swift response to customers’ on-the-go travel needs via Twitter; this real-time travel support serves to enhance the brand experience. Delta sees the opportunity; the airline is investing more than $3 billion to enhance the customer experience in the air, on the ground and online.
One word describes the state of US health plan digital strategists at the end of 2013: exhausted! The October 1, 2013 open enrollment milestone for the public exchanges became not an event but an epic saga. Integration failures, wobbly deadlines, and substandard policies that became the walking dead stymied large numbers of potential plan buyers, who either gave up or stood on the sidelines. But through a lot of persistence, 8 million Americans had managed to enroll in the public exchanges by mid-April 2014.
But with the enrollment process behind them, these tired digital strategists can’t rest. It’s time to shift attention from getting customers to keeping them. And not surprisingly, what matters to consumers when it comes to picking health plans is whether their doctors are “in-network”. But other practical aspects of the health insurance experience also matter, like:
Ease of resolving problems. When it comes to handling the nit-natty issues of plan maintenance issues like claims and payments, consumers want easy. That means that health plans have to make it easy for them to view their payment history, get their individual plan bills paid, monitor claims status, and access statements and tax documents online and increasingly through a plan’s mobile site, especially for that critical “young and healthy” segment.
April 22, 2014, was not just a regular Earth Day. It was also the 50th anniversary of the 1964 World’s Fair, one of the most amazing wonders of the world for its time. The 1964 World’s Fair, along with the famous Isaac Asimov, set people’s imagination on fire with a glimpse of the future of technology and a series of predictions of what our life would be like in 2014. And as we reflect back to what the fair and Isaac prophesized about life 50 years into the future (or exactly where we are today in 2014), it’s uncanny how much of what was showcased and predicted are now a part of our everyday life. From satellite phones to multimedia communication, interactive 3D TV, and driverless cars, our world has definitely changed. But sadly, the infrastructure that supported it all, the fairgrounds themselves complete with the iconic 140-foot-tall unisphere, has remained stuck in the past, a relic of that historic point in 1964. And for marketers, this tale provides an important lesson to learn.
On May 5, 2014, Target announced the resignation of its CEO, Gregg Steinhafel, in large part because of the massive and embarrassing customer data breach that occurred just before the 2013 U.S. holiday season kicked into high gear. After a security breach or incident, the CISO (or whoever is in charge of security) or the CIO, or both, are usually axed. Someone’s head has to roll. But the resignation of the CEO is unusual, and I believe this marks an important turning point in the visibility, prioritization, importance, and funding of information security. It’s an indication of just how much:
Security directly affects the top and bottom line. Early estimates of the cost of Target's 2013 holiday security breach indicate a potential customer churn of 1% to 5%, representing anywhere from $30 million to $150 million in lost net income. Target's stock fell 11% after it disclosed the breach in mid-December, but investors pushed shares up nearly 7% on the news of recovering sales. In February 2014, the company reported a 46% decline in profits due to the security breach.
Poor security will tank your reputation. The last thing Target needed was to be a permanent fixture of the 24-hour news cycle during the holiday season. Sure, like other breached companies, Target’s reputation will likely bounce back but it will take a lot of communication, investment, and other efforts to regain customer trust. The company announced last week that it will spend $100 million to adopt chip-and-PIN technology.
For the past seven years Forrester’s Groundswell Awards have recognized the most innovative social and collaboration programs with a measurable business impact. This year in the business-to-employee (B2E) division we gave out awards in two categories:
Employee Collaboration. This category recognizes programs that help employees work better together.
Employee Empowerment. This category recognizes programs that help employees better serve customers.