In a previous blog, I outlined how context matters, and specifically how the industry context in which you are doing business matters to the strategic decisions you make. But there are also commonalities across industries. Some business challenges plague multiple industries such as how to improve customer experience, retain loyal customers, and improve sales whether in the retail or hospitality sector, or how to get the inputs you need to make your products and to get your products to market in a timely manner in the manufacturing or pharmaceutical sectors. And, everyone these days is increasingly concerned about fraud, risk and security.
The holidays have a way of bringing people together in more ways than one – and every holiday season I’m reminded of just how universal the power of human emotion is. Regardless of lifestyle, background, and world view, people everywhere are truly emotional beings, moved by fundamental feelings of joy and sadness, hope and fear, love and loss. And anyone who has observed frantic shoppers careening through store aisles or the unbearable anticipation of children on Christmas morning can see that, at this time of year, emotions are at their peak.
Advertisers know holiday shopper emotions better than anyone; they have perfected the art of tugging at heart strings or prompting tears to spur a purchase. But as consumers wear their hearts on their sleeve, retailers broadly must be in tune with – and responsive to – customer sentiments. For example, when passionate shoppers turn to social channels, retailers mustn’t dismiss their cheering or venting. In fact, Forrester’s Customer Experience Index (CX Index™) data shows that consumers often experience their most positive brand interactions on social media – and remember them more favorably than engagements on websites, over email, through phone conversations, and even in person:
The fact that human beings make affinity and spend decisions based in large part on emotion is not new news. It is the underlying logic of advertising – heartstrings are the early sparks of revenue. But there is a reason that most companies have not baked emotion into experience design and into the day-to-day engagement with customers. It's hard to do.
Emotions are situational, dynamic, and hard to read. Yet the gulf between the science of emotion and the business of emotion is closing, creating a set of new tools to convert great experiences into sustained growth.
Last week during an online event, I brought together thought leaders, Anjali Lai, Harley Manning, and Roxie Strohmenger, to translate the science of emotion to the pragmatic business application of emotion. If you were unable to watch it live, here is the replay – and for good measure, here are key takeaways from our discussion:
Emotion is the next step in getting to know your customer.
The customer is now the center of the universe, and to win in this market, companies need to know – really know – their customer. Beyond satisfaction, advocacy, and journeys, companies must understand what makes customers tick and how to influence affinity and spend. Emotion is not the next thing "just because"; it gets to the heart and soul of operating in a customer-led market.
We’re pleased to announce that this year’s UK Customer Experience Index report is now live! The report is based on Forrester's Customer Experience Index (CX Index™) methodology, which measures how well a brand's customer experience strengthens the loyalty of its customers.
Overall, it’s been a good year for UK brands, with the percentage of good and OK scores increasing thanks to a significant drop in poor scores. We found that:
Six of the eight industries surveyed improved their average score.
Twenty-four of the 56 brands surveyed made significant improvements in their experiences.
Video conveys emotion unlike text and can show features and functionality unlike any picture. That’s why retailers see nearly triple the conversion rate on product pages that have video versus those that don’t. Entering what Facebook CEO Mark Zuckerberg calls “this new golden age of videos online,” companies and brands need an enterprise-class online video platform to deliver the video experiences that drive customer engagement.
Your business model is under attack. And it’s not by your competitors. It’s under attack from your customers. Three years ago, Forrester identified a major shift in the market, ushering in the age of the customer. Power has shifted away from companies and towards digitally savvy, technology-empowered customers. They now decide winners and losers: Our Empowered Customer Segmentation shows that more than a third all US online adults want new and engaging digital experiences. They will switch companies to find these experiences. In this environment, being customer-obsessed can be your only competitive strategy.
In Forrester’s 2017 Prediction Reports, we are tracking firms’ progress on their customer-obsessed journeys. In our annual collection of predictions, we look at business strategy, leadership, customer experience, and technology dynamics to examine progress and predict the key events, changes, and trends that will occur in 2017.
Here are three key findings from our 16 predictions reports:
The next wave of Customer Experience will have a profound impact on firms’ P&L: The shift to a customer-led market represents an immediate and prolonged threat to company survival. Our research shows a clear correlation between the quality of customer experiences and revenue growth; it also affirms that emotion is a core driver of customer loyalty and spending. The next wave of CX will connect these dots, blending analytics, technology, and design to evoke emotions to drive affinity and directly impact revenue.
Companies are turning to digital to do one of the three things: improve customer experience (CX) using digital technologies; improve their operational efficiency to better serve customers; and launch new business models.
The manufacturing and industrial sectors are undergoing a similar transformation. In my recent discussions with leaders in this market, Industry 4.0 and smart factory dominate the conversations, but the discussions quickly shift to the Internet of things (IoT). While the industrial internet is the most significant manifestation of the digital revolution in these sectors, we are also coming across a broader range of digital initiatives from manufacturing firms.
Tech vendors and systems integrators working with manufacturing firms have identified two types of engagements emerging. Infosys’ Global Head of the Manufacturing Vertical, Nitesh Bansal opined that one set of firms are taking charge of sensors and monitors that they own and leveraging the data assets to improve predictive maintenance, asset efficiency and improve track and trace. Outcomes from these digital operational excellence (DOX) initiatives include:
Collecting data and analyzing it for better predictive maintenance
Empowering technicians to do their job better by providing actionable directions at the point of maintenance
Using augmented reality to help with quick diagnosis and fix
Increasing the asset throughput while increasing safety using automated self-driven vehicles
Nokia’s services division recently hosted an analyst event where it elaborated on the interlinkage between network services and network infrastructure. Of course, network services matter to businesses and telcos because they help technology managers to better manage infrastructure complexity and to modernize network infrastructure with the goal of making networks faster and more reliable. However, there are more fundamental implications:
Network services add value to products and open new business areas. Customers want features and services that are relevant to them in the immediate context of their needs and desires. As more products become connected, network services will play a critical role in developing and enhancing such features. Moreover, network services play a central role in driving augmented and virtual-reality solutions in outdoor conditions, such as those already used in manufacturing by Caterpillar or in construction by BAM Group.
Happy CX Day! As part of our CX Day celebrations, which include a very special episode of CX Cast, and a comprehensive CX reading list that doubles as a holiday gift buying guide for the CX pro in your life, we are launching a new report: Why CX? Why Now?
In collaboration with my colleague, Sam Stern, we looked at why now is the time for CX pros to convince executives and colleagues at their organizations to double down on improving the customer experience. To make it a lot easier for you to message this across in your firm, we included an infographic that:
Conveys without a doubt how urgent it is to invest in CX because your customers, competitors and employees are changing!
Gives you six tangible business benefits from improving customer experience that will help you make the case for why CX drives business results. For example, Southwest Airlines, a consistent CX leader, has been profitable for 43 consecutive years, in an industry better known for red ink and bankruptcies.
Tells you which challenges most companies (and probably yours) face on the road to better CX. One example: More than half of CX pros said that their organization's culture impedes their success.
Shows the path to improving CX, starting from a CX vision, continuing with building CX competencies and strengthening your business technology foundation.