As I recently celebrated my fifth anniversary as a Forrester analyst, I reflected on how my coverage area has changed. For the past five years I've covered the web content management (WCM) market. This has been a healthy market, and I still get plenty of interest from my clients on this topic.
But the context of that interest has changed markedly, particularly over the past year. When clients used to ask about WCM, they wanted to know about WCM and WCM only. But these days, they ask about WCM in the context of other technologies supporting customer experience, such as commerce, CRM, and analytics. Our clients have reached a logical conclusion: WCM isn't the end-all-be-all for digital experiences but instead is one piece of the customer experience management (CXM) puzzle.
And the market will continue to evolve in 2012. In particular:
Watch for an avalanche of acquisitions, both big and small. Though larger vendors have multiple pieces of the CXM puzzle, no one has yet put together a complete portfolio. Vendors are still missing some critical pieces, such as rich media management (IBM), commerce (Adobe), and testing and optimization (Oracle, SDL). Watch for the CXM vendors to compete to fill these gaps. High-reaching best-of-breed WCMs such as Sitecore may not remain independent for long.
Contextualization will become the byword. Forget complicated business rules and template schemes. Technology to contextually adapt customer experiences based on user segment, browsing behavior, locale, and device will be high priority. Vendors will make strides so that customers can increasingly take an "automate + optimize" approach: automating contextualization for most experiences and manually optimizing it for a few high-profile experiences, such as home pages.
While I write frequently about the rise of the chief customer officer within firms advanced enough in their customer experience efforts to consider this kind of executive position, I often get questions at a much more basic level, such as: "Where do I get started?" Often an individual may get a mandate from an executive to spearhead creating a greater customer focus at the company. For those, here are seven steps for getting started:
Put together a cross-functional work team of supporters. Getting involvement and buy-in from different functions across the organization is important . . . a working group can be a source of getting allies across the organization. Build a working group of 10 to 15 individuals who can help put together some foundational pieces of your customer experience effort. While having diverse functions represented in this group is important, more important at this stage are influential leaders who are putting their budgets and reputations on the line in support of the effort. Look for supportive leaders who are already actively supporting customer-focused efforts or are willing to with some direction. A great source of early supporters is the frontline, where customer care and call center organizations interact regularly with customers. In addition to main marketing/branding, sales, support, and operations organizations, others you may want to consider early on include market research or customer insights, IT, HR, and legal/compliance leaders.
I scanned the list of industry high scores and wasn’t surprised to see names like USAA (banks, credit card providers, insurance providers), Apple (consumer electronics manufacturers), and Southwest Airlines. But there were names we don’t hear about as much in customer experience like Morgan Stanley Smith Barney (investment firms), Bright House Networks (ISPs), US Cellular (Wireless service providers), and Dish Network/EchoStar (TV service providers)*.
To me this says that brands trying to differentiate on the basis of customer experience need to look in a variety of places for possible competitive threats and standard-setters, not just the most obvious ones. History is full of examples of small firms that could transform more quickly than their larger competitors or introduce a disruptive innovation that no one saw coming. I expect both those scenarios to play out in customer experience over the next few years. The question is just where and when.
As part of our research in 2012 you can be sure we’re going to look into what these lesser talked about brands are doing to raise the bar in their industries, but in the meantime here are two of my favorite examples of CX innovations that came from places I would have never thought to look:
Hotcakes, you've got some competition: the phrase "selling like tablets" might soon enter the global lexicon. And it's not all hype — though there is a fair bit of that as well. Tablet users in the US are estimated to grow at a compound annual growth rate (CAGR) of 51% from 2010 to 2015. That’s a fast-growing market for firms of all stripes.
As such, the tablet as a touchpoint is becoming a critical consideration for eBusiness & Channel strategists. This is especially true for executives at banks, as financial transactions benefit from the immediacy of the mobile channel, but users often struggle to make these transactions on smaller smartphone screens.
In my new report, I outline the process Citibank went through in building its own tablet banking strategy, developing an iPad app, rolling it out to customers, and continually improving the service. We outline how Citi:
Google has handled its privacy debate by being disarmingly clear with a little note left on the fridge the other week.
We’re tidying up and love data too much to not want to connect it better.
Like it or lump it.
It’s their right - they are after all a private company and not the public service we somehow feel them to be. Google wants to “create a beautifully simple, intuitive user experience” and its data consolidation is what will help it do this. Facebook makes one product called Facebook while Google up until now has chosen to run many nom de plumes, betas, and side initiatives. I’d like to see a more capable ‘joined up’ Google sparring with Apple and Facebook on who can do the coolest and most useful things for people using data. In truth, the Google engineering team must be relieved to ditch the sticking plasters and chewing gum connecting the hitherto disparate data sets they manage.
Since publishing our Customer Experience Index, 2012 last week, we've gotten a flood of questions about the research, methodology, and results. I'm putting the finishing touches on a full Forrester report that answers the ten most common questions but thought I'd give everyone a sneak preview with a blog post summarizing a few of the answers.
1. Who are the people rating the brands in Forrester's Customer Experience Index?
To produce the CXi each year, Forrester conducts an online survey of US individuals ages 18 to 88. This year, there were 7,638 such folks who answered the survey during October 2011. We weighted the data by age, gender, income, broadband adoption, and region to demographically represent the adult US online population. The sample was drawn from members of MarketTools' online panel, and respondents were motivated by receiving points that can be redeemed for a reward.
2. Which touchpoints are consumers rating when they answer the CXi questions?
The short answer to this question is "any touchpoints they used to interact with the brand." We don't direct consumers to think about any specific touchpoints as they rate their interactions. Instead, we want them to consider all of their interactions with that brand over the past 90 days, regardless of how they happened.
I recently updated our research on enterprisewide customer experience leaders, who we refer to as “chief customer officers” or CCOs. While they often don’t have that exact title, we identified around 600 individuals who carry a mandate to improve the end-to-end customer experience at their company. We did some deeper research on close to 200 of them in order to understand the general profile of these people as well as how their positions are structured within their companies.
Forrester has witnessed a marked increase in the position over the past six years. And for good reason: Competitive forces are shifting dramatically in what we call the “age of the customer” (from Forrester report "Why Customer Experience? Why Now?"). Firms struggle to compete on product innovation alone, as global outsourcing and cloud-based computing lower barriers to entry and create scores of substitutes. Customer power has grown, as 73% of firms trust recommendations from friends and family, while only 19% trust direct mail (from Forrester report "Consumer "Ad-itudes" Stay Strong"). Firms have turned to customer experience as a way to differentiate in this commoditized world, which has led to the surge in CCOs. In my new report, I profiled key characteristics of CCOs as well as models for the kinds of organizations they oversee.
At the same time, as high-profile firms like Fidelity, The Washington Post, and General Motors have put in place senior customer experience leaders over the past year or so, I’ve been struck by the wide assortment of reasons that firms use to rationalize NOT putting a chief customer officer in place.
In talking with nearly 30 organizations, consulting companies, and solution vendors, I found that instead of deploying slow-to-change packaged applications or building difficult-to-change custom solutions, leading organizations are embracing business process methodologies — supported by process-centric IT platforms. They are striving to drive rapid process change, increased business engagement in IT projects, and achieve dramatic improvements in worker productivity.
In my new report, I define more than 30 best practices that organizations can use to support their transition to process-centric customer CRM. Here are few of them:
What are the key trends that CRM trends that business and IT professionals need to pay attention to in setting their plans during 2012? Here are the top trends that I am tracking. My full report that spotlights our latest research and recommendations for how to compete in The Age of the Customer will be published in late January.
1. Customer experience management will move beyond aspiration to strategy. More organizations will move beyond empty goals like becoming “customer-obsessed” to define clear and actionable customer experience strategies. The strategy must meet three tests: 1) It defines the intended experience; 2) it directs employee activities and decision-making; and 3) it guides funding decisions and project prioritization.
2. Brands will embrace the experience ecosystem. Firms will move to break free from their organizational silos, invest in understanding customer moments of truth through journey-mapping, and embrace the concept of the “customer experience ecosystem” — one that considers the influence of every single employee and external partner on every single customer interaction.
3. Experience management will emerge as a management discipline. There is increasing acceptance of the idea that customer experience management can be thought of as a discipline — a set of sound, repeatable practices such as those are defined in Forrester’s Customer Experience Maturity Framework.