If you’ve been following my research, you know I like to divide the business world into three categories of company:
Digital Predators successfully use emerging digital technologies to gain market share and/or displace traditional incumbent companies (e.g., Amazon, Lyft, Priceline, Airbnb, Netflix).
Digital Transformers evolve a traditional business to take advantage of emerging technologies, creating new sources of value for customers and opening up new competitive strategies (e.g., Burberry, Nestlé, L’Oréal, Unilever, USAA, Ford, Delta).
Digital Dinosaurs struggle to leave behind their old business model. These companies are typically slow to change because they must defend large P&Ls, or they have a near monopoly position, or they simply don’t see the opportunity/threat (e.g., many retailers, taxi companies, manufacturing firms, legal firms, recruiters, construction firms).
Today, we publish the Forrester Wave™: Web Content Management Systems, Q1 2017 after three months of research and another month of writing and editing. Today, we can step back and begin to help our clients leverage this research to shape their digital experience strategy. But first, a special thank you to my colleagues Danielle Geoffroy, Allison Cazalet, Stephen Powers, and Ted Schadler for their invaluable contributions. Also, thank you to the 15 vendors -- Acquia, Adobe, Crownpeak, Episerver, e-Spirit, Hippo (BloomReach), IBM, Jahia, Magnolia, OpenText (TeamSite), OpenText (WEM), Oracle, Progress Software, SDL, and Sitecore -- and their client references who made this research possible.
So where to start? At the highest level, we’re witnessing a step-function along our evolutionary journey thanks to digital. Digital disrupts communication, community, privacy, convenience, products, and services because always-on connections change our demand cycles. Those enterprise organizations who don’t evolve are being disrupted. My colleagues on customer experience research team have shown this correlation of revenue being tied to customer experience, across industries and geographies (link). Additionally, we’re starting to understand how digital maturity stages correlate to technology priorites such as Web CMS with Forrester's Digital Maturity Model (link):
Forrester recently presented our Asia Pacific 2017 Predictions at events across Singapore, Sydney, and Beijing, followed by a webinar earlier this week for customers across the region. We shared our view that businesses today are under attack, but not by their competitors. They are under attack from their 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 who now decide winners and losers.
Our Empowered Customer Segmentation shows that consumers in Asia Pacific are evolving — and becoming more empowered — along five key dimensions. These five key shifts explain changing consumption trends and lead to a sense of customer empowerment: Consumers are increasingly willing to experiment, reliant on technology, inclined to integrate digital and physical experiences, able to handle large volumes of information, and determined to create the best experiences for themselves.
Your digital intelligence strategy and implementation is struggling to keep up with your device-hopping customers. You’re trying. And it’s difficult – so many obstacles. But you face the Digital Dilemma, introduced by colleague Nigel Fenwick: your customers’expectations of digital experience keep rising. When any digital experience they have with you doesn’t meet their expectations, their perception of the value your firm provides falls … which leads to risk of customers taking their business elsewhere. Ouch. So, tackle the Digital Dilemma head on. Focus your digital intelligence strategy like a laser on the customer experiences that matter most to your business outcomes. How? With an actionable digital intelligence strategic plan. Here are 3 of the key components your strategic plan must include.
1. Align the plan to the right metrics and KPIs. The optimal approach is to align measurement with customer-focused KPIs that stakeholders are already measured on. Simple, but not necessarily easy. But this is how you get that laser focus on the experiences that matter most to outcomes.
You've been creating digital customer experiences for years now. You've built a successful app. You’ve assembled a martech/adtech stack. You may even have started swinging at omnichannel delivery or harnessed AI or piloted a connected product. So it’s time to declare victory on digital transformation, right?
In 2016 mobile evolved from a stand-alone channel to a baseline for all branded digital experiences. In 2017, mobile will continue to elevate customer expectations as it transforms even non-digital experiences – such as Starbucks “order ahead” functionality. There is no question that mobile moments are the battleground to win, serve and retain your customers. What a mobile moment is and where it surfaces, however, will become amorphous as it extends beyond smartphones to platforms and connected devices and then eventually lives in a consumer’s personal ecosystem.
App usage as we know it has likely peaked. In 2017, platforms will expand in importance as consumers continue to consolidate their time into fewer places on the smartphone. Already, they spend 84% of their time in just five apps. These experiences that we loosely still refer to as mobile (but not for much longer) experience will lives as fragments on third party platforms. Consumers will still use apps for in-depth experiences with brands, but will increasingly use fragments to get quick things done. Examples of popular third party platforms today include Apple’s iMessage, Facebook Messenger and WeChat.
Consumers in Asia Pacific are in the midst of a digital transformation. Within the past decade, online penetration in China grew from 8% to 54%, while mobile internet access grew more than sevenfold. Today, the rate of customer evolution is gaining speed, as consumers are increasingly willing to experiment with new products, rely on devices, demand seamless digital experiences, consume large volumes of information, and are committed to seeking out the best experiences for themselves.
Forrester’s Empowered Customer Segmentation measures these key shifts in customer behaviors and attitudes and anticipates how consumers both respond to digital innovation and demand it. An analysis of our Consumer Technographics® data for Asia Pacific shows that the most rapidly evolving customers dominate in metropolitan China and metropolitan India:
There's a fundamental difference between companies that apply digital technology as a bolt-on (frequently adding an eCommerce site, social media, or customer mobile apps) and those that take a more holistic approach to transforming the way the company uses technology to deliver better customer outcomes and drive revenue.
Transformers are more likely to succeed because they recognize their customers' expectations are evolving. The executives in these companies redesign their business to evolve alongside the expectations of their customers. These companies are obsessed with helping their customers achieve their desired outcomes, and they continuously explore new ways to do that profitably. This is why transformers are destined to become digital predators while bolt-on companies are more likely to become digital prey.
One of the distinguishing characteristics of many transformers that caught my attention back in 2013 remains a challenge for many companies in 2016: delivering digital operational excellence (DOX). DOX focuses on the ability to use emerging technologies to change operational aspects of the business (those not directly touching the customer) to create business agility in service of the customer. Why is this important? Because without the ability to evolve quickly, your company will fail. This is the digital dilemma.
I use this simple equation to illustrate my point:
As a customer insights / analytics / digital measurement pro, do you experience any of these challenges? And what can you do right now to make progress with them?
I can’t keep up with requests from my stakeholders for analysis and insights. Does the volume of requests and your team’s capacity seem increasingly out of whack in your organization?
Our customer data isn’t where we need it to be – we can’t get a comprehensive view of our customer. You’re not alone. Marketing and technology teams struggle to align objectives, roles, budget, projects and process, and timelines to maximize value from customer data. Marketing decision-makers report several reasons they are failing: too many data sources (44%), lack of access to technology to manage data source integration (38%), lack of budget (35%), lack of skills to support integration (34%), organizational silos (27%), and lack of an executive sponsor (23%).
We’re leaving money on the table because our different analytics and insights teams work in silos. Here’s a simple digital measurement example of this: one digital team is responsible for driving visits to the website. Other teams are responsible for maximizing on-site conversions. They work in their own separate silos. A more efficient and effective approach: work together to identify the characteristics of customers most likely to convert, and work on driving that group to the site. That type of silo breakdown needs to happen more.