CE_L---singles

Customers are settingthe business agenda

Getting personal withoffers you can’t refuse

How to build aloyal fanbaseP03 P08 P10

21/10/14#0284

RACONTEUR.NET /COMPANY/RACONTEUR-MEDIA/RACONTEUR.NET@RACONTEUR

1

i

f

t

CUSTOMER EXPERIENCE& LOYALTY

EURO

PE

one

card

2927 6552 1119 4030

23-90-33 47839022

VALID

FROM 08/14

EXPIRES

END

01/24

A CONSUMER

debit

1010 0111 0110 1010

10-10-11 01001011

VALID FROM 10/01EXPIRESEND 01/10

THIS SPECIAL REPORT IS AN INDEPENDENT PUBLICATION BY RACONTEUR MEDIA


1

i

f

t

CUSTOMER EXPERIENCE AND LOYALTY ONLINE: WWW.RACONTEUR.NET/CUSTOMER-EXPERIENCE-AND-LOYALTY P03

Overview

Without doubt it is the age of the customer. They are louder than ever, have

greater power and more ways of exerting it. Digital innovations have meant the consumer knows everything about a company, the product and its origins, as well as faster and more efficient ways of air-ing grievances and singing praises.

While it might be terrifying to think your customers know everything about your processes, there’s an argument for embrac-ing the move towards customer empowerment. This is absolutely crucial to loyalty, says Alex Cheat-le, chief executive of lifestyle con-cierge and loyalty solutions provid-er Ten Group.

“There is simply no such thing as a customer for life anymore; cus-tomer loyalty needs to be earned. Companies must show that they understand their customers and are responding to them as individ-uals,” he says. “A luxury clothing brand can’t just give away a pair of cufflinks with a shirt; they need to give the customer tickets to the op-era – because they know they like opera – in a city they visit regularly.”

The customer isn’t just a buyer of a product, says Mr Cheatle, “Car manufacturers such as Maserati don’t just stick extras on their cars, they think around the issue and

provide benefits that are perhaps unrelated to motoring, but are tai-lored to the person who is buying the car. Banks will no longer just offer travel insurance or Avios [re-ward currency] – customers have no patience with poring over small print or jumping through endless hoops for fulfillment.

“Programmes such as Thank You from Coutts offer curated opportu-nities selected and tailored to their account holders. The customer needs to feel in charge of the ben-efits they receive and companies must use benefits to show how well they understand the individuals they are doing business with.”

KEY TRENDS

A report from Forrester, entitled Navigate the Future of Customer Service in 2014, outlines a num-ber of key trends. Customers now demand an omnichannel service. They want to start an interaction in one channel and complete it in another. The report says today’s customer is beginning to adopt a “mobile-first” mindset. Companies are starting to move away from duplicating their web presence for mobile and instead are look-ing at the right usage scenarios to add value to customers in a mobile environment. There is now a ten-dency towards a more focused user

experience that allows tasks to be accomplished efficiently.

Customers 2020, a report from US customer intelligence consulting firm Walker, looks at the customer experience industry of the future. The report claims customer service is the next brand differential, and by 2020 will overtake price and product.

The report says to be relevant in 2020, companies must focus on leveraging data to create a single source of truth and make custom-er intelligence accessible. It says: “Companies must consider ‘insight generation’ as a sales enablement function.” It also predicts the like-lihood of more companies having “chief customer champions”, serv-ing one purpose, “to create an un-relenting focus on the customer”. Data is being used to reach out pro-actively to customers in the form of invitations to chat and take part in tutorials. In addition it is being used innovatively to develop post-pur-chase engagement.

Forrester’s The Business Impact of Customer Experience, 2014 report looks at the link between customer experience and consumers’ loyalty to a company. Unsurprisingly, the correlation is high. And the business case is strong. The research shows loyalty-based revenue benefit for a firm going from a below-average customer experience index score for its industry to above-average, ranged from $55 million for con-

sumer internet service providers to $1.6 billion for wireless providers.

And then there’s personalisation. There’s certainly a move towards the individualisation of the con-sumer process. Companies are in-creasingly using predictive analyt-ics to up and cross-sell to consumers based on their individual buying and browsing habits. It’s no longer just about knowing the customer’s name; it’s now about making sure offers are bespoke.

NEW ADVISERS

A 2013 IBM study, The Custom-er-Activated Enterprise, says that customers are the “new” business advisers, claiming that 90 per cent of senior leaders expected extensive collaboration with customers with-in the next five years. More than half (54 per cent) of chief executives said customers now have a considerable influence on their enterprises and, crucially, the outperformers are 24 per cent more likely than underper-formers to have given the customer a prime seat at the boardroom table.

The report highlights that in the first IBM study of this kind, released in 2004, chief executives ranked their own customers as sixth on the list of all market factors they believed would drive the most change in their organisations. What we see today is a very different sto-ry, where empowered customers now lead the agenda.

The value of customer loyalty, based on a positive experience of service, is more important than ever, writes Hazel Davis

Publishing ManagerNathan Wilson

Managing EditorPeter Archer

Head of ProductionNatalia Rosek

Commissioning EditorHazel Davis

Design, Infographics & IllustrationThe Design Surgery www.thedesignsurgery.co.uk

Although this publication is funded through advertising and sponsorship, all editorial is without bias and sponsored features are clearly labelled. For an upcoming schedule, partnership inquiries or feedback, please call +44 (0)20 3428 5230 or e-mail [email protected]

Raconteur Media is a leading European publisher of special interest content and research. It covers a wide range of topics, including business, finance, sustainability, lifestyle and the arts. Its special reports are exclusively published within The Times, The Sunday Times and The Week. www.raconteur.net

The information contained in this publication has been obtained from sources the Proprietors believe to be correct. However, no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the Publisher.© Raconteur Media

Contributors

Distributed in

Customer service is the next brand differential, and by 2020

will overtake price and product

HAZEL DAVIS

Freelance writer, she contributes to The Times, Financial Times, The Daily Telegraph and The Guardian on a wide variety of subjects, but specialises in small businesses.

MARCUS LEROUX

Industrial correspondent of The Times, he was previously the newspaper’s retail correspondent.

CHARLES ORTON-JONES

Former Professional Publishers Association Business Journalist of the Year, he was editor-at-large of LondonlovesBusiness.com and editor of EuroBusiness magazine.

IWONA TOKC-WILDE

Freelance business journalist, she contributes regularly to various national media and trade press, covering economic trends, professional practices and other business issues.

HUGH WILSON

Former reporter and feature writer for Retail Week, he now writes as a freelance on a variety of topics including business, technology and innovation.

CUSTOMERS ARE SETTING THE BUSINESS AGENDA

Image: Getty


1

i

f

t

CUSTOMER EXPERIENCE AND LOYALTY21/10/14EDITION #0284

Leadership

Indicators of customer satisfaction show that executives who empower employees not only manage to hold on to valued staff, but also improve levels of service, as Iwona Tokc-Wilde reports

Improving customer ser-vice need not involve a radical change in pol-

icy or complicated technology. Adopting a different manage-ment style and company culture, together with customer-focused personnel training, can increase both employee satisfaction and customer engagement.

The traditional “command and control” structure of organisations may no longer be fit for purpose in a connected world, where both em-ployees and customers want to be engaged differently. “Today’s team-based organisations respond best when their leaders are with them, not above them,” says Rachel Bar-ton, head of Accenture’s Customer Strategy Practice.

Some companies are, therefore, moving away from a hierarchical structure to one that is flatter, with fewer or no levels of middle manage-ment between staff and executives.

So-called flat organisations tend to organise themselves around the work that needs to be done and not around people occupying specific job func-tions. Time etc is a virtual workforce platform that provides services to businesses worldwide. Three years ago they switched from an upwards flow of work and reporting to mutual delivery, says founder Barnaby Lashbrooke.

“This means everyone, including me, delivers whatever is needed to other people in the business in order to push things forward,” he says. For example, Mr Lashbrooke now deals with every client com-plaint personally.

“But I still make sure the team are fully involved,” he says. “When they see how seriously I take every complaint, it hammers home the importance of customer satisfac-tion so they are getting better at resolving issues before they turn into complaints. It’s also good for clients to see the founder cares about their custom and that no complaint is too small.”

Despite significant growth in the last few years, Time etc receive few-er than ten complaints a year. Mr Lashbrooke points out it was the mutual effort that has led to all com-plaints being resolved satisfactorily in the last 12 months. “We’ve also seen a significant increase in team retention and morale since switch-ing to this way of working,” he adds.

In flat or flatter organisations, leaders seek their employees’ opinions regularly and act on them. “Engaging your workforce as equals, taking on feedback and keeping the dialogue open through every channel are all ways to flatten the management structure,” says Ms Barton.

Employee engagement at Lon-don Overground Rail Operations (LOROL) has been central to its success as the fastest growing UK rail company since privatisation. HR director Darren Hockaday says:

Retail sets example

Page 07

EFFECTIVE LEADERSHIPKEEPS STAFF ANDCUSTOMERS HAPPY

P05RACONTEUR.NET /COMPANY/RACONTEUR-MEDIA/RACONTEUR.NET@RACONTEUR

1

i

f

t

CUSTOMER EXPERIENCE AND LOYALTY ONLINE: WWW.RACONTEUR.NET/CUSTOMER-EXPERIENCE-AND-LOYALTY

Leadership

Research has consistently proven a link between happy

employees and happy customers

of operations. “Out of this has grown the company’s ethos of ‘training for all by all’ and in the last year more than a third of employees were in-volved in passing on their skills and experience to others.”

The fact that all staff, regardless of position, can now deliver custom-er service training was “a conscious move from a culture which was highly compliant, dependent sole-ly on people following procedures, towards a culture focused on cus-tomer experience”, says Ms Plow-right. Since the move the company has won several national customer service training awards for its high standards of customer service.

“Our net promoter score, an in-dicator of how likely our custom-ers are to recommend us, is indus-try-leading at +78 and customer retention rates are consistently over 90 per cent too,” she says.

Lawrence Jones, chief executive of internet hosting company UK-Fast, says their net promoter score has also improved, from +50 to +70, since he invested in an in-house training department last year.

EMPLOYEE AUTONOMY

In flatter organisations, front-line staff have a bigger say in how they deal with customers, which has direct impact on customer ex-perience. At John Lewis, staff work on the premise that the customer is right and they just need to solve

any problems as quickly as possible. What they call “heroic recovery” contributes to John Lewis scoring the highest marks in various custom-er satisfaction surveys year on year.

The world’s best hotels would not be the world’s best without their employees having almost complete autonomy, says Phil Anderson, client director at Ashridge Business School. “When I recently visited the Ritz Carlton in Singapore, staff were able to spend up to $2,000 replacing or re-pairing any item damaged by guests, without seeking approval,” he adds.

GO THE EXTRA INCH

De Vere Hotels and Village Ur-ban Resorts have a new customer service initiative called Going the Extra Inch, which empowers staff to take action to exceed their guests’ expectations. People development director Mike Williams gives an ex-ample of an employee who, working breakfast service, overheard a guest saying they preferred firmer pillows and went out at the end of her shift to buy them.

“We’ve also created VIPs – Very Informed People – in each hotel, who look for ways to improve cus-tomer service, and who then present their ideas to their hotel manager and the company executive team,” says Mr Williams.

Mr Anderson insists that in call centres and similar organisations, staff simply must have autonomy to be effective in dealing with custom-ers. “First Direct are an excellent example, they are truly a one-stop shop,” he says.

At Wahanda, an online bookings platform connecting consumers and beauty businesses, the custom-er service staff are allowed to make judgment calls and issue credit notes without reverting to line man-

agers first. “Our tech team aims to turn around any issues with the site within 24 hours, so our combined efforts have resulted in pushing up our net promoter score to over 70,” says Wahanda’s chief executive Lopo Champalimaud.

When employees have a bigger say in how and when they work, and get incentivised to deliver results, this too leads to better employee satisfaction and en-gagement, and to better customer service. At Wahanda, there are no limits on holiday allowances. “We simply trust people to do their job and they use their good judgment when it comes to taking time off,” says Mr Champalimaud.

UKFast gives £1,000, £500 and £250 to the top three support en-gineers at the end of each quarter. “Earlier this year, high-performing engineers were also taken on an all-expenses-paid trip to Las Ve-gas,” says Mr Jones. De Vere Hotels and Village Urban Resorts celebrate their best employees at annual em-ployee awards.

“Research has consistently proven a link between happy employees and happy customers,” says Ms Barton. De Vere Hotels and Village Urban Resorts have run their own com-parisons of their employee engage-ment scores for each hotel against their customer service measures, discovering a compelling correlation between the two. “Our three hotels with the highest customer satisfac-tion scores of over 80 per cent are also the top three when it comes to employee engagement, again over 80 per cent,” says Mr Williams.

of highly engaged employees believe they can positively affect customer service

Source: CIPD

of the variation in employee engagement levels is due to the line manager

Source: Accenture

50%+

1in2

80%

90%

72%

of organisations with high employee engagement retain 80%+ of their customers

Source: Demand Metric

employees in large organisations feel engaged

Source: Temkin Group Research

of leaders think an engagement strategy has an impact on business success

Source: Accor

“The way that LOROL has always approached engagement is simple yet highly effective: you regularly and consistently ask employees what they think, you analyse and think about what they’ve told you, you take ap-propriate action, and then tell the em-ployees what you’ve done and why.”

At LOROL, improved employee engagement now equals improved customer satisfaction. As engage-ment rose to 91 per cent in 2014, so did passenger satisfaction, which at 91 per cent nearly doubled from 57 per cent in 2007.

CULTURE AND TRAINING

Four years ago insurance com-pany Cornish Mutual flattened the management and delivery of their personnel training, changing their corporate culture in the process. “Every employee in the company, from managing director to adminis-trators, has been trained in coaching skills,” says Sharon Plowright, head

Imag

es: G

etty

P06 RACONTEUR.NET /COMPANY/RACONTEUR-MEDIA/RACONTEUR.NET@RACONTEUR

1

i

f

t


Commercial Feature


1

i

f

t

CUSTOMER ENGAGEMENT AND LOYALTY15/10/14EDITION #0000

As consumers once again reach into their wallets, many will be pulling out their cards and demonstrating their commitment to a particular or-ganisation, whether that’s a football club, airline or charity.

Affi nity card relationships can offer consumers loyal to brands a unique set of benefi ts as well as driving results for the brands themselves.

“Credit-card affi nities can help brands grow their business on the back of real consumer advocacy,” says Michael Don-ald, commercial executive at MBNA, a UK leader in credit-card affi nity relationships.

“Every time a customer takes a card product out of their wallet, it reminds them why they took it out and about the brand they have a particular affi nity with, whether retailer or airline. UK brands are able to make these connections even more powerful, while brands from

“Our model is rooted in truly under-standing consumer loyalties, and con-necting and rewarding these. It’s a win for the consumer, but also a commercial win for the affi nity brands we’re proud to work with.”

One example of this is the organisa-tion’s work with Manchester United, where MBNA was able to roll out a new “Champions” credit card to eligible fans in the UK within a week of the club win-ning the title for a record twentieth time, helping to strengthen its relationship with supporters and allowing them to share in the club’s achievement.

Commercial Feature

Powering loyalty with credit cards

emerging markets are also coming to the UK with their global brand, wanting to launch affi nities.”

For brands, it can not only generate an additional source of revenue each time a transaction is made, but also help to re-inforce and reward a customer’s loyalty to their organisation, ensuring priority of the card and helping to keep customers loyal in the future.

From a consumer’s perspective, af-fi nity credit cards allow individuals to benefi t from a wide range of rewards put forward by the brands they support, ranging from discounted fl ights to foot-ball shirts, tickets to events and charity donations, as well as helping to support that particular cause fi nancially.

MBNA’s affinity-card experience means it can work with partners to iden-tify the business model that best suits them and their customer base.

“We believe MBNA is unrivalled in the UK in terms of running co-branded cred-it-card programmes and the reason we’re so good at it is that we’re able to work with the partners to understand the needs of their customers,” says Mr Donald.

Michael DonaldCommercial executive at MBNA

MBNA IN NUMBERS

300affi nity card programmes

MBNA Thames Clipper

airlines6

football clubs

29

MBNA UK AFFINITY CARD PROGRAMMES

• ARSENAL• ASTON VILLA• CHELSEA

• LIVERPOOL• MANCHESTER UNITED• TOTTENHAM HOTSPUR

FOOTBALL CLUBS

• AMERICAN AIRLINES• EMIRATES• ETIHAD AIRWAYS

• MILES AND MORE (LUFTHANSA)• UNITED AIRLINES• VIRGIN ATLANTIC

AIRLINES

With the UK economy showing clear signs of recovery and household spending on the up, brands are capitalising on a renewed opportunity to commercialise and collaborate on customer loyalty

Credit-card affi nities can

help brands grow their business on the back of real consumer advocacy

• BREAKTHROUGH BREAST CANCER• BRITISH HEART FOUNDATION• NATIONAL TRUST

• ROYAL BRITISH LEGION• RSPCA• WWF

CHARITIES

“Our capabilities allowed the club to focus on their fan base and ensured pri-ority of the card in wallets or purses with a whole new set of engaged consumers,” says Mr Donald.

With credit cards operating across the three main credit-card networks of American Express, MasterCard and Visa, also means MBNA customers can benefi t from a wide range of additional rewards, driving even greater value di-rectly to consumers.

The model is well established in sec-tors such as football, airlines and trav-el, but there are other industries which

MBNA is an established leader in providing co-branded consumer credit cards, drawing on a 21-year history of operating in the UK and its relationships with more than 350 partners.

These include card pro-grammes with retail and professional organisations, such as the AA and NFU, as well as airlines, football clubs and charitable organisations.

The business is committed to its own brand promise of “making life easier”, and prides

itself on a pledge to provide world-class customer service. This brand promise can now be seen on the River Thames each day following its support of the MBNA Thames Clippers.

Owned by Bank of America, MBNA is also primary sponsor of the Sale Sharks rugby union team and its local football club, Chester FC.

It was voted credit card provid-er of the year in the 2014 Consum-er Moneyfacts Awards.

MAKING LIFE EASIER

could benefit, including utilities and retail. There are also potential opportu-nities for brands themselves to collabo-rate, using a mutual MBNA relationship as the basis for even more compelling customer offers.

“An example is airlines which have relationships in football,” says Mr Don-ald. “We support card programmes for both segments and that offers us some amazing potential.”

The economic downturn of the past few years has seen a number of fi nancial institutions and card providers leave the affi nity market, leav-ing behind those who have built their business around the concept.

“The UK issues more card products than any other outside the United States and we have one of the widest-travelled populations on the planet, for business and tourism,” he says. “The affi nity-card model, which is rooted in MBNA’s DNA, gives brands the opportunity to not only reward customers for demonstrating their loyalty, but to deliver a commercial win for the brand and their customers.”

MBNA is uniquely positioned to help organisations with large-scale customer bases and/or global or leading UK brands develop an affi nity credit-card programme. For more information visit www.mbna.co.uk or contact [email protected]


1

i

f

t


Walking through the doors of a shop will turn a customer’s mobile device

into a personal virtual sales assistant

Omnichannel

Retailers have always lived and died by the experience they offer their customers

and, in a previous age, the butcher who greeted customers by name and memorised their Sunday joint was likely to command loyalty.

Today a good customer experi-ence still provides a genuine point of difference in what can sometimes seem a rather homogeneous land-scape. Forward-thinking retailers use fast-evolving technology to repli-cate the butcher’s local information, and give customers a more satisfying experience in shops and online.

In store, for example, loca-tion-based analytics like Shopper-Trak follow customers as they move through a store, using anonymous signals emitted from shoppers’ mo-bile devices. It means customers see relevant marketing materials in the right locations and find staff on hand in the right areas at the right times.

But in-store is only one part of the multichannel offer. The rise of e-commerce means retailers offer customers two or more distinct sales channels – a bricks-and-mor-tar shop, its e-commerce equivalent and, increasingly, a mobile option.

And now that almost every retail-er sells online, the most progres-

sive seek to differentiate customer experience in increasingly sophis-ticated ways. “Smart retailers are shortening the purchase path,” says Jo Coombs, managing director of customer engagement agency Ogil-vyOne UK. “Amazon said recently they want to go from ‘I want that’ to ‘I bought that’ in 30 seconds, hence innovations such as Amazon Dash.”

NON-RETAIL

Customers want a smooth and speedy experience online, and that’s as true for non-retail commerce as it is for Amazon. Similarly, B&Q and Next, praised for embracing online communication channels and the speedy resolution of online custom-er complaints, offer an example to other sectors.

On top of that, retailers are in-creasingly integrating hitherto dis-tinct channels – store, catalogue, e-commerce, mobile – into one coherent customer experience, the so-called omnichannel approach.

Marks & Spencer’s “endless aisle” means its physical stores and e-commerce site become extensions of each other, rather than distinct silos. “Marks & Spencer reported in May that over half of all online purchases had an in-store element;

for example, goods ordered from home for in-store collection,” says Ms Coombs. Then there’s fashion retailer Oasis’ Seek & Send service, which will search the company’s stores and send an item to a cus-tomer’s home if it is sold out online.

Smartphones are pushing retail-ers to embrace another aspect of the omnichannel experience.

A shopper sees a product in-store and checks out reviews on-line before buying. They might scan a barcode and comparison shop in real time. They’ll expect their brand browsing history to fol-low them from web to smartphone to tablet, and even be available to staff in-store.

Most of all, the customer expe-rience must be consistent between these elements. “Brands cannot afford for customers to have a great experience when they visit their website or mobile app, only for it

to be fundamentally different when they then visit a store,” says Adam Goran, director of customer engage-ment at Grass Roots Group.

Sales assistants in-store have to be informed, engaged and steeped in the philosophy of the brand. Apple is an obvious example.

CONTINUOUS COMMERCE

Retailers also increasingly use the mountain of data thrown up by online shopping habits to per-sonalise messages and offers. And that, too, is driving the goal of a true omnichannel experience. “Today, the focus is moving to-wards customer recognition and data connectivity across chan-nels, media and devices,” says Paul Hatley, data strategy expert at data solutions company Acxi-om, whose clients include iconic London store Liberty.

Bricks-and-mortar stores, in com-bination with their online opera-tions, are slowly learning that they can use that data, alongside other technology, to offer customers a tru-ly holistic, personalised experience across all sales channels. In theory, for example, physical retailers could recognise individuals entering the store from their online profiles, and

push relevant discounts and offers to their smartphone or tablet.

“This seamless integration of our online persona with our phys-ical location ensures that retail-ers can provide a more personal interaction than that available through internet-based shopping alone,” says Scott Cairns, chief technology officer for IT and tele-communications service provider T-Systems.

He sees a near future in which walking through the doors of a shop turns a customer’s mobile device into a personal virtual sales assis-tant, pinging pricing information on a product they browsed online, guiding them to its physical location and providing other relevant details, such as discount offers or informa-tion on relevant accessories.

We’re not quite there yet, but in-terest in omnichannel is building. And it’s clear that, for all business-es, retail and otherwise, customers will soon come to expect a seamless experience between real and vir-tual worlds. Or as OgilvyOne UK’s Ms Coombs says, companies need to stop thinking in channels “and simply think of it as continuous commerce”. Those that get it right will win.

With consumers using a mix of high street, online and mobile shopping, customers expect seamless and consistent continuous commerce, writes Hugh Wilson

BEST PRACTICE IN RETAIL SETS EXAMPLE FOR OTHERS

Image: Getty


1

i

f

t


Personalisation

2

3

4

5

1Offering the same old customer experience is becoming obsolete. What consumers want is a personalised service, tailored to meet their individual desires, budget and mindset. As Charles Orton-Jones discovers, it is possible to offer a unique experience to each and every customer, no matter what sector a business operates in

Google boss Eric Schmidt once defined his company’s mission as serving you just what you want online before you’ve even asked for it. The trend for personalised advertisements is making that aim feel spookily close.The most common way to per-sonalise adverts is to look at the users’ search history and tailor adverts to match their search criteria. For example, James Villa Holidays, which offers villa holidays across the Mediterranean and United States, uses search retarget-ing to follow potential holiday-makers across the web.The process starts when a user begins researching a holiday online. They’ll type

in something like “Dalmatia holiday villa”. Then James Villa Holidays learns what it can about the user from their web history. It can then place precisely the right banner ads in front of the user by bidding, in microseconds, for web real estate. The firm uses an automated system supplied by search retargeting specialist Captify. The result?“Customers are incredibly receptive to our personalised digital ads,” says Sally Pemble of James Villa Holidays. “During a recent campaign we doubled the click-through rate compared with other digital campaigns we’ve run and increased the conversion rate by around 60 per cent.”

Computer games tend to be standard experiences. If you play Angry Birds or Portal 2, it is the same no matter whether you are an 8 year old or a mid-dle-aged hardcore gamer. This is changing. The new generation of games adapt to each user to ensure everyone gets the game they want.One of the biggest person-alisation consultancies is Edinburgh-based deltaDNA. It collects user data to help designers tailor games to different demographics. For example, Heroes & Generals, by games house Reto-Moto, is an online Second World War shooter game with 3.2 million registered users. With multiple game modes accessible across

multiple platforms, players can choose to play as either heroes fighting on the battlefields or as generals devising the grand strategy of a massive war with thousands of concurrent players. Using the deltaDNA platform, Reto-Moto is able to segment players based on their playing style and ability, ensuring the playing experience is shaped for different types of players. Nov-ice players can be nurtured; ex-pert players can be challenged, especially in the early stages of the game when churn is highest as being cannon fodder isn’t fun for anyone. The result is happy heroes and happy generals, no matter what level of compe-tence they play with.

China is a huge market for Scotch whisky. And what the Chi-nese want more than anything is the absolute top end. How better to serve this niche than by creating tailor-made whiskies?Three years ago drinks giant Diageo opened The Johnnie Walker House in Shanghai. It is marketed as an “embassy for Scotch whisky culture”. The crowning glory is the opportuni-ty for members and guests to have the chance to blend their own bespoke whisky. The result-ing product, your very own John Walker & Sons Signature Blend, is produced under the guidance of Jim Beveridge, master blend-er for Johnnie Walker. The packaging – both bottle and special presentation case

– is also designed to be tailored exclusively to a client’s prefer-ence, with both decanter and bottle options. London agency Sedley Place is responsible for this aspect of personalisation. Details on the bespoke packaging extend to a client monogram, personalisation of the bottle or decanter marked with the client’s signature, a specially designed neck charm and a certificate of authentication.The success of the Shanghai concept has led to Diageo opening new branches in Bei-jing and Seoul. Each Signature Blend starts from a price tag of £80,000, which gets you 20 bottles. To date ten Signature Blends have been produced.

Showing the same website to all visitors is a lost opportuni-ty. Ideally your website ought to optimise for every individual visitor, showing them precisely what they want to see.SkiWeekends.com is a ski holiday booking website cov-ering 24 ski resorts, serviced by 17 UK airports. The travel agent behind it has 30 years’ experience and is at the cutting edge of personalising the online experience.The site uses a service called Sitecore Experience Platform, which gathers all available data to personalise what each visitor sees. It takes into account factors such as search terms and the visitor’s location, using their IP (inter-

net protocol) address, to tailor site specifics such as desti-nations, transport options, promotions and incentives. Since the start of the 2013-14 ski season, sales revenue at SkiWeekends.com has in-creased by 16 per cent year on year, thanks to a 55 per cent rise in conversion of site visits to its online booking pages. The site has attracted 15 per cent more unique visits, increasing to almost 200,000 in six months. But, more signif-icantly, the improved usability and personalisation means 32 per cent more visitors are finding their ideal ski holiday – all done by a firm with just six full-time members of staff.

Children playing football don’t need any encouragement to keep playing. They’ll stay outdoors kicking the ball until it’s too dark to see. But why don’t they behave the same way with maths homework?The goal of personalised learning is to bring the same thrills and emotions to learning that games offer. The latest iteration in personalised learn-ing, developed by the global IT trade body CompTIA, tracks emissions of the pleasure hormone dopamine to ensure learners are kept at the perfect mental state: excited, curious and happy.The Chicago-based Computer Systems Institute is trialling CompTIA’s new system, called CertMaster. Questions are presented at specially timed

intervals to help each student remember, and each question must be answered accurately and confidently twice before the system shows they have mastered the topic. An algorithm looks at things which signify optimal dopamine levels, such as confidence level, based on what types of answers they choose and time they take to answer, the speed at which students master topics, and how well they memorise what they have learnt.This approach creates a dopa-mine effect and a self-perpet-uating positive feedback loop to keep learners’ attention and boost knowledge reten-tion. In early trials, CertMaster claims 80 per cent knowledge retention

LET’S GET PERSONAL

YOUR OWN PERFECT WHISKY

LESSONS YOU WON’T WANT TO END

SHOWING ADS YOU WANT TO SEE

NO MORE CANNON FODDER

PERSONALISED WEBSITES


1

i

f

t


Personalisation

80

60

40

20

0

80

60

40

20

0

95%

A

C

B

D

53%

49%

39%

46%

35%

39%

40%

30%

26%

28%

AGE OF PERSONALISATION

The big data problem

Personalisation approaches

How do you evaluate consumers' expectations for personalisation across various channels?

The segmentation opportunity

Big data drives results despite challenges

of data within organisations remains untapped

of marketers want to add online customer data to their customer profiles and be able to use that information

increase in revenue growth for companies that invested in analytics versus those that did not

of marketers say they can't turn their data into actionable insight

of organisations don't target any customer or visitor segments

higher return on investment for companies that invested in analytics compared to those that did not

of marketers think data is collected too infrequently or not in real time

of marketers believe it's important to identify actionable insights in large amounts of data

of marketers say data has improved customer engagement through personalisation

of organisations don't use real-time on-site behaviour to personalise the customer's experience

of marketers are unaware of which high-value customers to focus their marketing on

Ause personalisation and targeting, based on broad segmentation and simple clustering techniques, to execute campaigns

WEB ACTIVITY

CALL CENTRE WEB

SOCIAL ACTIVITY

STORE INTERACTIONS

INGESTION LAYER

PERSONALISED PRODUCTS AND

SERVICES

STORE INTERACTIONS

MOBILE LOCATIONS AND COMMERCE

of companies surveyed ask how consumers would like to receive their marketing offers

Buse personalisation and targeting, based on simple business rules, and execute campaigns across channels

use metrics that indicate the strengths and weaknesses of personalisation programmes to guide decisions

Cpersonalise products, offers and content based on the collective insights of users with similar preferences

have a robust testing and optimisation programme that gives insights into the types of content, offers and products consumers prefer

Duse real-time, self-learning analytics to drive personalisation and targeting across digital channels

use real-time decisioning technology to guide personalisation so consumer interaction drives the offer versus prebuilt propensity scores

A AB B

83%

86% 67%

53%

46%81%

34%71%

C CD D

SALE SALE

Source: Forrester, April 2014Source: Forrester, April 2014

Source: Monetate

Data

Knowledge base

Customer direct input

Transactions


1

i

f

t


Customer Communities

BUILDING A FANBASEBusinesses launch customer

communities for a variety of reasons – to help cus-

tomers with products, to improve the effectiveness of marketing ef-forts, to create customer feedback loops, to use market data and to im-prove customer satisfaction.

North of England-based open-ac-cess train operator Grand Central has developed an extraordinary rep-utation for great customer service, largely through word of mouth and the efforts of its very vocal fanbase, the customers.

The company ’s communica-tions and stakeholder manager Kate Thorpe says its success in this area has a lot to do with the need it serves. “As an open-access operator, Grand Central Rail exists because the local communities we serve did not already have a direct rail link to London,” she says. “Local support for our services in the early days gave communities a sense of owner-ship of Grand Central Rail services, and we work hard to maintain and develop close co-operative links.”

Ms Thorpe says Grand Central seeks out opportunities to support, promote and develop local initia-tives which benefit the community, “from supporting Brass Factor – a brass band talent competition in West Yorkshire – to jobs fairs and other stakeholder activity”.

The company runs a station am-bassador scheme manned by volun-teers. “As a small company which

does not own or manage any sta-tions, we do not have the infrastruc-ture or resources to staff stations on Sundays, when smaller stations are traditionally unstaffed and the ma-jority of rail engineering work takes place, disrupting rail travel across the country,” she says.

“The station ambassadors mod-el we adopted allows us to provide face-to-face customer advice on travel, tickets, rail replacement services, taxis and directions using fully trained, uniformed volunteers from local business communities, who donate their time in order to provide help and assistance. Their presence has had a positive effect on our passengers and staff, and contributes to devel-oping rail travel in the North East and Yorkshire.”

It has paid off. Figures released by Passenger Focus earlier this year found that 95 per cent of Grand Central passengers were “satis-fied” or “very satisfied”, which is something you don’t often hear in the same breath as the words “train company”. Enterprise busi-ness technology provider Avanade

uses social media as a core plat-form for its thought leadership as well as creating dialogue with its customers. Jessica Brookes, global director of media and analyst rela-tions, says: “Simply put, we listen to the market, making sure we are staying on top of developing indus-try trends, emerging technologies and enterprise pain points that are on the minds of our enterprise customers. The data we glean from this active listening helps inform our marketing campaign focus and content creation.”

Avanade generated 3.5 million impressions on LinkedIn last year and has 25 different groups there, with 15,000 members combined. But using social media to mobi-lise customers isn’t about gather-ing followers indiscriminately. It’s about how well you use the follow-ers you have. Avanade uses social media channels to manage its brand presence online, identifying who its audience and influencers are, and measuring how effective it is at reaching them. “We tailor our content to be relevant and person-alized, and respond in real time to questions, comments and trends,” says Ms Brookes.

“We do this at a corporate lev-el, regional level and with specific ‘digital executives’ who share their unique point of view. We are aim-ing for two-way communication with social platforms such as our blog and Tumblr accounts.”

TWEETCHATS

Avanade hosts regular tweet-chats, and even uses Instagram and Pinterest. Though Instagram, which isn’t typically used by large companies, might seem like a time-consuming and non-cost-ef-fective use of labour, Avanade’s chief marketing officer Stella Gou-let says it’s a great way of human-ising the company and showing its personality, and this filters down to the bottom line.

The company joined Instagram about 18 months ago and says Ms Goulet: “We leverage Instagram with teams and customers at vari-ous tradeshows, Formula 1 [motor racing] events, as part of its spon-sorship with Lotus F1 Team, and showcase fun things happening in our offices worldwide.”

Social tools such as Instagram might not gather millions of follow-ers, she says, but they, “ increase em-

ployee engagement and, hopefully, communicate to potential recruits that Avanade creates change”.

Research into consumerisation of enterprise sales, published by Ava-nade at the end of 2013, showed that enterprise buyers are beginning to mimic consumer shopping behav-iours and the value of the customer experience is now more important than cost in the buying process.

The research found that the value of the customer experience surpass-es cost as the top factor in a busi-ness-to-business (B2B) purchasing decision. Customers report they are willing to pay up to 30 per cent more for a superior experience. In fact, 56 per cent of those surveyed report paying more for a product in the last six months because the customer experience was better than other less expensive options.

According to the research, 61 per cent of B2B buyers report third-party sites and feedback from business partners, industry peers or social channels as more important than conversations with a company’s sales team when making a purchasing decision. They also talk about their busi-ness purchase decision publicly – 32 per cent posted a review on social media channels and 19 per cent posted comments about the company on Twitter.

Most companies know how to use social media to promote their business, but some are building successful cohesive and supportive online and offline customer communities, who are working almost as hard to back the brand as the paid employees. Hazel Davis reports

Communities thrive on shared interest, engaging dialogue,

freely exchanged stories and mutual support

Data is key

Page 13

Imag

e: G

etty


1

i

f

t


Customer Communities Case Study

RESIST SELF-INTEREST

Jim Prior, chief executive of brand consultancies The Partners and Lambie-Nairn, says: “Com-munities are built in the virtual world in the same ways as they are in the physical world. They thrive on shared interest, engaging di-alogue, freely exchanged stories and mutual support, and tend to resist more dictatorial or self-in-terested approaches.

“For companies, successful community building requires a different approach to the one-way broadcast technique of traditional marketing. It needs companies to

Mail-order snack subscription compa-ny graze has built an entire empire on involving the customer in its develop-ment process.“A big part of graze is letting customers influence the products we make and the ones we stop making,” says Angus McCarey, the company’s chief market-ing officer. “They do this through the ratings they give us.” The company takes the 15,000 product ratings they get every hour on their website and launch new products every week in response to what the customers are telling them. “In fact,” says Mr McCarey, “it takes a mere 24 hours to launch an entirely new product thanks to communica-tions technology, bespoke machinery and a supply chain that is designed around late customisation.”Recently, the company even asked its customers whether one of its more controversial snacks – Holly’s Spicy

Satay – should stay in the range. graze has a community of more than 150,000 people on Facebook between the US and UK. It also has nearly 100,000 on Twitter and it has started using social media to extend its customer influence, “for instance by letting people tell us whether a particular recipe should be launched or not”, says Mr McCarey. The company tracks the number of people who read its posts, and how often they are shared and commented on. “We’re proud that we often achieve far higher levels on these metrics than other brands or typical comparisons,” he says.“This data also allows graze to do something that traditional retailers shy away from – take risks and surprise customers with a product they might not usually choose. It creates a truly novel customer experience.” Because graze develops, manu-factures and sells directly to the consumer, unlike traditional retailers, it gives the company a unique relationship with its customers. It prints personalised customer inserts in every box sent out which, says Mr McCarey, “enables us to know whether a customer recommends us to other people because they have a unique code”.

‘GRAZING’ FEEDS THE BOTTOM LINE

The company takes the 15,000 product ratings they get every hour on their website

and launch new products every week in response to what the customers are telling them

be prepared to listen and respond to their audiences, in real time, with honesty and humanity.

“They need to be prepared to go ‘off-script’ – there’s no place in social media for carefully crafted press releases and catch-all cor-porate blurb – and engage in con-versation with their customers as human beings would. They need to think less about what they want their customers to do and more about what their customers might like to do, providing them with in-vitations, but not instructions, to contribute and share their thoughts and ideas. This kind of approach of-ten goes against the instinct of large

companies – it requires them, in part, to cede some of the control of their brand to the customer.”

And then, of course, this control needs to be carefully managed. The best companies do this in a very subtle way. Mr Prior concludes: “The key to managing them is to stay a part of the dialogue with-out appearing to exert too much control. The most fundamentally important point about building so-cial media communities is to think and act like a human being, not a corporate machine.”

Facebook

Ratings and reviews

Twitter

LinkedIn

Participate in industry

Blog/forum

Company/brand

Community

YouTube

Company/brand blog

Social media marketing with highest return on investment

Source: Raconteur

1

2

3

4

5

6

7

8

9

10


1

i

f

t


Commercial Feature


1

i

f

t

FUTURE OF WORK16/10/14EDITION #0000

We’ve all had the much-talked-about experience. You visit a website, type in your details, do a search and in-put your preferences. Then you ring the call centre… and go through the whole business all over again be-cause the person on the other end of the line has no access to what you’ve inputted.

Or you have a lengthy conversation with the call centre representative, then fi nd yourself having to repeat it yet again when you visit the store.

Ironically, we clearly know what a cus-tomer wants – because we are custom-ers. Yet we have organisations who defi ne themselves in silos, focusing on product or operational deliverables, and still many brands lag way behind their customers’ wants, while they struggle to put a cus-tomer-fi rst philosophy into practice.

To put the customer experience fi rst is now essential. There is no captive au-dience. Customers are more demand-ing, more selective and more savvy. They want brands that are committed to them and take time to understand exactly what they want. If a brand fails to recognise customer priorities, then social media at every level provides a powerful platform for customers to be heard and deliver their choices. And in turn a new wave of startups, such as giffgaff or ASOS, fl eet of foot and with no legacy systems, challenge well-es-tablished brands to deliver a smoother, more integrated customer journey.

CUSTOMER PERSPECTIVE

We believe brands need to have the ability to look at the customer experi-ence through the lens of the customer themselves, while being clear about which parts of the organisation are con-tributing to it – a two-way mirror.

But why do so many well-managed, sales-led, hitherto successful brands

baulk at starting with the customer? In a way you can hardly blame them. They perceive the answer as being a potential re-engineering of whole sections of the organisation or replacement of entire IT systems. And if that were the case – yes, it would be pretty scary.

“Do we really have to change everything?” clients often ask us. The good news is that the answer to this question is a resounding “No, you don’t.” Changing everything is like boiling the ocean when you really just want to make a cup of tea.

The Havas EHS approach is we make the difference that will make a difference. We create a single way of connecting all the different views of the customer, from unknown to identifi able, and work out how to manage all the in-teractions in-between. Then we map a customers’ journey to deliver new and better experiences that, if tested and work, are scaled up.

DATA IS GLUE

Data is the glue which creates our insights and enables us to know where, when, why and how to focus on creating better customer experiences.

There are so many moments that a customer “touches” a business, and we need to be able to defi ne which we should infl uence and where we can have the most impact; not just what happens “at the moment”, but what we do before and after each interaction.

This is customer experience context. Many businesses don’t have a view about the data they have; they don’t know what is available, what it means, how it can be supplemented or where it should be combined – digital data, as well as transactional and social data, web analytics, channel metrics, contex-tual data, data from inside and outside the business. I could go on – the broader meta data which enables us to look at the customer in entirety and use our cre-ative and data intelligence to drive more compelling and inspiring customer jour-neys and moments of interaction.

We start with pilot strategies to deliv-er proof of concept and build a common approach which links back to business objectives. And we blend our insights to create experiences indistinguishable

Commercial Feature

Delivering optimum customer experience is must-do for businessBrands must start looking at the customer experience from the point of view of the customer, not their own – a change that is easier to implement than many may think, says Tash Whitmey, group chief executive of Havas EHS

MAKE THE DIFFERENCE THAT WILL MAKE A DIFFERENCE

TRIGGERS

INFLUENCES

PREVIOUS EXPERIENCE

LANGUAGE RELATIONSHIPS

CHANNEL TOUCH POINTSTIMING

EMOTION INTENT TO ACT

from excellent service. This approach means that we don’t throw out existing customer relationship management (CRM) systems or reinvent tools or tech-niques. It means we can work with what is there, creating fast, fl exible and quick ways to deliver real business value.

In the beginning CRM was designed to replicate the old-fashioned grocer ex-perience, where you were known, recog-nised and delighted. The difference was the grocer was able to use face-to-face interactions to gather a deeper context from the customer – what was important, why it was important, what the customer was or was not happy with.

What we now need to do is replicate the ability to gather that context utilising the plethora of data available to us. This will enable us to hear and enable our cli-ent to give customers what they want.

By introducing the context of the cus-tomer experience, we can really under-stand a customer’s needs. So we look at the customer’s situation. Where are they? In a store or in the street with a mobile device? We also think about how they’re feeling? As they interact with the brand, are they excited, anxious or unhappy? What happened before the

transaction? Did they try another route to getting an answer, but couldn’t fi nd it?

The imperative for brands to adapt has never been greater – empower the customer by adopting their perspective, so the customer gets what they want and the business achieves its objectives.

For example, we are providing a clear “next best action” for customers booking a fl ight with easyJet, whether through the contact centre because of direct com-munications, or through the website. Our communications and customer experi-ence has to deliver the right information to the customer based on signals they are sending, as well as provide compelling reasons to take those actions.

In summary, regardless of where your brand is, what its barriers are and at which point on the journey you are, the necessity is to fi nd the com-mitment to this approach across the business. Start small, understand your data landscape to fi nd something meaningful to customers. Test it, learn what works and then scale it into day-to-day business. Your customers will reward you for the effort.

#HAVASCX

CUSTOMER CONTEXT

The imperative for brands to adapt has never been greater – empower the

customer by adopting their perspective, so the customer gets what they want and the business achieves its objectives


1

i

f

t


Customer Data

IN THE VANGUARDOF UNLOCKING DATA

Businesses are deluged by data – a wave of information that has opened up new possibilities for a far-sighted few, writes Marcus Leroux

The proliferation of con-nected devices, from tab-let computers to the inter-

net of things, saturated broadband coverage and the rise of the mobile internet has all lead to reams of in-formation about customers. At the same time, improved software plat-forms and analytics better enable this information to be harnessed.

A better use of the wealth of data lurking in the cloud, in customer relationship management systems and in sales figures can improve customer retention and satisfaction – and, ultimately, the bottom line.

But there are inherent challeng-es and tensions in using data. First, customers can find it unnerving if a company knows too much about them. Second, the security of data is a major concern as high-profile data breaches appear all too common for the public. Most recently, J.P. Mor-gan Chase fell victim to a hack that compromised the accounts of 73 million American households.

Getting hold of the data can be is as big a problem as keeping it safe. Asda’s challenge has historically been that it lacks a loyalty card, unlike its two biggest rivals Tesco and J Sainsbury. If a company has no way of tying baskets of goods to particular individuals, then it must rely on batch-processed, top-level, aggregated data, an approach that many have already consigned to the 20th century.

SMARTPHONES

Part of Asda’s attempted solu-tion has been to find ways to tempt consumers into making that link. Last year the supermarket group introduced a trial run of a tech-nology that allowed customers to scan products as they go around the aisles using their smartphones, making the check-out process re-dundant. According to Asda chief executive Andy Clarke, the need to gather data was a key part of the motivation.Chris Nott, IBM’s chief technology officer for big data an-alytics in the UK, says he has ob-served two new trends in recent months. “Firstly, organisations are

taking a much more rounded view of customers, and trying to understand their current context so they can be much more personal and individu-al in their interactions. They want to be much more seamless across channels and they also want to be much more in-the-moment in terms of applying insights,” he says.

“That’s driving demand for re-al-time capabilities. They want to use data while the customer is with you, rather than after they have left.”

Social media represents the sec-ond new frontier, but is an awkward part of the jigsaw to integrate with other data sources. “There are some technology components which will help you to realise that single view of the customer,” says Mr Nott. “It’s also about having a coherent approach to technology across the organisation so that you can take on

increasing numbers of data sources, such as website activity, mobile app usage or social media, which you need to be facilitated into the struc-ture if you want to build up that richer picture of how a customer interacts with you.”

Consumers appear to be show-ing an increasing willingness to let companies share their information by signing in to services or online stores via their Facebook or Twit-ter accounts.

Some 84 per cent of 18 to 34 year olds use social login when register-ing or signing in to websites, allow-ing brands access to some of their profile data, compared with 59 per cent for the population overall.

Patrick Salyer, chief executive of social login and consumer manage-ment technology specialists Gigya, says that allowing sign-in through social media yields better data and a better relationship with customers. “Personalisation depends on access to high-quality and authentic data about customers. If you ask custom-ers for permission to use their data and explain what you are going to collect and why, you will learn more and establish a foundation of loyalty and trust,” he says.

The advantage of superior data, pioneered through supermarket loyalty schemes such as Tesco’s Clubcard in the late-1990s, is the ability to target customers with of-fers tailored especially for them.

SHOPPING JOURNEY

The next phase of the develop-ment, for retailers such as Kroger in the United States and Metro of Germany, is targeted offers that ar-rive on a mobile device as a shopper strolls through the store. This capa-bility to offer a promotion to a con-sumer at precisely the right moment in the shopping journey is already standard among grocery websites, such as Ocado in the UK and Fresh Direct in the US.

In the cut-throat world of mobile phone network operators, better targeting of offers and marketing can prevent customers defecting. Pakistan’s Ufone at one point had a churn rate of 3 per cent a month, which meant that it had to replace nearly one customer in every 30 monthly just to stand still. It shifted away from conventional marketing campaigns – flyers, TV advertis-ing and so on – in favour of a more targeted and analytical approach.

It found that customers who were under-using their pre-pay packages were more likely to leave, and so it developed offers targeted at particu-lar types of user, which increased customer satisfaction scores and reduced churn.

In the insurance industry, Infinity in the US used analysis of fraud cas-es to reduce the workload of its loss adjusters by weeding out certain low-risk accidents, which cut costs radically and speeded up payments. The return on investment was more or less instant and customers were less agitated by delays in payments.

Such virtuous circles – saving money by using data to give the customer what they want when they want it – will become increasingly common for businesses at the van-guard of unlocking data. But experts say that the key is in asking the right questions – data is a means, not an end in itself.

Gigya’s Mr Salyer concludes: “Or-ganisations must reject the outdat-ed, and quite frankly careless, no-tion of asking as many questions and collecting as much data as possible, then sorting through it later.”

The key is in asking the right questions – data is a means, not

an end in itself

011010100101011010

11101010010101010

1110101001010010

11001011010

1101011010

10110010011

101110110111010010


1

i

f

t


Commercial Feature


1

i

f

t

POWERING THE FUTURE 15/10/14EDITION #0000

Every decade has its business buzzwords. Today it’s almost im-possible to talk about customer engagement and loyalty without hearing the phrase “the customer experience”. The words might be familiar, but what do they actual-ly mean? Ask ten marketers and you’ll probably get ten very differ-ent definitions.

In parallel, the growth of big data of-fers huge potential for understanding customers and their experiences more precisely, and at a more granular level than ever before. However, it can raise more questions than it answers.

At 5one we recognise that sifting through the vast and expanding ocean of facts, figures and other records that big data offers is overwhelming. We work with businesses to identify the informa-tion they can use to really understand customers, and help them focus on what is relevant to them and what they actually need. This is increasingly impor-tant as more data becomes available. Big data needs to be distilled into action-able information.

FIVE PRINCIPLES OF CUSTOMER EXPERIENCE

At 5one we don’t just manage data, we use it to help clients understand the full customer journey and so, we're increas-ingly finding ourselves helping a wide range of retailers and other businesses to analyse their customer experience, and to transform it into something they can action to leapfrog their competitors. At 5one we’ve developed what we call the five principles of customer experience. As a leading customer centricity consultan-cy, we find these simple rules help our clients as they seek to understand their customers better and develop more ef-fective engagement strategies.

A customer’s value to a business is driven by their experiences.

This means that each interaction, good or bad, a customer has with a brand has an impact on the way they view that brand. The experience is a cumulative impact of all their interactions and in turn determines their value. Historically

there has been a focus on what consum-ers are buying as a way of understanding their behaviour at the point of purchase. However, we’re finding that in order to be able to deliver a personalised cus-tomer experience, businesses need to analyse more than just this one part of the journey.

Customers’ experiences are broader than simply transact-

ing. In fact, the customer journey is cyclical. We interrogate data to under-stand the complete customer journey when they consider a purchase, read a review or have a conversation; when they shop in store or online; and after-wards when they enjoy (or otherwise) their purchase, speaking to customer support or reviewing on social media.

Customer value is both personal and social, so it’s vital that cus-

tomers aren’t just measured by the val-ue of their shopping baskets. They must also be evaluated by their influence, their online reviews, social media and blogs, among other outlets. Creating and recognising advocates is key to suc-cessful businesses.

Customers seek different ex-periences, dependent on both

their personal preferences and their shopping situation. For example, when a customer buys a sandwich at lunch-time, they want the experience to be quick and easy. On the other hand, when the same customer buys trainers from a specialist store, they expect ex-pert advice and time devoted to them to understand their needs. Depend-ing on whether the retailer is selling sandwiches or trainers, the customer experience they provide will be very different and so each retailer must offer the customer experience that is appropriate to them. Brands need to tailor this experience depending on where they play in the retail space. In addition, they will have to take into account the individual customer and the situation in which they find them-selves to create the most appropriate customer experience.

Commercial Feature

What customer experiencereally means for retailersThe phrase customer experience is frequently used, but defining it is less easy. That’s why customer centricity consultancy 5one has developed five essential principles of customer experience, says chief strategy officer Trish Ferguson

Simple rules help our clients to understand their customers better

and develop more effective engagement strategies

You can't maintain or enhance customer experience without

understanding and measuring it. We work with our clients to help them con-tinually improve the experience they give their customers. With marketing campaigns, for instance, we ask have we increased sales to the customers we’ve targeted? With website chang-es, have we decreased the rate of abandoned baskets?

Customers are becoming increasingly demanding and vocal, so understanding

their customer journey is more important than ever. But every retailer is different so, as well as recognising the complete customer journey, we enhance the jour-ney through our personalisation tools. At 5one we can implement the right tools and solutions for your business, which ultimately leads to giving each customer their desired experience.

For more information please visit www.5one.com

CUSTOMER EXPERIENCE AND ENGAGEMENT

It takes twelve positive experiences to make up for one unresolved negative experience

=

NEWS OF BAD CUSTOMER SERVICES REACHES TWICE AS MANY PEOPLE AS PRAISE FOR GOOD SERVICE EXPERIENCE

9people hear of

happy customers 22people hear of

unhappy customers

80%of companies say they deliver superior customer service

8%of people think these same companies deliver superior customer service

15%of incremental sales per customer can be driven through personalised experiences

CO

NSI

DER

ENJOY

SHO

P

Becomes aware of offerings and begins consideration

Enters the store or site and makes a purchase or booking

Uses and talks about their purchase

CUSTOMER

EXPERIENCE


1

i

f

t


Opinion

CUSTOMER FOCUSIS CENTRE STAGE

Two experts in customer experience consider the future for business-to-consumer and business-to-business companies in fast-changing times

The 2014 Temkin Experience Ratings found that only 7 per cent of 268 business-to-con-

sumer (B2C) companies earned excel-lent ratings. On the surface that seems pretty bad. Less than one in ten com-panies provides great customer expe-rience. So are consumers destined to

live in a world of mediocre customer experience?

Not likely. The story changes when we take a longer-term view. Compar-ing the Temkin ratings from 2011 to 2014 shows that the percentage of companies with good or excellent cus-tomer experience has grown from 16 per cent to 37 per cent, while the per-centage with poor or very poor ratings has dropped from 48 per cent to 25 per cent. Consumers may not be getting great customer experience, but it’s trending in the right direction.

The outlook is good for consumers. Nearly six out of ten large companies that Temkin recently surveyed are aiming to be the best at customer ex-

The experience which customers of business-to-business (B2B) companies have will pretty

obviously vary enormously from one organisation to the next and from one sector to the next. At one extreme, you have professional services firms, where key clients are managed by partners and therefore the customer experience is highly personalised; at the other, you have highly commoditised markets such as bulk office, where price is everything, brand counts for very little and ongoing relationships are tenuous.

Clearly both the nature of the custom-er and the value that they represent to the organisation are key in defining the experience that an individual will receive.

Although the vast majority of B2B organisations exist in between these

B2C

B2B

Bruce Temkin, chairman and co-founder of the Customer Experience Professionals Association, says the future of business-to-consumer customer experience is bright

Joel Harrison, editor in chief and co-founder of B2B Marketing, explains why business-to-business brands are waking up to a customer experience revolution

1

2

3

4

perience in their industry within three years. They have good reason to be. Temkin Group’s latest return-on-in-vestment research shows that a mod-est increase in customer experience at a typical $1-billion company can generate an additional $370 million in revenues over three years.

If you’re a B2C company and aren’t focused on customer experience, you should consider these questions:• Are consumers likely to expect less? • Are your competitors going to

get worse?• Is technology going to lower the bar?

For most of you, the answers are no, no and no.

To succeed in the future, you will need to know more about your cus-tomers, use that information to re-spond more quickly to their changing needs and recover in lightning speed to any mistakes.

FOUR CORE COMPETENCIES

Improving customer experience isn’t easy. Companies can’t just slap on a ve-neer of customer experience on top of their complex organisations and expect that consumers will find them easy to work with. To make sustainable improvements, companies must master what Temkin Group calls the four customer experience core competencies:

PURPOSEFUL LEADERSHIPCompanies need to (re)introduce a

clear purpose for their organisation that is more compelling than increased profits – a raison d’être that aligns the myriad of day-to-day decisions.

EMPLOYEE ENGAGEMENTEngaged employees are valuable as-

sets for business health plans. They trigger a “virtuous cycle” driving good customer experience and superior business results.

Our research shows that engaged employ-ees try harder, engage customers and drive stronger business results.

COMPELLING BRAND VALUESTrue brands are more than just mar-

keting slogans – they’re the fabric that aligns all employees with customers in the pursuit of a common cause. Companies need to clearly define their brands in terms of promises to customers, and find ways to get all employees to understand, embrace and deliver on those promises.

CUSTOMER CONNECTEDNESSIn most companies, decisions are

made with woefully little customer in-sight. People often rely on their “gut feel” or outdated anecdotes about customer needs, desires and feedback. But any com-pany that wants to improve its customer experience needs to embed deep custom-er insight in every aspect of its operations.

two polarised extremes, their focus on customer experience has often been conspicuous by its absence.

This has in part been due to the age-old tussle between sales and marketing for primacy – the key question being, “who owns the customer?”

Historically sales has had the upper hand in many organisations, being given responsibility for the bottom, and often much of the middle, of the traditional buying funnel. Marketing was margin-alised to top-of-funnel, driving aware-ness, and sales personnel were reluctant to let anyone else in on a potentially ex-tremely valuable relationship that they had fostered.

But the onset of the digital age is in-creasingly making the old-fashioned funnel redundant – the notion of the funnel depended on brands being in control of the information exchange, and business customers being contact-ed at a time and place when it suited the brand.

Today, Google and the power of searchable content, including videos,

slideshares, infographics and so on, means buyers are now in control, and are only willing to engage with sales at a time to suit them, when much of the decision-making process has already been taken place.

MARKETING IN DRIVING SEAT

This means that sales no longer owns the customer, marketing is now in the driving seat, and is increasingly responsible for all aspects of interac-tion, both before, during and after the purchase. B2B marketers have never been in a better position to drive and determine their customers’ experi-ence of their brands. Marketers are increasingly waking up to this new level of authority and the consequent responsibilities.

And that’s a good thing too, because increasingly social media is changing the ground-rules regarding custom-ers’ expectations. The “instant gratifi-cation” culture of generation Y, those who have grown up with the internet, demands that queries or complaints be

answered decisively and immediately, rather than vaguely and after signifi-cant hassle. Put another way, the op-portunity to call, e-mail or write to an organisation, to receive a response in their time, is laughably unacceptable.

Social media-enabled customers or prospects demand better from their business product or service providers, and if they don’t get it, will complain vo-ciferously and visibly, just as they will in their consumer lives.

Proving a good customer experience, in good times and bad, is no longer an option in B2B – it’s an essential. Those B2B organisations that don’t acknowl-edge and embrace this are living on borrowed time.

Documents

CE_L---singles