“A seismic shift is under way,” write Nicolaj Siggelkow and Christian Terwiesch in the May-June 2019 issue of the Harvard Business Review.1 “Thanks to new technologies that enable frequent, low-friction, customized digital interactions, companies today are building much deeper ties with customers than ever before.”
Deliver a differentiated and meaningful customer experience
Rather than waiting for customers to come to them, companies are meeting customers’ needs as soon as they arise, and sometimes even earlier, say the authors, both from Wharton and the Mack Institute for Innovation Management. “It’s a win-win: Through what we call connected strategies, customers get a dramatically improved experience, and companies boost operational efficiencies and lower costs.”
These connected strategies are key to delivering the types of differentiated and meaningful experiences customers expect today. The HBR article classifies them into four groups:
- Respond to desire – “Customer expresses what she wants and when”
- Curated offering – “Firm offers tailed menu of options to customer”
- Coach behavior – “Firm nudges customer to act to obtain a goal”
- Automatic execution – “Firm fills customer’s need without being asked”
Connected strategies are not mutually exclusive; companies looking to capitalize on continuous connections need to design customer experiences to blend these strategies. To deliver these experiences, companies must build connected strategies on a strong foundation firmly rooted in user experience design, integrated operating models, process efficiency, digital systems and technology, and robust datasets. Expanding on thought leadership that focused on the “what” and “why” aspects of customer experience, it is important to understand the building blocks that enable these strategies to come to life – and to determine which ones can unlock the capabilities that matter most to your customer.
Enable connected strategies
The building blocks to enable connected strategies include:
- User experience: Customer experience design, user interface (ui)/user experience (ux), flow/funnel, and capabilities
- Operating model: Functional integration designed to drive the end-to-end customer value chain
- Process: Coordination, automation, efficiency, and operational excellence between the customer, customer-facing staff and technology, and back office
- Technology enablers: Systems, devices, architecture, and APIs
- Data: Master, demographic, transactional, contextual, experiential, and behavioral
The next step is to extend thinking by Siggelkow and Terwiesch to incorporate more detail on the “how” – capabilities, enablers, and measure of success (see table below).
Table: Connected strategies and key enablers
|Connected Strategy||Interaction Type||Customer |
|Key Capabilities||Critical Enablers||Key Measurables
|Respond to Desire||Transactional||Speed|
Omnichannel (Buy Online Pick-Up Instore, Buy Online Ship to Store, etc.)
|Technology: APIs / Real-Time Integration|
Process: Integrated Distributor & Delivery Network
Operating Model: Customer-facing, store, and back office functional Integration
User Experience: Cart to Checkout Flow
|Number of Clicks
Order to Delivery
Dynamic Offering & Content
|Data: Product, Content, Transactional History|
User Experience: Personalized Pages, Dynamic & Targeted Content
|Coach Behavior||Relational||Goal Setting|
Engagement & Encouragement
Alerts & Reminders
|Data: Actionable, Contextual, Experiential|
Technology: Connected Equipment/Smart Devices
|User Experience: Preference Center|
Technology: Smart Devices, Equipment Integration,
Process: Systematic Event-Based Triggers
Data: Supply/ Demand, Preferences
Selecting the right connected strategies
Clients often ask us how to approach enabling the right connected strategies. Here are six steps help ensure a successful outcome:
- Talk to your customer and listen to what they need. It is important to conduct meaningful user research to develop the insights around the customer profile, current points of friction, and the specific capabilities that will create the most differentiation and build the most meaningful relationship.
- Make sure your value proposition is clear and differentiated. Understand your value proposition and how it delivers the right differentiated experience for your specific target customer.
- Define and prioritize your capabilities. Define the capabilities you need to unlock the value of the connected strategies, organize them across the different phases of the customer lifecycle (awareness, acquisition, sales, service, loyalty), and prioritize them based on customer benefit, strategic differentiation, ROI, development cost, effort, and change impact.
- Evaluate your technology stack and identify gaps. Leverage a business-driven technology approach to assess your ability to deliver front-end customer experiences via supporting technology enablers. These key enablers should include the overall enterprise architecture landscape, capabilities available in current system/platform, integration methods, and data.
- Have a clear data strategy. Data is the lifeblood of connected strategies. Without the data to drive the experiences, even the best user experience will fall short. Companies need to have a foundational understanding of the different data sources, data types, interaction types, and data integration methods that enable the attribution/segmentation, targeted execution, and data-driven insights that make the connected strategies a reality.
- Run quicker and fail faster. Speed and agility are key characteristics of organizations pushing to meet the ever-changing expectations of customers. Learnings from pilots or A/B tests can quickly be applied to refine how the connected strategy is ultimately delivered. Additionally, it is imperative to create a roadmap that generates benefit faster by structuring initiatives in a way where quick wins are achievable and can be leveraged for longer-term objectives.
For more on our approach to Digital and Customer Experience Strategy click here or contact Dan Izzo, Principal (DIzzo@libertyadvisorgroup.com).
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1 Siggelkow N, Terwiesch C. The Age of Continuous Connection. Harvard Business Review (May-June 2019); https://hbr.org/2019/05/the-age-of-continuous-connection