Scary stuff.
The good news is that there are many opportunities for companies to embrace, not just grudgingly accept, shifting power to create value through better customer engagement. We have experienced many of these at Summa and here are just a few scenarios that can represent big opportunities for better customer engagement.
1: Look for changes in control between company and customer—they indicate opportunity
Customers are equipped with tools that enable them to start and end relationships with companies whenever they want. This changes how the companies participate in the relationship. The change in control is not a loss of control. It is quid pro quo—a kind of tradeoff in which companies give up one kind of control for another.Companies surrender control of time and channels when customers decide how to engage. But they gain the ability to use context and location metadata to deliver a more engaging experience. The United Way, for example, can use metadata to engage donors based on their interests, not just through corporate giving campaigns. Donors can be notified of an emerging need that the United Way predicts will appeal to a donor and offer many ways of donating value, not just in the form of currency, but in the form of volunteerism or social sharing. The donor who chooses to respond to a local community in need like a flash flood may have the route mapped for them on their smartphone and use the app to source other possible donors from the crowd. The United Way can continue to facilitate the transfer of value from donors to communities and be relevant for years to come.
Embracing shifts in control can help companies gain a new kind of access to customers. For example, a teledermatology company that detects the types of devices customers use to access their service can know when an existing customer is using a native app on a smartphone and configure workflow to reduce the effort required to capture and upload photos of their skin using the camera. Alternatively, the company can deduce that a prospective customer is using a web app through a desktop-access device and use the larger screen size to present information that will compel account creation.
CRM systems are often used to capture the “reason for loss” of an opportunity. Drops in first call resolution rates captured in most call center solutions often indicate needs that the customer now expects companies to meet that require only minor adjustments to a solution. Qualitative research methods from the design, business and human-computer interaction communities that involve direct interaction with customers can unearth unmet and underserved needs that result from shifts in power.
When companies embrace shifts in power to customers, engagement improves and new kinds of value can be created.
2: Look for Shifts in Ownership of Customer-Facing Systems
The shifts in power between technical executives and business executives is widely acknowledged. CMOs and other business executives are typically more accountable to P&L and revenue growth than their peer technical executives. They achieve these results by acquiring customers, retaining them and increasing their share of engagement. The primary responsibility of CTOs and IT Directors is usually technical in nature and often supersedes business growth through customer engagement. Maintaining deployed systems is all-consuming and leaves scarce resources for engaging customers on their terms.This shift creates an opportunity for CMOs to leverage the pressure of demanding customers differently. By putting the customer at the center of the work, CMOs may design and build solutions that comprehend the continuity in the customers’ experience through the attract, sell and service decisions in their journey. By virtue of their business goals, CMOs are in a different position than their technical peers to unify the customer experience.
This shift also creates a unique opportunity for CMOs to advocate for the best total customer experience across all of the solutions in digital channels and physical channels and those that mediate the end-customer experience. The CMO now also has “customers” in marketing, sales, distributors, field service, customer service, inventory, shipping and who also engage customers. Cloud computing and SaaS platforms such as Salesforce have accelerated the shift in power within companies since it is easier than ever to move in and out of fast-changing solution options with or sometimes without IT. CMOs have become de facto managers of a portfolio of customer-facing software solutions driven by increasingly powerful customers.
While it may seem trivial, the proliferation of new titles for business executives evidences the customers’ ability to require companies to regard them more seriously. CSOs (Chief Strategy Officers) CCOs (Chief Customer Officers) CXO (Chief Experience Officers) and CDOs (Chief Digital Officers) are appearing in the c-suite to meet customer needs that have gone unfulfilled by IT executives who have been struggling to keep business critical systems operating in the face of rapid technological changes. For Zillow, Zappos and Netflix, this shift was a central part of the inception of the company. But for companies that existed before customer-facing software was critically important to their success, embracing the shift is progressing at a slower pace. Summa encourages clients to identify shifts in power between CMOs and IT as opportunities to better engage customers and to inform design of enterprise architecture.
3: Look for shifts in the roles of employees and 3rd parties that are involved in customer engagement
The new found power afforded to end-customers by mobile, cloud, social and analytics is also available to employees, partners and 3rd parties. These other types of customers are increasingly involved in customer engagement either directly or indirectly. Here’s a thought experiment that you can do at your company. Model the value chain at your company today and 5 years ago. Then overlay the employees, partners and 3rd parties that are in between the source inbound logistics and the end-customer. Many organizations notice that the greatest change is 3rd party involvement with end-customers.
Look for ways to incorporate the needs of all customers between the origin and delivery of value in your customer engagement platform. Suppliers, partners, brokers, distributors, dealers, contractors, specifiers, sales representatives with whom your company contracts are obvious choices, but less obvious are the 3rd parties like independent social media products, customer service rating agencies and opinion forums. All may present opportunities for companies to leverage the new and unique relationship with customers. These customers are often motivated to share data and/or insights with companies that can be used to anticipate continuous value exchanges.
4: Look for Changes in How Your Company Attracts, Sells and Services Customers
In Mad Men, Sterling Cooper helped companies engage their customers through broadcast advertisements and products delivered mostly through physical channels. In this simpler time it was easier to identify the customer—they transacted value with a cashier. Products were positioned based on demographic and psychographic insights about markets that were static compared to the present rate of market changes. Marketing messages were positioned to sell products and services to entire populations based on a general understanding of their age, gender, spending limits, interests, attitudes, opinions and beliefs. Don Draper’s markets were comprised of individual consumers who had little power to demand individual attention.
Today, individual customers abound. Anybody that can demand value from a company can reasonably be identified as a customer. Forming a 360° view of the individual customer now requires data originating from different systems—ERP, CRM, PLM, shipping, regulatory, purchasing, etc. to be assembled into a whole giving visibility into customers from many different roles within companies. For example, field service staff who now have access to customer data are often in the best position to collect contextual or situational data about a customer that can be used to sell new products or services. As another example, companies that capture data generated by sensors (IoT) like those found in the connected car or connected project site are uniquely positioned to sell data access services and analysis to new customers such as insurance companies, product development groups or analysts that require the data as inputs to their value chain.
At Summa, we encourage clients to investigate how staff in field service, customer support, sales and call centers interact with customers. Individuals operating in this capacity often have a unique view into the context of a customer need that Patricia Seybold described in her HBR article, “Get Inside the Lives of Your Customers” is critically important to engaging them by building interfaces that make it effortless to input data, form insights and suggest the action that is best for individual customers.
Summa is available to discuss how embracing shifting power in your organization can engage customers and create value. Contact Us today.
