egain digital day 2016 - keynote 1: digital customer experience—big trends and best practices for...

CONFIDENTIAL AND PROPRIETARYThis presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other intended recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Digital Customer Experience Big Trends and Best Practices for 2016

Ed ThompsonGartner

1 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.1 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Agenda

1. Big Trends• Demand-Side• Supply-Side

2. CEO Thinking3. Best Practices


Agenda



3 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Longer Lived

Source: UN


Less Violent

Source: Steven Pinker, The better angels of our nature: why violence has declined


Living Alone

Source: Statistics Finland, 2012


Time Starved


Always On


Information Rich


Willing to Talk


66% of consumers stopped doing business with a provider and switched to another in 2013 due to poor customer service experiences, up 4% from 2012 and up 17% since 2005 — Accenture Global Consumer Pulse Research Study 2013

Willing to Walk


Less Predictable. In 2030, Will the Customer

1. Environmentally Conscious

1. Unwilling to Pay2. Privacy

Protective

3. Algorithm Trusting

3. Expert Reliant

4. Embed Tech in Body

2. Willing to Take the

Risk

4. Not What Nature

Intended

Be… Or…


Agenda




The Nexus Provided the Foundation 5 – 10 Years Ago


The Internet of Things Was the Next Accelerant

Source: Forecast: Internet of Things, Endpoints and Associated Services, Worldwide, 2014

2020 7.3 Billion Personal Devices

30 Billion Internet Connected Things

Things Connected to the Internet Will Outnumber People by at Least 5 to 1

20091.6 Billion Personal Devices

0.9 Billion Internet Connected Things


Digital Business Is the Creation of New Business Designs by Blurring the Digital and Physical Worlds.

Digital Business Capitalizes on Smart Things


Smartphone to Bus: I'm Waiting.

Car to Parking Meter: Open space detected —50 yards on right.

Parking Meter to Car: I'm the Closest Available Spot.

Bus to Smartphones: I'm Running 10 Minutes Late.

How Would It Impact Your Organization If Everything Is Listening, Acting and Replying?

Street to Nearby Autos: I'm Closed From 10 a.m. to 3 p.m. Today.

Building to Maintenance Provider: My Furnace Is About to Fail.


Anyone Has the Ability to Generate New and Innovative Business Models. They Are …

… and they WILL COMPETE WITH YOU.


And Not Just Start Ups…


But…On which of these areas will you really focus most of your Digital investments through 2020?

A: Digital Business Model Innovation –transforming the way business is doneB: Digital Core – renovating core platforms to scale and support the next generationC: Digital Experience – removing paper, Digital Marketing, Web customer self-service and more


How Will Customer Engagement Accelerate in this New World of People, Business and Things?


Business Moment Scenario

Saving a Business Trip from

Weather Delays



Consumer Part

Business Part

Thing

Flight delayed Scott decides to continue with his business travel


Consumer Part

Business Part

Thing

Meeting attendees

notified

New schedule and bookings

confirmed

Smartphone used as airline

ticket

Rentalcar agency

notified

Airline notified

Hotel notified


Consumer Part

Business Part

Thing

Car unlocked with smartphone

Meeting attendees informed about new

arrival time

New meeting room scheduled based on

arrival time

Directions uploaded,

optimized for traffic


Consumer Part

Business Part

Thing

Hotel notified of arrival

Directions uploaded, optimized for traffic

Smartphone used to unlock hotel room

Waiter delivers dinner


Consumer Part

Business Part

Thing

Hotel sends folio after departure

VPA compiles expense report and

loads today’s itinerary

Scott gets in rental car and drives to

next city



Consumer Part

Business Part

Thing

Hotel notified of

arrival

Meeting attendees

notified

Flight delayed New schedule and bookings

confirmed


Car unlocked with smartphone

Smartphone used as

airline ticket

Meeting attendees informed about new

arrival time

New meeting room scheduled based on

arrival time

Rentalcar agency

notified

Smartphone used to unlock hotel room

Waiter delivers dinner

Hotel sends folio after departure

VPA compiles expense report

and loads today’s itinerary

Airline notified Hotel notified

Scott gets in rental car and

drives to next city

Scott decides to continue with his business travel



More things = More data = More (and faster) business moments

And more complexity


We are just getting started

Here are some signs


Run With the Big Boys


Grow More Food

Picture of a farm with a

digital overlay or pick up an image from

their website

Image Source: onfarm.com


Push a Button

Image Source: amazon.com


Save Me From Embarrassment

Image Source: dfree.biz


GamifyYour Sales

Organization


Anticipate My Questions


Track Your Beer

Image Source: steadyserv.com


Take Your Medicine

Image Source: dosesystem.com


Make Your Own Thing

Image Source: raspberrypi.org


But there is Much More to Come…


Device Mesh Information of Everything

Adaptive Security Architecture

NEW IT REALITY

Mesh App & Service Architecture

IoT Architecture & PlatformsAdvanced Systems Architecture

DIGITAL MESH SMART MACHINES

Ambient User Experience

3D Printing Materials

Advanced Machine Learning

Autonomous Agents & Things




NEW IT REALITY









From Desktop to Mobile to Wearables

Hands

Medical and safety

Clothing

Quantified self Pets

Feet

Carryable or pocketable

Jewelry/Accessories

Audio and video




NEW IT REALITY









Moving Toward a Postapp Era

Separate apps on separate devices

Intelligent assistants provide basic control and automation

New "app platforms" and services emerge

Fluid, contextual action

Wearables drive context and new interaction types

Notifications replace some app functions

Automated collaboration across devices

2014 2020




NEW IT REALITY









Smart Machines Enabled By Machine Learning

Deal With Complexity

Make Probabilistic Predictions

Actively Adapt

Passively Learn

Act Autonomously

Appear to Understand

Reflect a Well-Scoped Purpose

Machine Learning

Generates Novelty




NEW IT REALITY









A Spectrum of Autonomous Smart Machines

Physical

Virtual

ObviousUnobtrusive

Robots

Drones

Driverless Vehicles

Smart Camera Systems

Intelligent Sensors

Smart Appliances

Translation & Speech to Text

Smart Security & Operations

Smart Enterprise Apps

Virtual Customer Assistants

Virtual Personal Assistants

Smart Advisors


Agenda




2016 Economic Landscape

Economic Uncertainty Organizations need to focus on

cost optimization

Digital Disruption Organizations need to

evolve to digital business


When Will You Become a Digital Business?

Source: Gartner, Digital Business Is Here Now

22%50% 83%

2015

2017

2020

Are You Ready?

52 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved. 52

Ranked categorization of top three mentions

Growth54% Technology-

Related25%

Workforce24%

Customer21%

Financial

13%

OperationsImprovement

13%

CostManagement

12%

ProfitImprovement

11%

ProductImprovements

10%

Innovation, R&D

9%

Marketing

9%

“Please tell us about your organization’s top 5 strategic business priorities for the next 2 years”


26%

27%

41%

41%

42%

42%

45%

45%

46%

51%

54%

35%

29%

32%

25%

34%

29%

30%

28%

32%

30%

25%

26%

28%

18%

21%

17%

19%

18%

18%

17%

13%

12%

13%

16%

9%

13%

7%

10%

7%

9%

5%

6%

8%

Changed board of directors composition…

Acquired one or more businesses related…

Created one or more new businesses…

Initiated a specific committee or…

Created a new organization unit or…

Created new C-level role

Created new senior leader roles below…

Started an education and awareness…

Given new job scope and powers to CIO

Started an education and awareness…

Started regular briefings to the board…

We have done this Will do this by the end of 2016 We have not done this, nor plan to do it by 2016 Not applicable

“Which digital and technology strategy actions, if any, have you been taking or are you likely to take by year end 2016?”


42%

60%

77%

Now In 2 years In 5 yearsCIO survey (n = 344)

16%

25%

37%

22%

31%

41%

Now In 2 years In 5 yearsCIO survey (n = 609) CEO survey (n = 400)

Digitalization Is Intensifying; Stakes Are Rising

Private Sector Public SectorWhat % of your revenue is digital? What % of your processes is digital?


37%

32%

28%

27%

24%

23%

22%

20%

20%

19%

19%

18%

18%

16%

15%

Customer experience…

Digital marketing

Business analytics

Cloud-based business

Data science/big data

Digital products and services

Smart/intelligent processes

Supply chain optimization…

Sustainability

Internet of Things/…

Product cost analytics

Social engagement…

Enterprise mobility

Enhanced business…

M-commerce

Less Than 15%"Thinking"/intelligent computers 14%Social collaboration (internally) 13%Design thinking 12%Pay as you go 10%Mass customization 10%Location intelligence 10%Robot staffing 9%Gamification 7%Additive manufacturing 7%Neurobusiness 6%E-discovery 6%

CEO Survey 2015 Top Technology Investments, Next 5 Years“Which five technology enabled capabilities will be the most important areasof investment to improve your business over the next 5 years?”


Those Most Often Seen as Having the BestCustomer Experience

Disney

Legoland


Why The CEO Cares: Customer Satisfaction Correlates With Stock Prices

Sources: Claes Fornell, www.theacsi.org, S&P

http://www.theacsi.org/


Agenda




The dictionary defines experience as:"The sum total of conscious events." Gartner defines customer experience as:

"The customer's perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier's employees, channels, systems, or products." Gartner defines customer experience management as:

"The practice of designing and reacting to customer interactions in order to meet or exceed customer expectations and so increase customer satisfaction, loyalty, and advocacy."

Definitions


Seven Types of Customer Experience Projects

Design the ExperienceBenchmark usability and empathyDigital design cool

Recruit DifferentlyProfiling the personalitiesBalance teamsRecruit to brand

Stripped Down SimplificationOne size fits allStandardization and scale

Encourage ParticipationReview and comparisonCommunitiesSocial networks

Multichannel AvailabilityMultichannel integrationDevice-independent interaction

Adapt inReal TimeReal-time reroutingAnalytical-driven process decisions

Start a ConversationExpectations settingCapturing intentManage dialogue

Brand ExecutionValues and promise ReputationCommunication

Make Clear the Responsibility Governance and policingResponsibilityCompensation and contracts

Customize OffersBundling product/servicePersonal pricing

Demonstrate TrustHonor privacyShare dataUse only what you need

Share AnswersKnowledge managementSkills inventoryBetter search

Redesign ProcessesQuality controlsTrading efficiency and experience

Analyze OpinionValue analysisMarket researchSegmentationPropensity modeling

Have a StrategyExecutive enlighteningIdeal and real experiencesProgram and project plans

Empower EmployeesEducation and trainingCultural valuesOwnership of the experience

Personalize ProductsConfigure to orderMass customizationNew product development

More AccessibleSelf-serviceTrack for customerAdd channels

Achieve Consistent ExperiencesSingle view of customerRecognition

Find Moments of TruthProcess modelingIdentify the weakest linkAutomate and escalate

Collect FeedbackMultichannel collectionReal-time alerts and actions

DesignBetter

AlterAttitudesGet PersonalOpen UpAct as OneFrom Out

to InListen,

Think, Do

WarmWarm Hot Hot Warm WarmCool


Alter Your Approach Depending on Your Customer Experience Maturity Level

Fragmented Focus

Initial Developing Defined Managed Optimizing

Culture Change

Profit Parity

ExecutivesEngaged

VoC Validated45%

30%

20%

4%

1%

"Staying on Top""Getting Started" "Stealing Ideas"1 2 3


The Measurable Benefits of Customer Experience

Brand Advocates/Net Promoters

Customer Satisfaction Scores

Customer and Employee Referrals

First-Call Resolution RatesProduct Review RatingsNumber of Support Requests

Customer Attrition/Churn RatesDeactivation/Reactivation Costs

Loyalty Program Enrolled/Participating

Price Sensitivity

Use of Multiple Channels

Social Network Participation, LikesTrust Rating

No. of Product or Service Upgrades

Repeat, Frequency and Order Size

Delivery TimelinessProduct Return Rates

Accuracy of Inventory and Pricing

Reduced Cost of Defect and Error RatesLower Cost of ReturnsLower Replacement Costs

Metrics/KPIs Benefits

Lower Cost of ServiceLower Complaint CostsLower Compensation Costs

Lower Cost of Sales AcquisitionReduced Upsell and Cross-Sell CostsLower Retention CostsLower New Product Development CostsReduced Lost Revenue

Reduced Marketing CostsLower Cost of Sales AcquisitionIncreased Wallet ShareNetwork Effect of RecommendationsHigher Margins

CustomerSatisfaction

LoyaltyRetention

AdvocacyBrand

Reputation

Quality


How the Customer Measures You:Facets of Good Experience

32%

25%11%

18%13%

19%

13%

11%

15%

12%

10%

12%

4%

1%

34%

15%

24%

15%

19%

10%

14%

15%

6%

8%

8%

5%

13%

10%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Quality (of product/service)Responsiveness (communication)Value (cost, price, added benefits)

Support team (after-sales, service desk)Timeliness of delivery

Relationship (proactiveness)Attitude of staff

Resolution of issuesListening to needs

Flexible/agileDocumentation/information/training

Met expectations/agreementsConsistency/ease of interaction

Online channel/email interaction

Percentage of Respondents

BusinessConsumer

Multiple responses allowedAll others below 5%

Q: What did this company do specifically to provide outstanding customer experience? Coded from open-end responses.


Customer Life Cycle

Buy Own


Even Those as Famous as Starbucks UseCustomer Journey Maps to Improve


Business to Business Is DifferentCustomer Experience Activities Done For Free

• Executive sponsorship• Customer advocates/success managers

• Customer advisory boards• User groups• Peer to peer communities• Subject matter expert communications

• Early adopter programs• Product quality feedback programs• ROI assessments• Customer product training


CCOs, VPs, Directors and Headsof Customer Experience by Industry

Orange

Sprint Nextel

Time Warner Cable

Verizon Business

Yahoo

Bell Canada

AT&T

ComcastTelstra

T-Mobile USA

Vodafone

BT

KPN

Turk Telekom

Telus

SingTel Optus

XO CommunicationsO2

DIRECTV Thomson Reuters

Bell Aliant Rogers Communications

Cablevision Systems

Cox Communications

Celcom

Bharti Airtel

Globe

du

Etisalat

Reliance

Level 3 Communications

Primus Communications

Telenor

Telecom ItaliaCable & Wireless Jamaica

Deutsche TeleKom

Telenet

Virgin MediaVerizon Wireless

Saudi Telecom

Hutchison 3G

EE

PhotoBox

Virgin Atlantic

Alaska AirlinesAmerican Airlines

Air Canada

Expedia

United Airlines

AAA Northern California

thetrainline.com

Eurostar

Wyndham Hotels

Starwood Hotels

Marriott Rewards

Hertz

Orbitz Worldwide

Aeromexico

Avis Budget

eBookers

Jet.com

British Airways

JetBlue Airways

DeltaeasyJet

Emirates

Singapore Airlines

Malaysia Airlines

Qantas Airways

Etihad Airways

Latam AirlinesAirBnB

IHG

First Great Western

Software AG

Oracle

Symantec

Saba

Polycom

Orange Business Services

Vertex Business Services

SAP

BMC

IO

Juniper Networks

Misys

ClickDimensions

Xerox

HCL

Infor

Lenovo

Salesforce

Verint

HP

Appirio

Jive

Intuit

Dell

Netsuite

Microsoft

Sage

SearsSierra Trading Post

Marks & Spencer

Gap

Best Buy

Wendy's

Amazon

Walgreens

Macy's

eBay

Lacoste

PetSmart

Zale

Ralph Lauren

Kohl's

Toys "R" Us

Coach

QVC

Canadian Tire

JC PenneyKiehl's

Lowe's

Barney's

Staples

Radioshack

Sainsbury'sCarrefour

Fortnum & Mason

MoonpigAsos

TescoHomebase

Essilor

Schneider Electric

McKessonFischer Scientific

SARSPitney Bowes

Serco

Experian

Chubb

Sovereign Housing

RWE nPower

EDF Energy

SSESouthern Water

E.ON

Ovo Energy

United Utilities

Severn Trent

Direct Energy

PG&E

Florida Power & Light

Duke Energy

Xcel Energy

OGE EnergyNorthEast Utilities

Standard Chartered

Huntington National Bank

Bank of America

OCBC Bank

JPMorgan Chase

American Express

Royal Bank of Canada

Fidelity

HSBC

Citigroup

Barclays

Capital One

Wells Fargo

Union First

First National Bank of Omaha

Transamerica

Synchrony Financial

Riyad Bank

TIFF-CREF

OneWest Bank

MasterCard

BBVA Compass

SunTrust Bank

PNC

TD Bank Group

GE Capital

DBS Bank

Mashreq Bank

Morgan Stanley

Lloyds Banking Group

The Co-operative Bank

Volkswagen Financial Services

The Royal Bank of Scotland

MBNA

Nationwide Building Society

Mercedes-Benz Financial Services AutoTrader

Renault

Jaguar Land Rover

ChryslerGeneral Motors

AudiMercedes Benz

HyundaiVolkswagen

BMW Nissan

InsuranceBanking

Communicationsand Media

Travel and Hospitality

Retail

High TechnologyAllstate

Cigna

TravelersUSAA

CloroxCampbell's Soup

Johnson & Johnson Consumer

MillerCoors

SC Johnson

Mars

Interstate Brands

Wrigley

Pepsico

DiageoCoca Cola

Reynolds

Unilever

Sara Lee

Herschey's

Pfizer

GSK

NovartisMerck

MetLife

AIG

Zurich

Nationwide

Dyson

Aegon

Sony

Domestic & General

Aviva

Standard Life

Eli Lilly and CompanyAbbVie

ConsumerGoods

Pharmacology

Utilities

Others

Automotive

As of January 2015


n=189

CX Leaders Have Access to Power: Half Now DirectlyReport to the CEO, Board or Operating Committee

Zero14%

One layer away38%

Two layers away31%

Three layers away 17%

Reporting Layers from Most Sr. Executive

6%

5%

10%

10%

10%

11%

49%

Other

Strategic Planning

The CMO or most seniormarketing executive

The most senior sales executive

The COO or most senioroperations executive

The most senior customer serviceexecutive

CEO, Board or OperatingCommittee

Primary Function Reporting To

Q. S09: To what primary function within your organization do you primarily report?Q. S03: How many reporting layers are you away from the most senior executive in your organization?


n=189

Few CX Leaders have Sole Responsibility for Decisions83% of CX Decisions are Made by Committee

Solely responsible

for decisions

17%

Leader of a group or

committee responsible

for decisions

83%

Q. S06: Which statement best describes your highest level of involvement in decisions pertaining to your organization’s budgeting, design, development, and/or analysisor delivery of the customer experience?Solely responsible for decisions Leader of a group or committee responsible for decisions Advisor to the group responsible for decisionsMember of group responsible for decisionsProvide recommendations or advice to a group responsible for the decisionsDo not participate in decisions


1%

4%

13%

13%

22%

23%

23%

25%

38%

44%

47%

49%

53%

None

Other

Customer Intelligence department

Human Resources or Human Capital

A centralized Customer Experience dept.

New product development/ R&D

IT

Supply Chain Management

Strategy and Planning

Operations

Customer Service

Sales

Marketing

Q05a. Please tell us what department or function within your overall organization has primary responsibility for the customer experience?Q05b. What other department or functions within your overall organization have secondary responsibility for the customer experience? n=189

But Primary and Secondary Responsibility for the CX is Spread Right Across the Organization In Many Departments

Multiple responses allowed

0%

8%

8%

15%

17%

35%

46%

31%

63%

58%

63%

58%

35%

None

Other

Customer Intelligence department

Human Resources or Human Capital

A centralized Customer Experience dept.

New product development/ R&D

IT

Supply Chain Management

Strategy and Planning

Operations

Customer Service

Sales

Marketing

Primary Responsibility for CX (n=141) 75%

Those with Secondary Responsibility for CX (n=48) 25%


Q10. What % of your organization's customer experience programs involve the use of information technology?n=189

Half of CX Programs Involve the use of ITVery Few Organizations Use Technology on all CX Programs


2%

26%

18%

22%

26%

5%

Mean=48.7%

100%

75-99%

50-74%

25-49%

1-24%

0

Percentage of CX Programs that use Information Technology


1%1%

31%39%39%

40%40%40%41%41%

42%44%

45%46%46%46%47%

48%49%49%49%

50%50%51%

56%61%

NoneOther

Peer to peer communitiesDigital personalization

Multi channel engagement and optimizationCampaign management

Contact center infrastructureMaster customer data consolidation and management

HR and Talent managementSocial listening and engagement

PortalsNew product or service ideation

User experience designCustomer journey mapping technologies

Web and Mobile analyticsCustomer self-service

Digital or E-CommerceSecurity and Privacy management

Customer analytics, modeling and insightCustomer data enrichment

Content managementLoyalty management

Business process managementSales force automation

Voice of customer, feedback and surveyCustomer service and support

Q11a. Which of the following technologies do you see as part of enhancing the customer experience for your organization?

n=189

A Wide Array of Technologies Are Being Used For CX


Technologies viewed as part of enhancing the customer experience


Recommendations


Don't ask …observe.


Take Your Own Road

Go Offroad• External Incubator • Technology Partnerships• Digital Business Consulting

Use the SatNav• Best Practices Review

Go in a Convoy• Innovation Day

Take the Road Less Followed• Internal Incubator• Niche Consulting Firms• Agile Projects


Be Open to Changes on the Way

Business Models Will Change

Products to Services

Services to Products

Services to Services

Industrial Internet


Functions Will Change

!Think Destination Implications

R&D

Let's add asensor to our

product!

Marketing

Cool! We canwrap a service

around it.

Sales

Wait, how dowe sell and pricea new service?

Finance

Wait, we'll needto bill differently.

Supply Chain

Wait, whatabout productmaintenance?

Customer Service

Wait, we'll needto notify customersof sensor issues.


Recommended Reading

1999

2006

1989 20052002

2008

2004

2006 20132012

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CONFIDENTIAL AND PROPRIETARYThis presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other intended recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Digital Customer Experience Big Trends and Best Practices for 2016Ed ThompsonGartner