the era of living services: rila 2017 leadership forum
TRANSCRIPT
THE ERA OF LIVING SERVICES
RILA – NAPLES
JANUARY 2017
LIVING SERVICES ARE THE RESULT OF
TWO FORCES
LIVING SERVICES ARE THE RESULT OF
TWO FORCES
THE DIGITIZATION OF EVERYTHING
LIQUID EXPECTATIONS
CUSTOMER EXPECTATIONS ARE LIQUID AND TRANSCEND TRADITIONAL BOUNDARIES
DIRECT COMPETITORS
SERVICES THAT DIRECTLY COMPETE WITH YOURS
CUSTOMER EXPECTATIONS ARE LIQUID AND TRANSCEND TRADITIONAL BOUNDARIES
EXPERIENTAL COMPETITORS
SERVICES THAT (PARTIALLY) REPLACE THE NEED FOR YOURS
DIRECT COMPETITORS
CUSTOMER EXPECTATIONS ARE LIQUID AND TRANSCEND TRADITIONAL BOUNDARIES
DIRECT COMPETITORS
EXPERIENTAL COMPETITORS
PERCEPTUAL COMPETITORS
SERVICES THAT CHANGE CUSTOMER EXPECTATIONS – AND RAISE THEM FOR YOURS
WE’VE COME A LONG WAY
1990s
WEB & INTERNET
2000s
MOBILITY
2010s
LIVING SERVICES
•THEY ARE TAILORED AND LIVE AROUND THE INDIVIDUAL – FLEX TO MEET EACH PERSON’S NEEDS AND PREFERENCES
• THEY EVOLVE: THEY CONSTANTLY LEARN MORE ABOUT OUR NEEDS, INTENTS, PREFERENCES, AND CHANGE IN REAL TIME
• THEY ARE VERY PROXIMATE TO US IN THE ENVIRONMENT – THINK WEARABLES AND NEARABLES
LIVING?
•GROWTH OF CONNECTED DEVICES
•SENSORS
•NETWORK CONNECTIVITY
•THE CLOUD
•BIG DATA
•EVOLUTION OF UI
•CONSUMER EXPECTATIONS
WHY NOW?
HOW WILL LIVING SERVICES CHANGE OUR LIVES?
SIMPLIFY Automate decisions and actions, and reduce friction
DISRUPT Enable radical change – from reactive to proactive, from population-based to personal, from utility to beloved service
LEARNING from what we do, powered by data and analytics
ENVIRONMENTS not industries
O U R H O M E S O U R H O M E SO U R B O D I E S O U R B O D I E S
O U R S H O P P I N G O U R S H O P P I N GO U R WO R K O U R WO R K
O U R E D U CAT I O N O U R E D U CAT I O N
O U R F I N A N C E S O U R F I N A N C E SO U R FA M I L I E S O U R FA M I L I E S
O U R T RA N S P O R T O U R T RA N S P O R T
A BRAVE NEW WORLD FOR BRANDS AND
RETAILERS?
THE DUNBAR NUMBER
VERY FEW
BRANDS I LOVE AND ENGAGE WITH OFTEN
BRANDS I DON’T LOVE BUT ENGAGE WITH OFTEN
BRANDS I LOVE AND DON’T OFTEN ENGAGE WITH
BRANDS I DON’T LOVE AND DON’T OFTEN ENGAGE WITH
MANY
MORE LIMITED BY BANDWIDTH OF
AFFECTION
MORE LIMITED BY THROUGHOUT
THE DAY
BUT THE DUNBAR MAP IS DIFFERENT FOR EACH PERSON
SO… PREPARE TO ATOMISE
• PROVIDE JUST THE RIGHT SERVICES ON CUE
• BUILD AWARE PLATFORMS
• A WORLD OF BRAND PLUGS AND SOCKETS
• BRANDS LET GO OF CONTROL – EMBRACE CO-PRODUCTION
• DIGITAL TREATIES AND ALLIANCES
• OPERATE ACROSS ORGANIZATIONAL BOUNDARIES – INTERNAL AND EXTERNAL
• UNDERSTAND THE LIMITS OF YOUR REACH AND TRUST
• LIVING BRANDS – THROUGH RELATIONSHIPS
…TO MAKE YOUR BRAND FEEL ALIVE
BECOMING A LIVING BRAND
WHAT KIND OF RELATIONSHIP?
{number of interactions x quality of
interactions}
UTILITY BRAND
Something to use Interactions on occasion
LE
VE
L O
F C
ON
TR
OL
FREQUENCY OF INTERACTIONS
AUDIENCE BRAND
Something to say Occasional interactions
EXPERIENCE BRAND
Something to do Continuous interactions, brands are part of users’
daily lives.
RELATIONSHIP BRAND
Something to relate to Brands that transform
users’ daily lives.
CO
NT
RO
LL
ED
BY
TH
E
BR
AN
D
CO
NT
RO
LL
ED
BY
TH
E
US
ER
S
BECOMING A LIVING BRAND
WHAT KIND OF ROLE?
The brand keeps delivering its service with
no visible partnerships
The brand filters and selects partners to deliver
a curated experience
The brand experiences are accessible through third party platforms
The brand aggregates third parties and delivers
a holistic experience
STANDALONE CURATOR PARTNER PLATFORM
BECOMING A LIVING BRAND
WHERE & WHEN?
Gestures, voice interactions, AI… The days of point and click are
gone
NEW INTERACTIONS
With new contexts for interactions there
will be new engagement opportunities for smart brands
NEW CONTEXTS
You don’t control the experience anymore. Clients decide when and where to
interact with brands
NEW TOUCH-POINTS
How are you going to be available anytime, anywhere?
How is your tone of voice going to sound?
Will you have a signature gesture?
How will you be ready to engage clients in new contexts and needs?
BUT THIS IS NOT ENOUGH
I T ’ S N O L O N G E R E N O U G H T O C R E A T E S O M E T H I N G T H A T
P E O P L E L I K E
Y O U M U S T B U I L D E X P E R I E N C E S T H A T
P E O P L E L O V E
B U T L O V E I S C O M P L E X
H O W D O Y O U D E F I N E L O V E F O R A B R A N D E X P E R I E N C E ?
1 W H AT M A K E S P E O P L E LOV E A B R A N D E X P E R I E N C E ?
2 … A N D W H AT S U S TA I N S T H AT LOV E ?
TO FIND OUT, WE EMBARKED ON A TWO-YEAR RESEARCH STUDY
WE STARTED WITH QUALITATIVE ETHNOGRAPHIC STUDIES ACROSS:
3 COUNTRIES US, UK AND BRAZIL 4 INDUSTRIES RETAIL, HOSPITALITY, AUTOMOTIVE, AND BANKING 6 BRANDS PER INDUSTRY
USING ADVANCED STATISTICAL TECHNIQUES, WE CREATED AN ALGORITHM EXPLAINING PEOPLE’S FEELINGS TOWARD BRAND EXPERIENCES
WE THEN CONDUCTED QUANTITATIVE GLOBAL SURVEYS OF 27,000 RESPONDENTS
THE RESEARCH REVEALED 5 DIMENSIONS FOR MEASURING CUSTOMERS' FEELINGS
TOWARD A BRAND EXPERIENCE
F
FUN
Holds people’s attention in an
entertaining way
R
RELEVANT
Provides clear and customized
information
E
ENGAGING
Identifies with individual needs
and wants
S
SOCIAL
Connects people with each other
H
HELPFUL
Is efficient, easy and adapts over
time
O V E R A L L B R A N D A F F I N I T Y I S B U I L T C U M U L A T I V E L Y
B A S E D O N H O W C O N S U M E R S R A T E I N D I V I D U A L E X P E R I E N C E M O M E N T S A C R O S S T H E F R E S H
D I M E N S I O N S
T H E L O V E I N D E X P R O V I D E S A R E L I A B L E A N D R E P E A T A B L E
E X P E R I E N C E - M E A S U R I N G S Y S T E M
T H E D I M E N S I O N S A P P L Y T O A L L B R A N D S ,
P H Y S I C A L O R D I G I T A L
THERE WERE 4 KEY FINDINGS FROM THE STUDY
Each industry has a unique FRESH shape consistent across every market.
Five experience leaders set the pace for brand engagement across industries in the U.S.
Digital-only brands outperform traditional.
Brands have considerable scope for differentiation across one or more dimensions; The Love Index shows where.
1
2
3
4
1. THE SHAPE OF INDUSTRY
Regardless of geography, each industry, comprised of six prescribed brands, has its own distinct shape reflecting the dimensions people care about most.
But these brands and industry shapes are traditional – crafted by decades of experiences with products and services.
As experience leaders change user expectations, brands will need to “stretch” one or more dimensions to differentiate.
Their scores will rise and create a new shape altogether - for themselves and potentially their entire industry.
In an era of disruption, existing brands and start-ups will continue to bring imaginative technologies, services and experiences to market.
The driving force behind this momentum is the shape of opportunity.
2. DIGITAL BRANDS OUTPERFORM TRADITIONAL
Digital giants – such as Google, Fitbit, Amazon, and Netflix – outperformed traditional brands in the three markets we studied. These findings demonstrate the embedded role technology plays in our lives.
To remain relevant, traditional brands must focus on building design-led, user-centric and adaptive products, services and experiences.
3. BRANDS HAVE CONSIDERABLE SCOPE FOR DIFFERENTIATION
By plotting all of the brands within the industry on a graph, we can assess how they perform across the FRESH dimensions, relative to each other.
By visualizing the scores, it becomes clear which dimensions certain industry players are outperforming others, whilst highlighting the areas for improvement.
10
8
6
4
Brand A Brand B Brand C Brand D Experience leaders
4. EXPERIENCE LEADERS SET THE PACE FOR OTHER BRANDS
THE FOLLOWING COMPANIES GARNER THE MOST BRAND LOVE FOR ONE OR MORE DIMENSION:
Fun Relevant Engaging Social Helpful
Experience leaders are high-scoring top of mind brands that set the experience expectations on specific dimensions. These top of mind brands are those that consumers recall as their most loved brands,
without any direction from TLI team.
Experience leaders have the power to affect how traditional brands might choose to innovate and differentiate themselves according to FRESH,
and how emerging start-ups might aim to further disrupt business and society.
NOW, LET’S SEE HOW 5 RETAILERS SCORE ON
THE 5 DIMENSIONS…
The distinct shape of the retail industry reveals brands focus on making their experience Helpful, Relevant and Engaging.
US RETAIL MARKET
Lower scores on the Fun and Social dimensions are surprising, considering how so many people turn to ”retail therapy” to lift their spirits, or use shopping as a way to socialize with family and friends.
There’s an opportunity here for new, or existing players, to boost investments in Fun and Social experiences, as a method for gaining a competitive advantage over fellow industry players.
10
8
6
4
FUN
RELEVANT
ENGAGINGSOCIAL
HELPFUL
Walmart Target Nordstrom
Best Buy Whole
Walmart
Best Buy
Target
Whole Foods
Nordstrom
The performance of the retail disruptor, Amazon, demonstrates all retail brands have work to do beyond the Fun and Social dimensions.
US RETAIL MARKET
Traditional players are lagging behind Amazon most considerably on the Fun, Helpful and Relevant dimensions. The difference in the latter 2 dimensions is likely to be driven by Amazon’s large assortment of items, ratings, reviews and personalized suggestions for companion items.
Amazon scores equally unimpressively on the Social dimension, further demonstrating the opportunity for an existing or new player to invest in this area as a method for increasing love.
Walmart
Best Buy
Target
Whole Foods
Nordstrom
Amazon
10
8
6
4
FUN
RELEVANT
ENGAGINGSOCIAL
HELPFUL
The significant differences in performance between the experience leaders, and the retailers highlights clear areas for improvement if retailers are to meet their customer’s liquid expectations.
US RETAIL MARKET
Consistent with previous analysis, the Social dimension is a big area for improvement, along with Fun.
How could retailers integrate our social networks into the shopping experience, to make discovery more personal? How can retailers bring back the fun of shopping, utilizing new technology?
Walmart
Best Buy
Target
Whole Foods
Nordstrom
Amazon
10
8
6
4
FUN
RELEVANT
ENGAGINGSOCIAL
HELPFUL
Experience leaders
WE CAN ALSO SEE HOW IMPROVEMENTS IN THE 5 DIMENSIONS
CAN IMPACT THE NET PROMOTER SCORE
STEP 1 MEASURE BRAND’S SCORES ON FRESH DIMENSIONS
STEP 2 CHOOSE A DIMENSION(S) TO IMPROVE AND THE REQUIRED PIN-POINT ACTIONS
STEP 4 TRACK IMPACT ON NPS
STEP 3 RE-MEASURE IMPACT ON FRESH SCORE
Fun = 5.5
Relevant = 6.7
Engaging = 6.4
Social = 5.6
Relevant = 6.7
Design, iterate and update the brand’s experience to make it more Fun. This could include:
• Making the experience more entertaining
• Designing a more immersive experience, that makes the user lose track of time
Fun =
7.5 (+36%)
A 2 point increase in Fun will lead to a
+0.3 increase in NPS
• Gen Z and younger Millennials are seeking ease and efficiency.
• Monthly curated subscription programs – particularly for Fashion (77% of both groups), Health and Beauty (56% Gen Z and 63% Young Millennials).
• Automatic replenishment programs - substantially more indicated that they would shift more than half their purchases to a trusted retailer offering the service.
• Gen Z shoppers are the most excited by voice activated ordering - they can’t wait to use this technology for fashion, consumer electronics and health and beauty items.
LASTLY… LIQUID EXPECTATIONS ARE VERY REAL
T H A N K Y O U
A C C E N T U R E
J i l l S t a n d i s h [email protected]
@ j p u l e r i
F J O R D M a r k C u r t i s
[email protected] @ f j o r d m a r k