Digital Transformation Opportunities

We noted earlier in the year, analyst firm IDC and others say that 50% and upwards of ICT spending from now to 2020 will be on Digital Transformations (DX). Having explained in our January issue what comprises a DX we now move on to what the desired outcomes are that firms are trying to achieve.

One of the key overarching objectives for a digital transformation is for suppliers to get closer to their customers. Whilst this closeness can take many forms, the principle desired outcome for the supplier is often common. It is to have a more detailed knowledge of what users think about them and their products. What are users and potential customers looking for in terms of improvements that could result in the supplier developing more successful products and then getting these products to market quickly before their competitors can take a slice of their business.

It’s no accident that this sounds like gaining a competitive advantage and retaining customers.

Recently I have been gathering data myself on metrics relating to customer and user engagement as well as how UK businesses are responding to user interactions via a number of media. Today we would fashionably call these interactions ‘Omni Channel’ marketing. Think, phone, email, social media – all kinds of messaging.

It’s been my belief for some time that marketers have been talking the talk when it comes to customer engagement but frequently stumbling, if not falling over, when attempting the important walk part of the process.

To illustrate these points nearly 60 per cent of UK organisations believe that real-time customer engagement can deliver a 10 to 40 per cent increase in revenue, according to a report launched by SAS, a leader in analytics. However, the study, The Age of Now, found that brands are collecting less than a third of relevant personal data on their customers, and only 25 per cent of that data set is being used in segmentation for real-time customer engagement.

The report revealed a stark difference between understanding of customer identity and being able to use the information available to drive customer intimacy in real time.

We take this to mean that 75% of collected customer data is being left on the cutting room floor and that suppliers are not acting quickly enough on that data to maximise sales opportunities. It looks like a case of nice start but then snooze and lose.

Putting flesh on my conclusion the Age of Now report revealed that only 16 per cent of UK organisations can adjust their marketing communication in real-time based on customer behaviour, 17 per cent in a few hours, and 25 per cent within a day. Worryingly, only a quarter can halt or retract communications in reaction to unexpected socio-political events, and just a third claim to be able to switch communication channels in response to customer behaviour or external events.

Moreover, and in specific regard to so called Omni Channels, 60 per cent of UK organisations said they are unable to communicate with customers via multiple channels in an integrated manner.

Tiffany Carpenter, Head of Customer Intelligence at SAS UK & Ireland, said: “The Age of Now is dividing consumer-facing organisations. There is a small segment of organisations leading the charge to capture the imagination and needs of consumers. But most organisations are struggling to embrace real time. As consumers become ever more demanding of personalised experiences, organisations must bridge the gap by truly harnessing real-time customer engagement strategies. The strive for real-time communication is really focused on delivering at the right time.”

Putting that in context…

Creating meaningful customer-centric, real-time communication requires organisations to first have context around external offline factors (e.g. the environmental, political and economic context) to inform real-time interactions with their customers. UK organisations have already taken the first step and are monitoring many factors including financial market movements (55 per cent), Government policy (48 per cent), major political events (34 per cent), retail price wars (33 per cent), consumer injustice (27 per cent), weather (26 per cent) and major attacks on the public (23 per cent).

We don’t live in a perfect world and it is easy to criticise any operational activity so what are the major barriers to real-time customer engagement?

Just over half claim budget constraints are a key obstacle, suggesting there may be willingness among many brands to undertake more real-time customer engagement initiatives. Other barriers include data security (40 per cent), legacy IT systems (30 per cent) and regulation (30 per cent). With GDPR fast approaching, a third of respondents believe this could be a positive trigger point to overhauling their data governance and improving their ability to analyse customer data in real-time.

Looking at the data I had gathered it was therefore perhaps understandable that some business sectors are going backwards in their attempts at gaining user insights and delivering customer service excellence.

Here’s a curate’s egg of data gleaned from the highly competitive insurance sector.

91% of consumers say good digital customer service from insurers makes them more loyal – yet the UK’s leading insurance companies fail to accurately answer more than two thirds (68%) of routine questions asked through the web, email, Twitter and Facebook.

In 2016 the figure was 47%, showing a dramatic decline in performance over the last 12 months. No wonder that just 15% of consumers are happier with the insurance customer experience compared to 5 years ago.

Showing the gap between expectations and reality 78% of consumers said they wanted to be able to switch between channels when talking to insurers – but none of the companies surveyed could answer on all four channels of email, chat, Twitter and Facebook. Many gave completely different responses on each channel, showing a worrying lack of consistency in a regulated industry. Only 5% had answers that matched on 3 channels while 70% of insurers were completely inconsistent, with no matching answers across any channels.

Someone needs to point out that the ‘Omni’ in Omni-Channel means one.

For those looking for accurate, fast answers to their queries, social media led the way over email – although all three channels deteriorated compared to 2016. 30% of questions received an accurate response on Facebook (down from 40% last year), 25% on Twitter (from 50%) and just 23% on email (down from 80%). Many insurers seem to have switched off email for non-customers, making it difficult to gain basic information through this channel.

Response times also worsened – on average it took 40 hours 25 minutes to get an answer on email (up from 28 hours 4 minutes in 2016), 49 minutes on Twitter and 3 hours 45 minutes on Facebook. These are generally far outside what consumers expect – 44% said they wanted an answer on Facebook in 30 minutes, and 62% on email within 2 hours. Just 10% of companies met this deadline.

Clearly there is a growing gap between consumer expectations and digital reality.

Channel Responses

We asked Gamma to let us know how they were putting across DX messages to channel partners and was the channel now receptive to these DX concepts as well as what challenges they faced in grasping the opportunities presented.

David Doherty, Director of Digital Strategy and Data Products at Gamma told us “We know that companies embark on Digital Transformation for a variety of reasons, including better interaction with customers, communicate and sell through a number of different channels, improve internal efficiency and to appear available for customers at all times. Whilst the benefits of going digital are clear, the method of doing this successfully is still up for debate. It will create far greater reliance on the network, design, connectivity and type of connections to the internet. It is often assumed that greater bandwidth (a bigger pipe) is the solution, and therefore look for the cheapest connection available.

However, to cater for the needs of a successful Digital Transformation it is essential to have fast, high performance data access to customer sites, the Internet and cloud-based applications, including Office 365, Amazon Web Services (AWS) or Salesforce, no matter where the customer or their staff are. We have constructed our data services to support a range of unified and mobile based communications that Gamma has developed to deliver telephony, contact centre, inbound and mobile communications to provide a range of mix and match services that our channel partners can mould into an integrated solution for each specific customer Digital Transformation they are supporting.”

Daryl Pile, Gamma’s Managing Director – Channel says that the channel has been receptive and was quick to adopt digital practises, particularly in regard to marketing and, at the end of the cycle, billing and invoicing.

“It appears to have slowed in terms of adopting digital practise to sell, project manage and on-board customers. Whilst this leaves a lot of room to implement new practises, the challenge will be where not to digitalise. There is a reluctance, and perhaps for good reason, to substitute face-to-face contact with a video or audio conference to close a deal or on-board a customer. Despite the savings that can be made in time and travel costs, the benefits of a representative sitting with a prospect or customer to build the relationship, far outweigh these costs. The challenge for the channel will be to strike the right balance between adopting modern, efficient digital practises and remaining in touch and personable to their customers.”

Paul Burn, Head of Category Sales at Nimans, believes that integration is probably the biggest factor in digital transformation.

“There are various parts of the market as well as various technologies that need to integrate much more than they currently do and I think this is where the reseller is in a key position to drive the DX process forward.

Over time many businesses will have invested in a range of different platforms and solutions and the reseller challenge lies in identifying how to make it all work together in a way that delivers the user outcome objectives. Resellers are however in a prime position to look at the users’ current position as well as the options they have for future, more integrated overall solutions.

I think the challenge today for end users is that the more bespoke they become in terms of the technology deployed the more complicated for them it can all end up.

The reseller must try and glue everything together for users and beware of not throwing the baby out with the bath water by starting all over again from scratch. Currently there’s no such thing as a single platform that can address all business needs. Digital transformation relies on a reseller understanding the bigger picture, joining all of the pieces of the puzzle together and knowing what goes where.

The conundrum for businesses, large and small, is to determine what they have, what needs to be replaced and what needs to be done to make it all work together.”

Burn says that the good thing about digital transformation for resellers is that it’s a great door opener, based on a ‘land and expand’ strategy.

“What I mean by this is let’s say the reseller is selling purely headsets to a customer. What they need to do is work backwards from these endpoints and look at how and where these devices are being used. Resellers don’t necessarily have to be the ‘owner’ of a phone system they just have to be a supplier to their customer - right back from a communications socket in a wall. It’s a bit like ink falling into a pool of water and watching the

ripples spread.

Is the channel receptive? Overall I believe it is but there are challenges ahead for resellers in grasping the opportunities and for me that challenge is all about integration because to transform you must make sure all components are working together. And don’t forget potential pain points as organisations still have to run smoothly whilst digital transformation is taking place.”

Marketing Automation AND DX

Nikki de Kretser, VP Marketing at DX solutions firm Arkadin, says, “One of the biggest headaches with IT is actually getting their people to use

new services.

Digital transformation seems to be the buzzword of 2017 with organisations across the globe focusing on strategies to completely transform their digital infrastructure. But even the biggest and best organisations will fall down if the on-boarding and adoption process is not handled effectively.

Adoption rates of new technology is a difficulty for all organisations, but what if that process was personalised and targeted to each individual user? If organisations could offer a journey to digital transformation on a personal level for every employee then the adoption rates would sky rocket.

And adoption is not just about understanding the technology at hand, it is about connecting with it, understanding which functionality is relevant to you and which parts of it will enable you to do your job better. This is where personalised journeys can come in. Through technologies like Smart Start (Oracle Eloqua and Arkadin) organisations can offer their employees a journey that is not only automated but is quick, personalised by name, department, needs and interests. The data available is used to offer them relevant videos, remind them when they have not watched one, advise on other videos that may be of interest and take them step by step through the on-boarding process of the new technology.

Not only does this kind of interaction enable more users to get the most from the new technology available, it drives forward the digital transformation strategy that the organisation is trying so hard to promote.”

Ed Says…

In most digital transformation projects of a reasonable size a set of UCaaS applications is generally deployed and in most of those cases there is a form of Omni-Channel customer contact solution available. From the research we have seen the user management of this really valuable feature set is somewhat patchy. There’s little flexibility in switching between contact method during an interaction, say from Twitter to Web Chat and nor are the interactions consistent in outcome. There’s little point in telling someone in a chat session that the product they want is in stock but only available in purple when the agent next door is emailing another person to say there’s a two week delay on all colours. Nikki de Kretser at Arkadin, says, ‘One of the biggest headaches with IT is actually getting their people to use new services’. I’d add to that, ‘Then manage it properly’.