Over 20 years ago, Michael Treacy and Fred Wiersma wrote a book called The Discipline of Market Leaders. They described three potential strategies that a firm might follow to achieve competitive differentiation, and argued that that choice must be an intentional one:
In 2019, those of us running customer experience (CX) programs will re-learn some old truths, as our 2018 CX reality has been a tough one.
The headline of Forrester Research’s annual CX index was “Customer Experience Quality Languished In 2018.” The report paints a picture of overall stagnation: the number of brands in the index that jumped or fell were about equal—the overall tide did not rise.
If we do this right, we will take the headwinds facing CX in 2018 and create the new trends for advancement of our craft in 2019. Let’s start by re-learning some truths.
Trend #1 – Let’s be honest: Customer experience is not a buzzword, it’s a strategy
Transformation and customer experience have become conference talk clichés. Not a single company doesn’t claim a customer-centric orientation. CX is a deliberate strategy, not a sudden epiphany, as Treacy and Wiersma told us over 20 years ago.
Commitment to CX as a strategy for competitive differentiation is evidenced by:
In 2019, trend #1 is honesty: if the CX program doesn’t have the above attributes, it’s not how your firm truly plans to differentiate—which means you’re back to either cost leadership or product leadership.
Trend #2 – Use data, but trust employees
When we over-index on customer experience metrics, we risk ignoring the other side of the experience coin: your employees, and their experience. Many of us run employee engagement surveys and have collection points for employee feedback. Do you actually ask your employees how to fix the pain points in your customer journey?
As CX teams, we are religiously data driven, using correlation analysis to assess the factors that have the most impact on customer satisfaction. We use this analysis to help our leadership focus its investment calories to get the biggest bang for a dollar spent. That’s all necessary work. Once you have those priority opportunities, create a process to ask the folks who deal with those issues day-in, and day-out, how they would fix it (the employee “suggestion box” is not the right answer.)
In 2019, trend #2 is to start trusting and start executing: have faith that your CX expert is the person sitting inside your company, taking the customer calls and working those problems. Shortcut your analytics, your lean process, and your business case – get to the answer and start piloting. (That’s your business case, right there.)
Trend #3 – Organizational structure is your CX lynchpin
Traditional companies continue to structure themselves in traditional ways. In The Lean Startup by Eric Ries, he describes the dimensions of an innovative startup environment. It’s a very product-focused message, and if CX is truly your competitive differentiator (or aspires to be) – then your CX must BE the product.
Ries’ outlines the product stages (and they should look VERY familiar to anyone running a CX program): Define – Learn – Experiment – Test – Leap.
Your organizational structure has silos. It’s orderly. As Ries’ would say, it’s “mostly calm.” Your departments publish operational metrics showing what Reis’ calls “vanity metrics” and product milestones. The silo is busy optimizing itself, but not the customer journey.
In 2019, trend #3 is predicated on trend #1: if your company’s strategy is to differentiate on the basis of customer intimacy, then treat CX as a product and organize around the success of the product. This product cannot be brought to market via silo’s– it’s one, continuous infinity loop where the customer learns from you, buys from you, engages with you, and (hopefully) buys more as you innovate that product.
2019 CX trends are perhaps better called our New Year’s resolutions – this is what will get us moving up the CX index.
Savvy retailers are turning “brick-and-mortar” stores into a competitive advantage, blending digital technology with traditional merchandising. From enabling personalized item recommendations using tracked buying preferences to streamlining purchases with mobile check-out, digital technology increasingly delivers a superior customer experience, driven by real-time, secure data. According to a recent Incisiv study we co‑sponsored with BRP Consulting, “digital already directly drives more than a third of all retail sales, and it further influences a much higher percentage.”
One challenge: Success with in-store digital technologies demands robust, resilient network connectivity. Over the next twelve months, retailers are posed for 2x growth in digital retail technology focused on mobile enablement such as mobile POS, in-store mode for mobile apps and customer Wi-Fi among others. Legacy retail networks don’t have the bandwidth and reliability needed to enable the new retail experience – an issue compounded by this new wave of tech investment. To take full advantage of the technology available, retailers will need to reimagine their network to gain new levels of performance, capacity, and reliability.
New imperatives for retail networking
Leveraging cloud applications for stores and distribution centers is an essential starting point for delivering valuable data that is both real-time and uniform across all stores and applications. Beyond this basic requirement, retail networks need to be simple, fast, agile, reliable, and secure.
Added bonus: Implementing an advanced network can significantly reduce operational costs, creating a strong business case for an upgrade. It does not take a strong imagination to see how a solid network foundation will accelerate business and position retailers for any applications the future may hold in store.
Learn more at NRF
To further explore the retail network of the future, be sure to visit booth 4609 at NRF 2019. Experts from Windstream Enterprise and retail consulting firm BRP Consulting will be on hand to answer questions regarding your specific needs and best options for satisfying them – the real starting point toward reimagining your network for the new competitive landscape of retail.
There are a few fundamentals that underpin any effective customer experience program:
You’re likely doing all of this already… so what could create a breakthrough from incremental improvement to a game-changer for your customers’ journey? Perhaps, Blockchain technology.
Blockchain offers potential to remove friction from customer interactions
Let’s start with blockchain fundamentals—and I’m not talking Bitcoin—but rather the general-purpose technology that underlies applications like Bitcoin.
Interesting, but how does that benefit me and my customers?
Blockchain has the potential to remove two big costs for you—and cost is a proxy for friction in your customer journey:
The Cost of Networking means your cost to organize all the players involved with a transaction. Think of a single interaction your customer initiates with you – for example adding services. There is a buyer (the customer), the seller (your company) and other vendors (perhaps the shipping company or the firm that supplies a device). If there are lots of actors to coordinate to facilitate this, presumably it’s a high cost for you to organize, and may result in a fragmented or lengthy delivery process to your customer.
A blockchain-driven platform can gather these actors into that distributed network and have them participate across this network. If they comply with pre-defined “consensus rules,” the need for intermediaries to organize their activity is removed. The use of tokens associated with underlying monetary value can be used to incent the actors to participate and facilitate the transfer of value across the network.
The Cost of Verification is the cost you bear to authenticate your buyers, and the friction your customers encounter by having to provide “proof” of their identity — for example, providing bank statements or prior bills.
Blockchain technology has the potential to bring these costs close to zero, and for your customers, a smoother, even instantaneous verification. This is done using a “smart contract,” which pre-defines the contractual attributes required for a customer transaction, and digitally codifies those attributes.
You might build existing intermediaries or third parties into your smart contract to provide information. If they’re participating on the blockchain platform of your choice, it can be provided automatically, and dramatically reduce the time and costs to conduct the same verification manually. Because the verification process is built into the code, the data coming into your contract should come with integrity already assured.
What makes a good opportunity for you to take advantage of a blockchain platform?
The opportunity is ripe when you have (1) high transaction verification costs and (2) high networking costs along your customer journey.
Can you identify examples in your customer interactions that bear these costs? If you removed that customer friction, how much faster would the revenue be realized by your organization? How about incremental customer happiness?
Blockchain technology offers a breakthrough opportunity for companies—particularly those operating with legacy systems and where powerful intermediaries are in place who hold critical information required to transact with your customers.
We should all be investigating this game-changing technology now and determining the IT roadmap for blockchain technology adoption to drive a customer experience benefit. The early movers will gain a massive CX jump, and a competitive differentiator with a smoother customer journey.
Thanks to PCI DSS, the retail industry has done a remarkable job of mobilizing to protect customers’ cardholder data. While widespread compliance can’t completely keep the cyber thieves at bay, PCI DSS unquestionably has mitigated their capacity to steal cardholder data.
That’s great for consumers. It’s now time for retailers to also step up their defenses against the greatest cyberthreat to core retail operations: the distributed denial‑of‑service (DDoS) attack, in which hyper-aggressive, orchestrated streams of incoming traffic from multiple sources effectively shut down a network, impeding operations.
According to The Standish Group, network outages cost retailers an average of $4,700 per minute. Unfortunately, DDoS attacks and the outages they cause are escalating rapidly.
DDoS attack protection
According to the Ponemon Institute, DDoS attacks accounted for 22% of unplanned outages in 2016, up from a mere 3% in 2010. Retailers, a favorite target, are particularly at risk of negative impact from revenue loss and damaged customer perception.
Minimizing that risk requires continuous monitoring, speedy detection, and immediate response as soon as possible after a DDoS attack begins. For retailers, DDoS attack protection is a must-have for business continuity and resiliency, an essential element of a complete security strategy.
DDoS mitigation is a highly specialized form of network security and many retailers have discovered that the most effective protection comes from DDoS mitigation service providers. A well-rounded service can identify gaps for remediation, address those gaps with added network security, and provide ongoing monitoring and extremely rapid response – thwarting DDoS attacks before they rack up sufficient downtime to cause a major hit to retail revenue and brand reputation.
Is your retail operation sufficiently protected?
Virtually every retailer in the U.S. takes the necessary steps to ensure PCI DSS compliance, yet most view DDoS attack protection more as a secondary concern. The rapid escalation in DDoS attacks indicate a clear need to treat them as a primary threat as well. Those who do give the threat of DDoS attacks the attention it deserves are often those who have already been hit, and hard. It doesn’t have to be that way. Thorough, proactive DDoS mitigation and PCI DSS compliance measures are far preferable to dealing with the fall-out after the fact.
Just ask any retailer who has been there.
It’s hard to believe that it’s been just over a year since Windstream Enterprise fully launched its software-defined WAN (SD-WAN) solution. We have seen remarkable growth since our launch last July and were pleased to end 2017 with more than 500 enterprise customers at our six-month mark.
As we sit here now, roughly over six months after reaching that milestone, the number of customers adopting SD-WAN has more than doubled again – Windstream Enterprise today leads the market with more than 1,000 SD-WAN customers.
There are multiple factors that play into this success, but the clear common denominator is the talent and commitment of our team. Enabling a new service to scale at this pace is no small feat. Our sales teams are leaning in and helping customers understand the value. Our service delivery teams are constantly challenging themselves to do things better, faster and with high-quality results, fewer manual touchpoints and more automation, while still providing the agility that our customers and the market require. Our IT and product development teams have championed DevOps and agile methodologies to allow us to rapidly deploy new features and functionality (internally and externally) at a cadence that is completely unfamiliar to most traditional network service providers (aka many of our competitors). Our architecture and product teams are always looking around the corners and out into the future to understand and anticipate customer needs and further differentiate our solution from the competition.
A doubling of a business every six months does not happen without some growing pains along the way. The measure of an organization is in how you respond. We aim to respond with accountability, agility and an appetite to invest as needed to drive continuous improvement.
The fact that so many have embraced this new solution means their homework convinced them of the fundamental gains to be made by making the switch. If you’re in the “still cautious” mode, consider the core advantages SD-WAN offers, as explained in our original product announcement – the benefits we promised then still ring true for more than 1,000 customers and growing:
If your enterprise is still on the fence, you should take a very serious look at SD-WAN today. There’s an excellent chance you’ll be using it in the coming years if you aren’t already and realizing SD-WAN’s benefits sooner rather than later makes tremendous economic and operational sense – as 1,000-plus and growing, Windstream Enterprise customers can testify.
Networking for businesses that serve consumers used to be so simple. When all the network needed to do was provide customers and employees with basic voice and data connections, choosing a communications service provider (CSP) had little if anything to do with its effect on the customer experience. Criteria for selecting a CSP tended to look like this:
Now that everyone is wired and the consumer experience depends far more on CSP‑delivered services, that criteria looks like this:
That change in CSP selection criteria was front-and-center in a recent customer meeting we attended with a very large houseware retailer. Our solution was ideal for getting them to a highly resilient, “always on” state, and at a much better price point than they were getting from their current CSP.
When I asked the CFO how he would measure the success of the solution they eventually selected, he said something surprising:
“My customers’ experience.”
The surprise is that this came from the CFO. He is responsible for the financial well‑being of a major retail operation, yet was far more concerned about the outcome of his customer’s journey than our service price.
He explained further: “We can always capture the sale, but if we can’t check inventory to ensure we have the item in stock, or we can’t check the reservation system to ensure we have someone available to deliver it, the customer leaves the store happy, expecting to get their refrigerator right away. Then we disappoint them later with a notification that they won’t have their refrigerator for a few weeks. We’ve probably lost them to a competitor – and caused a problem for ourselves.”
Thanks to social media, the disappointed customer’s voice is now amplified. Their positive – or negative – experience will influence other prospects, helping or hurting overall brand and reputation.
So, the CFO knew clearly and instinctively that our solution had to be “customer‑centric” first and foremost.
That houseware retailer isn’t unique in this regard. Thanks to digital engagement, we’re all now operating in the Age of the Customer.
Is your own CSP delivering on the promise of customer experience?
If you’re not already well-acquainted with our recommendations regarding advanced retail networking, it all boils down to this: Any multi-store retailer not already moving to software defined wide area networking (SD-WAN) has some serious catching up to do.
That’s actually true of pretty much every distributed enterprise. The rapid growth in data, apps, and connected “things” all contribute to an escalating thirst for bandwidth to carry traffic destined for the Internet and public clouds.
The entire networking industry is gearing up; DC FutureScape estimates that 60% to 70% of all software, services, and tech spend will be cloud-based by 2020. Yet traditional networks were designed for much simpler demands, connecting to the Internet at headquarters or data center locations through a centralized firewall. Traditional connectivity options can’t handle today’s bandwidth explosion, and centralized firewalls can’t avoid congestion in the face of such new demands.
All of this puts unprecedented stress on the WAN. Consider:
Virtually every new technology is created to solve a problem that can no longer be satisfied by older technologies. And every new technology that succeeds in going mainstream does so by proving its ability to satisfy emerging needs in full. That is certainly the case with SD-WAN.
IDC estimates that sales of SD-WAN equipment grew from just $225 million in 2015 to $1.19 billion in 2017, and should reach more than $8 billion by 2021. The reason for such explosive growth: Enterprises are switching to SD-WAN “to resolve challenges created by increasing cloud, mobile, big data and analytics traffic.”
SD-WAN’s success in resolving those challenges stems from three core advantages over traditional connections:
In addition to those inherent advantages, SD-WAN serves as a platform for other network services such as UCaaS (unified communications as a service); managed network security; and secure, private, dedicated access to cloud service providers, offering a direct connection for payment card processing.
The unique needs of retail
While enterprises in general benefit from the shift to SD-WAN, retail faces several unique dynamics that make adoption especially imperative.
Every retail executive is acutely aware that continuing to do what we’ve always done will no longer do. We’ve seen so many storied brands fade, passed up by more forward‑looking retailers committed to getting ahead of the curve.
Those who succeed do so for a variety of reasons, as no two retail enterprises are exactly the same. But nearly all retailers who are succeeding in the transformation have one thing in common: They embrace advanced networking and all that it enables. If you’re not quite there yet, there’s still time to catch up.
It may just feel like you’ve entered a futuristic sci-fi movie with some of the latest retail tech trends exploding on the market. Retailers across the board are upping the ante to deliver a more personalized and pleasurable shopping experience to differentiate against competition, and attract and retain a new generation of clientele.
The impact of mobile technology on behavior
Mobile technology has impacted all areas of our lives, from how, when, and the degree to which we communicate/interact, consume/share information, down to what we purchase and how. Mobile technology combines two very powerful things that effect our everyday behavior: unlimited and access.
Given our present mobile existence and constant connection to people, products and brands, shopping behaviors are changing. The upshot? Mobile technology is presenting a win-win scenario for retailers and consumers alike. With its ubiquity and ease-of-use, mobile capabilities are offering retailers tremendous opportunities to appeal to customers, and customers to take control of their own retail experiences, reaping the benefits of more convenient and enjoyable ways to shop.
So, what are some of the biggest mobile retail trends and how are they impacting the industry?
Virtual Reality (VR)
Although not completely new, this emerging technology is creating quite the buzz because of its ability to make virtual brand experiences more readily accessible, eliminating prior limitations of space and time. A great example of this is Volvo’s Reality App, which enabled potential customers to test drive a new SUV model that was not yet available via their smartphone. Offering a realistic experience, the app provided users with 360 degree views of the interior of the vehicle and simulated a test drive through various panoramic scenes. The result? The first edition of Volvo’s XC90 model sold out in under two days and the app was downloaded more than 40,000 times. Another retailer approaching VR with the ultimate convenience in mind, is Neiman Marcus. It’s visual search app, ‘Snap. Find. Shop.’ allows customers to snap photos of apparel, accessories and shoes they like and it’s smart image recognition serves as a personal shopper, instantly finding similar products available. VR’s unique ability to provide a complete immersion shopping experience is expected to reduce returns, lower marketing costs and provide retailers with more efficient data. We will see more retailers continuining to build VR into their shopping journeys.
Augmented Reality (AR)
While not as immersive as VR, AR is providing retailers with an effective way to bring in-store experiences of “trying on” products and services into the homes of consumers via their mobile device. In addition to giving retailers the ability to reach those who are not physically in their store, AR is providing customers with the opportunity to examine products more closely and get a realistic vision of what they will look like in their homes or on their body, before making a purchase. Retailers like Anthropologie, created an app to give shoppers detailed views of furniture in different colors, fabrics and lighting. The same is holding true in fashion with apps like Converse’s Sampler which enables shoppers to virtually try on shoes at home, with the added ability to seamlessly share pictures with friends/family for validation before making their selection. The use of AR on mobile devices is providing retailers with an easy and interactive way to engage with, and reach targeted audiences, a likely approach we will see more of.
Unified commerce and mobile payments
VR and AR are becoming popular, but equipping associates with mobile technology/mobile pay is becoming critical to the shopping journey as well. Mobile devices are driving a shift in retail to unified commerce, blurring previous divisions between online and offline shopping experiences. According to Boston Retail Partners (BRP) survey of top retailers in North Amererica, 81% of retailers will deploy unified commerce platforms to support commerce across stores, mobile users and the web by the end of 2020. Mobility is essential to competing in an omnichannel environment, with more than a third of smartphone users worldwide estimated to use their mobile phone to pay for a purchase at a physical point of sale (POS). However, payment security continues to be a concern. Merchants that are utilizing retail IT solutions to migrate their store applications to the cloud are alleviating some security risks by eliminating the storage of customer data at the store-level. Additionally, mobile payments are enabling purchases to be made via smartphones using tokenization, providing an extra level of security.
Mobility in-store is something we will see more of from shoppers and associates alike. Consumers will continue to use their mobile phones in-store to research products, read reviews, compare prices, and increasingly, to pay for in-store purchases. Arming
in-store associates with mobile tablets, phones, headsets and handheld scanners provides retailers with the opportunity to streamline operational functions and improve the CX, such as inventory, price validation and speedier checkout processes. Most noteably, enabling the mobile point of sale (POS), which allows customers to make a purchase on the spot, without needing to wait in line. According to BRP’s 2018 POS/Customer Engagement Survey, the use of mobile devices and tablets for associates and customers will continue to increase, with an anticipated decrease in the use of traditional PC’s and POS terminals. The survey confirms that 42% of retailers currently offer mobile solutions for associates, with 78% planning to offer these tools within three years.
Strengthening your mobile retail strategy
Pew Research Center reports that 77% of Americans own smartphones. Despite the increasingly connected prospect pool, many retailers are still playing catching up with respect to their mobile strategies. According to BRP, the current priorities and initiatives for retailers are to facilitate a seamless experience across all channels. Mobile is critical to this initiative. As retailers strive to deliver a more differentiated CX, focusing on mobile retail strategies that offer convenience and simplify shopping journeys will be key.
Although there are many exciting mobile trends surfacing, the underlying network technology and infrastructure that retailers have in place becomes a critical part of the equation. To take full advantage of the mobile technology available, retailers need to overcome limitations with network availability, WiFi, security and mobile infrastructure. Enlisting the right solutions will ensure retailers benefit from the scalability and agility that a cloud-based unified commerce can provide.
Why does it seem like there is a survey for everything? Surveys asking things like tell us about your experience on our website (often as soon as we land on the site), to how was your vacation stay? Once we actually had a hotel employee chase us down the hall because we didn’t answer all the questions on her survey.
Tempting as it might be, may we suggest you think twice about deleting the next survey that comes your way. Why? Because you, the customer (or potential customer) are the top priority for just about every company you do business with. Those companies want to know what you have to say. They actually need to know: if you don’t share your thoughts – good, bad or indifferent – they won’t know what they can improve to serve you better.
Here at Windstream Enterprise, this kind of feedback is essential to our business. Our own transformation process literally began because we knew we had to connect and elevate this experience for our customers. Improving our CX is now a primary focus for EVERY employee here at Windstream Enterprise. And the most essential ingredient in this transformation process was listening to what our customers had to say.
Making VOC – Voice of the Customer – central to CX
Listening is really just the start of things; acting on what you hear comes next. WE did that by establishing a VoC – Voice of the Customer – program designed to proactively monitor the customer experience. By looking at both what we see as “inside out” metrics (our own internal operational metrics), alongside “outside in” metrics (customer feedback), we’re able to:
In fact, understanding how a customer views their interaction and relationship is important to both Windstream Enterprise and the customer themselves. If we aren’t on the same page, the customer won’t be happy and we aren’t able to meet (or exceed) their needs. That’s what a VoC program is really all about.
Taking Action: What WE learned in our 2017 CX Survey
Inclusive listening is tremendously important, but creates no value for anyone unless it leads to action.
Our own 2017 fall relationship survey told us WE improved in the areas of network performance and billing issues, though customers shared concerns with installation experience, digital online tools, and support processes. Suffice to say, here’s what our cross-functional teams are working on to turn customer concerns into customer advantages:
Installation: To improve the installation experience, we’re streamlining the process by aligning resources to match order workflow, and assigning project managers/coordinators earlier for a more seamless experience from sales through installation. We’re also implementing automation to improve order accuracy, faster provisioning and more accurate invoicing.
Digital tools: Recognizing customers like the flexibility and convenience of managing their business online, we’re reviewing every tool to reduce complexity and create a better customer experience. In addition, we will launch several new online resources that you can preview here.
Support: Small scrum-like teams are working on solutions that improve the coordination of simple move/add/change requests and status communications that provide more meaningful updates and show a sense of urgency.
We also established an on-going CX Action Board, a team of VP-level leaders, who act as our board of directors. They meet monthly to inspect our results, pinpoint specific issues we need to address, and develop solutions that lead to quick sprints that we resolve within weeks.
Your turn to elevate the experience
Business, IT and digital transformation are all about leveraging new techniques and technologies to build strong and lasting customer relationships. And that is of course the intention of our own CX programs, and the reason we put listening to our customers at the center of our efforts.
We take the results to heart – even when the feedback is difficult to hear. We read every comment, and set initiatives in motion to address stated concerns. How you decide to elevate your customer experience as part of your own transformation process is completely up to you. The options are endless. But the basic process of listening to the needs of your audience, deriving insights/analytics from what you hear, and acting on the input is pretty consistent. Of course, building a strong and differentiated network infrastructure is essential to delivering that experience in a consistent and engaging manner. Though at the very start, our simple survey is where we began.
What are you doing to elevate your CX? We’d love to hear. And remember; your customers are counting on you.
A public commitment to customer experience is the hot new industry buzz, even in B2B. The Chief Customer Officer title has become a key function in the C-Suite. It’s all driven by what’s often called the “Age of the Customer,” meaning the customer’s power and knowledge has been amplified, and the customer is the biggest determinant of brand perception, corporate reputation and product evangelism – versus the corporation itself.
A great customer experience program therefore starts with humility: genuinely listening to customers and acting on the feedback they offer you. Just as the customer displaced the marketing department as the prime driver of company reputation and product advocacy, customers are also challenging and disrupting traditional engineering functions.
Engineers become customer advocates
How can that be, when engineers have invested in technical degrees, architected complex technology and built elegant automations – all of which leads to solutions customers can’t usually solve themselves? The disruption that occurs is not that the customer is displacing the position of engineers as technical experts, but rather, one that has changed the engineers’ stance from instructors to guides. Looking through our own lens, our network architecture team is always working to innovate for the relentless market demand for bandwidth (big pipes), and combine them with efficiency gains (low cost) to design networks. We would tell customers where the network was going, and customers ideally follow.
Following the Customer’s lead to mutual success
Today things are different. Now, the network follows the customer. At Windstream Enterprise, our position has evolved to first understand where the customer is going with their business, what challenges they are trying to address, and then design a solution accordingly. We’ve dropped our assumption that we know what the customers wants. Now the mantra is solving for customer success.
While “Customer Success” used to be the domain of the Customer Relationship Managers and Customer Experience teams, we’ve committed our network and engineering organization to the same goals – ensuring that our solutions meet the customer’s strategic goals, and the KPI’s that they us to define them.
Conversation and careful listening is now the prime input for our architecture and network designs, a radical change in thinking, and a mandatory one in the Age of the Customer.