Part 9 - A 5 stage process for Digital Transformation
Customers 2.0, Networked, Connected and Interactive
I’m back after a short and very unconnected holiday in St Lucia, an island I am very fond of for many reasons. I’m looking forward to getting back into the swing of writing more frequently and developing the other project I hinted about in a previous post. Stay tuned.
Lastly, I hope the title renaming doesn’t throw you off guard too much. To keep some consistency, I’ve titled this issue as planned with “Issue XX” removed.
This week is all about the customer and their impact on our Digital Transformation. Today’s customer has changed and is changing, and you need to me mindful of this and adapt. Let’s get in to it.
Onwards to the issue.
If this email was forwarded to you and you’re not signed up to receive it automatically, you can sign up for free here:
Continuing the series and picking up from where I left off, the next lever for Digital Transformation is a laser sharp focus on your customers. Customers are the make or break part of any enterprise, ask any business leader. Don’t get this confused with the oft repeated mantra that the “client is king”, this may have been true some time ago, but it is not entirely relevant today. The best way to think about your clients today is to remember that your clients have a choice.
Wealth is not about having a lot of money; it's about having a lot of options. - Chris Rock
I don’t know when Chris Rock made this insightful comment, but in today’s increasingly digital world, customers are exposed to more choice than ever before, and it is up to you to entice them to use your products and services. This exposure changes the way in which your potential customers act when making buying decisions, and how they go about “hiring” something to allow them to do the job to be done (JTBD).
Aside from the important generational differences, there is now a common set of attributes to today’s customers that affects all types, generations and segments. It is precisely because digital and digital services are so ubiquitous that this is true. In all but the most underdeveloped nations in the world most of the population own a smartphone with — and most importantly — a reasonable data plan. Which explains why the first attribute is so true.
Today’s customers are networked and this is the first attribute! They are permanently connected to their cell phones using them multiple hours per day (see graph below), and when they’re not using their phones, their computers or tablet computers are connected to the Internet as well. This is a fundamental shift in behaviour and the last 5 years or so, and has had an enormous impact on their behaviour. Customers are literally a less-than-one-second-search away from getting the information they want. I recently found an object I’d never seen before in the washing machine — it had come out of one the pockets of my son’s clothes — and the name on the item didn’t give me much of a clue. I searched it, and within less than 10 seconds I knew exactly what it was, what it was for, how much it cost, where to get one and plenty of other (mostly marketing) details about why its the best at what it does. The same will be true for your products and services.
This affects how customers behave in their consumption and how they discover new things. Here in the Caribbean, word of mouth is still a strong discovery tool, but it is becoming less and less relevant when we’re consuming more products and services online. The search engine has rendered word of mouth a secondary validation tool. Today, customers search first, then ask peers and online forums for recommendations. They leverage the network they have, which in many cases spans to many hundreds of people and in some cases many hundreds of thousands. Formerly, it was your immediate entourage of a few tens of friends and family, most of whom had no idea on the subject you were researching. And so, communication itself has fundamentally changed not only in type, but in scope.
Another attribute of Customer 2.0, is that they are incredibly connected. The paradigm shift that the network brought to discovery, expanded to all users of the network, making them link together to create huge dynamically connected groups where information and experience is there for all. They no longer live individual experiences; they share their experiences with anyone and everyone. They create new networks with the explicit purpose of sharing information and experience down to the minute details using todays platforms like Twitter, and in some cases they build new platforms solely to partage this knowledge with others. You’ve no doubt noticed the abundance and impact “Influencers” are having on brand awareness. Some brands have chosen to ditch lucrative contracts with celebrities, and have substantially reduced costs and increased control by using Instagrammers to get their message across. They have understood that modern marketing is not about persuading their potential customers, it’s about inspiring purchase through association to a better lifestyle. The customer has the control and sway, it is no longer you or your business.
Shared experiences, although being available to all, are consumed at different times or in different contexts, giving the impression that we are unique. Previously, we would all watch or listen to the same film or series the day it was diffused to the mass market via the established media networks. We would then all talk about it the next day at school or in the office, the spoiler alert was virtually non-existent. Nowadays, we consume not only at the time or in the context we choose, but we consume at the pace we desire. Netflix started releasing all episodes of their exclusive series on the same day, changing consumption habits of those that would like to watch several episodes in one sitting instead of waiting for next weeks’ diffusion.
This connection additionally gives rise to the creation and sharing of niche information on a much larger scale than was previously possible. You can look for the most obscure topic using today’s search tools, and you’ll almost certainly come across a YouTube video about it or a huge Reddit thread of enthusiasts pouring over minutiae. Places like the Caribbean were previously shut off from participating in “fan” groups, through very real world hinderances such as distance, time zone and sheer expense. This is no longer the case.
Which leads me to the third and final attribute of Customer 2.0. They are interactive in a way that we have never seen before. We’ve all seen the freephone numbers on the biscuit packet asking for feedback if something is displeasing, these were however, rarely or if ever used. The reason, friction! Remember when I talked about the JTBD, I mentioned that an important aspect to not lose sight of, was the amount of friction not takes a customer to get the JTBD finished. If your solution involves more friction, customers are likely to look elsewhere, even if it is more expensive. This is because today’s digital society has spent much time reducing the friction at each step in the customer journey. Customers today have very little friction to contact you directly using Twitter, and they use it liberally too. Not only do they use it, but they expect a rapid response and a rapid resolution to their query. I’ve had interactions with companies that were resolved quicker and more accurately than by plodding through traditional “support” channels.
I was recently on a trip and had phone issues meaning I couldn’t use the phone apart from when connected to Wi-Fi for messaging through WhatsApp or iMessage. Using the browser on the phone I requested help through their support page, a mistake. I received a response two days after coming back, by email, terribly worded and incomprehensible in terms of resolving my actual problem! I’m looking to move operators in the next few months.
Strategies in a digital world
When looking at how we can reach our potential customers and we look at how the world used to be compared to today’s landscape, we see that customers are no longer a mass-market segment and they are part of an ever-changing network. They no longer are susceptible to mass-market communications over mediums like television and radio (or at least not in the same way as before). Today’s customers want to be part of the experience, but more importantly have direct influence on the process. We see this in some of the more progressive brands today, employing Instagrammers to participate in the prototyping stage, allowing both the brand to benefit and the influencer to expand their reach.
Perceived value is another important factor that the modern customer innately thinks about, and more importantly, judges your products and services. I recently listened to a podcast where the topic of discussion centred around VR and AR. One of the guests had conducted a study — being the lead researcher for his company — and he noted that currently, commercial AR applications like Microsoft’s Hololens are used on average around 40 minutes per day. Businesses and users are evaluating the value of the product, calculating that several thousand dollars of investment are only providing a couple of tens of minutes of use. So you need to be mindful of not only the JTBD, how you can make that frictionless to “hire”, but also, once hired does real-world use provide perceived value?
It’s a lot to think about, and a lot to measure and analyse!
The strategies you need to develop must address all these points and try to answeer basic questions like these:
What are the types of information that my potential customers are looking for related to my products and services?
How do they discover this information and though what mediums?
What are the JTBD?
What attributes are they looking for to solve their JTBD?
What do they not like and why?
How could we include potential customers early in the cycle?
What would customisation of our products and services look like?
As you can see your customers or potential customers are a big part of the Digital Transformation process and one of the most important (of not the most important) lever to tackle when developing your Digital Transformation strategies.
I haven’t finished developing the ‘how’ of the strategies required in this article and it is already very long! Next instalment will discuss in detail some of the things you can do to build out those strategies. Look forward to seeing you next time.
I hope this helps you with your own Digital Transformation process. If you have any questions or want to discuss your own projects, please let me know, I’d be only too happy to help out, click to email me at email@example.com.
For the non-French speakers amongst my audience, the local and highly regarded newspaper for the FWI, France-Antilles, is in severe financial trouble. They recently redesigned the paper and heavily invested in a new printing press in a move that can only be described as rearranging the deck chairs on the Titanic. This is almost certainly not the only example around the Caribbean, and it is a topic I’d like to address in a future article, but one I haven’t quite found the angle as of yet. Suffice to say however, that the old media business model of advertising, once lucrative and a competitive advantage, is now a competitive liability… Disruption Theory and Aggregation Theory.
This is a good resource for researchers like me to get a feel for Digital Transformation throughout the Caribbean and further afield. You’re welcome.
One of my pet subjects — ride-hailing services and public transport — this NYT article looks at the older generations’ use and how other services like health and occupational therapy are linking up with Uber and Lyft to provide better services to those in need. A clear opportunity for the Caribbean if we could just unlock the potential, come on banks, give us a bone!
The Future is Digital Newsletter is intended for anyone interesting in learning about Digital Transformation and how it affects their business. I strongly encourage you to forward it to people you feel may be interested.
You can read all the free back issues here:
Thanks for being a supporter, have a great day.