Could Customer Experience Management Reshape The Fortune 500?
EMEA chief marketing officer for Merkle and dentsu’s customer experience management service line.
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Are we approaching the end of the age of business disruption? The idea that digital innovation is responsible for reshuffling and displacing around half of the Fortune 500 since the turn of the century is now rooted in corporate thinking. In 2018, it was predicted that 50% of companies ranked in the parallel Standard & Poor 500 would drop out over the coming decade.
The degree to which digital innovation has caused change within the league tables of the world’s most powerful and successful business giants is debatable, but there is little doubt that technology has caused disruption. From Tesla to Apple — we can see the impact of innovation in our own lives, never mind business rankings. However, a far more stable period of sustainable corporate innovation and successful adaptation to circumstances could be around the corner.
Customer experience is at the heart of innovation success.
Tech innovation has been an evolutionary process. First, we saw growth in computing power, miniaturization, the arrival of the internet and high-speed connectivity. Next came super-efficient internet search, digital services, media and social media, e-commerce, smartphones supporting mobile application ecosystems, and location-based and personalized behavioral data collection. These increasingly sophisticated technologies provided the platform for market-changing ideas across every industry.
Across this evolution, you can see a central thread. Each innovation and subsequent business disruption has one thing at its heart: customer experience. Every idea that has succeeded has done so because it spoke to a human experience and substantially improved, speeded up or completely changed the way we live and work, often for the better.
In the last wave of disruptive innovation, ideas such as aggregating film and TV onto an internet platform and enabling viewers to subscribe and stream content instantly resolved multiple consumer experience problems — especially the question of whose turn it was to return the DVD (or VHS!) to the store. Uber solved problems we didn’t even know we had. The idea of relying on a random cab to show up to a fixed location in the rain is over. The same can be said for Facebook — who knew we could stay so close to so many people we hadn’t seen in ages?
There are ways to make disruptions less dramatic.
The list of optimized or revolutionized experiences is now endless, and each changed experience has previously caused competitive headaches or existential moments for companies that did not adapt fast enough in response.
There are two fundamental changes occurring within businesses that will begin to neutralize the impact of further brilliant ideas that threaten disruption. The first is a systematic investment by heritage companies in digital infrastructure and the reorganization of data and talent. These companies are essentially buying the capability to adapt fast to new market trends or the arrival of competitive black swans.
But investment in data management and IT is rudderless without a guiding principle. The second fundamental change is the organizing ethos behind what can collectively be called deliberate digital transformation or the customer experience transformation. The goal of investing in CXT over time is to create businesses that will stay competitive through ongoing effective customer experience management.
Customer experience management is key to stability.
CXM is the key to enhancing performance in what has been described as the expectation economy. Technology created the economic foundations upon which an expectation-based economy could function, and the pandemic encouraged momentum toward this state by accelerating the digitization of our lives.
In an expectation economy, business success is determined by the efficiency with which customers’ expectations are met. Forrester found the better the customer experience, the stronger a company’s performance will be.
In short, much of the existing business universe is tooling up to continually tailor themselves to what customers want. Different companies are responding to the need to rebuild themselves around digital operational models in different ways and at different speeds. There will be many different flavors of CXM.
But data infrastructure that draws on multiple sources such as product usage, customer data, CRM support, network data, market information, business planning, etc. can provide the eyes and ears to enable brands to become closer to their customers, spot and analyze the impact of new competitors and innovate themselves. If, for example, legacy banks had understood their customers better, they would have potentially headed off the arrival of new entrants such as Monzo.
If service providers better understand customers’ potential to use services in emerging contexts such as gaming or driverless vehicles, they may gear themselves up to seize opportunities before others do. This will not mean radical new innovations stop arriving. But, businesses will be able to adapt faster without tearing themselves apart in the process. They will become adaptive organizations, where change is natural.
A great recent example of a business able to pivot naturally in the face of radical change is Square Inc. Previously known for its payments hardware systems for retailers, Square launched a mobile payment and money transfer service, Cash App, as the pandemic threatened its core business. It now has more than 70 million users.
Instead of constantly looking around the corner, focus on value-oriented forces.
Technologies such as robotics, the metaverse, green tech, health tech, space tech, blockchain and crypto currencies may provide the mechanics or platforms by which disruptive new ideas emerge, but they are not in themselves disruptive. The real drivers of change will be the human-centric ideas built upon them.
Value-orientated forces such as diversity, equity and inclusion, environmental concerns and expectations, regulatory changes or cultural trends are also likely to create opportunities around customer experience. These are among the forces CXM will enable businesses to adapt to.
The Fortune and S&P 500s will continue to change, but I believe adaptive organizations that have embraced CXM have a competitive edge in corporate performance league tables.
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Why ISPs need to build today to support tomorrow’s needs
We live in a world built on connectivity. Look around. Chances are, if you’re in a public setting, be it work, school, or at your local coffee shop, everyone around you is connected to the internet on multiple devices. The Internet has become fundamental to today’s culture, indivisible from nearly everyone’s daily life and routines.
On a large scale, the internet has revolutionized global sectors such as business, communications, education, healthcare and government. On a smaller but equally important scale, it’s revolutionized global social structures and communications. Today, whether businesses need high-speed connections to support cloud-based industrial applications or simply to provide their retail customers with reliable in-store connectivity while shopping, fast, high-capacity connectivity is a must. It’s the same story at home for virtual learning, remote working, or simply sitting on the sofa catching up on a favorite show—a high-speed connection has become key to our modern existence.
That makes it easy to see why internet service providers (ISPs) like my company, Ziply Fiber, are working so hard to not just make sure your internet allows you to do all those things today, but also that we’re thinking ahead and building technology (like 5-gig and 2-gig residential fiber and beyond) to ensure you receive the best possible connectivity for years to come. We’re futureproofing our network for your home and business.
The Internet: Then and Now
The transformative effect the internet has on society is directly correlated to how the internet itself has been transformed throughout the years. Let’s look at one of today’s most popular businesses. Netflix started in 1997 as an online, rent-by-mail, DVD service. Users would browse their website—typically on a dial-up internet connection with speeds around 40 kbps, if you were lucky— to rent a movie delivered straight to their door. As the allure of online ordering and preference customization attracted millions of customers to Netflix, competitors like Blockbuster explored the possibility of streaming. However, with dial-up internet connection still the norm, the technology simply wasn’t compatible.
Throughout the next decade, ISPs continued to innovate—introducing services like broadband and WiFi that allowed for accessible, high-speed connections anywhere in the home. Years later when Netflix decided to pivot from DVDs to the streaming service millions of people know and love today, the technology had evolved, and the internet was finally able to keep up with the needs of users.
In the last two years alone, we have seen the rapid acceleration of digitalization across all sectors of business. From customer relations to internal and external operations, companies big and small have used the internet to stay competitive in our new digital environment. Traditional businesses like grocery stores and healthcare are even embracing online channels with $59.5 billion in digital grocery sales expected in the US, and telehealth spending expected to reach $106B in 2023.
As the world continues to move dramatically towards online channels, the nature of how and why we use the internet is evolving. That evolution won’t stop, which is why it’s critical for ISPs to focus on the future and invest in what people and companies will need years from now, not simply what they’re desperate for today.
Futuristic fiber-optics
This need for network evolution is why Ziply Fiber has prioritized aggressive fiber expansion across the Northwest, bringing the fastest possible internet to millions of people at their homes and businesses—and not just in big cities, but in smaller suburbs and rural and frontier communities too, because we believe zip codes shouldn’t determine the quality of someone’s internet.
Simply put, fiber-optic internet is the best available internet—better than cable or DSL. With a fiber-optic network, not only can you get multi-gig-speeds, but also the unique advantage of symmetrical upload and download speeds combined with super low latency. Because fiber-optics are designed for data they deliver speeds and reliability that is far superior to other connection types. In fact, it is fiber that is in the backbone networks that feed all other types of connections. In short, fiber is the gold standard.
For example, we recently added equipment that enabled both the new and old portions of our network to deliver both 2-gig and 5-gig residential service—the fastest in the Northwest—and the speed and capacity does not stop there. Fiber is capable of far more as the needs of our users grow. Our all-fiber infrastructure ensures both symmetrical speeds and that neither your download nor upload abilities are constrained by large file sizes or lack of bandwidth in high-traffic areas—a crucial advantage for consumers and businesses in today’s digital world. Cable internet, although more widely available, lacks the capacity, speed, and reliability that fiber provides.
A key takeaway from the last few years is how crucial a reliable connection is for students and employees. As of 2020, the typical household averaged 10 connected devices, with numbers expected to rise to 50 by this year. More so, many of these devices are being used simultaneously. When shifted to a remote environment, the sudden influx of video and audio across devices has proven troublesome for networks operating with asymmetrical speeds and became frustrating to many users. However, those using fiber-optic networks have generally experienced clear, consistent, reliable connections.
By anticipating consumer needs and social trends, ISPs like Ziply Fiber were able to build our network with greater capacity, allowing businesses to have high-functioning capabilities, and entire families to simultaneously work, stream, game, order takeout, chat and much more without any lag or congestion. So why stop there?
A network built for tomorrow’s needs
In addition to the expected increase in connected devices, the content we consume and create will continue to evolve as the world is becoming increasingly online.
Content streaming will become more and more prevalent in business and entertainment. Video calls with embedded video content sharing will become the norm for businesses. Neighborhood coffee shops will see multiple people logged on and all video conferencing at once. We’ll see the rise of immersive 8K sports, online events, and gaming. In summary, file sizes will increase, digital channels will grow exponentially, and online operations will require large amounts of bandwidth, greater capacity and much quicker download and upload speeds.
Many current networks will not have the capacity to manage this influx of devices and usage, high quality content and round-the-clock connectivity that are increasingly required by users as more online services are integrated into daily life. According to a report by CISCO, the average internet user was projected to generate 57 gigabytes of internet traffic per month in 2021, up 139% from 2016. Our fiber users greatly exceed this prediction now, with the average fiber connected home starting to approach one terabit/month of usage. Usage growth continues and with more and more events and services moving online, it is crucial for ISPs to prepare for these upcoming higher bandwidth needs now or risk congestion in the near future.
Aggressive high-capacity fiber expansion across our four-state territory is a key part of Ziply’s futureproofing efforts.
Ziply Fiber is doing just that. We’re building a network with more capacity, made for a world where the average person owns more than 15 IoT devices, and the average business operations are 75% online. We’ve built networks capable of terabits per second between our offices and are constantly upgrading our core and aggregation networks to operate at 40% peak load, ensuring that even during peak usage hours our network will support your use at full speed. A consistently fast connection 24/7 is our design goal.
More so, our network upgrades feature rigorous route diversity and a redundant core backbone that is operated by us for our customers and is capable of 20+ terabits per second on all major inter-city fiber paths. We utilize fully redundant local aggregation networks and multiple fiber connections so that we can keep your service up even when someone’s errant backhoe digging miles away accidentally tries to slow you down.
This allows us the capacity to support not just at-home 5-gig connections, but much more for both our residential and business customer-base well into the future. It also protects against single-location incidents or disasters that might break a customer’s connection.
The internet is going to continue to evolve and grow, and how people and businesses use it will evolve as well. Networks must evolve with it, and we must choose to innovate today to provide for the needs of consumers and businesses tomorrow. We choose to futureproof our networks for ourselves and for our customers and by doing so today, customers in turn will choose us. As I always tell my engineering team, we are building the network that we want to use, which means everyone else will, too.
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My thoughts about Ethics within the Metaverse: Privacy Edition
The evolution of the Internet is here, and its name is the Metaverse. What was once seen as an abstract concept is now here and thriving. The Metaverse is a “phygital” world that merges our physical and digital selves into a virtual world that parallels our real lives (Dow). From a marketing perspective, the Metaverse brings boundless promotional and experiential opportunities. It’s not just a trend or fad; it’s here to stay, and marketers need to prepare.
Yet, many are reluctant to fully embrace the Metaverse. Just as we’ve seen within the history of technology, there is hesitancy and questions for this next, new thing that is different from what has been done in the past. In this paper, I focus on the ethics of the Metaverse - specifically, the role of individual privacy as more and more information about the phygital consumer comes online.
As marketers, it’s important that we make ethical choices and conduct business in an ethical way. Personally, I hope to “spark joy” in my future campaigns, to create a positive experience that can make a difference to my targeted audience. But I also understand that when creating these positive experiences, there needs to be full transparency to my audience as it relates to their personal information and their individual privacy.
Photo from American Marketing Association
The American Marketing Association applies a set of standards for ethical norms and values. It states that 1. Marketers should do no harm (AMA). With that embodying high ethical standards and adhering to all laws and regulations in the decisions we make. 2. Trust should be fostered in the marketing system. Avoid deception in product design, pricing, communication, and delivery of distribution (AMA). 3. Hold on to ethical values. Build relationships while also enhancing consumer trust in the integrity of marketing by acknowledging these core values: honesty, responsibility, fairness, respect, transparency, and citizenship (AMA).
These core values are essential for marketers to follow, especially as we head into the Metaverse with its blurring of the real and digital worlds. There are new ethical dilemmas that we will also face in this virtual world. We have to walk a tightrope in providing a terrific, targeted experience based on what we believe the individual will want to see, and a need to safeguard their privacy. Marketers have a responsibility to assure consumers that their data is safe. Consumers will want to know where their data is being collected, shared, and how it is secured.
Michael Litman, strategy lead at Media.Monks believes data-driven advertising can still happen in a privacy-centric way that offers “a meaningful, ethical value exchange for users.” He also stated that opportunities within the Metaverse will make users want to “opt-in.” It is up to the consumer on whether or not they put their privacy first (Clark). Many consumers are happy to give up their data for a better, customized experience but there's a catch. According to Medium, 75% of internet users won’t mind handing over their personal details, but they do want something in exchange, whether it be a reward or some kind of value in return. The problem with this is many do not know how it will be used and feel the consumer should be in control of whether or not they consent to privacy and data. In the US, data privacy is largely unregulated (Klowoski). In Europe, the General Data Protection Regulation regulates how personal data is used. As I shared at the beginning, transparency is an important way to build trust with your audience, from a marketing perspective. This is becoming a crisis in the Metaverse. Deepfakes, big data, and cyber attacks all have the ability to damage a brand, erode trust, and harm a company’s customers. One school of thought is that we should hold big tech accountable for transparency and ethical use of data being collected (Hackl).
Photo from PlayStation
According to WireWheel, studies have found that in a 20-minute session in virtual reality (VR), a headset can generate two million data points and unique recordings of body language. This body mapping can then create a digital twin of an individual for the metaverse. This type of technology can track highly-sensitive information that can create lucrative opportunities for businesses yet a wide range of privacy and reputational issues to users. Another example is data awareness technology, which provides information about the specific locations of individuals. While helpful for marketers (“here’s a coupon for Joe’s Java!”), this location information could be used for bad intentions if it falls into the wrong hands.
In researching for this paper, I became increasingly uncomfortable for two reasons. 1. Invasion of privacy: It’s fascinating that technology knows so much about us as individuals - and this can provide us with a good experience to help us navigate maps, get customized offers, and more. You don’t think about it on a day-to-day basis, yet when you hear information that can be recorded - such as your body language, or something that has mapped and can recognize your motion, you wonder what may come of that information. 2. Losing customer trust: 87% of consumers will take their business elsewhere if they don’t think a company is handling their data responsibly (Council). It’s a shame that a business could lose a customer because they have decided not to be fully transparent about their data.
Photo from City Journal
The Metaverse is on track to becoming the biggest social media network at some point. Humans will use it extensively to connect with one another. It upsets me that someone has to either give up their privacy rights to have accessibility to the Metaverse or choose to keep their privacy and not be able to engage. Companies should care about their customers, and have them be able to trust us in return. Marketers should be able to state a very clear privacy policy and provide alternatives so that consumers can experience some of the joys of being in the Metaverse. Customers should know exactly what they are putting on the line and can decide for themselves whether on not they would like to go ahead.
Marketing sheds a light on innovation that can and has changed the world. I’m passionate about the field of marketing because I believe it has the power to make the world better. Going forward, Forbes suggests Marketers should be creating best practices for how to respect a consumer’s data. This includes how marketing companies can respect consumers’ data, how they respond to misinformation attacks, as well as what types of technologies and experiences to use in the Metaverse. As organizations enter the Metaverse, I hope they take this into consideration.
Sources
A. (2018, August 28). How Concerned Are Consumers Really When It Comes to Data Privacy? Medium. How Concerned Are Consumers Really When It Comes to Data Privacy?
Azuma, Y. (2021, October 20). New Technology Meets Old Unanswered Questions: Data privacy in the age of virtual reality. WireWheel. Data Privacy and Virtual Reality (VR) - WireWheel
Council, C. (2019, December 10). Brands Lacking A Privacy-First Culture Risk Losing Customer Trust. PR Newswire. Brands Lacking A Privacy-First Culture Risk Losing Customer Trust
Clark, K. (2022, January 20). The metaverse data privacy debate is getting feisty: here’s what you need to know. The Drum. The metaverse data privacy debate is getting feisty: here’s what you need to know
Dow, L. (2022, January 12). The metaverse is coming. Are your ethics ready? Fast Company. The metaverse is coming. Are your ethics ready?
Hackl, C. (2020, August 3). Now Is The Time To Talk About Ethics And Privacy In The Metaverse. Forbes. Now Is The Time To Talk About Ethics And Privacy In The Metaverse
Klosowski, T. (2021, September 8). The State of Consumer Data Privacy Laws in the US (And Why It Matters). Wirecutter: Reviews for the Real World. The State of Consumer Data Privacy Laws in the US (And Why It Matters)
The American Marketing Association Statement of Ethics. (2018). American Marketing Association. Retrieved February 3, 2022, from
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