In the beginning was the word. And the word was CRM. And it was good.
In the early 1990s, advances in applications technology enabled the elusive trinity of Sales, Marketing and Service to form the ‘single customer view’. For the first time, organizations could view, analyse and coordinate customer-facing activities using Customer Relationship Management (CRM) systems. These served us well for nearly 20 years.
But with the relentless pace of technology, the proliferation of the Web and rapid rise of Social Media, smartphones and tablets, the customer’s expectations soon outgrew our capability to effectively serve them. At the core of this challenge was the inescapable fact that CRM systems were designed ‘inside out’. That is to say, they were designed with an organisation’s internal processes in mind, with the Customer Experience (CX) usually a distant second to the imperative of running the business.
At this point let me say that, although the term CX is relatively new, I believe the concept is timeless and simply refers to the sum total of experiences and perceptions that any individual customer has about an organisation or brand.
From ‘Inside Out’ to ‘Outside In’
As we moved into the second decade of this century, focus moved to an ‘outside in’ view of the customer experience. Organisations began to ‘walk in the customer’s shoes’ and design their sales, marketing and service processes around customer journeys. CX Management (CXM) has now replaced CRM as the buzzword on everyone’s lips. With more channels of communication than ever, organizations are moving beyond the simple multi-channel model. CX is now omni-channel, with customers skipping and jumping between channels to fulfill their needs. It’s not uncommon to research a product on the Web, view it close up in a showroom, compare prices on your smartphone, then purchase the item though a call centre or online!
So what’s wrong with CXM? Firstly, the customer experience is still driven by the organisation providing it. This might sound obvious, but it means that companies are still trying to anticipate (or simply guess) what customers want, even if this is down to segment, or micro-segment. If they’re lucky, customers can specify a few preferences (e.g. how they prefer to be contacted, whether they want their inbox filled with ‘third party’ e-mails, etc), but this is hardly revolutionary and results in a generally unsatisfactory customer experience. Surely it would be better to allow customers to decide themselves how they want to be treated at every step of their journey. The era of the customer managed experience (CMX) is just beginning. Customers should be made aware of their choices at every stage of their journey and be able to ‘teach’ an organisation how to treat them. You might think this is tedious for customers to set up, but by making intelligent defaults (perhaps based on their previous behavior or digital ‘body language’), the customer’s workload would be reduced and the advantages for them would be high.
Clearly, implementing a CMX requires a step-change in technical capability compared with current systems. Perhaps one way of doing this is for organizations to employ intermediaries to collect these preferences, but they must ultimately be implemented in all customer-facing channels. This won’t be a rip-and-replace strategy for existing systems. Just like modern CXM systems are ‘layered’ on top of traditional CRM systems, CMX could be an additional layer.
(By the way, the concept of CMX isn’t new. I first came across this at a Gartner conference a few years ago. I was captivated by the idea, but haven’t seen much discussion or debate since.)
The Customer Takes Control (almost)
CMX breeds customer loyalty. If you’ve spent all that time teaching an organisation how to treat you, the barriers to switching are high. This is great for companies, but is it really what the customer wants? Herein lies the fatal flaw of CMX: customer tie-in. What if you have been shopping with supermarket ‘A’ for a few years and you want to try supermarket ‘T’? Can you migrate all of your preferences? Of course, the answer is almost certainly ‘no’. And the dilemma doesn’t stop there. Most of your CMX preferences probably apply to most other retailers too.
How does the customer truly take control? How do we reach the nirvana of a customer controlled experience (CCX)?
Customer Experience Re-Born
The only way to truly attain a customer controlled experience is for an intermediary to broker the customer profile. The customer expresses or refines their preferences once, and if they wish, expose their profile to organisations serving them. This has massive advantages for consumers, but represents huge challenges for our ‘big brand’ friends. For the customer, their loyalty is now ‘portable’. Companies will need to work very hard to retain them. Customers can drive the best deals on products and services. Companies will still have levers for loyalty, but convenience and ‘switching inertia’ won’t be among them!
I don’t think it’s a matter of if CCX will happen, more a question of when and how. My view is that CCX will be commonplace by 2020. The CMX step will be merely transitional; almost a defensive strategy by big brands worried about protecting a loyal customer base. The next big battle will be for the CCX platform. Will it be an existing customer data platform (Facebook, Google?) Or will a new, disruptive player emerge to fill this gap?
Once this platform is established, the possibilities are limitless. For the first time, your ‘persona’ will exist online. Your ‘proxy persona’ can represent you while you sleep or work! It knows what you want. It knows when you want it and how much you’re willing to pay. And there will be no shortage of organizations happy to serve it.
(All opinions expressed are my own. Comments welcome!)