Customer experience (CX) is the new competitive battleground. According to Walker, CX will overtake price and product as the key brand differentiator by 2020. Excelling at Customer Service has always involved predicting and embracing new technologies. Websites transformed how customers could reach brands; a few years later, mobile and social channels revolutionized how they could interact with those brands. Today, we’re on the verge of the next paradigm shift in customer experience: it’s called The Internet of Things (IoT).
With IoT, things are getting personal. Connected devices, wearable tech, Radio Frequency (RF) enabled technology – all of these innovations allow companies to build incredibly detailed profiles not just of customer segments, but of individuals. And in return for giving away huge amounts of their personal data, customers are demanding a highly personalized experience. They expect the provider to recognize them and customize the interaction accordingly, thereby making the overall experience a mutually beneficial one.
All of this means that IoT is helping to forge far stronger relationships between companies and customers. It is the next major CX enabler. Yet despite this, only a fraction of businesses are fully on board. A survey by Bain & Company revealed that about 90 percent of companies remain in the planning phase of incorporating IoT into their business strategy, and only 20 percent expect to have full-scale IoT solutions in place by 2020.
As with all expensive and complex new technologies, adoption is not always an easy decision. Cost, integration and security concerns can all slow the process down. But with Gartner predicting over 20 billion IoT devices to be in use by 2020, it’s difficult to see how any company afford not to invest in IoT, at least to some extent.
Here are five ways in which IoT has completely transformed customer experience.
Customers hate unpleasant surprises. Things breaking, products expiring, performance waning: all irritations that chip away at the customer experience. But IoT is making that a thing of the past. Using multiple data points along the entire length of the customer journey, it is adding a level of predictability previously unseen.
For instance, Pirelli and Michelin are embedding their tires with sensors that collect data about vehicle performance and road conditions. This data is used to identify areas of concern before an actual problem arises. Crucially, this so-called ‘Tires as a Service’ is also turning our relationship with our tire dealer from an occasional anonymous purchase in to something far more personal and regular. It represents a major customer relationship win.
When it comes to how brands and customers interact, knowledge is power. When a customer knows about everything a product can do, and can use it in a way that solves specific problems, they will have a great brand experience. In turn, when the brand knows exactly how and why customers are using their products, it can use these insight loops to make better products. This creates a cycle of satisfaction. IoT is at the heart of providing the knowledge that fuels the cycle.
Nest Labs, for example, has revolutionized the home thermostat by building in the multitudinous data points that IoT can provide. What was a one-way device for controlling your home climate, is now a two-way connected dashboard that monitors real time behavior. Not only does the data collected allow the homeowner to be more efficient and save money, it also allows Nest to build better products.
IoT makes business personal. Customers no longer have to fall into highly researched and faceless segments, they can just be individual people again. Disney, world leaders in customer experience, realized this early and invested in IoT to the tune of $1 billion.
The result is Disney World’s MyMagicPlus program. Disney guests receive a MagicBand, a wristband that is equipped with RFID technology and a long-range radio. As guests walk through the park, the wristbands communicate with thousands of sensors streaming real-time data to hundreds of internal systems. The data tells Disney where you are, what you’re doing and what you want, allowing the company to give you the most personalized, beautiful customer experience possible.
Today’s customers want to be treated as individuals, but they also want to belong to communities of peers. IoT not only puts brands right at the heart of these communities, it allows the companies to create them.
For example, Strava turns your phone or GPS watch into a performance tracking device for when you run or cycle. The data collected goes to your Strava feed, where your friends and followers can also share their performance stats. Through the Strava community, people from all over the globe are coming together in the spirit of competition. Members are getting healthy, getting connected, and they’re having a great experience – and they have the brand to thank for it.
IoT data strips away the last layers that exist between customer and brand. It allows companies to clearly see the human at the other end of the transaction. Using real time, rich contextual data, brands can understand and interact with consumers in a whole new way. It makes products more intelligent, but also more responsive and mindful. By revealing the human face of the customer, IoT allows the customer to see the human side of the product.
Choosing not to invest in IoT may save a company ten cents, but it will lose them a dollar.
In a marketplace where customers are demanding to be treated as individuals, fine-tuned customer experience is king. It separates those who will win big from all the rest. IoT is at the very heart of this customer experience revolution.