Smarter commerce does matter in the age of the customer

Much of this waste is found in our systems of commerce – in inventory backlogs, failed product launches, wasted materials and ineffective marketing campaigns. It was highlighted in a 2010 IBM research from the survey of more than 500 economists worldwide. Huge loss, isn’t it?

We are in the age of customer where they are empowered by technology, transparency, and an abundance of information. They expect to engage with companies when and how they want. That is why they have no patience for all kinds of waste. They want speed and a consistent experience across all channels. And definitely they can champion a brand or sully a reputation with the click of a mouse.

Fans of iced frappucinos may be aware that getting a coffee at Starbucks is not simply a buy-and-sell transaction, it’s an experience creation. With over 5 million fans on Facebook, Starbucks regularly holds discussions on coffee appreciation, announces weather conditions near local stores, and has even designed and launched a new instant blend – Starbuck VIA – through social media. One promotion via Facebook and Twitter drove more than 1 million customers to its stores in a single day. 

Apart from retail, companies in industries such as telecommunications, and banking, too have realised the importance of positive customer relationships and consequently embraced the need to engage customers wherever they are.

 

Change in Dynamics

In the Communications Service Providers (CSP) industry, social networking and mobile commerce have dramatically changed the dynamics between buyer and seller. To succeed, CSPs must put relationships with customer at the centre of their operations, using two-way communications and synchronising their plans with their customers’ in order to profit from the information explosion.

A real-life example is at China Telecom (CT). With more than 100 million subscribers, CT implemented a programme that analysed customer data, enabling themselves to identify trends, customer segments and behaviours for differentiated, targeted offerings. Sales and customer loyalty have climbed up several notches as a result.  

Traditional strengths are no longer sufficient. Today, buyers have an unprecedented level of power over businesses. Companies who want to stay competitive need to invest in customer experience capabilities that work across all channels where possible. 

Dutch bank ING’s marketing campaigns for example, were losing effectiveness because many of them were not relevant to the bank’s customers. It was too heavily reliant on direct mail, which was not in line with the needs of a multichannel bank with a strong Internet focus. By implementing a centralised campaign management programme that created personalised offers in real time, delivered through multiple channels, ING increased average campaign response rates and expects to reduce its direct marketing costs by 35 per cent per year. 

The effectiveness of personalised and real time communications is not only applicable to ING’s customers. Customers today find out about a company’s products and services via online reviews and mobile Web access. More than two-thirds are more likely to trust peer information on social media than advertisements. They expect to engage with companies when and how they want, through physical, digital and mobile means; all the while expecting a consistent experience across all channels. With experiences being shared online, companies can easily find out what they need to know about the strengths and weaknesses of brands, and react accordingly.

 

Customer first

Technology-driven shifts in consumer behaviour blew up Blockbuster, toppled Tower Records, and bankrupted Borders. To survive the shift, businesses need to put the customer at the heart of their operations. This means that you need to align all your processes – from design to manufacturing, from sale to customer service – around customer preferences; essentially creating an organisation capable of delivering smarter commerce. 

Waiting for monthly reports from the field or results from surveys can slow down the decision-making process. Invest in social media listening programmes and business analytics to help you gain insights from engagements with your customers on the Web, and their behaviour at your outlets. The graveyard list of companies that still relied on “business as usual” is getting longer by the day. The age of the customer requires you to realign your organisation to deliver smarter commerce, the ability to understand your customers’ needs in real time, and to deliver experiences that resonate with them across all channels. Thanks to smart phones and free social media apps, customers have become more instrumented and interconnected than ever before. Companies need to react to their needs for continued survival.  

 

Parnsiree Amatayakul is managing director of IBM Thailand. Her article is published every third Friday of the month.