At Open we identify and examine customer issues. At DNA we deliver on that thinking.

"We cannot solve our problems with the same thinking we used when we created them." - Albert Einstein


Is convergence always an unholy marriage?

Grenville Main February 2010

Are your customers getting stuck between channels?

How open are we to creating simple, relevant and integrated experiences?

In this issue of Open we explore the notion of the multi-channel world. Is it making life simpler or more complex? Are businesses and customers really better off? Where is convergence coming from and where is it going? To explore this topic we’ve gathered views and opinions from contributors who work across a range of sectors and disciplines. The result makes for some interesting reading.

So what are we talking about here?

Customer’s needs and goals increasingly inform the course and shape of business. They influence what you offer, how you sell and how you support it. It wasn’t always this way. Customers were not always given enough credit for knowing what they wanted or how they wanted it. Let alone being considered worthy of being in control of the purchase process.

But therein lies rub. Customers are smart - they do know what they want. They are focused - they do know how they want to get things. And they are astute - they do know how to value what things cost them, versus what they cost you.

In services and retail, customers either adopt or demand the things that matter. In some cases it’s functional, i.e. they want a simple, easy and low touch experience from you and your staff. Or they might demand a more engaged, interactive, or even expert interaction. They definitely have clear ideas about what feels right when it comes to investing their time and money. And many clearly understand the differences between express, standard or premium versions of products and services.

That may be well and good if you ‘think’ you’re listening to your customers and always evolving and improving to meet their changing needs. The trouble is that their wants are being influenced by others – their peers and other businesses they relate to. These are people you don’t naturally have your eye on, and businesses you don’t directly compete with.

For example the pace of technology adoption in sectors like air travel (look at what they’ve done with buying travel and boarding flights) creates a comparison benchmark for other sectors. That means food, clothing or hardware retail is being judged by customers referencing a range of new and improved customer experiences - whether or not you see this as competition.

But this in itself can become a trap. If you focus too much on what you can’t control, or too much in trying to offer what you need to compete, your costs can blow out. Your offer can also get complicated and/or your real point of value can get muddled for the people you are most trying to please.

There is also a new breed of consumers and (as we all know) the times are changing - quickly. The pace of this is illustrated by the fact that millions of kids are multi-tasking at a very early age. They’re totally comfortable with technology and happy to adopt it as an accepted part of how they operate, find each other, talk, share, entertain and inform.

What does this suggest about the way they’ll expect to be offered products and services in the future? And what does it say about their perceptions around quality and value? The answer must lie in ‘fit for purpose’, because these kids flip between digital and physical easily, and don’t see it as anything other than logical. Oh, and it’s not just youth...people of every generation are ‘getting it’.

  At DNA we often look at where digital and retail worlds collide, and sadly, where they often miss each other completely. When it works well customers have a seamless experience. The ‘managed’ aspects are all there at their fingertips. Past choices are traceable, individual preferences are noted, and their tastes are understood by those serving or selling to them. This makes it easy to demand a more tailored and personalised service, to optimise the purchasing experience, or even to switch to another supplier. (Although on the downside, it can also mean that too much effort is required - inputting information online for example - to make a simple purchase.)

Of course the lure of the new has always been an easy trap – is investing in all that technology really necessary? But this is not really the question, rather it’s about whether business can embrace customer demands or not. Change can be too hard to plan for and pull off. And there are many examples where siloed company structures and an inability to consider the cumulative customer experience leads to frustrating customer relationships.

There are also examples of highly successful mono-channel business models. We see the success of online-only retailers who’ve found their niche. While the big red box retail model is humming in many towns and cities around New Zealand. For it always comes down to how good you are and what value you offer, be it through one channel or by offering multiple ways to engage and transact.

So, what is an integrated experience? Is it the same in your mind as it is in the minds of your customers? Do your staff feel enabled and empowered when channels integrate? The answers are many, but what is common is it’s about adding an X factor, about simplifying the sales experience or about allowing self service and promoting self reliance.

A great example of digital and physical experiences combining successfully is Telecom New Zealand’s retail stores. Here touch screens entice customers with the latest services and songs, while allowing them to self-serve when selecting and upgrading handsets and plans. Crucially they can get information without the pressure of buying, which so often happens when staff simply ask ‘can I help you?’.  Likewise, business customers can calculate their costs in real time and look at potential savings. While staff (when they are wanted) can use modules to explain how to use and tune products. 

As a result, the sales of games, wallpapers, songs and ringtones have grown significantly, while the buzz of the ‘new’ in-store environment is palpable, and the increased satisfaction of a fruitful visit is more frequently delivered. That said, the ‘total’ integration between Telecom’s websites, in-store staff and screens (something customers will increasingly expect) is proving somewhat slower to realise.

Finally…New Zealand is a nation of small businesses. So is this an enabler or a barrier? Mobile, RFID, touch screen and many other technologies are well and truly available. But what is the right strategy for your business and customers? Is it easier or harder the bigger you are? Is all this really the path to unlocking a better experience and better business results? It’s probably too early to tell.

Trends do suggest retailers are investing in more hardware (touch and kiosk in physical environments) and striving to offer more seamless ways for customers to interact, personalise and/or self-serve from their homes, or via mobile devices. And one thing is for sure – thanks to the customer revolution - change is coming to a store near you, whether it’s digital or physical, and whether you’re ready or not.

Perhaps a perfect customer world is one where every interaction is simple but connected, and everything just happens seamlessly as you navigate your way if someone knew you were coming and what you were going to want.

So how do businesses make decisions about all this? Chances are the answer is right where customers are telling them it is.


Phil Muhpantaloons 19 April 2011 at 8:24am

This is all well and good. The theory of delivering two channels with concurrent and seamless experiences is often undone in practice. These 'experiences' are often driven out of head offices in Melbourne or Sydney, partlcularly if they're here in New Zealand, and one of those big-box retail channels you refer to. Coupled with that, is, as you rightly point out, New Zealand is a country of SMEs. This means it's very hard to convince a business, certainly within New Zealand to make these kinds of investments.They are less likely to think in terms of 'channels' and more in terms of 'customer service'. My experiences are more heavily influenced by the one to one interaction I have with staff. In a recent example, the Telecom one you refer to, yes the instore kiosk works well, but trying to get a resolution on a fault in a two day old handset was met with arrogance, blind indifference and the 'procedure' we have around here. Of course, this has left an indelible impression. One thing New Zealand businesses need to invest in is customer service delivery. They can have all the channel integration they like, or divergence, but if you're left with the kind of experience I had that day, you're dead in the water.

What do you think?