Competing on Customer Journeys

Competing on Customer Journeys

Digital technologies over the past decade has created “empowered” consumers so expert in their use of tools and information, they call the shots, hunting down rock bottom prices.

·         Retailers/Service suppliers scrambled to develop big data and analytical capabilities to understand customers, regain control

·         Leveraging emerging technologies, processes, and organizational structures in order to restore the balance of power, create new value brands

Journey’s – central to the customer’s experience of a brand-and as important as the product itself- providing competitive advantage

·         Companies are shaping their paths, leading rather than following

Example: Sungevity-manages the end-to-end process

·         Sales and custom installation

·         Coordinating the work of an ecosystem of companies:

o   Supply

o   Finance

o   Install

o   Service the panels

Their “product” is seamless, personalized digital customer journey, based on innovative data about the solar potential of each home or business. Making the “journey” compelling that once the customers encounter it, competitors may not even be considered.

·         Reconfigured the classic model of the decision journey

·         Immediately paring the consideration set to one brand

·         Streamlining the evaluation phase

·         Delivering the customer into a “loyalty loop”

                      

Getting Proactive (McKinsey’s marketing and sales practice)

Consumers decision journeys

·         How people move from initially considering a product or service to purchasing it and then bonding with the brand

·         The sequence of interactions consumers have before they achieve a certain aim

o   Example: transferring cable service to a new address

·         Firms have shifted strategy from reactive to aggressively proactive

Four Key Capabilities

Companies build the most effective journeys master four interconnected capabilities:

1.       Automation- involves the digitalization and streamlining of steps in the journey that were formerly done manually

2.       Proactive personalization-companies take information gleaned either from past interactions with a customer or from existing sources and use it to instantaneously customize the shoppers experience

3.       Contextual interaction- using knowledge about where a customer is in a journey physically or virtually to draw him forward into the next interactions the company wants him to pursue

4.       Journey innovation- ongoing experimentation and active analysis of customer needs, technologies, and service in order to spot opportunities to extend the relationship with the customer

The New Journey Management Organization

Technology smarts are necessary but not sufficient for designing competitive, continuously improving journeys; companies also need new organizational structures and types of management

                                               

Chief experience officer - Overseeing all of a firm’s interactions with customers

Journey focused strategist – helps guide decisions on which journey investments and customer segments to focus; he or she prioritizes current journeys for digital developmen and spots opportunities for new ones.

Journey product manager (AKA: solution managers, experience managers, or segment managers)- the journey’s economic and creative stewards. They have ultimate accountability for its business performance, managing it as they would any product.

Product managers- judged according to how well they meet an array of product-specific measures, including journey ROI.

Scrum teams- specialists from across IT, analytics, operations, marketing, and other functions. these team members work to understand customers’ wants and needs at each step of the journey and make taking the next step worthwhile.

o   Nordstrom is one company that uses this scrum-team approach