by Otto Berkes

The strategic CIO’s guide to building customer intimacy

Apr 06, 2018
CIODigital TransformationTechnology Industry

Digitally interacting with a customer through a live, Internet-connected application allows a deeper understanding of that customer as an individual because the flow of data is ongoing and bidirectional.

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The 24/7 digital feedback loops at the heart of modern digital business models require CIOs to face head on the inadequacies of yesterday’s technology delivery models.  In my last “Shifting the focus from IT to your customer feedback loop,” I talked about how the path to modern, always-on “customer intimacy” requires companies to design the customer feedback loops they need, map out the way to architect, scale and evolve them, and then wrap the right culture around them to enable speed, throughput and continuous improvement.  In this post, I’m going to focus on that first element – building the feedback loop.

Digitally interacting with a customer through a live, Internet-connected application allows a deeper understanding of that customer as an individual because the flow of data is ongoing and bidirectional.

Any aspect of the user journey through the software experience can be recorded and analyzed to gain insights into user preferences, behavior and needs. The interaction is one-to-one, and each customer can be understood as a “market of one,” thus enabling experiences to be individually tailored. Critically, data gained from such interactions can be the source of deep insights, which can be used to inform the business across every dimension.

The feedback loop between the data gathered through digital engagement and the insights delivered back into the business is one of the most important aspects of your new way of operating in the digital world. It is this capability that allows you to shape your business in close partnership with your customers.  Digital engagement can fundamentally reshape your relationship with customers as it becomes a powerful, primary mechanism for sensing and responding to unmet needs.

Your technology organization must be able to create, build and operate the software that fuels the feedback loop, but it’s critical that this is a cross-enterprise effort.  Creating effective feedback loops for your business requires partnering with all stakeholders including marketing, sales, operations and finance.  Although the technology organization can track any number of metrics, such application responsiveness, infrastructure utilization and user churn, the full value of what is measured will only be realized in the context of the entire business.  Are the latest updates to the web site increasing sales leads?  Is the new version of your app increasing customer engagement?  Which version of a feature in your app do customers prefer?   What are your customers saying on social media or on your site’s chat function?  Are your digital channels cost-effective? 

The technology organization must engage across the entire spectrum of the business to do its job effectively. Any gaps in collaboration around the feedback loop with customers and the business will mean lost opportunities and a sub-par customer experience that reflect organizational gaps and inefficiencies. Cross-functional collaboration will lead you to explore new methodologies and approaches, such as human-centered design, behavior-driven development, multi-variable testing and deep personalization to help create richer and more meaningful customer experiences across the entire digital journey.

This new toolset will be driven by robust analytics and applied heuristics that are real-world (and sometimes real-time) reflections of your existing and potential consumers. These approaches adopt and expand the concepts of continuous, omni-channel delivery — ensuring that every customer experience is consistent, integrated and connected across every digital and physical channel.

Powering the feedback loop

In my book, Digitally Remastered, I shared some best practices from one of our partners (Cognizant Technology Solutions) as an example of how these feedback loops work.  In their case, they used customer sentiment analysis from specialized analytics systems that mined data from customer feedback channels, such as social media, app store and review sites, to arrive at sentiment scores. These provided insight into what customers loved and hated, what worked or didn’t, and what they wanted (or don’t), as well as how a brand compared with its competitors. All of this information can be leveraged for better quality assurance — such as
new feature verification, product updates and fixes, and new test cases and A/B testing scenarios.

Crowd testing that involves independent end-user testers is another popular technique that can provide similar QA insight. For example, an athletic company worked with a large U.S. apparel manufacturer to perform customer experience testing on its wearable fitness tracker. Huge amounts of data from the company’s social media channels (i.e. Twitter) were mined using Hadoop-based, big data analytics systems. This data informed the development of more than 70-odd product features and improvements, as well as provided them with new test scenarios that were previously not anticipated.

Similarly, a large pizza chain suffered from poor user experience (scored less than 2 on a scale of 5) on its mobile app. The company utilized crowd testing on its app, and analysis of app store reviews to identify and address critical issues that resulted in a doubling of sentiment scores (to above 4).

The new software experience and service paradigms

As CIOs, it’s important to take a step back and realize that your new digital operating model has two main “cycles” — each with its own unique challenges and opportunities. Because your end users are consuming live experiences, your technology ecosystem has to perform two critical functions. First, it must give you a way to ideate and build software as an experience that represents and reinforces your brand. This is not about digital commerce; if it were, you could just build a simple e-commerce portal and be done. This is about digital engagement, and everything you do to foster that engagement is integral to the experience creation part of the software cycles within your organization.

Second, you have to find a way to deliver your software experiences as a reliable service — that means 24/7 with utter reliability, high quality and the capability to provide continuous updates along the way. This cycle is all about uptime, availability, responsiveness and feedback on the performance of your experiences. The new three-second-rule — the fact that users will abandon your app in three seconds or less if the app fails to come to life in that time — puts tremendous pressure on your organization’s technology ecosystem to get this part of the software cycle right.

The day you launch your app is the first day of a de-facto, ongoing relationship that you establish with your customers and a feedback loop that spans your business as well.  How that is all architected, scaled and evolved to deliver continuous value will be the subject of my next post.