How the Internet of Things is set to break the mould for customer experience
The customer experience process is rapidly changing. For brands, getting the customer to return again is not new, whether through incentivisation or simple brand loyalty. But the landscape is being turned on its head – and it’s through such new technologies as the Internet of Things (IoT) driving what is being described as the new services economy.
Companies are recognising this. Instead of buying standalone products, it’s now about buying services. Take Netflix as a prime example of that. But managing the customer relationship, managing the customer journey, is taking on a new dimension.
Michael Ni is chief marketing officer at payment solutions provider Avangate. One of the firm’s key points is to not only ensure a steady stream of revenue for companies through managing the customer journey, but also recovering lost revenue. 47% of consumers in a recent survey said they’ve had to replace their credit card in the past five years.
“In the world of recurring transaction, the world of subscriptions, which has become fundamental to all the type of companies we’re working with, the ability to retain their customer becomes incredibly high,” he tells MarketingTech. “What does that mean? It means you have folks who really want to keep their service going, but don’t keep their service providers updated – and what happens is you end up churning those customers out.
“And if you lose a customer, you may lose them for good.”
By utilising this, as well as intelligent retrying and failover mechanisms, companies’ revenues can increase by at least 10% in the first year. “It’s almost like free money,” comments Ni.
Yet there’s a problem – customers don’t like knowing they’re being sold to. The survey data uncovered some interesting stats on buyer control; 67% prefer to make monthly payments for all recurring subscriptions, 39% prefer to pay their bills online, while 29% want monthly reminders about their recurring subscriptions.
Ni uses the example of HP, one of Avangate’s customers, to explain the flexibility that’s required.
“If you look at our customers, both large and small, they are making a shift to how they have to sell,” he explains. “They see all of their margins coming to the add-on services, whether it’s storage, or tech support. So we look at the need to be able to create modular packages that can be sold with new models, whether it’s freemium, trial or usage based, and how you tie that into any touchpoint.”
All of this moves back to the same message – customer experiences are becoming much more personalised, and companies who succeed in the new services economy will have to control the experience across all the touchpoints of the customer. But as 2015 progresses, it will be the Internet of Things which could drastically alter buyer and seller strategy.
“We’re going past the hype,” Ni explains. “It’s not just devices, a lot of people can build devices. [Take] Nike. Nike realised it’s not about the shoes…that’s a one time buy, and maybe hopefully you’ll get them to buy another one in a year, or two years or so, but they’re doing personalised exercise plans [and] training regimen.
“That’s something that’s collecting data, and because of that daily data, that intake, now I can manage a real experience around you. That is something super sticky,” he adds.