Are you ready for the Empowered Customer?

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1 Are you ready for the Empowered Customer? Jennie McLaughlin Partner Advisory October 2016

2 For Discussion today 1 Customer Experience (CX) Maturity Think about where you are at today and your aspiration 2 Exploring Megatrend #5 - Empowered Customers What are empowered customers and why do you care? Practical Tips & Case Studies How do you create experiences to satisfy empowered customers? EY 2

3 Customer Experience is front and centre of any growth strategy 1 Customer Focus their business on providing a differentiated customer experience by predicting customers needs and delivering personalized value. EY Growth Navigator model Digital, Technology and Analytics Digital is the primary driver of customer value and business strategy and has redefined the business model. EY

4 What is your level of Customer Experience Maturity? 1 5 8% 4 Engaged Customer experience is a core part of the company's strategy and objectives. 4% Embedded It's in the company's DNA, the essence of everything and anything the company does. 19% 1 Interested Customer experience is important, but funding and upper - level support is minimal. 22% Committed 11% Customer experience is critical to the 2 company and executives understand how it's connected to fundamental results: It's not customer experience Invested for customer experience's sake. Customer experience is important and initial programs are being put in place - but the effort is still not connected with profitability for the organisation. EY 4

5 Are nearly all embedded CX organizations are Purpose-led companies? 1 B2C companies B2B companies Inspire and nurture the human spirit one person, one cup and one neighborhood at a time We believe in challenging the status quo. We believe in thinking differently Fulfill dreams of personal freedom Deliver a better future Imagination at work Better power for a changing world Dairy for Life. To be the most trusted source of Dairy, globally Promote and spread happiness They have a clear reason for being we know what they stand for EY 5

6 Organisations that embody purpose see significant, measurable results 1 Get (and keep) the best employees Attract, retain and engage customers Increase returns for shareholders 1.4x 89% 10x of clients believe a purpose-driven company will deliver the highest quality products/services $ 1.4 times more engaged and 1.7 times more satisfied 1 x times more likely to stay 1 72% of global consumers would recommend a company with a purpose, a 9% increase from % of emerging market consumers make cause related purchases at least annually 2 Purpose-led companies outperformed the S&P 500 by 10 times between 1996 and % $ Meaningful brands connected to human well-being outperformed the stock market by 120% in Source: 1. The Energy Project, What Is Your Quality of Life at Work, Edelman, The goodpurpose study, Raj Sisodia, Firms of Endearment, Havas, Meaningful Brands Index, 201 EY 6

7 Nike vs. adidas a clear case of purpose driving performance 1 $85b Market cap. $16b Market cap. Bring inspiration and innovation to every athlete* in the world *If you have a body you are an athlete Purpose: Aspirational and belief-driven Humanistic Resonates with the company Applicable to all stakeholders Simple Unique to the company Long-term Action oriented Outwardly focused Strive to be the global leader in the sporting goods industry with brands built on a passion for sports and a sporting lifestyle EY 7

8 Of all the megatrends, Empowered customer is applicable to every industry right now. 2 1 Industry redefined Disruptive Forces Technology Empowered customer 5 2 The future of smart Globalisation Urban world 6 4 Future of work Behavioural revolution Demographics Resourceful planet Health reimagined 7 8 EY 8

9 What is an empowered customer? 2 Customers today have increasing expectations, know their commercial value and expect to be understood in their full complexity. They demand trusted relationships. 1 Shift of power 2 Digital Trust Customer More educated Higher expectations Media Access to more information Globalisation Technology Product Choice of channels Regulation Increasing regulatory pressures Economic Increase in wealth EY 9

10 Trust is built one experience at a time 2 EY 10

11 The trust journey Benefits increase as a company moves along the trust journey 2 Trusted organisations Trusted organizations: When trusted relationships are more plentiful than any other kind Trusted customer relationships Trusted customer relationships: Earned over time by consistent interactions infused with integrity authenticity Consistent customer experiences Consistent customer experiences: Each experience creates value by meeting or exceeding customer expectations Optimised customer interactions Optimized customer interactions: Every interaction is a chance to build or erode trust Cash value of each customer EY 11

12 The questions to ponder over 2 1. How to know what my customer wants? 2. How to understand it?. How to respond to it? 4. How to design for it? 5. How to implement and deliver at speed? EY 12

13 Balancing capabilities, transformation and customer experience. Experience Led Implementation: driven by voice of the customer (outside-in) Capabilities design: company capabilities to deliver experience design (inside-out) EY 1

14 EY s Experience-led Framework Listen, Design, Implement, Deliver Listen Again. 1 Experience Ambition Experience Design Purpose & Cx Ambition Prioritized Journey & Personas Innovation X Studio Intentional Journey Design Cx Maturity LAUNCH Voice of Customer; employee; partner 2 LISTEN Vision ITERATE Customer analytics Hassles & delights 5 Enable the experience 4 Experience Roadmap Experience implementation plan Experience governance Experience capabilities & gaps Prioritized experience roadmap Experience benefits case EY 14

15 Global leisure parks and media giant Experience design & prioritization The challenge The client was undertaking a large customer experience transformation project. It continually seeks to improve the customer experience to enhance loyalty. It was creating more than 150 new customer experiences that it will integrate into its existing experiences. Each new experience would have a ripple effect on many others experiences. What EY did Defined a digital and branded customer experience Used a combination of technology tools and employee interactions to identify gaps, solutions, options and impact Segmented the client s customers, using a combination of activities and demographics Brought together representatives from several groups to examine how each of the new experiences would impact them Result The EY team helped the client maintain and improve the customer experience EY created a framework to assess its current customer experiences, which made evaluations and assessments easier, and laid the groundwork for future evaluations EY 15

16 Global Pharmaceutical Company Patient centric transformation The challenge In the new world of patientcentric care, a global pharmaceutical company wanted to create a reputation for improving the lives of its patients. The company wanted to understand how technology would change the lives of it s patients and define how the organisation should respond to take advantage of the digital opportunity whilst simultaneously managing the risks What EY did Ran a series of design event workshops that brought together patients, legal & regulatory professionals, commercial and R&D practitioners to design a vision outside-in from the patients perspective Identified a series of initiatives to put in place to take advantage of the digital opportunity Result The client focused its energy on identifying and prioritizing key opportunities and initiatives that will help to unlock their purpose and improve the lives of their patients and also mitigate the risks created by digital EY 16

17 Global Automotive Giant Delivering the future retail vision The challenge The client recognized that Digital implications have fundamentally changed the way consumers buy cars. Average visits to a dealer before purchase has dropped from 4 to just 1 as consumers research and configure cars online, and consumer trust in dealers has steadily declined. The client desired assistance in creating a future roadmap focused on channels and customer preferences What EY did Helped the client develop a vision for future omni-channel retailing that put the consumer at the heart of the design Defined new customer experiences that took inspiration from luxury retail environments and technology trends Designed and helped deliver a global implementation of the new future retail model, allowing for local customization Result The company successfully piloted the future retail concept at a European dealership, including setting up a new Sales genius role, and global roll out is underway EY 17

18 Major Online Travel Agent (OTA) Digital Segmentation Strategy The challenge The client wanted to better understand how visitor behavioural segmentation drives effective marketing and site personalization What EY did Created a behavioural segmentation using advanced analysis of online behaviours to generate highly targetable and persistent segments for use in the marketing and (eventually) site personalization programs: Created 2-Tiered Behavioural Segmentation that classified users based on their key behavioural characteristics: Created automated rules for matching offers to segments based on high-level segment meta-data Result Double digit lift in response rates for general s along with significant declines in unsubscribe rates Redefined offer propensities based on segment characteristics, which provided an effective means of easily matching offers to visitors in both and online EY 18

19 EY Assurance Tax Transactions Advisory About EY EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com EYGM Limited. All Rights Reserved. EYG no. ED None This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice. ey.com EY 19