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How next-gen Customer Experience will be driven by AI and Digital Transformation

We’re moving into a more holistic digital transformation era, which requires the threads of data, data analytics, and artificial intelligence to be strung together. And all these threads need to be focused on delivering a transformative customer experience which attracts, converts and retains customers.

Current “digital transformation” is at the edge

“Digital transformation” initiatives at the edges are the stuff of marketing campaigns but they do nothing to support the digital experience at scale. In fact, once customers move beyond the “new mobile app” they are invariably disappointed by the clunky and clumsy lack of integration between the new experience and the legacy systems with which they still have to contend.

The same applies to most artificial intelligence initiatives e.g. Sephora’s Virtual Artists and its Color Match (driven by AI). They are very clever but remain islands in the total customer experience.

Digital transformation will become the operating model

While “digital first” has been a manta, the reality is that most of today’s organisations are still based on an old functional model designed for “industrial efficiency”. And although these organisations have lots of data, the data tends to be transaction-centric.

The digital-first organisation aligns its capabilities around the delivery of great experiences, not only for customers but also for staff and for suppliers. This is complex. It requires rejigging the internal process, reporting lines, technology and the culture. This kind of transformation also embeds digital transformation as the norm in the organisation – as an ongoing process, not a project with an end date.

The rise of the Chief Product Officer

To do this well, organisations have been appointing Chief Product Officers (CPO). The CPO has the business, process and technology skills to identify and deliver coherent digital products which enhance the customer experience and deliver value to all stakeholders.

The CPO has many of the capabilities of the COO, the CIO, the CDO and the CMO and is more holistically digitally savvy then them all. While the CMO may have been capable of driving the edge “digital transformations” it would be a rare one who would have the deep process, product and digital capabilities to drive holistic digital transformation.

As digital transformation becomes part of the “way we do things around here” the CPO will proceed to decentralise it into a portfolio of efforts. This will require a business, process, technology, and cultural architecture through which the parts will coordinate and cooperate. Innovation will be part of that diffusion.

Only AI can make use of the data

A key technology which will be part of that diffusion is artificial intelligence. Why? Because it is the only way to make use of the massive amount of data that will be needed to deliver a highly personal customer relationship.

Today we are in our infancy of customer touch-points. Yet even today there are few organisations able to collect and harness data from these touch points. The average US customer, for instance, uses more than 14 devices, channels, and platforms, and they expect brands to meet them where they are. Few firms are developing experiences on new devices, channels, third-party platforms, chatbots, progressive web apps, instant apps, smartwatches, voice assistant speakers, or VR headsets. And that’s not to mention the Internet-of-Things and the collection of masses of time series data.

The amount of transaction-centric data will eventually be a minute fraction of the “environmental” and experiential data held about a a customer. The integration of social data into enterprise data via platforms like Sprinklr will pale into insignificance compared with future data integration requirements.

Intelligent feedback loops create the personalised experience

If we like to run and cold weather is coming and we have recently been “seen” online and/or in a store searching for a running jacket and our last running shoe purchase was a year ago and we travel interstate frequently and stay in the same area and we’ve just been reading about keto diets and also strength training then a properly constructed value-adding personalised offer – beginning with omni-present prompts – can yield a big basket sale.

AI can make sense of all that data and create a “probabilistic offer”. Current programming techniques cannot – they’ll most likely just manage a single transaction for a new running jacket or new running shoes.

Developing a superior customer experience in real life comes from feedback loops – feedback from customers. At scale, digitally, this requires machine learning systems. Artificial intelligence will be used to make predictions to fulfil the personal experience for each and every customer. The reaction of the customer will provide the feedback to allow the system to adjust its prediction models on how to best enrich the experience of each individual customer.

It is only through AI-at-scale that the mountains of future data will be able to be interpreted in order to deliver an enriched personalised customer experience. We’re talking here about massive scaling, and massive feedback loops leading to constant refining of predictions about how to create a natural organic feel to each and every individuals experience.

Summary

The organisational platform of digital transformation as a way of business, combined with artificial intelligence as the core technology for prediction and feedback, are two key foundations of the future customer experience.

Contact Us for audit and data sourcing advice; strategy and implementation of your customer experiences enhanced by social data.

—– Walter Adamson
@adamson
LinkedIn /adamson
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