High-stakes Experience Economy is Here to Stay

The experience economy is here to stay – and the ability to embrace it could spell the difference between success and failure for companies.

Enterprise business is about developing products, marketing them, selling to customers, trying to increase adoption and, hopefully, getting users to come back and buy again, says Emmanouel Raptopoulos, chief operating officer: South Europe, Middle East and Africa at SAP.

Technology is the driver behind this process and one part of the environment, the operational technology, already exists.

“The world that is emerging now – and is already a reality – is the experience world,” says Raptopoulos. “and this is not about what or how, but about why. Why are customers buying products? Are they going be a detractor?”

Raptopoulos cites the example of JetBlue, which uses technology to improve customers’ experience.

The airline often has to reschedule flights owing to weather events. Customers can’t blame the airline for weather, but they can hold them responsible for how it responds, and how well they strive to improve the customer experience.

The experience economy narrative is important for a number of reasons, Raptopoulos says.

The numbers show what a high-stakes business it is: the annual cost of customers lost due to churn in the US is $1,6-billion; lost productivity costs $55-billion, new product development is $499-billion; and the spend on outsourced market research is $40-billion.

“So the experience economy is relevant now and will remain relevant.”

SAP has embarked on a customer experience journey, cognisant of the fact that it needs an end-to-end view of the customer.

C/4 HANA puts the customer in the centre of the equation, and aims to get a 360-degree view of the customer experience.

“We believe that the combination of Qualtrics and SAP will allow us to capture the experience economy,” says Raptopoulos.

Bertrand Van Overschelde, vice-president: sales EMEA at Qualtrics, explains that the company was set up 17 years ago in Utah and is now part of the SAP family.

More than 10 000 brands already use the Qualtrics platform, all of whom recognise that the experience economy is changing the way they compete.

BMW is one customer that uses Qualtrics to improve customer experience to improve business outcomes for itself and partners.

Van Overschelde points out that Apple, in 1997, turned the company around by focusing on customer experience.

Overall, it’s a verified fact that customers pay for experience at a premium way above what they pay for commodities and for experience.

“This is what a race to the top looks like,” Van Overschelde says. “Anything else is a race to the bottom.”

He cites the experience gap – the difference between the service companies think they are providing versus how customers view it.

“Those that don’t’ recognise this experience gap are on their way to the bottom,” Van Overschelde says.

Instrumenting customer experience is the secret, he adds. Companies need to find a way to merge experience data with operational data.

Brands often make the mistake of looking just at experience audit information or at just operational data.

“You cannot fly your business on a single-instrument system,” says Van Overschelde.

The four stages that Qualtrics believes with help companies to instrument the business are collect, analyse, act and workflow.

Getting the collection right is the first step, which is about getting the data, often in many different siloes, into the system.

The Qualtrics XM directory lets companies put all of their into data in one place, giving them a deeper understanding of the people at the core of the business.

The next phase, analytics, is about making sense of this collected data, using reporting and visualisation and including tools like artificial intelligence (AI)

Qualtrics’ iQ products offer the tools to help companies do this. The solution already include text, statistics, prediction and drivers, and now also includes voice.

The next step is to act on these insights with operational insights that allow the team to make relevant changes.

The ability to automatically route data, and recommend the relevant action is Qualtrics’ tools.

“But you can only manage these steps if the instruments are well set up and easy to use,” Van Overschelde says.

The workflow is therefore important, and Qualtrics offers a number of pre-determined workflows that allow companies to select and set up the most appropriate system.

This article first appeared on IT Online.