CX for B2C

Part
01
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Part
01

Leaders in CX for B2C

Some leaders selling technology services in the Customer Experience (CX) for the Business to Customers (B2C) space include Adobe Systems Inc., Avaya, CA Technologies, Inc., IBM Corporation, Genesys, Oracle Corporation, SAP SE, SAS Institute, Inc., and Zendesk. Adobe System Inc. has a revenue of $9.03 billion and is in use by 9,406 customers. We have provided the required information about the companies in the attached spreadsheet.

Leaders in Customer Experience for B2C

RESEARCH STRATEGY

To answer this request, We began by searching through news articles, trusted media sources, and publications such as Forbes, Newyork Times, Bloomberg, and Business Insider for available details on leading customer experience (CX) companies in the (Business to Customer) B2C space in the United States. After an extensive search, most of the publications available (like Forbes) centered on either the B2B CX software or the best CX software instead of market leaders.

We went ahead to search for any market research or analysis about the US Customer Experience (CX) space. Our search proved futile as we found no such report available in the public domain. We then expanded our search base to the North American region, hoping to find US companies as part of the top companies in the region. This strategy was useful as we identified a report by Grand View Research and a similar source by KBV Research on the analysis of the North American CX market and a list of top players. Although this report confirms that the US holds the largest share of the regional CX market, however, this report did not provide any information about which of these top players are B2C centered.

This led us to further expand our search to a global scale where we found similar reports by Grand View Research and a corroborative sourced by Market and Market which only confirmed that list of players as detailed by the previous regional reports. We then switched our focus to reports and publications from top consulting firms about the leading customer experience (CX) companies in the (Business to Customer) B2C space in the United States. We looked at reports from companies such as McKinsey & Company, Bain & Company, and KPMG. Following this step, we found a Customer Experience research conducted by KPMG, which revealed that top players in the B2B CX space also retain the top position in the B2C space too. Having confirmed this, we went ahead to conduct in-depth research on the list of top players in the North American region to identify the companies with the most substantial revenues and customer base as requested by the research criteria.

Unfortunately, we were unable to identify the revenue of these companies as it relates to the customer experience solution. To find this, we searched through the companies profile, annual report, form 10k, and investors relations. Although most of the companies were public companies and had their annual reports available in the public domain, the report only provided the revenue data for the entire company or a breakdown into the different subsidiaries.

Next, we searched through reliable financial expert companies and other financial news articles and publications about these companies from third party sources. This strategy also provided us with details about the company revenue with no breakdown in product generated revenue. Furthermore, searched through the success reports and progress rate of these solutions to know if there is a mention of such information, but there was none.

Lastly, we checked for the companies revenue data and profile through business directories expert sources such as Crunchbase, Pitchbook, and Craft.co. for information about the revenue generated by B2C Customer Experience Management companies. This step also provided similar information as the rest of the strategies taken. We have provided the revenue information for the top companies listed and other requested information in the attached spreadsheet.
Part
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Part
02

CX Leaders 1

Adobe System's core services include campaign management, content management, commerce, marketing, broadcast media, and personalization & optimization. An example of its marketing messaging to B2C customers is "Make customer experience management your new obsession". The requested information is summarized in the attached spreadsheet.

Adobe Systems Inc.

Avaya

IBM Corporation


RESEARCH STRATEGY

To answer this request, we searched for precompiled information on the websites of the listed B2C customer experience key players for the core services they offer, their business strategies to B2C customers, and the vital marketing messaging. We also consulted third-party sources such as customer case studies, industry publications, and media articles for the companies' business strategies.


Part
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Part
03

CX Leaders 2

Zendesk, Genesys, and CA Technologies are three leaders in providing customer experience services to B2C client organizations. All three companies focus on improving customer experience through a range of different technology and software options. The requested information is summarized in the attached spreadsheet.

Zendesk

  • Zendesk offers a range of B2C support services through customer experience management software including, web, email, and social media, customer context, business rules, apps and integrations, and analytics and reporting.
  • They also offer live chat, voice and SMS, knowledge base, and omnichannel dashboard and reporting services.
  • The business strategy for the B2C segment is focused on customer retention, engagement, and creating a positive customer experience.

Genesys

  • Genesys offers a range of B2C services across customer service, marketing, and sales.
  • Its support software solutions include digital and AI innovations, customer interaction software, analytics and insights, employee development, omnichannel and communications, and intelligent routing and digital transformation.
  • Genesys' B2C business strategy is focused around enriching the customer experience. The customer is at the center of its business strategy.

CA Technologies

  • The core B2C services of CA Technologies include AI-driven insights, development and testing, cost optimization, creating digital trust, automation, API Management, testing, security, and providing a frictionless digital experience for customers.
  • Since CA Technologies was acquired by Broadcom, the B2C business strategy has focused on the development of new products and engaging with new customers.
  • The licensing model has changed from a perpetual model to a subscription model. CA Technologies products and services are being leveraged against Broadcom's portfolio to encourage customers to convert to CA tools.

Research Strategy

We searched precompiled information on the websites of the respective companies to determine the core services they offer, their business strategies to B2C customers, and their messaging. Information regarding the companies' business strategies were not readily available on the websites, so we reviewed a range of industry publications, media articles, and interviews to obtain this information. To obtain the messaging used by Zendesk, we reviewed a range of marketing publications and advertisements.
Part
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Part
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CX Leaders 3

Oracle Corporation, SAP SE and SAS Institute are three leaders in providing customer experience services to B2C client organizations. These companies provide a variety of solutions that focus on improving customer experience, for example, Oracle provides marketing, commerce, sales and service solutions. We have entered their information including core services, business strategy for B2C and marketing messaging to B2C customers in columns H to J, rows 6 to 8 of the attached spreadsheet.

Oracle

SAP SE

  • SAP integrates a variety of solutions for marketing, sales, and customer relationship management. SAP C/4HANA's portfolio consists of SAP Customer Data Cloud, SAP Marketing Cloud, SAP Commerce Cloud, SAP Sales Cloud and SAP Service Cloud.
  • SAP's business strategy for the B2C segment is focused on covering every step of a customer's engagement with a business, from the first contact to when they choose to buy a product.

SAS Institute, Inc.


Part
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Part
05

B2C Needs in CX

A given company's CX is almost always handled internally, though often with CX-centered software solutions or help from research consulting firms. Interestingly, there is often a disconnect between what a B2C company wants and what it needs to connect to their customers, and this disconnect grows substantially among companies will less-mature CX strategies.

CX is Generally Handled Internally

  • Lists of the top CX experts show them overwhelmingly working for successful companies in other industries, not CX consulting firms.
  • The exception to the above rule is the Healthcare industry, which is new to focusing on CX and for which several successful consulting firms, like Influence Health and Acxiom Corp, have stepped in to bridge the expertise gap.
  • B2B CX vendors come in two primary types:
    • "CX/UX research companies" (aka consulting firms), which provide services such as research and strategy solutions, competitive intelligence, market analysis, social media marketing, and other, similar services.
    • "Customer experience management companies," which primarily focus on providing software solutions to help companies manage their CX internally, from building customer journey maps, to customer review management, to better desktop, mobile, & app experiences, among others.

The Maturity of the CX Strategy Affects a Company's Desires

  • A company's maturity level when it comes to using CX is a major factor in what they want.
  • For example, those with a novice level of CX (e.g., lacking a clear CX strategy) or who completely "ignore" their strategy are far more likely to see CX in terms of profit-building, with 50% (novice) to 65% (ignore) saying that the goal of their company's CX initiatives is to acquire more customers, become the industry leader, increase sales, or increase customer retention.
  • However, those with a mature approach to CX focus on the customer end, with 55% saying that the goal of their company's CX initiatives is to deliver an outstanding experience or improve customer satisfaction.
  • This is ironic, given that companies with a mature CX approach are far more likely to be in the top tier of revenue than those with a novice approach (28% to 10%).
  • This is because focusing on immediate purchases in a company's CX can drive out the 72% of customers who are browsing, researching, or comparison shopping.

A Disconnect Between Company Desires and Needs

  • There is a major perception gap between marketers and customers on CX: 87% of marketers think they are offering an engaging CX, but nearly half of consumers believe that brands are not meeting their expectations and two-thirds can't remember the last time a brand exceeded their expectations.
  • Successful CX initiatives focus on "old-school" approaches, "such as talking directly to their customers, having the best talent on board, and doing market research," while less successful approaches rely too much on technology fads such as chatbots, predictive analytics, and augmented reality, as well as relying far too much on social media.
  • Even so, experts expect the adoption of "descriptive, predictive, and prescriptive analytics," AI-driven chatbots, APIs, and AI "CX enablers" to continue to grow among companies, suggesting a disconnect between perception and reality in many companies.
  • 70% of customers prefer that companies simply ask them for their feedback, compared to only 40% of brands.
  • Customer feedback is the "#1 driver of successful customer experience strategies," but the less competent a company is in developing a successful CX strategy, the less they are likely to recognize it (45% mature vs. 19% "ignore").
  • Likewise, successful CX strategies depend heavily on employee training, but the less mature a company is in its approach, the less likely they are to recognize it (21% mature vs. 13% "ignore").
  • From this, we gather that what a company, particularly a novice in CX, wants is not the same as what they need.

From Content Management to Digital Experience Management


The Need For Data Management Tools and Expertise

  • Companies are starting to recognize that, due to the volume and complexity of the data about their customers now available to them, data management is becoming a barrier to developing winning CX strategies and the consequent need for someone who can answer the following questions:
    • "What is the business’ data strategy? "
    • "How will we manage the data (e.g. collection and processing)? "
    • "Why employ data for CX initiatives?"

Research Strategy

In the course of researching CX trends for another brief in this project, we came across several salient details that seemed suitable for this brief, particularly the disconnect between what companies with less-mature CX strategies say they want and what they need. We went on to seek articles providing advice to companies on what to look for in a third-party CX firm. There seems to be little in this area, as most advice is aimed at internally improving a company's CX strategy rather than choosing a vendor.

Reasoning that an analysis of the marketing of top vendors would likely give us insights into what their clients were telling them about their needs and desires, we sought lists of top CX companies with which we could work. These proved to come in two broad categories: "CX/UX research companies" (aka consulting firms) and "customer experience management companies," which primarily focus on providing software solutions to help companies manage their CX internally. Indeed, lists of the top CX experts show them overwhelmingly working for successful companies in other industries, not CX consulting firms.

Therefore, to produce findings both useful and relevant to the report criteria, we have read between the lines, as it were, of the available sources. We should note that this brief is best read in light of our related brief on CX trends, which also highlights both current client desires and instances where said desires and preconceptions may not accord with the best business practices.
Part
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Part
06

Industries Using CX

While CX is very much a cross-industry concern, the Retail, Discrete Manufacturing, Banking, Healthcare, and Hospitality and Entertainment industries have been particularly noted for their expenditures and, in some cases, their innovations in improving their customers' experiences.

Cross-Industry Drivers

  • Studies show that 86% of consumers are willing to pay a higher price in return for an excellent customer experience.
  • By 2020, customer experience is expected to surpass both price and product as the "key brand differentiator."

Retail

  • The retail industry is expected not only to have the highest spend in CX in 2019 at an estimated $56.7 billion but to have the fastest growth in its spend at a CAGR of 13.1% over the next four years.
  • The drivers for developing a strong CX strategy (see above) are particularly important for retail.
  • Many retail companies, particularly in the fashion sector, are using augmented reality to allow customers to "try on" their wares before making online purchases, including eyeglass retailer Warby Parker and Rolex.
    • Likewise, clothing store Hollister has developed its in-store CX by tantalizing "shoppers’ senses with enticing lighting and even a bespoke store fragrance."
    • Nike offers a value-added app that enables customers to track their runs but which also provides Nike with information about the customer's habits and suggests when it is time to purchase a new pair of shoes.
    • Neiman Marcus' "Snap. Find. Shop" app enables customers to take a picture of a product that they like. The app then pairs those customers with links to similar items in Neiman Marcus' inventory.
  • However, the most winning CX strategies in the Retail industry are those with a personal touch, as 75% of consumers say they want more human interaction in their customer journeys, not less.
    • An example of a company successfully engaging with its customers is clothing-store chain Reformation, which provides "a shopping experience that makes customers feel like rock stars," including the ability to have different sizes or even items brought to the wardrobes by employees via a tablet.

Discrete Manufacturing

  • Discrete manufacturing is in second place in its CX spend for 2019.
  • The main driver in this spending appears to be an attempt to overcome several acknowledged disconnects in the industry's CX, which follow the disconnects noted in another brief in this project.
  • As noted in a Verndale report, "Manufacturing & Distribution companies are at a critical inflection point — rethinking their business and their customers relationships in a digital context."
  • Tesla has particularly stood out among manufacturers seeking to capitalize on excellent CX, opening "fancy showrooms in shopping malls and prime locations, with a completely transformed customer experience" which focuses on the tangible, human-centric side of CX over the digital despite being a cutting-edge technology company.

Banking

  • Banking is in third place in its CX spend for 2019.
  • According to the Digital Banking Report, "improving the customer experience" has been a major trend in this industry for at least the past several years.
  • Likewise, according to another report by Kantar, "financial institutions that lead in customer experience (CX) have a higher recommendation rate, a higher share of deposits, and a greater likelihood that customers will increase their portfolio of new products and services from their bank."
  • The most recent trends have focused on "humanizing" the digital banking CX, bringing human and digital resources together to focus on partnering with customers and building long-term relationships.
  • Among financial institutions, USAA tops Kantar's CX scoring list, followed by Regions Bank, Chase, BB&T and Citizens Bank. Kantar attributes this to pursuing a customer-centric model that delivers "a great customer experience that exceeds their brand promise."

Healthcare

  • Healthcare is second only to Retail in how fast it is growing its CX spend, with a CAGR of 11.5% expected over the next four years.
  • As noted in a recent Forrester report, healthcare organizations (HCOs) have historically had a limited understanding of their customers' desires, needs, and behaviors, have put too much focus on digital channels, and have lost control of the end-to-end customer experience, and yet these matters are critical to future success.
  • Taking the above two together, we understand the Healthcare industry to broadly recognize the truth articulated by Forrester and, consequently, to be rapidly accelerating their CX programs.
  • Increased CX spend is also necessitated by the fact that CX is an "unknown frontier" in healthcare, leaving the industry unprepared for the shift towards consumerism in the industry, further forcing the rapid shift in budget priorities.
  • HCOs have, therefore, turned to consulting companies to fill the experience gap. Examples include:
    • Influence Health, "a vendor of CX-related technologies geared at healthcare providers, including a CRM system, authoritative health content, appointment systems and related details," which improves the healthcare CX by providing patients with more communication and information tools.
    • Acxiom Corp, a Big Data company which provides HCOs the tools they need to leverage their existing patient data into improved customer experiences.

Hospitality and Entertainment

Though not listed in the IDC report, the Hospitality and Entertainment industries have been at the forefront of using technology to enhance the customer experience while gathering data so that they can continue to fine-tune their offerings. For example:
    • Disney uses "Magic Bands" at its theme parks to provide conveniences to their visitors such as freeing them from needing to carry a wallet, keys, and tickets while also providing Disney with valuable information about the movement of their visitors through the park, allowing the company to continually fine-tune its CX there.
    • Disney and Royal Caribbean use AI-driven facial recognition "to gauge how visitors are reacting to performances" or menu items to improve the customer's experience.
    • Streaming services like Spotify and Netflix are using customized playlists which not only offer suggestions based on their customers' overarching viewing habits, but which take into account the time and day of the week to, for example, provide energetic music at the time when the customer is in the habit of working-out or only suggesting R-rated movies after 8 pm in families with children.

Others

  • We are unable to determine the fifth most-common industry to invest heavily in CX based on the available public data.
  • However, in addition to those above, IDC tracks the following 15 industries for CX, suggesting that they are among the highest spenders: Insurance, securities and investment services, process manufacturing, construction, resource industries, wholesale, professional services, personal and consumer services, transportation, federal/central government, state/local government, education, telecommunications, media, and utilities.
  • Based on overlap with a Forbes list of the 100 most "customer-centric" companies, segmented by industry, we suspect that the insurance, telecom, or process manufacturing would be in the fifth slot; however, as this list focuses on success rather than expenditures, it appears more relevant to another brief in this project.

Research Strategy

In identifying key market segments for a given industry (in this case, the industries served by CX), we most often begin our research by locating existing market reports for the industry in question. While these reports are most often proprietary and expensive to obtain, the public abstracts often provide important details and guidance to the remainder of our research. In this case, we found only one report, published by IDC, that provided any details about market segmentation. This report outright stated the top three industries by CX spend (though it provided the dollar amount for only one) and allowed us to infer a fourth (healthcare) based on how fast its spend is growing. However, while the report also notes other industries whose CX spend was significant enough to warrant being in the report, we could not determine which would likely be in the 5th slot, let alone the 6th of 7th, from the public portions released by IDC.

Therefore, we attempted to ascertain CX spends and/or top industries from other sources. However, we found no public data that directly pertained to the request. For example, Forbes list of the 100 most "customer-centric" companies, segmented by industry, might lead us to suspect that the insurance, telecom, or process manufacturing would be in the fifth slot. However, this list focuses on success rather than expenditures and appears more relevant to another brief in this project.

Consequently, we have provided our analysis of the four industries we are certain about in addition to a list of other possibly-significant industries in our findings above.
Part
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Part
07

CX Performance

While there is a distinct lack of quantitative success metrics for CX in the public domain and current surveys suggest that success is best measured by company rather than by industry, below is a listing of industries which have been determined to be particularly successful in creating excellent customer experiences according to a recent Forbes article. Our research strategy follows.

Successful Industries in CX

According to a list of the most customer-centric companies, the following industries are the most successful in their CX strategies:
  • Retail
  • Finance
  • Healthcare
  • B2B
  • Software/Internet
  • Hospitality
  • Insurance
  • Telecom
  • Manufacturing
  • Agriculture

Unsuccessful Industries in CX

Due to a lack of quantitative data (see our Research Strategy below), we are unable to determine which industries or markets have been particularly unsuccessful in their CX strategies.

Research Strategy

We began our research by pulling the many reports and articles available on the subject of the evolving CX landscape, quite a few of which became instrumental to other briefs in this project. In particular, we looked for instances where multiple industries were compared by some quantitative metric by which we could make an objective judgment as to which industries were being the most and least successful in their CX approach. However, we found a disconcerting lack of available data; while there is at least one proprietary report which tracks CX spending by industry by IDC, nothing in the report's summary leads us to believe that it also attempts to track the success of these strategies by industry or even use-case. There appears to be no publicly-available or even proprietary source which would provide us with the needed metric.

We hypothesize that this is because, as noted in other briefs in this project, most companies handle their CX strategy internally and see no benefit to sharing their success metrics with the public. Consequently, composing a cross-industry analysis may well be impossible, or nearly so.

In the interest of providing useful findings, we have taken a more qualitative than quantitative approach. Forbes recently published a list of "100 of the Most Customer-Centric Companies," which was helpfully segmented by industry. While even this list does not claim to be exhaustive or completely objective, it provided at least a trusted third party's assessment combined with enough insights into what makes each company successful as to ensure at least some level of objectivity.
Part
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Part
08

CX in 2020

Studies show that 86% of consumers are willing to pay a higher price in return for an excellent customer experience. In fact, by 2020, customer experience is expected to surpass both price and product as the "key brand differentiator." Consequently, the CX landscape is one subject to multiple trends and fads at any given time, not all of which are necessarily sound business practices.

Gathering CX Information

  • In addition to gathering information by the tried-and-true method of simply talking to their customers, companies will continue to develop technologies to gather information about their customers to include their CX.
    • Forbes offers as an example Disney's "Magic Bands," which frees visitors from having to carry a wallet, keys, etc., but also gives Disney valuable feedback on the flow of visitors to the park, e.g., how long they are standing in line, which rides are the most popular, etc.
    • Similarly, Nike offers a value-added app that enables customers to track their runs but which also provides Nike with information about the customer's habits and suggests when it is time to purchase a new pair of shoes.

"This Moment" CX

  • According to Forbes, "Responding to customers at THIS moment is the next customer experience trend that's gaining traction today. This trend involves mass customization and taking advantage of micro-moments to offer customers what they need in the precise moment they have that need."
  • As an example, Spotify is developing customized playlists for their customers which take into account that a customer wants different music on their morning commute from during their workout.

The Problem of Pathetic Personalization

  • However, recognizing this is causing many companies to fall into what InMoment's 2019 CX Trends Report calls "pathetic personalization," such as including customer names in interactions rather than being aware of their interaction history (e.g., "calls, chats, email history, social media engagement").
  • In fact, when asked what brands could do to improve their CX, 69% of customers placed "knowing me" dead last and expect complete transparency on how their data is being collected and used by the company: 89% of customers say they would give a transparent brand a second chance after a poor experience.

From Omnichannel to Segmented Customer Journeys

  • Following from the above, combined with the difficulties in properly implementing it, leading some experts to expect the "much sought-after omnichannel strategy" to start to fade out in favor of managing customer journeys across multiple, segmented channels.
    • However, this will be a slow transition, as strong omnichannel strategies currently result in far higher retention rates than weak strategies (89% to 33%).
    • However, companies who have a "formal customer journey management program" see lower customer service costs combined with a 54% higher marketing ROI and 3.2 times as much revenue from customer referrals.

Value-Added Digital and Tangible Experiences

  • Many companies are offering value-added products in addition to their core product line, as when health insurer Vitality Health offers their clients an Apple Watch and "feedback about how to be healthier."
  • Others offer augmented customer experiences, such as the ability to "try on" different glasses and clothes on one's mobile device before buying.
  • However, despite the advancement of digital CX solutions, both Forbes and surveys of companies with a mature CX strategy emphasize the necessity for "tangible experiences," including direct human contact.

Being More Direct

Sources
Sources

From Part 01