Digital transformation means customer transformation.
I hope this idea is obvious. If you’re completely remaking your business, you’re either changing the expectations of your customers, or you’re getting yourself a new set of them.
That’s true of companies undergoing any type of digital transformation:
- Augmenting their current offerings with data, like a torque wrench manufacturer providing insights on how often nuts have been tightened out of spec
- Selling or offering data back to their clients, like loyalty-card processors who offer AI-based predictions about customer buying patterns to retailers
- Offering a hard-good-as-a-service, like an engine manufacturer who “rents” engines by the operating-hour rather than selling them outright
In each case, the company undergoing digital transformation needs to convince its customers that the new products and business model(s) are better than the old ones, and to find new customers who actively want to use the new model.
And, unlike with employees, you can’t just force your customers to engage with the new model. (Not if you want to keep them, anyway.) Companies that want to engage in digital transformation need to offer a better customer experience (CX) as they transform their business models.
That’s a mixed bag. It’s great to have a green field for a new customer experience, released from the constraints of your old business model and fulfillment systems. On the other hand, you’re probably not fully released from those constraints, because your customers might not want to move to the new model right away – and you’re going to need to bring together the financials, metrics, and CX information from the old model and the new model during your transition.
In a previous post, I described the way digital transformation requires you to draw your employees and business partners into your new company mindset. It’s the same thing with your customer transformation. You need to be watching everything your customers do, getting feedback and monitoring satisfaction to ensure that they’re coming along for the ride. And they’re only coming along for the ride if you’re offering a better customer experience.
Unfortunately, you’ve never done exactly this – whatever your new company is transforming itself into – before. It’s a digital transformation. It’s transformative, right?
So you’re finding out what your customers enjoy about your transformed company as you go along. Anything you’re doing that doesn’t improve your customer experience won’t help your digital transformation, and should be stopped before it goes too far down a path. Don’t misread me: It may take a while to see the difference. Don’t start something and ditch it after two weeks unless people actively hate it. But you need to know whether your customers are coming with you on your transformation journey, and whether they enjoy it – and you need that information as early as you can get it.
Some of that will happen through surveys, focus groups, customer advisory groups, and other traditional ways of gathering feedback.
The odds are pretty high, though, that as you transform your company digitally, you’ll be able to build in data collection that allows you to watch what your customers do rather than just what they say. (If you haven’t built that in, you need to evaluate why not and what you can do about it.
Finally, it’s worth noting that many digital transformations involve giving your customers more data directly. Customer-facing data and analytics can be an incredibly important part of giving your customers the CX they really want.
Some people naively think that giving customers data downloads – spreadsheets and whatnot – is sufficient. But that’s an old-school customer experience. They want to understand the data they get, not just download it. So a digital transformation will usually involve highly interactive data applications for customers, and they have to be flexible and intuitive enough to give those customers the answers to all of the questions they’re likely to need. In other words, they need InfoApps, not data dumps.
So your digital transformation requires some important things:
- The ability to create new data, some of which will itself be the product and some of which will help you monitor the product’s success
- The ability to harness this data, along with data that the untransformed part of your company uses, to get a complete picture of how your customers are experiencing your transformation
- The ability to change your customers’ experience quickly, and to ensure that it continuously improves
- The ability to leverage all this data in new ways to enhance your customers’ experiences, including highly interactive customer-facing data applications
There’s more, but as you can see, these are specific issues related to data and analytics.
Previously, I made the case for data and analytics to be at the heart of digital transformation; now we see it taking – and increasing – the pulse of your customers.