Even casual observers of the world of commerce know by now: The traditional marketing “funnel”—the model that described a customer’s path to buying goods and services as linear, beginning with awareness and ending with purchase and loyalty—has lost its relevance. It’s too slow, too static and too generic to be used as a foundation for companies’ marketing, sales and service strategies, and as a guide to their execution.
But in their efforts to create a new model that better reflects today’s realities, scholars, analysts and consultants often miss a key shift in consumer behavior: Buyers no longer enter a channel. Instead, they are continuously in the channel.
As long as they are within arm’s length of a smartphone, tablet or PC, today’s consumers are able to participate in any and all of the components of traditional channels at the time and place of their choosing, online. They can also move seamlessly between various channels and components, both online and in the physical world. Distinct sales channels are giving way to a single, all-encompassing model.
This shift affects business-to-business as well as business-to-consumer relationships, and has strategic implications, not just for such marketing activities as advertising and promotion but also for sales, service and every other function of the channel.
|Drawing on decades of client experience and research on consumer behavior carried out by Accenture as well as by leading scholars, and informed by careful mapping and consideration of the most recent trends in customer behavior, Accenture has developed a new model—the Nonstop-Customer Experience Model—that captures what’s really going on. Successfully interacting with and serving customers in today’s often bewildering array of channel options begins with executives in all areas of the company understanding the new model. Companies must then integrate three guiding principles into their existing marketing, sales and service strategies, and even their product development and production efforts.
Excelling in today’s marketplace means leaving the funnel far behind. By shifting to this new model and executing on the basis of the insights it provides, executives can create relevant consumer experiences, capture new demand, seize opportunities from less agile competitors and find new avenues to profitable growth.
What makes the Nonstop-Customer Experience Model unique? Among other things, evaluation, not purchase, is its focal point. Even after a purchase, customers today frequently reevaluate their decisions, and the alternatives. What if I can find a better deal by checking just one more place? I know that the product’s in the mail, but is there still time to cancel? As new information comes to light, it’s easier than ever for customers to change their minds.
Ultimately, the Nonstop-Customer Experience Model reflects how the experience of shopping—a journey for customers across the many activities in any given channel—has fundamentally changed in three critical, strategically significant ways.
The customer’s journey is now dynamic
Enabled by technology, customers can now easily control and vary their routes within (and across) channels to suit their needs at any given moment. Although shoppers move through the same fundamental stages today, they have replaced their traditional beeline route through the funnel with a variety of pathways that can be direct but more often than not are nonlinear, including loops and switchbacks.
The customer’s journey is now accessible
More content than ever is being put in front of customers, much of it beyond any given company’s control. And that third-party influence is increasingly insistent and influential. This content also appears from all sides. It’s anytime and anywhere, and it can come from or through anyone.
At the same time, in this more open environment, customers are demanding greater transparency about how their own data is being used. Companies will need to comply with these requests, even as they capture customer data and use it to enhance their own operations.
The customer’s journey is now continuous
In the not-so-distant past, customers might have considered a product on a Saturday and then had to wait until the following Thursday, when the store was open late, to purchase it. Today, technology—digital, mobile, social—means that such gaps have evaporated. Being exposed to a flux of touchpoints that are “always on” means that customers are almost always moving around the channel.
There’s a downside to this perpetual shopping, however: It’s easy for customers to become trapped in a state of endless evaluation, and unable to make the final decision to buy. Faced with that frustration, they may make a knee-jerk purchase driven by emotion, buy some-thing based on the last piece of information they processed or simply walk away.
While the journey will change for all customers, different customer segments will react with different behaviors to the dynamic, accessible and continuous environment (see chart).
How should marketing, sales and service leaders respond? A good place to begin is by considering where their companies’ current funnel-based, go-to-market strategies may show signs of weakness.
For example, most traditional marketing approaches lack the agility and ability to respond quickly to a customer who is on a highly dynamic journey. Sales and service strategies, focusing on such indicators as aggregated customer churn metrics rather than on individual customer defection risk, may overlook signs that customers are eager to switch brands. They may also be using a one-size-fits-most approach, failing to use the insights they have about individual customers to make interactions with those customers more relevant and tailored.
Similarly, companies struggle to deal with customers who are accessible on their journey. Many have tweaked their activities in light of third-party and word-of-mouth influence.
|But few are prepared to shine in this environment. They may be missing big opportunities for would-be loyal customers to get engaged or stay engaged—for example, by enabling them to participate in shaping idea-generation sites or by “elevating” selected customers to expert-among-peers status as they share their knowledge on forums and blogs.
The continuous journey presents other obstacles. Traditional approaches don’t give companies any leverage when it comes to influencing customers who are predisposed to reevaluate their options again and again, and learn from experience.
In fact, many marketing, sales and service functions are broken even before the customer journey begins, married as they are to a company’s internal structure and organization rather than to the customer’s uninterrupted experience.
With these weaknesses exposed, and understood, a good next step is looking to the Nonstop-Customer Experience Model for insights into what matters most, strategically. What high-level characteristics of that new behavior should become part of a critical foundation in any discussion about developing or refreshing strategy?
Begin with evaluation. Evaluation is all about learning, and so it becomes increasingly important to understand how customers’ learning experiences (including what they’re learning, from whom and how actively) affect their subsequent impressions and actions. (Harvard Business School professor emeritus Chris Argyris co-developed the seminal concepts of single- and double-loop learning, which are relevant here.)
Second, as the model’s design suggests, companies ought to recognize, explicitly, the two distinct loops in the customer’s experience. These loops meet at the center—evaluation—and they are ultimately interdependent. But companies need to recognize each as a separate branch of the same tree, and manage each one purposefully. From the customer’s point of view, these two loops connect expectation and reality. For a company, they should link promise and delivery.
Ultimately, the Nonstop-Customer Experience Model suggests that companies must transform their business activities to serve customers in newly critical and valuable ways. Along either loop (expectations or delivery) and on any path, consumers will increasingly value a company that can improve the quality of the journey in the following three ways.
Follow and guide
When companies are able to follow customers as they shop, purchase and consume, they’re better able to understand the underlying intentions in each choice the customer makes, and anticipate (and facilitate) his or her next steps.
|For example, a company may be able to identify the point at which a customer “drops” the path to purchasing a specific branded item or service, and analyze his or her actions to figure out what went wrong, and make adjustments accordingly. What barrier caused the drop? How might the company remove that barrier? With this purchase under way, what else might the customer be considering but hasn’t yet articulated?
Following a customer’s choice journey may reveal the answers to those questions and help position the company to complete a sale, or move the customer toward an additional purchase.
By following customers closely—and then analyzing their behavior using predictive analytics—companies can also gain a better understanding of the nuances of pace, and be better able to position and deliver a brand message at the point when (and where) it will have the greatest influence. When is the customer impatient? What factors cause that impatience? What triggers the desire to reevaluate before purchase? After purchase?
An enhanced knowledge of how quickly or slowly customers shop for any given item or service will help companies anticipate and influence customers’ next moves.
Motorcycle Superstore provides an example of how a company can follow a customer to its advantage (and the customer’s satisfaction). The Medford, Oregon-based company pays attention to the way customers search for a particular product, and adjusts the language on its website to match the terminology, including colloquialisms, they discover in customer searches. That way, customers find what they are looking for (and what the company is hoping they’ll find) more easily.
Online travel-booking companies provide a good example of guiding. When a customer goes to purchase a plane ticket, a travel site gets out in front and acts as a guide by anticipating his or her next move. If a customer is booking a flight, he or she may also need a hotel and a car. The site guides the customer, providing a full set of options for both. This may sound simple, but to be successful, the guidance must be sophisticated, which today means it often is dependent on sophisticated customer analytics.
Filter and curate
Companies can’t control open content, that tidal wave of information and opinion that continuously breaks over the Internet. But they can listen, and they can learn when they can effectively influence behavior in their favor. Which external content is just “noise”? Which truly attracts a customer’s interest? Which content influences a customer’s behavior?
By figuring out when open content makes a difference, companies can help customers filter out the information that doesn’t matter as much to them, thus helping them on their journey. Again, advanced analytics, such as “sentiment monitoring” or social media listening, can help companies with this task.
Home Depot provides a good example of filtering done well. The company, which often teaches customers how to use its products, uses “quick response,” or QR, codes to encourage customers to access its content-rich mobile site. When scanned, the codes bring up detailed product information, instructional videos, consumer reviews, product ratings and the ability to purchase the product online.
If filtering narrows the field and improves a customer’s focus, then curating brings other, select products and services into the customer’s already narrowed view.
True curating takes guiding to the next level. Where guiding simplifies and speeds the pathways of the customer experience, curating helps companies approach trusted advisor status. Curating makes the shopping experience easier for the customer by finding that perfect product or service or by drastically reducing the number of choices to the few that are most likely to serve that customer best. This reduces the time he or she needs to travel around in the channel.
Interior designers are curators by default, as are the carefully trained salespeople found at high-end department stores. The challenge is taking a skill—the ability to assess a customer’s needs quickly and to guide that person to the products that are right for him or her—that’s often present in isolated, individual sales and service associates, and ensuring that it becomes a natural part of the way the company interacts with customers. That’s true whether the company is marketing a single brand or serving as a conduit for many different brands and suppliers.
To get curating just right, a company often needs systematic input from the customer. Netflix’s Queue is a good example. By encouraging customers to evaluate their rentals (and making it easy to do so), the company follows unobtrusively. Then it steps into a curator role, considering the customer’s reviews as it tailors recommendations, and encouraging customers to broaden their scope.
The Netflix Cinematch feature goes even further. Using advanced analytics, Cinematch builds on what Netflix learns about its customers’ choices by making sophisticated connections and suggesting new movies that would not be intuitive choices for those customers. For example, Cinematch once found that people who like the movie The Patriot and (predictably) Pearl Harbor also like the movies Pay It Forward and I, Robot. Caution, however. There is a fine line between following and stalking, and between curating and intruding.
JewelMint, a partnership between actress Kate Bosworth and stylist Cher Coulter, provides another example of effective curating, albeit one that markets a single brand. JewelMint works by asking customers a few questions to ascertain their style preferences, and then every month presenting each with a tailored selection of jewelry of the company’s own design.
Bosworth and Coulter communicate with potential customers through email messages that blend their personal opinions with product information. The two send customer updates regularly and, when a new “showroom” is ready, they send additional information on fashion trends or on how each piece of jewelry might be paired with an outfit. To round out their presentation, they also send customers special offers and coupons.
Synchronize and optimize
Synchronizing is all about making sure that the customer experience is consistent across marketing, sales and service—that the promise gets delivered, every step of the way. Optimizing means making sure that the actual customer experience consistently exceeds expectations. While technology is of course a key enabler, the second key is data, which links the activities that make synchronizing and optimizing possible.
|The company that successfully adheres to this guiding principle will act as a single and seamless point of contact, from the moment a potential customer becomes aware of a brand through whatever channel route the customer chooses, then through and past the point of purchase, no matter whether the journey takes place online, in a physical store or across both mediums.
Drawing on analytics-based insights, these providers will stay on top of the customer’s evaluation experiences so that they can intervene as needed to counteract a potentially emotional or unpredictable reaction to external content. They will recognize that the experience starts long before someone becomes a customer and continues even after he or she has completed a purchase.
And they will continually (and brutally) scrutinize their own processes, asking questions like these: When do our customers want to come to a physical store and when are they better off online? What kind of follow-up is optimal in either scenario? What connections between the physical and virtual shopping experiences would a customer value? And where are the gaps or misfires in our marketing, sales and service activities that are resulting or can result in a less-than-excellent experience for customers?
American Express synchronizes and optimizes its customers’ experiences through social networking plaforms, including Facebook, Foursquare and Twitter.
For example, the company offers cardholders automatic discounts on a host of items and services based on their activities on social media sites. All the customer has to do is synch his or her social accounts to AmEx. What’s more, since offers are extended and redeemed by AmEx, customers need not present coupons or deal with rebates; in fact, sales personnel at the store where the transactions occur may not even be aware of them.
The offers are contained in their card, managed by AmEx, and tailored according to the interests of cardholders and their social connections. For example, through the AmEx “Link, Like, Love” program on Facebook, cardholders can connect to a personalized dashboard through which AmEx delivers those tailored offers. Cardholders choose the deals they would like, and then use their cards normally. American Express then sends statement credits to their cards.
By engaging with customers in this way, American Express subtly encourages more use of its card, all while building an increasingly massive wealth of customer information that could lead to even more sophisticated customer outreach and tailored offers in the future.
Zipcar, the car-sharing company that positions itself as an alternative to traditional car ownership and renting, offers another example. The company synchronizes and optimizes its customers’ experiences from the moment they become members at the Zipcar website, which then offers clear, soup-to-nuts directions designed to guide each customer through an optimal journey.
Thereafter, members can interact with the company through its website, on Facebook and through a variety of other apps (as well as a traditional toll-free number and local offices).
One example of how Zipcar synchronizes and optimizes the customer experience: text messages sent to customers reminding them that the rental deadline is approaching (and giving them the option to extend their reservation, if the car has not already been reserved), thus allowing the customer to avoid a late fee.
These companies make synchronization look easy, even in customer service and customer complaint response methods. But there are many more examples of businesses that stumble badly when it comes to helping customers navigate among products, move back and forth between online and physical venues, or even complete what ought to be a single transaction.
Funnel-based strategies worked very well in their time. They even continued to work well enough for many companies for several years after the funnel itself had begun to disintegrate. The then-strong economy masked cracks in the strategies, as did isolated pockets of excellence in marketing, sales and service.
But companies that continue to cling to a funnel-based approach today are like people driving cars long after the gas warning light has come on. Their success (if they aren’t already struggling) isn’t sustainable, and in all likelihood, they’ll stall out sooner rather than later.
It’s not difficult to recognize the realities of today’s customer experience, as demonstrated in the Nonstop-Customer Experience Model. The challenge is designing a strategy based on the model, because for most companies, the organizational changes needed to implement such a strategy will more likely be transformative than incremental. Making the shift will probably require bold, even sweeping, changes. Companies will need to hone their analytical abilities; they’ll need fluency in cutting-edge interactive technologies; and, in many cases, they’ll need to overhaul their operations.
But the long-term results, in the form of a company attuned to today’s nonstop customer and with a growing base of loyal buyers, will be worth the effort.
For further reading
“Shoppers without borders,” Outlook 2012, No. 3
"How to make your company think like a customer,” Outlook 2012, No. 1
About the authors
Paul F. Nunes is the executive director of Research at the Accenture Institute for High Performance. He is based in Boston.
Olivier Schunck is the Offering Development lead for Accenture’s Marketing Transformation group. He is based in Brussels.
Robert E. Wollan is the managing director of Accenture Sales & Customer Services. He is based in Minneapolis.