In brief

In brief

  • Faced with intense competition from agile digital disruptors, how do established big businesses continue to attract, engage and retain customers?
  • It requires a new growth formula to break down silos and reinvent business functions to deliver seamless, omni-channel customer experiences.
  • An AI-powered, data-driven approach can drive up profits by 50 percent, so you can unlock working capital, create new opportunities and fast-track growth.

Companies in industries like communications, media and retail are facing new, profound challenges. For incumbents, it is a time of existential crisis. Growth has stagnated. Margins are tighter. Categories are blurring. Digital natives are changing customer expectations both inside and outside of their industries. One thing is certain: Future growth will look different than it has in the past.

Liquid expectations are raising the bar
As digital brands proliferate, they are setting higher standards. Consumers expect rich, highly personalized experiences with no friction.

Digital disruptors are blurring industry lines
Niche players with agile operating models are creating new market opportunities across industries, and achieving unprecedented speed-to-scale.

Channels are merging and disappearing
The penetration of artificial intelligence (AI) powered digital assistants—in phones, cars and homes—is creating interactions without boundaries. Consumers can access content, products and services from a single point of contact, everywhere and at any time.

A digital “earthquake” in retail is imminent
Traditional retailers will continue to lose their grip on consumers, as digital disruptors, like Amazon, vie for dominance at the local level.

As a result, consumers are in a constant state of re-appraisal, demanding that businesses remain relevant in every micro-moment between sales and service. As market dynamics are increasingly shaped by digital players who are radically customer-centric, incumbents are losing their capacity to attract, engage and retain customers.

As market dynamics are increasingly shaped by digital players who are radically customer-centric, incumbents are losing their capacity to attract, engage and retain customers.

Becoming hyper-relevant will require breaking down silos

But pursuing a single growth formula isn’t a quick change for big companies. It will require them to completely rethink how they work within and across business functions.

They can no longer make decisions in silos, working against discrete business metrics as opposed to customer outcomes. Domain expertise will have to be augmented by data-driven insights, which reveal relationships across the silos leading to innovative growth strategies. In doing so, they will collapse product development, sales, marketing and service into a seamless continuum of value for the customer. And, they will establish a new foundation for sustainable growth.

Businesses need to rethink how they work within and across business functions.

Hyper-relevance is the ticket to new growth

The digital disruptors and new entrants that are defining the future are unifying around the customer.

That means they are pursuing a single growth formula where products, customers, channels and servicing are combined and tailored in a seamless way for each customer. They deliver end-to-end customer experiences that are agile, real-time and hyper-relevant to the individual.

Chart showing how revenue growth outcomes can span across products, customers and channels.

A data-driven, AI-powered path to new growth

AI will be central to enabling new growth. It will reveal integrated insights from data across products, customers, and channels to inform better decision-making across the enterprise.

It will empower employees, unleashing human ingenuity and fueling innovation. And most importantly, it will help businesses personalize and humanize every consumer touchpoint at speed and scale.

The integration of AI will help:

Unify across functions and improve performance

  • Diagnose – AI helps leaders drive coordinated change by revealing granular insights on how actions impact key performance indicators (KPIs) across the business, not only within each function. This creates operational efficiency and lays the groundwork for a seamless, omni-channel customer experience.
  • Prescribe – Algorithmic recommendations go beyond interim improvements to specific sub-functions (customers, channels, products) to help businesses meet end goals in a more integrated and impactful way.

Discover new opportunities for growth

  • Understand – AI will provide granular insights about individual consumers by processing vast sets of structured and unstructured data from 1st and 3rd party sources.
  • Target – AI helps identify micro-segments and priority demand spaces (e.g., new occasions, category sub-segments and servicing opportunities) to develop new business models and optimize product, pricing, promotion and packaging practices.

Increase efficiency while unlocking working capital

  • Automate – AI learns from its interactions with customers. As such, it identifies and delivers increasingly relevant experiences, automates more activities than ever before, provides operational efficiency and informs business process transformation.
  • Unlock – By pushing more activities down to the execution layer, AI drives margin enhancement and lowers costs to unlock capital for funding the digital business.
  • Empower – AI and automation can be scary concepts for employees, but they don’t have to be. These powerful tools enable employees to pivot from their manual tasks of today to lead high-value analytical and strategic initiatives related to innovation and competitive differentiation.

Create hyper-relevant experiences to increase engagement, reliability and loyalty

  • Sense – AI’s use of unstructured data (e.g., photos, video, audio, etc.) increases insight by identifying individual needs based on their context.
  • Comprehend – Natural language processing will help machines better infer what human communications are intended to convey.
  • Act – AI increases engagement by building personalized experiences in real time, including customized products, promotions, marketing and value- added services.
  • Learn – Machine learning enables continuous improvement by understanding and adapting to an individual’s needs and desires.
  • Using AI to unify around the consumer and reinvent relevance, companies will develop a powerful new capability to retain and expand their customer base, reduce costs, differentiate competitively and drive new growth. Furthermore, AI will help them set ever-increasing standards of performance by continuously optimizing interactions and transactions—creating a self-perpetuating path to growth.

Lan Guan

Managing Director – Applied Intelligence, CMT

Matthew Green

Managing Director – Applied Intelligence, Products (Retail)


Intelligent customer engagement: Reinventing service with AI
Embedding AI to reinvent relevance for B2B

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