The Dirty Dozen of 2021 Trends

It’s that time of year again. And although I’m not really into trend articles, I think it’s time this year to start thinking about what’s going on in the worlds of customer experience and customer relationship management — and how it’s affecting businesses and customers. Especially since I was also asked …

So here’s my list of developments that I think will be relevant in the next few years, in quite random order, and admittedly not entirely without overlap.

Digitization — not Digital Transformation

Companies and their employees, as well as customers, have had to learn to deal with a highly distributed work infrastructure. Companies have responded by building communications infrastructures (zoom fatigue anyone?) and building out or rebuilding their sales and service infrastructures for increased remote capability. This is being done in 3 phases: First, as part of a stop-gap solution, an infrastructure was quickly pulled up that allowed operations to continue somehow. In the second phase, order was brought into the chaos thus produced. Now, in the third phase, more attention is being paid to integration and efficiency.

As a result, we will see more end-to-end digitized processes that address the needs of both customers who want to interact efficiently and effectively with businesses and those of a distributed workforce.

Mind you, I’m talking about digitization here, not digital transformation. The different meanings of these two terms I have described elsewhere

The death of the four P’s is accelerating

Hierarchy of Customer Expectations
Hierarchy of Customer Expectations
The Pyramid of Customer Expectations

But be careful: It is not about consistently overfulfilling the customer’s expectations. On the contrary, it’s about being as consistent as possible with your own brand.

Conversational is the new black

The Building Blocks of enabling Customer Experience
The Building Blocks of enabling Customer Experience
The Building Blocks of enabling Customer Experience

Now companies are following suit and also increasingly offering their employees and customers initially text-based and later also voice-based interfaces to the systems available. That includes combining them with video.

For efficiency reasons, these communication channels are being integrated directly into the application platforms and the Business Communication Platform is becoming part of the overall platform to increase employee productivity.

Work from Home becomes Work from Anywhere

Embedded AI with an explanatory component

The problem here is accountability and trust. Users are always responsible for their actions, but want to rely on the predictions and suggestions of the system. However, this is difficult to achieve in a black box that is an AI. Learning from experience simply takes too long in a world where quick wins are necessary.

The commoditization of AI

At the same time, AI technologies are becoming increasingly commoditized by being embedded in business applications.

Therefore, more and more AI-enabled systems will have an explanation component that allows users to evaluate the system’s predictions and suggestions.

The age of the Customer Data Platform and the 360-degree view of the customer — Sigh.

One of the buzzwords that has increasingly emerged in 2020 is that of the Customer Data Platform as a vital component of a system landscape. The corresponding systems certainly have their raison d’être in a corporate cloud world increasingly made up of organizational and data silos, to enable companies to respond properly to customer needs in a given situation, or even to take proactive action. However — and hence the sigh in the headline — they are not the “silver bullet” they are often offered as — nor are they a goal in themselves (see also the next point).

Closely related to this is the notion of a 360-degree view of the customer. Nobody wants that. Really not! Just imagine this logically: Actually, one always looks only at a part of the whole.

What is actually desired and necessary is the ability to use (the right, out of the many that the company has accumulated) existing data to offer the customer, ideally in real time, a solution for the current need.

This requires a comprehensive, consistent, time-dependent data set about the customer, from which, covered by the customer’s consent, the information that is currently relevant is determined and used for the customer’s benefit.

The creation of this comprehensive customer database from many sources and its utilization for all departments is the task of a CDP. Since, as mentioned, too many non-integrated systems exist in companies, another system is needed for the time being to fulfil this task as the core component of a customer experience platform, as shown in the diagram below (with a focus on customer-facing applications).

Architecture of a Customer Experience Platform

Which brings me to the next, and more comprehensive, trend.

The boundaries between CDP, personalization, real-time interaction management, and customer journey orchestration are blurring.

At the moment, all of this is often implemented by a wide variety of systems, some with overlapping functionality. This will change to the extent that the separation between these individual systems will increasingly dissolve and they will become more and more modules of a whole. This trend is already evident with some manufacturers, also as a reaction to the fact that this is being demanded more and more so that system landscapes do not become excessively complex.

Efficiency becomes more important again

However, many companies now lack the financial freedom to invest for the long term. Therefore, every single investment and process in the company needs to be examined even more closely to see how it/they affect the company’s ongoing revenues and what the RoI looks like. Actions and investments that have an (almost) direct positive impact on cash flow, revenue and profit are gaining in importance. Companies will invest more where they see the famous easily achievable fruits and where efficiency can be gained quickly. This is a concept that Constellation Research analyst Nicole France very aptly calls “revenue operations.”

Marketing and sales merge to become customer engagement

First, potential customers are targeted with information that is directly tailored to their needs and challenges. Second, ABM provides the first dovetailing of marketing and sales. While this approach only scales to a limited extent, it points in the right direction.

The big step is to bring marketing and sales together into a ‘Customer Engagement’ department, working hand-in-hand with the goal of winning customers by creating value for the customer and a common set of KPIs. This requires an increased outside-in view of companies and processes and ultimately leads to winning more customers by giving them more value early on. This effect can then be amplified by early involvement of deep product or consulting expertise, which a customer engagement team by its very nature does not have.

E-commerce becomes any-commerce

This trend is related to the increasing merging of CDP, personalization, real-time interaction management, and customer journey orchestration that I described above. The path to Any-Commerce is ultimately a logical consequence. The main channels for (B2C) sales to date have been the brick-and-mortar store and the e-commerce presence. In recent years, mobile applications have also been added to a large extent. Messaging and social media as well as external sales platforms are increasingly becoming a part of the channel mix. It will become increasingly irrelevant on which of these channels a customer journey leading to a purchase is started, continued and finally completed.

Of course, this will also have an impact on processes that are not usually associated with customer experience: Warehousing as well as Logistics, as this splitting of channels makes a centralized view of merchandise management more necessary than ever.

All of this, in turn, is a driver for another trend.

Front and back office are merging — finally

IoT and Customer Experience

Bonus Trend: Privacy and increasing compliance with the EU DGSVO

The good news is that more and more companies are actually starting to rethink and change their data collection. It doesn’t matter if they’re starting because they’ve seen that the DGSVO isn’t a toothless tiger or because they realize that a more customer-centric strategy of using consent and preferences is more purposeful. Negative headlines such as the Bluekai data scandal last June, as well as browser vendor initiatives to prevent cross-site tacking in browsers as well as mobile apps, probably do the trick.

The good news is that it’s happening!

What trends do you see? Let me hear your thoughts, via Twitter or LinkedIn.

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