Insurance providers have started to offer customers a computer device for the car that monitors driving behavior and reports it back to the provider over a wireless network. The providers use the data to adjust insurance rates based on driving behavior, charging lower rates for those deemed to be safe and higher rates for those who aren’t.
Adjusting insurance premiums based on data from this telematics technology is an obvious use case, one the industry is slowly adopting. Now, Allstate Insurance is exploring a more active approach— real-time feedback to help drivers become safer. A safer driver gets a lower premium and becomes less of a risk, which means fewer payouts by Allstate.
Whenever the driver makes a risky move, the device can give immediate feedback using a glowing red light on the dashboard or a sound that says, “That was a risky move.” In trials of the usage-based telematics product with Allstate employees, 25 percent initially scored in the safe zone, but over the course of the test, that figure rose to 75 percent.1
“In the long run, insurance companies that use telematics successfully will use it to change their exposure,” says Fred Cripe, the former executive vice president at Allstate involved in its telematics efforts. “By charging customers for the kind of driving they do, these companies will give customers more control over their insurance costs.”
By embedding capabilities to understand how customers drive and augmenting the driver experience with real-time feedback on actions that create risks, insurance providers can go beyond the transaction of signing up customers and helping them achieve the goals of controlling their insurance costs and staying safe
The result is the transformation of insurance coverage from a passive-response product to an active digital coach that helps the customer while reducing the provider’s costs. (See Figure 1.) This use of active feedback illustrates an evolving goal-oriented solutions approach that engages the customer after the product is sold. It’s an approach made personal and continuous thanks to the digitization of consumption and the augmentation of customer experience into a new relationship that extends beyond the transaction of a sale.
PwC believes that going beyond the transaction by building post-transaction relationships2 is a major step forward in the interactions between businesses and their customers. The fundamental breakthrough is the digitization of consumption. Businesses thus far have transformed their pre-transaction relationship with potential customers, often referred to as e-commerce.
Major elements of e-commerce include digitally reinventing product discovery, comparison shopping, buyer feedback and reviews, and purchasing and delivery options; in essence, all the steps up through the transaction.
The post-transaction relationship reinvents the engagement with customers by reaching beyond the transaction and focuses on helping customers achieve the personal goals they buy the product for. What makes this approach possible is a set of emerging technologies collectively called the Internet of Things: wireless communications, cloud-based processing, sensors, embeddable computers, and real-time big data analytics.
This issue of the Technology Forecast explores how emerging technologies are facilitating the ability to create post-transaction relationships. This article examines how to go beyond the transaction, the opportunity it provides, and some of the rethinking it requires of businesses. The technology article, “The Thing Stack: Technologies that guide customers to their goals,” looks at the maturation of the technologies that make building post-transaction relationships possible. And the CIO article, “CIO leadership in post-transaction relationships: IT’s role in customer engagement,” explores the key role IT staff can play in this transformation.
Nearly every company refers to its products and services as “solutions,” but most are not. They create the potential to satisfy a want or need, but customers are pretty much on their own to translate that potential into reality.
From the customer’s perspective, products and services are means to ends. Customers have goals. They usually want a particular outcome, one that is personal. They buy athletic shoes to stay fit, insurance to keep themselves healthy and safe, sports gear to improve performance, food to make meals for nourishment and enjoyment, how-to magazines and books to improve some important aspect of their lives, and so on.
Businesses try to understand these goals enough to market a product or service as a possible solution, but in most cases that’s as far as it goes: a way to achieve a transaction. The story ends there, and it’s up to the customer to achieve the desired goal. But it doesn’t have to stay that way. “By charging customers for the kind of driving they do and communicating alternative behaviors that will cost less, these [insurance] companies will give customers more control of their insurance costs,” suggests Cripe. To do what Cripe suggests, insurance companies will create a post-transaction relationship, a relationship defined around the customer goal of control on insurance costs. The implications are strategic. “The business model change will move the industry from what I will call a reimbursement model to a prevention and loss control model,” Cripe forecasts.
With a focus on achieving a sales transaction, businesses usually do not invest in understanding customers’ personal goals. From a product perspective, customers are typically defined in broad-brush market segments based on demographics and psychographics. However, goals have specific characteristics:
Progress toward a goal often has little to do with speed, and more with the direction. Customers need help to channel their energies in the right direction and advance toward the goal. What they need is feedback, in real time when possible, that recommends behavior that will keep them on the right path.
Businesses should define specific and measurable outcomes that become the basis for incremental feedback along the journey, and they should direct consumer behavior to stay on target. Whereas goals are aspirational, outcomes are incremental and directional—in some sense, they are the mile markers along the highway to the goal. (See Figure 2.) Emerging technologies in connected sensors now make possible the measurement of the outcomes of each behavior and their contribution to the overall goal.
In a post-transaction relationship, the path to any goal is a journey directed by outcomes. Outcomes are incremental feedback that will direct consumer behavior to stay on the right path and move toward the goal
For example, real-time feedback that indicates the driver has made a risky move or chosen a risky route provides information on whether the driver is progressing toward the goal of achieving certain savings. This information can direct driver behavior that will reduce the driver’s risk and rates.
Can the Internet of Things—as a combination of sensors, devices, and applications—change customers’ behavior toward their goals? Evidence emerging from many experiments, such as Allstate’s, seems to suggest yes. Realtime feedback taps into human psychology and physiology and helps people change their behavior. Why? Sensemaking theory explains why, as well as how people interact with a complex world around them and how people change their behavior to effect change in that world.
Sensemaking is the process by which people give meaning to experience.* Sensemaking theory says people make sense when three elements are present: cues, scripts, and schemas. Cues arise when a person receives feedback that something is wrong or amiss and needs to be addressed. Cues act as triggers for behavior change to ensure success and survival. Scripts are the rules people follow once they get a cue to change behavior. Scripts are based upon capabilities a person needs for a new and goal-achieving behavior. Schemas represent the structures that provide rewards or punishments for responding to the cues and following the scripts. They create the motivation for a new behavior.
In the insurance example discussed in the main article, alerts signaling risky driving behavior are the cue to trigger change. A script is change that directs the driving behavior toward the safe zone by removing or altering the cue. A schema is the savings in premium associated with a sustained change in behavior. The Internet of Things enables all of these actions to happen in real time.
Sensemaking theory works, because the psychology of making sense of the surrounding world is grounded in human physiology where the brain receives chemical rewards (dopamine) and punishments (cortisol) based upon the cues, scripts, and schemas that emerge. Here are some examples of solutions that use a combination of sensors, devices, and apps to take advantage of sensemaking theory. They provide further evidence that sensemaking theory explains why consumers will change behavior to move toward a goal:
What all these companies and solutions have in common is that they gather data and information in real time through networked sensors, and they use this information to create cues to trigger behavior change right at the moment when the behaviors seem misaligned with goals. Their solutions include the scripts that can be followed to effect a change in alignment with goals. Finally, they also provide a schema to ensure appropriate and customized rewards and punishments (psychological and physiological) to sustain the change. New behaviors then provide new cues, which lead to new scripts, based upon new schemas—and the feedback loop of sensemaking can repeat.
* For more details, see http://en.wikipedia.org/wiki/Sensemaking.
The leap businesses need to make is to understand customer goals, make them explicit, create measures and methods for tracking progress toward the goals, and redefine the product or service around how it advances the customer toward the goals.
By making the goal and progress toward it measurable, visible, and adjustable, a business lets the customer cross the chasm between theoretical desire and actual pursuit, so the customer can, in psychological terms, self-actualize the desire into reality. Evidence is mounting to suggest that providing real-time feedback taps into human psychology and physiology in ways that propel people to make substantial changes in the way they live, interact, and behave. The sidebar “Sensing a change in behavior” describes the theoretical basis that explains why a system of sensors, devices, and applications brings about behavior change toward the achievement of goals.
Because the goal is continual, so is the engagement with a provider such as Allstate, whether through software on a mobile device, hardware and software in the car, the Allstate website, or some other venue—and most likely through several of these media. The providers gain access to an incredible wealth of data on individual customers and customers in aggregate that it can use to improve products and services, discover new products to support other customer goals, and build a richer, deeper, and engaging post-transaction relationship with each customer.
Pre-transaction relationships focused on the transaction and the activities leading to it, using digital media such as the Internet, enterprise resource planning (ERP) systems, and databases to manage the shopping and supply chain processes, enabling greater access to more product choices for more people. But the products sold were largely the same: consumer electronics, clothes, books and CDs, medicines and medical gear, even pet supplies.
By pairing shopping with easy inventory search, relevant suggestions, previous buyers’ feedback, and fast, traceable delivery, businesses created new value and transformed the shopping experience. However, once sold, there was little relationship carried forward concerning the use of the product itself, even if e-commerce providers did establish an ongoing shopping relationship in the broader sense.
Focusing only on the transaction has resulted in two key disconnects that customers and providers face today and that limit the ability to create new value:
A post-transaction relationship addresses both disconnects by taking advantage of developments along two dimensions. First is the growing ability to digitize consumption, which provides new information about how the product is used. Second is the ability to augment experience by extending the physical objects and environment into the digital realm, thereby facilitating an integrated and seamless experience across both physical and digital spaces. The confluence of these two capabilities provides the basis for a new value opportunity; that is, enabling businesses to help customers achieve their goals. (See Figure 3.) “The technology now enables companies to help customers achieve the goal that they’re buying the product for—as opposed to just selling it to them most cost-effectively, which is what businesses have done in the past,” Cripe says.
To help customers achieve their personal goals, businesses need to invest in post-transaction relationships that take advantage of two developments: digitized consumption and augmented experience
Until recently, it was too expensive to analyze customer activities at a level granular enough to gain an understanding of both individual customers and customer segments. But that’s changed, as Figure 4 shows, thanks to a broad set of technology advancements. Most industries are either past or rapidly approaching the tipping point where the value that can be created by understanding granular consumption is higher than its associated costs.
Most industries have arrived at an inflection point where it is now economically feasible to understand customers’ granular consumption activities, setting the stage for being able to build a post-transaction relationship
With the availability of small and less-expensive sensors and the ease of embedding networking capabilities, all companies have the potential to digitize how products and services are consumed or used—from toothbrushes and forks to cars and roadways. “The ability to surface consumption-level data enables a relationship with a customer where you can help with their personal goals,” says Carlo Gagliardi, a partner at PwC UK. To help with progress toward goals, businesses will need to understand where a customer is in his or her journey toward the goal. Granular consumption data becomes the basis of this understanding.
For instance, if a customer’s goal is to bring his or her automobile insurance rates below a certain level, the data from the telematics device is essential to understanding the risk of this customer’s driving behavior and providing feedback on this customer’s progress toward the goal. Absent this data, neither the insurance business nor the customer has the necessary information to reduce the cost of insurance.
The digitization of consumption provides insights that are useful beyond helping customers to achieve goals. Visibility into how a large pool of customers uses the product can provide insights not possible by other means. For example, most customers will not bother to report small events, such as a paper jam in a copier, to its manufacturer.
“They just straighten it out and move on,” says Jim Ingrassia, vice president of the solutions support division at Konica Minolta Business Solutions.
“But when we see it happening across 50,000 or 60,000 machines during a period of 30 days, then we look at the data from a different perspective. We start seeing patterns and realize that perhaps we have a design issue.”
It’s amazing how much information can be collected about individuals, both directly through digital services and products, and indirectly through the analysis of databases that contain everything from statistics about web visits to demographics. While consumers demonstrate a growing acceptance to share usage data in return for value-added services, the prospect of being so closely monitored and tracked is not without risks to customers or businesses.
Various social networks and many “free” cloud services have already shown just how much information can be obtained about individuals—often from them directly—by offering a compelling personal value proposition. At the same time, the outcry every few months when such providers cross lines of comfort likewise shows the discomfort such aggressive usage of personal information can cause. It’s unclear whether this discomfort is a fundamental barrier or a transitory reaction to a new highly connected world. In either case, navigating the bounds of privacy will be uncertain as the interplay of technologies, behaviors, and policies evolves.
Indeed, businesses should be open with their customers about what information is captured, how it is stored, who it is shared with, and on what terms. All this disclosure helps customers answer the most important question to them, “Who knows what about me?” However, should customers experience direct harm when information is compromised, then customers will react strongly and negatively. The outcry and swift legislation in response to some employers’ demands for social networking passwords is an example; job applicants quickly perceived such requests as ways to deny them employment, a very direct harm.*
Business policies should protect customers from direct harm from breach and misuse of personal information. For example, stolen credit card information can have direct harm to customers, but the industry has highly sheltered them from any consequences, so the harm falls much more on the business than the customer.
It’s clear that customers must trust either the businesses they deal with or the regulatory framework that governs the industry. Plus, customers must perceive no specific harm from the use of their personal information. It’s up to the businesses to earn that trust, especially for products and services that use risky (to the customer) personal information, such as health data, driving behaviors, and even food purchases. And then businesses must maintain that trust by not abusing (again, in the mind of the customer) the information collected.
* Doug Gross, “Facebook speaks out against employers asking for passwords,” CNN, March 23, 2012.
By digitizing the consumption of its products to the point where every small event is collected, Konica Minolta also learns from events the customers may not view as significant. For about a decade, Konica Minolta has been using the digitized consumption of its copiers as a means to improve products, services, and overall value. (See the sidebar, “Many blueprints of businesses building post-transaction relationships.”)
The digitization of consumption is not without its challenges. Granular consumption information can be sensitive, and businesses will need to earn an unprecedented level of trust to create a post-transaction relationship, as the sidebar “Trust issues in post-transaction relationships” suggests.
Customers today live their lives in two spaces—their particular physical world and the digital space they access using computers, tablets, or smartphones. The achievement of any goals will span these two spaces. When done right, the notions of online and offline aren’t separate states but are coexisting, mutually aiding states perceived as one flexible, seamless state the user “lives” in for certain activities.
When asked how he created the sustainable dance floor3 that fuses the physical space of the dance floor and the technology space of electricity generation into an augmented experience where the act of dancing generates the electricity to power the discotheque, Daan Roosegaarde, an artist, inventor, and entrepreneur whose Studio Roosegaarde consults on interactive design for human space, replies, “We upgraded reality. This is augmented reality in its purest form—not as a mobile app, but as a seamless integration of the physical environment and technology.”
Roosegaarde has done several projects that use digital technologies to provide integrated seamless experiences across physical and digital domains. “Technology is super important, but more important is the will to create new and seamless crossovers between physical and technological interfaces,” he says.
For example, he has proposed reimagining highway design in a way that exemplifies the concept of an augmented experience. He notes that billions of dollars are spent to make cars smarter, but not the roads they travel. Why, he asked, couldn’t highways use sensors (many already have them for traffic monitoring and the detection of hazardous materials) to interact more intelligently with drivers based on local conditions?
The Smart Highway concept4 proposes using signs that are painted on the roads and appear only below a certain temperature to display warnings about icy conditions, or that are connected to wind sensors to display only during high winds. When these warnings appear on static year-round signs, they are more likely to be ignored. Lane markers, such as those designating carpool lanes or express lanes that skip some exits, could also be made digital, so they change with traffic flow and volume; they could be made with photosensitive materials that keep them lit at night and charged via solar power during the day. Streetlights could have detectors so they turn on only when cars are nearby.
In augmenting the experience, businesses are empowering their customers to achieve their goals more effectively than they could on their own. By creating seamlessness between the physical and digital spaces, businesses create a real-time feedback loop between the context of consumer actions and the progress toward their personal goals.
The use of the product or service forms the personal nexus between customer and provider in an ongoing relationship and becomes the conduit for persistent value.
This shift in thinking is significant. “Since you can track progress toward a goal, you can sell outcomes and not just products,” PwC’s Gagliardi says. Selling outcomes is a different mentality from the historic focus on selling a product but leaving achievement of any goal up to the customer.
The dynamics of value exchange between business and customer will change, as shown in Figure 5. Customers’ willingness to share personal data about their consumption will be a critical component of the new value exchange. The benefit is mutual, as Cripe explains using the insurance industry example. “There is alignment of customer and enterprise goals. Insurers win because we pay out less relative to what we charge. The customers win because they save money and they really didn’t want the annoyance and the danger and the injury that comes with being in the accident in the first place.”
The dynamics of the emerging value exchange in the post-transaction relationship. The new value businesses will provide is the enablement of customers’ goals in exchange for the consumption data that a customer shares. The value businesses receive is a deeper relationship with and advocacy from the customers
Creating the ability to measure and share incremental outcomes evolves the transaction into a deep relationship. Rather than satisfying a one-off want or need, products and services that go beyond the transaction satisfy an individual customer’s ongoing needs through a continuous relationship. For example, a golf club that monitors swings to provide feedback for improvement, a medical monitor that allows patients more independence while monitoring them 24/7 and providing feedback and help as needed, or a car computer that provides route and driving suggestions to reduce risk every day and thus reduce premiums and insurers’ outlays.
Enterprises will need to acquire new capabilities to take advantage of principles that enable post-transaction relations. In particular, they will need to do the following:
Various enterprise functions— including product design and development, marketing, and IT— will need to collaborate to build these capabilities. The article, “CIO leadership in post-transaction relationships: IT’s role in customer engagement,” provides some insight into how enterprises can go beyond the transaction.
Products that go beyond the transaction have a strong service orientation, interact with the customer directly, and over time rely on a broad range of inputs, process lots of data, and become an adjunct to a person’s activities. They depend on a closed-loop system using sensors, real-time feedback, and analysis of consumption data. The notion of such capabilities is not new. But until now they have been difficult to deliver, given their need for constant communication, access to a large amount of data and data storage, and computing capabilities and sensors that can be embedded in devices people wear and carry without burden—and use for hours without needing a power source.
“It was too costly and impractical to understand how people used the product, where they used the product, and what they thought of it. But now because of always-on connectivity, a willingness to share personal data, and the growing capabilities of smartphones, it’s no longer too costly or impractical to understand granular consumption,” PwC’s Gagliardi says.
The technology barriers are collapsing and will continue to do so during the next few years. (See the article, “The Thing Stack: Technologies that guide customers to their goals,”) For personal devices, technologies include radios (cellular and Wi-Fi), local wireless (Bluetooth and various emerging companions), embedded sensors (cameras, microphones, light sensors, temperature sensors, accelerometers, GPS receivers, pressure gauges), and central processing units (CPUs) and processing and memory hardware.
There’s no single template for products that capitalize on post-transaction relationships. The approach will be industry specific and will depend on the nature of the product or service. Whatever the unique circumstances, the ubiquity of the technologies means the door is open to disruptive changes across design or product development and service, new business models, new sources of value, and industry change. All result in a proactively useful customer experience sustained over time. The following examples illustrate four blueprints.
Improved internal processes and product quality through on-site intelligence
By going beyond the transaction with its copiers, Konica Minolta improves product designs and makes post-sales support easier on customers and more profitable for the company. Konica Minolta has a highly configurable system for collecting consumption data directly from copiers. End customers experience fewer problems, faster service, and improved satisfaction. Konica Minolta gains insight into usage patterns, proactive alerts of potential issues that produce fewer service calls and more efficient stockpiling, and better information on product vulnerabilities and defects to allow changes to new units that reduce future service costs. And all of this data improves Konica Minolta’s processes.
“One advantage is being able to call a customer and tell them that they’re having issues with the machine and that the service rep will be there within the next several hours or tomorrow to address them. Typically, customers won’t even have been aware that they’re having issues,” says Jim Ingrassia, vice president of the solutions support division. It also helps engineers improve designs for future products, even versions of the same products yet to be manufactured. The result is a feedback loop that stretches from product design through customer service, providing a better experience to the customer, fewer post-design change costs, and a better understanding of customer usage by Konica Minolta. (See the interview with Jim Ingrassia.)
It also creates a different relationship between product engineers and their products, and between maintenance staff and the products they support. “We have transformed the overall experience [of technicians] by taking advantage of the tracking information and creating a seamless end-to-end experience for technicians,” Ingrassia says. Technicians use a mobile app to seamlessly make warranty claims, order parts, schedule visits, visit sites, and so on, boosting their productivity and satisfaction.
Although the big benefits are better product and process design and delivery, the customer also benefits in a sustained, ongoing way through reduced friction and an “it just works” experience that leads to long-term satisfaction.
Protecting the elderly through continuous monitoring
At The Oaks, a senior care facility in Orangeburg, South Carolina, semi-independent patients living in care facility settings or residential home settings are monitored with Wi-Fi-connected sensors so practitioners can see if someone is immobile for a worrying length of time, which could indicate a fall or fainting spell, or if they are moving around in the night, suggesting they are not sleeping. Such assisted-care facilities have long had buzzers that patients use to call for help, and their staffs have regularly performed in-person check-ins, but the connected sensors give the facility more immediate context and patterns that can reveal unknown problems.
James McGee, president and CEO of The Oaks, recalls a situation in which the sensors detected the patient moving around the apartment each night, yet she reported sleeping soundly. Something didn’t add up.
“We looked at her medical chart, and the doctor had prescribed a medication that can produce a side effect of sleepwalking,” McGee says. He quickly realized she was in fact asleep while moving through her apartment. He alerted the doctor, who changed the medication. “Once we did that, she was getting good sleep at night.”
The Oaks uses technology solutions from GrandCare Systems. “Our solution embeds several sensors in the living space to track movements around the house, movement on the bed, as well as sleep, medication, glucose, weight, and so on,” explains Laura Mitchell, vice president of business development for GrandCare Systems. The effect is to digitize everyday actions in the home.
There are many potential goals for such a service; one of them is to prevent emergencies. “We use this technology to try to predict something before it happens,” McGee says. The direct benefits to the resident are obvious: better, smarter care. And the facility is digitizing the consumption of services to reimagine the business process behind a service (healthcare, in this case) as a proactive, preventive service rather than a reactionary, crisis-oriented one.
Reinvention of a passive service into an active assistant
When businesses start to go beyond the transaction, it is not always clear exactly what the new value might be, but it is important to seek it. That’s what First Data is doing by exploring the notion of universal commerce.
“Universal commerce is an evolving concept that suggests movement toward a future where retail activities are seamlessly integrated into a single end-to-end experience—shopping, payment, marketing, loyalty, money management, and offline and online experiences,” says Dominic Morea, senior vice president of advanced solutions and innovation at First Data.
The payments processor is exploring how it might tap into customers’ transactional data to create new values for its retailing customers and their shopping customers. Morea cites several possible enhancements that, when combined, create a seamless experience for shoppers and retailers alike. (See the interview with Dominic Morea).
For example, by having access to the transaction data via First Data, customers and retailers avoid the hassle of dealing with paper receipts for returns, and discount redemption becomes automatic and less labor-intensive, both of which increase customer loyalty while reducing operational costs. Morea calls such capability “adding value at the basket level.”
Many companies already have some forms of loyalty and customer-account programs. Morea believes a larger improvement in customer experience and retailer insight would occur if companies could access a wide pool of customer transactions from multiple retailers. “We are creating the ability to see the consumer on a longitudinal basis,” he explains. For example, by tracking the products customers are exploring at online retailers and the products they have purchased, First Data may be able to help customers complete more transactions. First Data could flag when an item is available at a nearby shop (via geo-location capabilities in a smartphone) to encourage its purchase or, conversely, to suggest an online order of a product being explored but unavailable at a retailer’s physical outlet.
Reinventing the methods and processes of healthcare
Healthcare is possibly the industry that changes the most by focusing on helping customers understand and achieve their health goals. “What the consumer has now is a thermometer and Google. There is nothing in between,” says Walter De Brouwer, CEO of Scanadu, a startup developing a tricorder it expects to release in late 2013. De Brouwer envisions the convergence of health and smartphone to lead to a health phone that will create a health feed for each person. (See the interview with Walter De Brouwer.)
When it comes to health, everyone has goals. “Consumers want services that guide their behavior to habits that improve their health and well-being,” suggests Christopher Wasden, global healthcare innovation leader at PwC. By extending the capability of smartphones to include molecular diagnostics, using the camera in the phone as an imaging device, and using physical contact with the device to monitor vital signs, the phone will maintain a continuous health feed—a time series of the person’s vitals. Such data will be a big resource to help consumers with their health goals.
The center of gravity of care will shift. “The place of care must be shifted to the home—where it was in the first place,” De Brouwer says. He expects that will happen and that in the long term, a tricorder on a chip could be implanted in a person’s environment and that person’s medical records could be in their body, always with them.
The relationship with healthcare professionals today is transactional in nature, usually based on an illness or injury. “What she [the doctor] sees is a Doppler effect, a distortion of our health feed, since she does not have access to the full feed,” De Brouwer says. A health phone will capture the full feed, remove the distortion, and set the stage for everyone to advance toward the goal of better health.
For the infrastructure, the technologies include cellular and other wireless networks to handle the communications, the constellation of online cloud services to provide storage and computing resources, and a loosely coupled, modular software environment based on application programming interfaces (APIs) and inspired by the emerging web platforms.
On the corporate back end, the technologies include big data analytics to analyze relevant data sources, gamification for managing and refreshing customer engagement, and back-end systems, such as ERP and supply chain management. Previous issues of the Technology Forecast explore the technologies involved with gamification, APIs, social technologies, cloud computing, and big data.5
The enabling technologies available today to better understand customers’ behavior when they consume or use products and services can create an incredible opportunity to redefine value for customers and businesses. To realize that value over the long term, businesses must focus on helping customers achieve their personal goals by going beyond the transaction and building post-transaction relationships.
This new relationship requires a goal-oriented approach to product and service design. It starts with a reframing of the fundamental value proposition beyond the typical onetime, transactional approach of addressing a specific need or want. In going beyond the transaction, the purchase is not the end of the sales relationship but the start of a goal-satisfaction process that could last months or years, with plenty of opportunity for new insights, additional sales, and delight. Products and services that can help make personal goals actionable are in the best position to be chosen.
Businesses that fuse digitized consumption with an augmented experience in the service of the customer’s personal goals will find a new level of success. Thanks to the maturation of the enabling technologies, they can now begin to do so.
1 Allstate Insurance, “Allstate announces crowdsourcing effort to test usage-based insurance product,” news release, July 25, 2012.
2 Scott Bauer and Carlo Gagliardi, “Creating post-transaction customer value: How digital technologies are re-inventing value for customers after the sale,” PwC, 2013.
3 For more information, see http://www.studioroosegaarde.net/projects/#sustainable-dance-floor.
4 For more information, see http://www.studioroosegaarde.net/project/smart-highway/photo/#smart-highway.
5 For previous issues of the Technology Forecast, please visit: http://www.pwc.com/us/en/technology-innovation-center/publications.jhtml.