Sinch spoke with Andy Gladwin, head of mobile for Cheetah Digital, about how technology and channel strategy can solve critical challenges in the COVID era.
Q: Let’s begin with the topic that’s on everyone’s mind: COVID.
There’s a lot of short-term thinking going around; how are companies planning for long-term changes that may result due to COVID, particularly as it relates to delivering positive customer experience?
A: One of the most important things any enterprise strives for is frictionless engagement with their customers. And during the pandemic, when you cannot have direct in-person customer contact, mobile has been a great way to break through the noise of other channels.
Where there is so much ambiguity in the current environment, it’s incredibly important to use available technology channels to try and drive clarity. Whether it’s a supermarket confirming opening and closing hours, a shop clarifying the process customers must use when they visit in person, or a company sending updates about logistics, making sure your customer experience offers confidence rather than triggers questions is key. When customers have unanswered questions, it becomes a barrier to purchase.
Q: Sinch research uncovers deep generational divides in mobile behavior each year.
How do big brands design customer experience strategy to manage very different customer expectations by generation?
A: It’s important to avoid being reductive; for example, saying, “Statistically speaking, this is the channel you should use for this use case or for this demographic.” Instead, we make sure customers can engage with brands on the channels that are native and preferential to each individual. Companies need to be active in all those channels.
The second part is making sure that accessibility to preferred channels is apparent. By that I mean building “gateways” (i.e. ways to sign up for social and/or email) and preference centers to let customers choose how they want to communicate with you. The focus must be on creating an ongoing, frictionless relationship between a brand and a customer. Customers should not be forced down channels based on assumptions about their demographic. Preference is everything.
One interesting artifact of the pandemic is a surge in the use of text/SMS. If you want to send a message to any handset without the requirement for a smartphone, WiFi, or 4G, then SMS is that ubiquitous channel to engage with customers. It also has no technology hurdle because nearly all customers are familiar with it, whether they’re 17 years old or 70-year-olds. To summarise, SMS gives enterprises the ability to communicate ubiquitously with their customers, with a high level of confidence that a message will be read within a short period of time regardless of their location.
Q: What I find interesting about your response is that we often hear people saying, “Artificial intelligence will tell us what our customers want or don’t want.” But you’re saying, “No, just ask them. Let’s not overcomplicate this.”
A: Exactly. In the mobile app environment, you gain a huge amount of contextual and behavioral data to help you optimize what you’re going to say. So an example might be, looking at where someone is located and then choosing to promote flip flops or umbrellas, depending on what the weather is like as you send out promotions, according to where they may be in the States.
Applying those insights can drive much better customer experience by using the context of behavior to (1) see how it will impact the relevance of the communication, but (2) be able to communicate over any channel with a unified voice, based on the centralized view of that data. With a holistic view of your customers’ behaviors and communications across all digital relationships, you can then decide how you use the right channels and tone and content going forward to drive value, rather than just working in multiple silos.
So data is incredibly important. Using machine learning and AI models, you can optimize send-times, build personas, and have models applied for the propensity of customers to churn or convert. All of which can drive improvements with customer experience and engagement.
But to your question, it’s critical to have your customers share their preferences first; then you are using AI as an overlay to drive additional context and optimization.
Q: Another research finding: Consumers’ enthusiasm for messaging from brands is often higher than their current usage rates.
For example, 92% say they want to get notifications from their bank about potential fraud in their account, but just 31% use that service today. Why the gap? And what’s the right business strategy to close it?
A: There are two issues here. First, while there may be demand for these use cases, the software decision-makers may reside in a different area than those who see the value in it. For example, your security team says, “We absolutely see the value and need for fraud alerts to be sent out by SMS,” but the decision to send out alerts sits within a different division. We at Cheetah see that decisions are increasingly owned by marketing, where the legacy responsibilities of the marketer for promotions and branding have expanded to all touch points between customers and the enterprise.
Second, no one has calculated ROI for these messaging types … and I see this all the time. Until you start to look at things in terms of ROI, you won’t get sign-off and budget for it.
Say we are analyzing a restaurant sending a reservation reminder. We need to ask: What is the downside of people not showing up after having made a dinner reservation? What will it cost to send a reminder to each customer on the channels they use? What kind of effect will notifications have on no-shows? You are essentially building a business plan for using notifications.
Then, with this starting point, you can begin to ask, “How can we optimize and enhance those results?”
As part of that ROI calculation, companies must consider: What is the “addressable audience” on each channel? A company may want to start using WhatsApp for Business, Messenger, or RCS, but the addressable audience may be in the single digits or low double digits. Sure, you may want to show off your company as being first to market or talk about enhanced customer experience relative to your competitors. But in terms of rolling out large programs, it’s a lot of effort and energy to expend if the addressable audience is low. That’s why spending the time to build out the business case for these investments is key. And for new channels, which certainly hold notable engagement enhancements, there is a critical mass that must be met for the investment to be warranted.
Q: So far we’ve focused on high-utility messaging, such as fraud notifications and reservation reminders. How about promotional messaging?
How should companies strike the balance between offering utility versus promotions?
A: Promotional messaging’s success or failure starts with the introduction or the “value exchange.” That’s when you look at what the brand is offering that has value, such that a consumer says, “Yes, I would like to actively provide my consent to have ongoing communications with the brand and here is some additional information about myself to better improve our relationship from here on. This is what we call “zero party data,” which is not your customer data, such as name and address, but self-reported preferences, motivations and intent data.
When a consumer provides more depth about what they like, as well as details about themselves, then brands have the ability to provide much more contextual, impactful, valuable messages; they have the data to drive relevance and personalization based on the direct feedback and consent of the customer. The customer clearly understands the value of the exchange, and willingly shares their data based on this. It creates a very different relationship, one of trust and one that provides greater lifetime value for organizations.
Ready for more?
Hear from Andy Gladwin as he discusses SMS, third-party messaging apps, and conversational messaging on the Cheetah Digital podcast, Thinking Caps.
Find out what customers expect from brands on mobile based on a survey of over 2,800 consumers around the globe by downloading our latest report Customer experience in a transformed world.