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vol. 32 • No. 6 • June 2019

The Authority on Data-Driven Engagement & Operations

The Future of Mail Marketing ❱6

Mail to 2025 ❱ 8 Letters to the president ❱ 10 Does mail still drive post growth?


// 3 On the cover The Future of Mail Marketing

Vol. 32 | No. 6 | June 2019

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EDITOR Brendan Read - brendan@dmn.ca

Mail to 2025 › What could the future of mail look like? › The five-year future of mail fundraising

PRESIDENT Steve Lloyd - steve@dmn.ca DESIGN / PRODUCTION Jennifer O’Neill - jennifer@dmn.ca Advertising Sales Mark Henry - mark@dmn.ca CONTRIBUTING WRITERS Patrick Bartlett Aurangzeb Khan Greg Brown John Leonard Michelle Burrows Chandrashekar LSP Vito De Filippis Debbie Major Steve Falk Stephen Shaw Anthony Gadient Matthew Storm Mark Harrison Kesheyl van Schilt Kristi Kanitz Luc Vezina LLOYDMEDIA INC. HEAD OFFICE / SUBSCRIPTIONS / PRODUCTION:

302-137 Main Street North Markham ON L3P 1Y2

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Three critical reasons to embrace feedback

Phone: 905.201.6600

Mail Marketing

Fax: 905.201.6601 Toll-free: 800.668.1838 home@dmn.ca www.dmn.ca EDITORIAL CONTACT: DM Magazine is published monthly by Lloydmedia Inc. plus the annual DM Industry Guide. DM Magazine may be obtained through paid subscription. Rates: Canada 1 year (12 issues $48) 2 years (24 issues $70) U.S. 1 year (12 issues $60) 2 years (24 issues $100) DM Magazine is an independently-produced publication not affiliated in any way with any association or organized group nor with any publication produced either in Canada or the United States. Unsolicited manuscripts are welcome. However unused manuscripts will not be returned unless accompanied by sufficient postage. Occasionally DM Magazine provides its subscriber mailing list to other companies whose product or service may be of value to readers. If you do not want to receive information this way simply send your subscriber mailing label with this notice to: Lloydmedia Inc. 302-137 Main Street North Markham ON L3P 1Y2 Canada.

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Letters to the president

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Does mail still drive post growth?

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Turn map markers into marketing success

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Direct mail in the summer?

POSTMASTER: Please send all address changes and return all undeliverable copies to: Lloydmedia Inc. 302-137 Main Street North Markham ON L3P 1Y2 Canada Canada Post Canadian Publications Mail Sales Product Agreement No. 40050803

Twitter: @DMNewsCanada

Features ❯❯13

❯❯26

Innovations and dangers

Contact Management

❯❯ 2 The growing business case for video

❯❯ 3 Unlocking the value of contact centre data

❯❯ 4 Boosting customer support with AI

❯❯ 5

Attracting different consumers

How brands can get it right

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❯❯ 7

What comes next? June 2019

Excellent Execution

Customer Centricity

Your front is different than your back DMN.ca ❰


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Customer Centricity

Three critical reasons to embrace feedback A

Luc Vezina is the CEO of Vanilla Forums

(https://vanillaforums.com) the cloud community software helping hundreds of top brands provide a great community experience to millions of people around the globe. Luc is a B2B software-as-a-service (SaaS) veteran and is responsible for Vanilla’s vision and strategy.

n executive at a booming software company recently explained to me that he was hesitant about deploying a branded community on his web site because the customer feedback might get too hot to handle. Considering my position, one might think I was shaken by this admission. But it’s not the first time I’ve heard this. Negative feedback can be a tough pill to swallow, but it can result in great things for a business. Businesses need this critical input to determine whether customer expectations are being met and how satisfied customers are feeling. In fact, not collecting feedback is one of the biggest mistakes your business can make if you want it to be the best it can be. And if you don’t want to be the best, well, you probably shouldn’t be working in business. Opinions aside, here are three substantial reasons why feedback is vital to continued growth and success. 1. Reduces customer churn. Customer retention is about a business keeping existing customers over a period of time. There is no better way to increase retention and decrease the churn than proactively identifying hiccups before they become issues. There are several causes of customers discontinuing to use a business. They include customers feeling like they aren’t being treated well and being dissatisfied with a product or service. Feedback will help you understand why something isn’t working out for the customer, so provide a place for proactive critique. Keep in mind these buckets of discontent are both incredibly broad and as such can indicate a number of different issues that need to be taken into consideration. For example: ❯❯ What are the underlying factors about how customers perceive they’re being treated? Do they think they’re waiting too long for support? Do they walk away with the vibe that customer service representatives are rude? Do they feel like they aren’t being valued with rewards and incentives?; and ❯❯ Why are your customers feeling dissatisfied with your product? Are they experiencing technical issues? Is something missing during their interactions? Are there new features they wish you offered or tweaks that would improve their experiences? 2. Improves customer engagement. Customer engagement is often contingent upon feeling like being a part of something. That may include making it known that the customer has opinions that are valued and their contributions to the brand are taken seriously. Every business should embrace engagement because it: ❯❯ Develops customer loyalty; ❯❯ Finds brand advocates; ❯❯ Increases purchases; ❯❯ Creates hype around the products;

❱ DMN.ca

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Decreases churn and increases retention; and Connects with your customers in a personal way.

Now that we know why customer engagement is important, we have to ask ourselves, “How do they want to engage?”. This may sound oversimplified, but it’s pretty simple: Ask. There is no better authority to tell you what they want, and how their experience can improve, than your customers. Some businesses may be old school and think that the best and the most standard way to gather the facts is to distribute a survey. The truth is probably only 2% of customers will actually take part1 and 80%2 will abandon the survey before it is completed. That’s not a good sample to make sound decisions. To gain a truly representative picture of the customer, a high response rate is imperative. Consider this: more than 85% of Fortune 500 companies turn to an online community for clear insights into customer needs3. Give customers a platform to speak and be heard. Customers are going to be more engaged when they feel like the brand is listening. 3. Improves products and services. If you aren’t always striving for improvement, what is the future for your business? Change is inevitable. Customer feedback not only helps your business improve existing products and services it can also help with the development road map. Online communities are arguably the best environment to collect feedback for analysis and business decisions. In addition, they provide two of the top customer expectations: ❯❯ 90% 4 expect organizations to have online selfservice support options; and ❯❯ 73%5 want to solve product or service issues on their own. Today’s customers demand self-service options to find answers to questions and provide feedback on their terms. An online community is a multi-faceted solution to both meeting the demand for service 24/7 and providing a platform to share feedback whenever the customer sees fit. At the end of the day, businesses shouldn’t fear feedback, especially negative feedback. It helps shape your product and services to suit the people who actually use them. Accept the challenges that negative feedback presents and take action to improve. 1 Lindsay Willott, “Stats that will change the way you survey your customers”, MyCustomer, May 25, 2016. 2 OpinionLab, “Retailers: your surveys are making customers suffer”, blog, March 7, 2014. 3 Maïlys Reslinger, “10 Brand Community Statistics That Every Marketer Should Know”, Potion, blog, October 1, 2015. 4 Microsoft, “2017 State of Global Customer Service Report”, 2017. 5 Johnny Rosa, “5 Statistics To Know About The Future Of Customer Service”, CustomerThink, August 21, 2018.

June 2019


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// 6

Mail Marketing

The Future of Mail Marketing

Mail to 2025 By Brendan Read

Is the “past is prologue”, as William Shakespeare wrote in The Tempest? Or, on that vein, is “history bunk”, to paraphrase Henry Ford? Measures of both views might be the right answer, for while history may set the stage it does not anticipate the future, like of disruptive events and innovations: like the automobile, and yes, the Gutenberg press and the uniform penny post. Which leads to Canada Post, and mail marketing, both of which are at crossroads in more ways than one as we turn the decade at the end of this year. The Crown corporation has a new president and CEO, Doug Ettinger (see the article Letters to the president) who has taken charge at a time where the role of mail is being transformed in today’s digital always-on era. Here are what two of our industry leaders see where mail marketing is going over the next half-decade.

What could the future of mail look like? By John Leonard

L

et’s take a look at the future of direct marketing (DM), where evolving technology and the power of database marketing might criss-cross in the years to come. Some potential developments are in a direct line from our history and others are fun, blue-sky concepts. We were on a sales kick a few years back espousing the concept that direct mail was the “original digital”. Today with everything digital being so obvious: online targeted advertisements and pop-ups, that spooky recurring advertisement for my Kenneth Cole Shoes and even the abandoned shopping cart follow-ups in my in-box, it can be easy to forget that it all emanates from the use of data. And that direct marketers were the first to make use of the data being collected in the ‘70s. ❱ DMN.ca

Clunky as it was, database marketing is the origin of today’s marketing database machines, and the resulting behemoth companies (Amazon, Facebook, Google, et al.), as well as many of the concepts behind digital marketing being employed today. Simply put, database marketing is about collecting information about consumers’ habits, preferences, histories and demographics then using those data points to offer them products and services they would have a higher propensity (than the average consumer) to acquire. And it was the basis for DM and direct mail specifically. Then and now There is a direct line between what was started 40 or 50 years ago to today’s iteration of digitally driven physical (i.e. mail) and digital marketing. Now marketers have access to more data than ever and

that data can be presented in a variety of ways to create relevant communications for consumers. Brands and companies like Air Miles (LoyaltyOne) and Loblaw have created world-renowned loyalty programmes and a great deal of consumer value by using data to create completely variable marketing communications to their customer bases, driving consistent sales activity. Our current state is trigger marketing, whereby an action (online or offline) can be used to trigger a form of communication, such as e-mail or physical mail. Yet until more recently it was difficult to connect the digital world to physical mail. But with the implementation of automation and tools such as application programming interfaces (APIs) to directly connect networks and databases to production, most activities, if captured digitally,

can trigger a mail piece that contains information and even images specific to that person and interaction. The lead time to mail can be as quick as same day or even overnight in many cases. Drawing an arc into the future or what is possible, consider three things: one, data-driven (as always), two, timeliness (or timing) and three, personalization/engagement. We are already making use of data-driven, but what if we could use real-time modelling in a sort of artificial intelligence (AI) fashion to create pieces on the fly? Pieces that not only provide personalized relevant information from the data, but where we could fill the “white space” with more value for the recipients. A product that is in-market and gaining traction is Canada Post’s Postal Code Targeting (PCT). Conceptually it affords marketers the opportunity to target June 2019


// 7

Mail Marketing consumers in a marketer’s target audience, while saving the postage and production costs of those that are not in the target audience at a very attractive cost. One of the unique aspects of this “product” is that it targets down to a postal code level and allows the marketer to personalize to the postal code and suppress individuals within the area. This is an excellent use of Canada Post’s data that will no doubt evolve over time as more mailers and service providers use it and figure new ways to leverage the intelligence. As more data is collected, and AI is deployed more extensively in database modelling, we will see even more driven by the data. What is considered timely is rapidly changing. The timelines seemed to have been halved every decade for the last 30 years, which is hand-in-glove with society’s expectation of having everything now. Technology has been great at keeping up with this exciting

aspect of the industry. As a service provider it’s always a pleasure when we can solve a client’s challenge. We are in a time when the ability to react to customers is very quick. Moving to the future As previously mentioned, trigger marketing can be same day in the mail. What if, in the future, we could use this timing, coupled with predictive analysis, to market to people just before they might need a product? In the past this was done on a generational segment of demographic level, but what if it could be done at the level of one? Engagement can be an exciting area that delves into technology and creativity. What the industry might be able to do in the future? What could a mail piece look like if paper could replicate video? In the old days there was lenticular (I still have a lenticular postcard from my visit to the CN Tower in 1977!) But what if short videos or even GIFs could

be contained on paper? As 3D printers become more prevalent and able to create better details, think about what kind of depth we could create, or about the pop-ups and dimensional products could be created? What if these could be data-driven so that a postcard, with depth, could be changed for each recipient? Another new and exciting way of engagement is tracking, confirmation and connecting to another medium. An oftoverlooked aspect of postal transformation was the installation and implementation of new scanning hardware across the country. While this is boring operational stuff it might afford new products that connect the post with the sender and recipient. Also, think of how you track a package, but in a mail sort of environment? What if, for a cost, you could track a mail piece and follow-up with a call or e-mail upon receipt? What if, blue sky here,

an advertisement on TV, a mail piece and a follow-up call could be co-ordinated? While it feels a bit like some of the images from Blade Runner, much of the technology is available now, but not connected. Really, it wasn’t that long ago that we marveled at the devices in Star Trek. Yet now a communicator, a tricorder (of sorts), a translator, replicator (3D printer), tablet and even natural language queries (speech-to-text) exist, many simply on our handheld devices. Think big! John Leonard is vice president sales and

marketing, Cover-All (www.cover-all.ca). John has an extensive background developing, acquiring, on-boarding and servicing clients in data-driven environments. He also has a long history of involvement on education, having developed and administered seminars on mail for the Canadian Marketing Association (CMA), authored a handful of books and was an active member of the CMA’s Postal Relations Committee.

The five-year future of mail fundraising By Kesheyl van Schilt

W

ith 2020 just around the corner, we can’t help but think about where mail marketing is headed and what it will mean for the fundraising industry. But we know one thing for sure: direct mail is not dead. Nor will it be in the next five years. That said, the landscape continues to change rapidly. We can no longer expect a two-way exchange with direct mail anymore. We are past the “mail in and mail out” approach, and if you’re basing your results and key performance indicators (KPIs) on that alone, your results won’t be an accurate picture of what is happening in your programme. We can’t reach our audience through one channel, so if you aren’t already, you need to start meeting your donors wherever they are, including the mail. (If you aren’t where your donors are, you can bet someone else is). Here’s what we think things will look like for the next five years in direct mail fundraising. June 2019

1. Integration is key (and means higher lifetime value). Don’t get us wrong. Direct mail still a major source of revenue for many charities and will continue to be in the next five years. But if you aren’t integrating it with other channels (think: diversifying your portfolio), you are leaving money on the table and may see diminishing returns. Our research shows that a donor who interacts in multiple ways with a charity has a higher lifetime value: 72 times greater than other donors. Additionally, they will give 18 more times in their lifetimes and will stay on your file 11 years more than your average donor. Integration is key to surrounding the donor with your message and it allows the donor to have multiple options on how to make their gifts. We think it’s safe to say fully integrated campaigns, with direct mail in the mix, are both the now and the future. 2. Make it personal, or not at all. The value in direct mail is that your donor will receive a personalized and physical piece for them to engage

with, something that is theirs and theirs only. Gone will be the days of high-volume junk mail. People don’t have the time to read it, nor will they want to. Mail will need to be even more personal and relevant to the people receiving it. It will need to be entertaining to stand out. Think about it: what is different about your mail pack? If you send your donors something that is personal and reflects them as a person, all while making them feel valued and unique, we can guarantee that they will want to open your package and actually take the time to read it. Mid-level giving programmes are already benefitting from this approach. The technology is now at a place where creating highly personalized and content-relevant direct mail is cost-effective.

success of direct mail (or any other channel) in a multi-channel world? We look at behavioural metrics of our targeted cohorts across all channels. It’s not just how your 13-24 months donors did in the mail, it’s how those donors performed overall in that time period. Looking at how cohorts perform when single channeled (direct mail only) versus multichanneled (direct mail + e-mail + social, for example) will ultimately provide better metrics to plan your programmes in the future. Looking ahead, we believe direct mail will always be an important part of the fundraising mix. There is something about the experience and value in opening a piece of mail, as long as it is personal and relevant. Kesheyl van Schilt is president and CEO,

3. Change the way you look at results. Donors are migrating to digital channels, due to their ease of use. But this migration is making it more difficult to report on their behaviour and accurately measure results. So how do we measure the

Blakely, Inc. (https://blakelyjourney.com) and a fundraiser with over 20 years of experience in the sector. Kesheyl’s discerning client perspective brings a sharpened focus to strategic planning and development for her clients, ultimately moving the needle and raising millions of dollars for amazing causes. DMN.ca ❰


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Mail Marketing

The Future of Mail Marketing

Letters to the president Dear Doug, Congratulations on your appointment to this important and challenging role. For the last couple of CEOs, the successful candidates came from outside the company and, in one case, outside the industry, resulting in a long learning curve. You have spent time at the company and have had an opportunity to learn more about it and the industry, allowing you to hit the ground running. We applaud the Board’s and Government’s choice. The challenges facing Canada Post are significant and can be all-consuming. There is declining revenue in Lettermail and rising costs. The relationship with CUPW [Canadian Union of Postal Workers] is difficult and, despite the best wishes of the Government, is not easily managed. The Government has also limited the commercial freedom of the corporation through moratoriums on the closing of rural post offices and the conversion of residential delivery to community mailboxes. Canada Post has been able to benefit from the growth in parcels by effectively leveraging its mail delivery infrastructure. The density that mail provides in delivery routes provides a cost structure that cannot be matched by competitors, including Amazon. An important objective for you has to be finding ways to sustain the mail channel and direct marketing mail provides the best opportunity to achieve this goal. It remains an effective channel with its unique characteristics, providing marketers with a positive return on investment. Doug Ettinger, president and CEO of Canada Post Corporation.

By Brendan Read

D

oug Ettinger became president and CEO of Canada Post Corporation (CPC) in March 2019 after serving nearly three years as its chief commercial officer and as a member of the senior executive team. He has over 30 years experience in the consumer packaged goods industry, including with brands like Coca-Cola, Nestle, Parmalat and Canada’s famous Ganong chocolates, leading sales, marketing and product management. Here are open letters to Mr. Ettinger from several of our prominent readers.

❱ DMN.ca

However, mail is changing, and must adapt to this omnichannel world. The average size of a mailing is declining as targeting and personalization better define a marketer’s best prospects. Consumer behaviour in digital channels is driving relevant, highly productive mailing campaigns. The industry needs to work together to enhance the technology and processes that allows these types of mailings to occur seamlessly and programmatically. It is important to avoid repeating the mistakes of the past. Canada Post should not be trying to go it alone, but rather look to expanding and strengthening its partnership with the industry. We believe Canada Post can successfully innovate by engaging with the industry and working with us to build the services, technology and processes to enable the changes in marketing and mail. The industry is waiting to engage and brings real value to the table. Doug, we wish you much success in your new role. NAMMU looks forward to deepening its partnership with Canada Post and working to foster innovation and growth in mail.

Executive Director, National Association of Major Mail Users (NAMMU) http://NAMMU.ca

June 2019


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Mail Marketing

Dear Mr. Ettinger, Congratulations on your new appointment as President and CEO of Canada Post. Hi Doug, I’m sharing my perspective from the users of the direct marketing side of the business. I’ve earned my entire adult livelihood by producing mail and parcels that travel by the Post. I’m a big fan of the mail. Your printed mail channel provides valuable communications opportunities in many circumstances, despite the erosion of market share due to the wave of digital channels. But we users and producers of mail have been challenged by two main threats in my view. Firstly, the ongoing uncertainty caused by postal disruption and secondly, the complexity of doing marketing with the mail. If you could focus on these two points, I think we have a much better chance of us being a robust part of the future of the CPC. These are not external forces affecting your business model, but internal ones that need to be addressed to meet your customers’ expectations. In this era when you can deploy a Facebook or Google AdWords campaign or get an online mortgage approval within minutes, dealing with CPC is a slow and burdensome process. You should address the paperwork, forms and departments that are involved in starting and onboarding new clients. Being a first time or returning client is brutal. It feels like applying for a passport in 1938. I can imagine a simple online form: “Want to start mailing? Enter your name and e-mail and we will give you an account, postage rates and a list of suppliers in your area who you might call to get your mail rolling”. Compare that with the current 10 days to get set up and mailing for new clients. I’m not sure how many CPC employees or departments are involved but it is too slow and complicated. I don’t need to say much about the labour disruptions except to mention that both sides, and all the people and organizations downstream who support this industry from printers, trucking, data companies, charities, and to business mailers and advertising mailers, all suffer from the unpredictability. It shouldn’t really surprise you to learn that many direct marketers and mailing companies are choosing other channels or getting out of the business; the Internet does not go down unexpectedly for weeks during the busy season. Digital promotion channels are agile and dependable. Users of your channel don’t want to plan for “potential” disruptions. It takes months to plan a mailing project. Mailers cannot pivot and it’s costly to do so. Mailers choose the dependable route and that is often an online option where they say goodbye to printed mail forever. Let’s try to avoid that. On behalf of all of us who’s livelihoods, businesses, charities and aspirations for the future depend upon a reliable and client-focused mail service, I wish you all the best in your new role.

At the beginning of 2019 my company, Data Direct, attended the Canada Post National Sales Convention. There were many vested marketers in the room. We talked about many concerns and ideas, and I would like to share several of them with you. Observations ❯❯ As providers of mail to Canada Post we do what is called MOBO (mailed on behalf of). We do this to ensure that the Canada Post sales representative gets the volume related to the client they serve. But we wonder why Canada Post does not MOBO for parcels so that the Canada Post sales representative gets credit for the parcel volume as well? This would ensure a continual working relationship between the Expert Partner and Canada Post; and ❯❯ We are observing trigger mail and the power of it. Trigger mail as it implies triggers an action. This is a trend that will increase. Go online and visit a site and ask for information and trigger an e-mail or a piece of mail. Concerns Whether you are a provider of mail or a user of mail we are concerned with Canada Post heading into more negotiations with the union and the impact that may have on business. We as an industry are still struggling from the impact of the last contract negotiations. Opportunities There still remain a lot of companies that are unsure of the value of the data and the power of direct mail. There is an opportunity to continue to take the lead in education regarding this. Canada Post does a great job of educating the marketplace and holding forums to advance direct mail with events such as Think Inside the Box. Recommendations ❯❯ It is hard to attract new talent to the vendor side of the equation. Much of the new young talent do not view this as a place to consider working. We look to Canada Post to help in assisting in educating and attracting young people to the vendor side of Direct; and ❯❯ Collectively as an industry we would like to see the charities and the not-for-profits have their own postage category. Canada Post volumes would increase, and the charities and not-for-profits would garner more donations for the increase volumes of mail. Sincerely yours, and we look forward to working with you.

President, Prime Data https://primedata.ca

June 2019

Debbie Major President, Data Direct www.datadirect.ca

DMN.ca ❰


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Mail Marketing

The Future of Mail Marketing

Does mail still drive post growth? By Mark Harrison

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or the past decade the International Post Corporation (IPC)’s IPC Global Postal Industry Report (GPIR)—published every November—provides an analysis of the performance of 50 postal operators worldwide and leading integrators (see box). Much has changed since the first edition was published back in 2009. The world economy has steadily expanded after recovering from the global financial crisis. The iPhone has revolutionized the world of mobile, while social media platforms like Facebook and Twitter have changed how we communicate. Meanwhile e-commerce has grown rapidly, with Alibaba and Amazon together now reportedly accounting for more than one in every three euros spent online. The postal landscape has also changed dramatically. Postal operators (posts) are delivering far fewer letters and many more e-commerce packets and parcels than they were ten years ago. Competition has intensified as mail markets have been liberalized and the parcels market has become more vibrant. Posts have honed their commercial focus as private ownership has increased: ten posts are now listed on local stock exchanges. The industry has also become more diversified and developed an increasingly strong focus on e-commerce logistics. More admail, less regular mail This year’s edition of the GPIR confirms that despite significant structural change, the postal industry remains resilient. Industry revenue reached (euros) €392.3 billion in 2017, up €7.2 billion on 2016 results. Mail (letters, flats and packets) remains the industry’s largest segment, but it declined by €3.2 billion on ❱ DMN.ca

aggregate, as structural volume declines in letters were only in part offset by price increases and growth in lightweight e-commerce packets. However, many posts achieved volume growth in 2017 in advertising mail (admail). It represents the best performing segment for two-thirds of posts analyzed in the 2018 edition. Given that admail remains tied to economic growth in many markets, improved business sentiment has helped increase advertising spend across media channels. For example, Österreichische Post’s unaddressed advertising mail volumes grew 5.2% in 2017; it cited new pricing models and overall economic growth in Austria as key volume drivers. The admail trend is also occurring in Canada. In 2017, Canada Post delivered three billion domestic transactional mail items, generating €1.8 billion, or 32.1%, of its total revenue. With personalized admail services complementing other media for businesses, in 2017, Canada Post saw revenue for its neighbourhood mail service grow 6.9%. Canada Post is one of

the posts, along with Norway Post and Royal Mail, which have seen volumes of unaddressed admail increase the most. Parcels, logistics power higher revenues At the same time, parcels and logistics were the two engines of industry growth in 2017, up €9 billion and €1.5 billion respectively according to the GPIR; both segments were fuelled by e-commerce and now account for over a third of industry revenue. E-commerce will continue to drive the growth of the postal industry. By some estimates Internet retail will be worth €2.5 trillion in 2022. The share of e-commerce in total retail is increasing and estimated to reach 14.1% on average by 2022. In advanced e-commerce markets, the online share of total retail sales already exceeds 20%. In Canada that share is only 8%, though it is expected to be one of the fastestgrowing e-commerce markets over the next few years1. Parcel business already accounts for almost 45% of Canada Post’s revenue.

between admail and e-commerce. The IPC Cross-Border E-Commerce Shopper Survey, which surveyed over 30,000 consumers in 41 markets worldwide, showed that close to 50% of frequent online consumers had received an admail piece from an e-retailer. Of those respondents who received admail from e-retailers in the past year, 41% made an online purchase as a result of it. In Canada, 37% of online shoppers received admail from an e-retailer and 43% of them made an online purchase as result. As consumers respond to effective admail pieces and continue to shop by e-commerce (like using their voice assistants to place orders) it is not unreasonable to expect this transformation of posts to continue. Which is good news financially, enabling them to fulfil both their letter handling as well as their advertising and parcel-carrying roles. Mark Harrison is head of markets,

International Post Corporation (www.ipc.be). 1 Euromonitor International, “What’s New in Retail: Emerging Global Concepts”, December, 2017.

Admail/e-commerce synergy A direct correlation is also found

The reference on the global postal sector To stimulate postal transformation through market research and strategic thinking, IPC’s Marketing team produces a range of reports analyzing industry and operator performance. Now in its tenth edition, the IPC Global Postal Industry Report (GPIR) continues to provide an in-depth review of the postal sector. It features 72 charts tracking overall market trends and detailed performance comparisons across 50 postal operators from Asia Pacific, Europe, North America and BRICS (Brazil, Russia, India, China and South Africa) countries, as well as integrators UPS and FedEx. With 12 deep-dive articles and timeline of key events, the report also keeps on top of market news, hot topics and disruptive forces. The IPC GPIR is the sector’s most comprehensive, holistic and in-depth source on postal industry trends and performance.

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Mail Marketing

The Future of Mail Marketing

Turn map markers into marketing success By Greg Brown

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ccurate address data is imperative to running a business. Without it, you can’t ensure timely deliveries, can’t bill and get invoices paid and can’t stay in touch with customers. However, did you know address data can also be used to deliver great insight so you can market even smarter? But the caveat is that the addresses have to be clean and accurate. Let’s discuss some helpful marketing tools that you can use to leverage the power of the address. When you have physical addresses (locations), you can develop business intelligence that relates geographic contexts to business data. One application that is useful for this is geocoding. Geocoding is the process of turning physical addresses into precise latitude/longitude (lat/ long) coordinates. The geocodes can be visualized on a map or loaded as input for spatial analysis, so you can make smarter choices regarding targeted marketing. But how can you convert an invalid address into a real geocode? Bottom line: you can’t. What you’ll get is a misplaced marker. Before location analytics can unlock deep insight, you must determine if your address data is accurate. That’s where address verification comes in; it’s the first step toward key findings. Global address verification solutions, like Melissa’s, fix spelling errors, standardize international addresses to country specifications and complete addresses that have missing or invalid components. Once the data is verified, geocoding can be applied. The benefits of such accuracy and precision range from mapping, to business intelligence and to cost reduction and beyond. June 2019

Smarter marketing Once you have verified lat/ long coordinates, you can place the geocodes on a map for visualization, market analysis and strategic planning. Plotting your customers on a map helps you recognize geographic patterns that normally go undetected. That information can be crossreferenced with key demographics and used to develop targeted marketing campaigns for clusters of prospects that have similar attributes.

As you can see, placing geocodes on a map reveals clusters of customers that are not apparent from a list of addresses. You can then find neighbouring areas that match your customer demographic.

Geocoding also makes it easier to add key location intelligence to your customer database, such as demographics, psychographics, property data and business firmographics. The more you know about your customers, the better you can determine purchasing behaviour and tailor your messaging for improved response. Additionally, if you have a database of customers and prospects from all over the place, and you want to direct them to your nearest store location, geocoding will help you group them by distance or radius. You can then use variable printing to personalize your direct mail campaigns and promote storespecific offers. Driving bricks-and-mortar sales Another benefit of accurate

location information through geocoding is ease of shopping. Geocoding can power retail store location and local search lookups to help customers quickly and easily find the location nearest to them. This is a great way to drive foot traffic from your web site to your bricks-and mortar store and increase sales from impulse buys. Conversely, geocoding can help you identify an area where you might want to open a new location, distribution centre or sales office based on underserved clusters of customers. It can also help you more precisely target your direct mail campaigns to generate the most profits from your outlays. Geofencing is a new way to increase foot traffic and sales. Here’s how it works. GPS signals from customers’ mobile devices (and tablets if turned on) are used to decipher their exact locations. The lat/long coordinates are converted into addresses through reverse geocoding and then crossreferenced against nearby store locations. When a customer enters the fenced area—or most-likelyto-buy zone—that’s when you can prompt them to visit your store by hitting their phone with real-time geotargeted text marketing messages. What to look for When choosing a global geocoding tool, there are a couple factors to consider. These are international coverage and exactness. Let’s review one of the leading geocoding tools, Melissa’s GeoCoder, to understand how geocoding tools work. GeoCoder provides real-time geocoding for more than 240 countries worldwide. It can seamlessly and simultaneously work with Melissa’s Global Address Verification service to ensure standardized, accurate

international addresses. Melissa’s address verification is SERP Certified and meets the stringent Canada Post test. It taps multisourced data and deep domain knowledge to provide the most accurate results. This helps power GeoCoder: providing the best matching and fastest processing. Successful geofencing depends on accurate reverse geocoding. Reverse geocoding requires excellent coverage in your address table to be able to convert the geocode to an address. Melissa has more than 30 years of address data quality expertise and multi-source reference data from postal entities like Canada Post, USPS and other reliable sources to provide coverage and accuracy that’s unmatched in the industry. Businesses today face both disruption and stiff competition as customers demand more relevant marketing and personalized customer service. Combine the power of the address with location intelligence tools like address verification, geocoding and reverse geocoding to gain more insights about customers, precisely target direct and digital marketing programmes and bring more customers to your site or through the doors. After all, location, location, location could be the competitive differentiator your business needs in today’s tough environment. Greg Brown is vice president of global

marketing, Melissa. Greg powers Melissa’s brand management, business-to-business, Internet and e-mail marketing strategies. He is an ANA-certified Marketing Professional; having worked for more than 15 years on both the client and agency side, he brings a unique perspective to developing creative, resultsoriented marketing programmes to acquire and retain customers. For more information on GeoCoder, please visit i.melissa.com/ geocoder or call 1-800-MELISSA. DMN.ca ❰


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Mail Marketing

The Future of Mail Marketing

Direct mail in the summer? By Kristi Kanitz

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ummer tends to be a time that everyone slows down and takes time off. This is true for businesses as well. With employees taking vacations and sales dipping, many businesses question the need for summertime advertising. So, should a business spend the time and money to advertise in the summer of sun and fun? You would be surprised to know the answer is “yes”! Here are some of the many reasons! 1. Captive audience. When consumers aren’t out enjoying the weather, they are spending more time in their airconditioned homes. This means a relatively captive audience for your messaging. And since your competitors are likely taking a break, advertising competition is not as heavy in the summer. This makes it a great time to get your brand front and centre. That isn’t to say direct mail marketing to this audience is always easy. People can be more distracted as the summer starts, so you need to work to get their attention. However, attitudes are more relaxed so many consumers will tend to make purchases without as much research. To use this to your advantage, put your information

within easy reach in your direct mail piece. There are more impulse purchases and many prospective purchasers are out and about, from tourists looking for gifts or unique finds to locals stocking up on essentials at bricks-and-mortar locations. Place products or services attractive to these groups prominently in your advertising. Consumers also tend to spend more on themselves versus the winter when they tend to do more shopping for others1, so keep that in mind as well. 2. DIY and hobbies. Many folks tend to plan projects in the better weather, from do-it-yourself (DIY) inside and outside the house to starting new hobbies. Home repairs and renovations are most often scheduled in this season. See if you can tweak your advertising to tie into this, for example a spa/fitness facility could advertise their services as a way to deal with reno-stress. Local stores and restaurants can promote delivery service as a benefit to homeowners too tired to cook after finishing endless yardwork. 3. Families with children. This group tends to have the most disruptions in the summer. Routines are displaced by playdates, sports and other

activities so shoppers tend not to be as organized. A U.K. study shows 60% of consumers with children change their shopping routines for essentials in the summer. They tend to shop in larger quantities less frequently (probably to avoid having to take the kids!) and saving money is a priority2. If families with children form part of your target demographic, be sure to keep the advertising focus on easy purchase options and lots of attractive deals. So, what are people shopping for in the summer? Seasonal items are obvious: furniture and equipment for outdoor activities and gardening, vacations and convenience food and drinks, as well as things to keep the kids entertained and active, such as camps and amusement park tickets. There is a higher level of consumables purchases: vv think sunscreen, snacks and propane for the BBQ. There is less planning and structure and more reacting based on factors such as the weather, activities and vacations. Ads, mailers, marketing that works With these factors in play, how does the savvy marketer grab the attention of prospective

customers when they are busy with the summer? Here are some suggestions tried by advertisers: ❯❯ Summer-themed ads (or contrast by making it winter-themed) to showcase the warmer months and focus on how your products can make the summer better. Offer unique summer deals; ❯❯ Die-cuts with fun and funky shapes to stand out in the mailbox; ❯❯ Advertise local events to connect your business with the community and add to the shelflife of your printed piece; ❯❯ If your company isn’t summerrelated, partner with one that is. For example, a car dealership could offer golf packages at a local course as an incentive for test driving; ❯❯ Share a recipe related to the summer: it will make your company relatable and customers are more likely to keep the piece; ❯❯ Focus sales on the holidays (Canada Day, Civic Holiday, Fête nationale, Labour Day) and backto-school; and ❯❯ Connect with life events that tend to happen in the warmer months: graduations, vacations and weddings.

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Samantha O’Neill

Chief Marketing Officer for Canada Sun Life Financial is pleased to announce the appointment of Samantha O’Neill to the company’s Client Experience Office Leadership Team in the role of Chief Marketing Officer, Canada. In this newly created role, Samantha works with Sun Life’s Canadian businesses and the Global Marketing functions to develop and deliver a holistic Client experience. Samantha joined Sun Life in 2017 and brings twenty years of extensive Client insight and expertise to the team. She is a passionate leader dedicated to creating memorable Client moments. Sun Life Financial is a leading international financial services organization providing insurance, wealth and asset management solutions to individual and corporate Clients. Sun Life Financial has operations in a number of markets worldwide. As of December 31, 2018, Sun Life Financial had total assets under management of $951 billion.

❱ DMN.ca

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Features

Attracting different consumers By Vito De Filippis

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he rise of discount brokerages, direct banks and the emergence of robo-advisors has fragmented the financial services industry. To protect their market share, firms that were once devoted to providing face-to-face client advice, or advice seekers, have established new divisions to serve self-directed investors. This two-pronged approach is shaping their product offerings and marketing strategies. Financial institutions will want to separate profiles of these two distinct consumer types. But what if the most attractive—and lucrative—market is a hybrid blend of self-directed and advice-seeking consumers? At some level, the notion that there are consumers who seek out advice and manage part of their portfolios may not seem like much of a surprise. Advisors, for instance, have long known that some of their clients are reluctant to entrust them with their full portfolios, even though doing so is essential to provide them with comprehensive financial plans. What is surprising is how large this group of “hybrid consumers” is in Canada. After analyzing Canadians (excluding Quebec) over age 18, we found that almost a quarter of the market falls into this camp. To put that into perspective, that is only slightly behind the number of self-directed investors we found, while just under half of the consumers we studied rely on professional financial advice. Our analysis also found that hybrid consumers are quite distinct in terms of their financial needs. Their financial profiles and their social values suggest they respond to different marketing messages and product pitches compared with the other two segments. More importantly, they are also more willing to pay for advice. Financial institutions need to determine how many of their existing clients fall into the hybrid consumers bucket, as well as learn who they are and where they are concentrated so they can engage them appropriately. June 2019

Where to find Advice Seekers, Self-Directed Investors and Hybrid Consumers

Copyright ©2019 Environics Analytics. Environics Analytics acquires and distributes Statistics Canada files in accordance with the Government of Canada’s Open Data Policy. No information on any individual or household was made available to Environics Analytics by Statistics Canada. PRIZM5 nicknames are registered trademarks of The Nielson Company (U.S.) and are used with permission.

Target group map of Toronto and the surrounding area by dissemination area

How do you create the profiles? Knowing that this group of hybrid consumers exists is one thing but identifying and locating them is what matters most to the financial sector. To identify them, along with Advice Seekers and SelfDirected Investors, we began by scouring several of our proprietary databases to select variables that would delineate the different types of behaviours representative of our three segments. We looked at variables from MoneyMatters Powered by Canadian Financial Monitor, which tracks consumer behaviour and how they interact with financial institutions. Also, at Opticks eShopper Powered by AskingCanadians™, which includes data on online researching and purchasing habits for financial products. We then profiled them using PRIZM, our comprehensive segmentation system, and looked for patterns to assign those variables to one of our three custom segments. Finally, we layered on additional demographic, behavioural and psychographic data to flesh out the

segments and describe where they live, as well as understand the type of messages and the most effective channels to engage them. What are the financial differences? Our analysis found that their banking and financial habits are quite distinct. Advice Seekers, the largest of the three segments, tends to favour credit unions, which may have to do with a large number of these consumers living in small towns and rural parts of Canada, where credit unions tend to be more accessible. This segment seeks out advice by choice. With below-average household incomes and a large proportion entering retirement, they do not have large investment portfolios or savings that require complex advice. Self-Directed Investors, in contrast, have higher incomes and larger debts. Typically, they lead busy lives, so they prefer the speed and convenience of direct banking and discount brokerages. While they have above-average household incomes, they are in life

stages where most of their equity is in real estate instead of liquid investments, like stocks, bonds, exchange-traded funds (ETFs) and mutual funds. While these consumers are aspirational, they are still establishing themselves, so saving money on banking charges and management fees is valuable to them. Their real estate holdings may also help explain their high debt levels; many of them are concentrated in major urban areas where home prices have been increasing in recent years, so they need to seek out large mortgages with competitive rates. The Hybrid Consumers group is the highest value segment. They use both discount and full-service brokers at high rates and tend to spread their wealth across all types of products and services. They have an average household income of $131,284 and an above-average net worth. The consumers in this segment tend to hold lucrative jobs in finance and business. But what truly sets this group apart from the other segments has to do with why they are DMN.ca ❰


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Features interacting with their financial institutions. For starters, they are more likely to hold a diverse portfolio of investments that benefit from professional financial advice. However, while financial advisors manage some of these investments, Hybrid Consumers opt to maintain their less-complex holdings using self-directed investing tools. They are more likely to apply for credit cards and insurance online and they are more likely to have an account with a direct bank, indicating that they may be parking money where there are better rates available or trying to avoid fees for everyday banking. What media/messaging will resonate? Through the understanding of their lifestyles, media and communication habits we can better understand what type of messaging may resonate best, and hence provide a more effective message. Self-Directed Investors, for instance, rely on their mobile devices. They buy products from well-known brands that allow them

❱ DMN.ca

to express their style and status. As brand identity is important for this segment, a financial institution with a strong reputation is more likely to win these customers’ loyalty. Given their reliance on the Internet, financial marketers should focus their efforts on social media messaging or e-mail offers for this group. Their high incomes and high debts make them ideal targets for marketing focused on deposits, investments and lending products. Given their appreciation for fast and convenient options, financial institutions may want to ensure that there are no barriers to opening new accounts or accessing existing ones. Advice Seekers are on the opposite end of the spectrum. They prefer traditional media—TV, radio and newspapers—and they tend to watch sports, reality shows and entertainment news. These older families have embraced a strong sense of community. As such, they frequently read community newspapers and often respond to advertisements within those papers. Given the older

demographic of this segment, financial institutions may want to target these consumers with messages about how they can secure their financial futures. Hybrid Consumers have diverse media consumption habits—they are heavy users of the Internet and social media— but they also like to read newspapers. Since they are wealthy and more likely to hold managerial jobs in business and finance, they are willing to pay more for technology that saves them time. Accordingly, financial institutions should devise solutions that capture their attention and offer convenience. For this group, it’s all about asset management and how they can grow their wealth. Notably, they have a very different mindset from the other two segments. They feel compelled to question everything around them and avoid the status quo. That, combined with their desire to control their financial security and their willingness to try new things, helps explain why they choose to spread their finances around between direct

banks and traditional advisors. Because this group is highly concentrated in urban centres they often rely on transit, which suggests that placing ads around the city on bus shelters and in subways may be an effective way to reach this audience. They are also more likely to enjoy a night out and take in a concert. Financial institutions hoping to boost their brand awareness and align their brands with their consumers’ value could consider sponsoring such events or incorporate images from them into their messaging. Similarly, Hybrid Consumers index high for yoga and Pilates, so producing ads that send a message of a healthy and active lifestyle may also help appeal to this elusive group. Whether you want to learn more about your existing clients to determine your wallet share or find better ways to engage them, data and analytics can help you find the answers you’re looking for. Vito De Filippis is a leader in the finance

practice at Environics Analytics.

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Features

What comes next? By Stephen Shaw

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he future has a nasty habit of creeping up on businesses when they least expect it. The corporate graveyard is filled with infamously complacent brands which ignored the storm warnings. The reluctance of most companies to conceive of a future much different from today narrows their thinking to proven ways of making money, even in the face of disruption. How else can you explain BlackBerry ignoring touchscreen technology? Or Blockbuster failing to anticipate the streaming revolution? Or Nokia undervaluing the importance of software? All textbook examples of temporal myopia, so fixated on the current reality that they failed to see what comes next. That myopia is suicidal when you consider the velocity of change. Society is entering the early stages of a “Fourth Industrial Revolution” which will usher in an age of ubiquitous connectivity. Massive aggregation of data from connected devices, combined with machine learning, will transform the functioning of society. This new hyper-connected world will have a profound impact on how people behave and how value is created. It will obliterate current business models. And it will affect every company, large or small, in profound ways: how they market themselves, create new products and take care of customers. Every business needs to be thinking now about what that future could look like. But most businesses are poorly equipped to think about the future, never mind plan for it. Futurism is often seen as a waste of time by short-sighted companies afraid to tamper with what they know works. As noted business strategist Gary Hamel pointed out, “More often than not, companies miss the future not because it was unknowable, but because it was disconcerting”. Culture of obedience A classic example of temporal myopia is General Electric (GE), once admired for its history of innovation. How is it possible that June 2019

one of the industrial titans of our times, whose lighting systems modernized everyday life, could lose nearly half its share value in the past year alone? The origins of this dramatic change in fortune lie in the ethos of the 1980s when most companies surrendered to the ideology of shareholder value. Virulent “shorttermism” infected the upper ranks of publicly traded companies, especially GE which, under the lean and mean regime of Jack Welch, valued productivity and cost cutting over risk-taking. His

differently. Their religion was Six Sigma. Failure to perform was punished. And management’s obsession with “making the numbers” encouraged risk aversion and conformity. To save costs, GE fatally cut back on basic research, which is the lifeforce of any industrial products company. As former chief marketing officer Beth Comstock explained in her tell-all book, Imagine It Forward: Courage, Creativity, and the Power of Change: “GE had become a reliable performance machine, not a place for change-makers”.

developed a promising industrial Internet of Things (IoT) platform. He launched an “Ecomagination” sustainability programme to make GE products more energy efficient. And he pushed for every business unit to come up with novel ideas under a marketing-led programme called “Imagination Breakthroughs”. But no matter how hard the now former CEO tried he could not overcome years of hubris. GE’s belief in its own immortality had finally caught up with it. Today GE faces a shrivelled future under new leadership.

Immelt chose to grow revenue organically. To do that, according to Comstock, he had to “make marketing into an innovation engine that inspired cultural transformation”. Marketing had to turn a culture of obedience into a challenger culture—one prepared to break the rules and invent new rules—just like a start-up would. A tough transition to make when most of the company was programmed to believe “if we build it they will come”. Immelt started to play the long game, knowing that new ideas take time to incubate and grow to scale, often on the back of trial-anderror. He invested in the creation of GE Digital Business, which

Lean innovation GE is certainly not the only iconic brand whose imagination withered under the pressure of shareholder returns. Consider the plight of Kraft Heinz, owned by 3G Capital. The company’s recent $15 billion write-down of its Kraft and Oscar Mayer brands was a clear indictment of 3G’s single-minded insistence on cost management above all else. The big food giant was oblivious to the growing consumer preference for healthier eating. At a time when people steer clear of the processed food aisle in favour of natural products, Kraft Heinz slashed its advertising and research budgets, resulting in

The Horizon Model introduced in The Alchemy of Growth.

infatuation with earning profits today at the expense of tomorrow turned out to be costly. His greatest misstep was turning GE Capital into a virtual bank, which, at its peak, accounted for close to half its revenues. The industrial heart of the business—power turbines, jet engines, magnetic resonance imaging machines, and the like—became secondary to money lending—that is, until the financial crash of 2008 almost took down the company. Welch’s successor as CEO, Jeff Immelt, was determined to return GE to its innovator roots. But the company’s innovation muscles had atrophied. Managers had been trained to salute, not to think

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Features across-the-board market share losses1. Brands that had been household names for generations were no longer reliable earners. As Jorge Paulo Lemann, co-founder of 3G Capital, recently confessed: “I’ve been living in this cozy world of old brands and big volumes. We bought brands that we thought could last forever. All of a sudden we are being disrupted”2. Fear of disruption is why globally leading consumer goods company Proctor & Gamble (P&G), has renewed its commitment to innovation, knowing the consumer market has radically changed. Challenger brands are stealing market share, doing end-runs around traditional distribution channels. Under the leadership of former CEO A. G. Lafley, the company invested in a mix of “disruptive” and “incremental innovation”. Novel brands like Swiffer, Febreze and Pampers gave life to brand new product categories while Tide maintained its long grip on the household detergent market by simply getting better every year. In his book The Game-Changer: How You Can Drive Revenue and Profit Growth with Innovation, co-authored with Ram Charan, Lafley stated: “Innovation must be the central driving force for any business that wants to grow and succeed in both the short and long term”. Recognizing the need to create more connected and “holistic” brand experiences, P&G recently adopted the practice of “lean innovation”, taking its cue from the growing universe of directto-consumer start-ups. It also launched a company-wide initiative called “Hands on Keyboard” to raise the digital fluency of the company. And P&G is rethinking the whole process of brand-building. The chief brand officer, Mark Pritchard, has even said, “The days of advertising as we know it are numbered. We need to start thinking about a world with no ads.” 10x thinking Reimagining the customer experience through the lens of new and emerging technologies is becoming the surest path to growth. It is how start-ups gain fast traction. But for established companies, how much time and energy should be given to ❱ DMN.ca

innovative thinking? And whose job is that, exactly? According to Beth Comstock, marketing is best positioned to “look through the eyes of the user to find gaps in the market, to look at what’s happening and imagine what could”. Marketers are used to probing for the problems that customers are trying to solve. Serving as customer advocates, marketers can make the case for truly bold thinking (what Google calls “10x thinking”) that transform the customer experience. And as the brand storyteller, marketing can convert that aspirational thinking into a compelling narrative which

ideas flowing from ideation to commercialization. The funding formula should assume more misses than wins, like a prospector panning for gold. And market successes need to be celebrated to sustain enthusiasm. That process should be structured around two objectives: one, achieving incremental innovation that leads to an immediate competitive advantage and two, transformative innovation that rewrites the rules of the game. Bold, bolder, boldest An innovation programme should not be confused with digital transformation. While they may

Walmart’s Store Nº8.

ladders up to the business vision and purpose. But while marketing should take point on “big picture” visioning, new ideas are born out of free thinking involving many different perspectives. Innovation is a team sport. Collaboration and alignment are crucial. Otherwise even the most promising ideas will never be given permission to grow. People move back to their day jobs, figuring the cool ideas they dreamed up with will take flight on their own. But conflicting priorities will inevitably stall any momentum. The burning issues of the day will always take precedence, even when failing to act opens the door to disruption. For innovation to become an entrenched part of the business culture, a repeatable process is required to keep new

overlap, digital transformation is usually tighter in scope, enabling a company to compete in an always-on world. An innovation programme, by contrast, is a breeding ground for novel ways to create value for customers, either by inventing new products, overlaying a service dimension or developing entirely new business models. The main goal of innovation is not to disrupt; instead it is to create a bond with customers resistant to disruption. If that happens to result in a disruptive idea which creates uncontested space, all the better. A structured way for companies to think about innovation is the “Horizon Model” first introduced in the book, The Alchemy of Growth, by Mehrdad Baghai, David White and Stephen Coley. According to this model, sustainable business

growth depends on the right mix of near- and long-term innovation. The key priority is incremental innovation within the core business, followed by more speculative bets on the medium and distant future. That way, the company can improve upon its current market position while ensuring the company remains relevant and viable for years to come. When that seminal book first came out, a long-term innovation was defined as taking a decade or more to incubate, contingent on an imagined scenario playing out as hoped. It has come to be known as a “moonshot” (think SpaceX or Google X). Yet “change the world” thinking is no longer bound by time: technology is moving too fast. Companies must now pursue different innovation streams— bold, bolder, boldest—with the expectation that any idea, no matter how far-fetched, could be born at any time. Since the primary goal of innovation is to create new customer value, most tools and methodologies begin by looking at problems the customer needs to solve, now and in future. Harvard Business School professor Thales Teixeira, in his new book, Unlocking the Customer Value Chain: How Decoupling Drives Consumer Disruption, suggests looking for “weak links” in how customers interact with brands through the relationship lifecycle. Like by identifying gaps between what they experience and what they want. A complimentary approach is to consider market trends that might inspire a business opportunity, lead to a brand repositioning or demand a strategic pivot. An adoption curve can help identify tipping points when these trends are likely to set off sweeping social change. A critical stage of innovation is scenario design: imagining what an alternative future might look like five to ten years from now. That decade-long time horizon is a short enough to make some educated guesses without crossing over into the realm of science fiction. For example, one certain eventuality is that people will

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THE CUSTOMER EXPERIENCE MAGAZINE ISSUE 2 • 2019

The

Operations

Issue

❯❯ The growing business case for video ❯❯ Unlocking the value of contact centre data ❯❯ Boosting customer support with AI ❯❯ How brands can get it right ❯❯ Your front is different than your back


Operations

Advanced video systems like the Jabra PanaCast offers improved customer experiences through enabling impactful face-to-face conversations.

By Aurangzeb Khan

Y

ou would perhaps be challenged to draw out memories of calling a number to access information or standing in line to deal with a bank query. The customer experience (CX) might have progressed with the enablement of technology solutions, but we’ve carried with us one paradox I’m still aware of each day. While we might be able to solve certain customer queries with relative simplicity in comparison to a decade ago, consider what is happening today on the experiences we still have as customers. Dimension Data found that 90% of businesses perceive customer satisfaction as a key competitive differentiator1 and information we have gathered indicate that most companies believe they deliver excellent customer service. But how come, according to the mass media, social media and from our own experiences and that of our family, friends and colleagues, that most of us believe the opposite is true? When you investigate it, the causes become evident, but the good news is that solutions are becoming increasingly available to address the issues. Digital contact centres and the CX have grown more complex following the changing nature of customer interactions and access to information. They’ve also grown more relevant to brands and businesses that realize that every touchpoint is significant. However, though the CX is delivered via a multitude of channels, with the simpler queries being handled by chatbots, the flip side is that it is more challenging and costly to handle the types of queries people make contact for today.

Why video Video is at the leading edge in addressing both the complexity of interactions and the resulting costs. Here are two things I’ve noticed. One, that human-to-human interaction is key to delivering exceptional customer service. And two, that video is critical to solving a plethora of issues for which the responses are currently limited by traditional technology solutions: which often lack visual or 2 | Contact management

physical presences. Though we’re seeing a CX landscape in which needs are changing and touchpoints are adapting, this increasing trend back towards human-to-human customer experiences is because the types of issues we can’t solve ourselves hold complexities that call for subject matter experts. About a year ago, I was talking with an Indian services company and they were describing a typical sales situation with a client in the U.K.. Their salesperson would visit the customer’s site, and then dial in one or more subject matter experts from India for the “double click” conversation. But all too often, these calls were not as impactful as they had hoped and they would end up losing the deal, or at best delay the business win, while ramping up an expense sheet by flying out those experts to claw it back. Naturally the solution wasn’t scalable or time effective and ended up costing quite a bit more than budgeted for. The services company’s client said this was because, over an audio-only bridge, their remote person could not read the customer’s body language or understand if they were following along, or they were stuck or were distracted by other things around them. And when a customer did engage and try to ask a question there was often difficulty in doing so.

Courtesy GN Jabra.

The growing business case for video

Technology and experience enablement Though audio is a much richer dialogue than asynchronous communication like chat or e-mail, video collaboration is becoming much easier to implement. Consider the shift of video from analog to digital. Consider also the advent of cloud across all unified communications, and the cloud-delivered video conferencing services which work ubiquitously over existing infrastructure and bandwidth. These services are further leveraging advances in the near-universal availability of high-bandwidth networks and automatic rate adaptation for video over available bandwidth, which is contributing to the growth of services like Microsoft Office365 and Zoom2. Our individual familiarly and trust in video has grown thanks to its ubiquity since the introduction of VoIP on popular messaging platforms like WhatsApp and Facetime, as well as the mass consumption and sharing of video content on social platforms. This individual utilization of the medium has further spurred its adoption in business uses, along with improvements in the accompanying camera technology. The PanaCast cameras we developed use Intelligent Vision to detect and count people in a room and include everyone in the discussion, with the ability to find and present whiteboards as a virtual Issue 2 • 2019


Operations video camera stream. These features further improve the collaboration experience, automate workflows and provide real-time information for businesses to run better and faster. Market availability, cloud infrastructure and individual interest, driven by employee and customer how-to knowledge with these tools, has brought us to an implementation point where the pros of this digital video shift are beginning to surface. What if I didn’t have to organize an insurance survey on-site or get myself to a hospital for a follow-up? Imagine if you could seek legal counsel with a practitioner halfway around the world? But a lot of this isn’t instinctual because of our sense of trust. Good video creates trust and increases business velocity via exceptional customer experiences. It also increases one’s sense of connection during a CX interaction. Along with these psychological aspects, video allows us to solve complex issues far more efficiently than we’re used to doing without a visual component in the solution. As our latest study revealed, and many contact centre managers will be aware, the length of calls and relative costs are increasing by around 40%. This links back to the complexity of issues being solved by contact centre agents, and further necessitates a need for video to simplify and accelerate the customer satisfaction around efficiently dealing with issues.

New next steps Managing customers on video allows us to focus on people, read a room and use the visual information to decide what to say, when to say it and how to say it. And when video is coupled with audio it is further poised to offer an arsenal of customer service tools through developments in artificial intelligence (AI). Jabra’s partnership with audEERING is developing AI applications that can monitor call sentiment analysis, and when you couple this with the AI from PanaCast’s digital video, the potential of digital video starts to become more apparent. GN Audio’s purchase of Altia Systems in February 2019 indicates the growing value of video in collaborative environments. The resulting technology likely to come from the acquisition sets a vision of powerful tools to come as we enter a period of augmented audio and video deployment in the CX fields. 2019 will set a new high for video conferencing, with USB conference cameras playing a pivotal role in this space, having recorded 48% revenue growth year-overyear in 2018, according to an IHS Markit report3. Data and technology point towards the increasing importance in video solutions across three layers of CX. Firstly, we see a huge need to be able to offer easy-to-deploy end-solutions for buyers. Secondly, the products need to be agnostic and easy for agents to adopt. Lastly, it needs to offer an enriched CX to legitimately deliver a powerful return on investment (ROI). As video and audio combine moving forward, businesses can adapt their contact centres or decentralize them off-site with video and deliver a higher-value CX with great cost savings. It’s a shift I’m excited to be a part of, with video at the forefront of this evolving landscape. Aurangzeb Khan is senior vice president, intelligent vision systems, GN Jabra (www.jabra.com). 1 Dimension Data, “Global Contact Centre Benchmarking Report”, 2016. 2 Frost & Sullivan, “Global Video Conferencing Endpoints and Infrastructure Market Forecast to 2022”, 2018. 3 Matthias Machowinski, Prachi Nema, “Enterprise Telepresence & Video Conferencing Equipment Market Tracker”, IHS Markit, March 7, 2019.

Issue 2 • 2019

Unlocking the value of contact centre data By Anthony Gadient

I

n today’s competitive business environment, companies need accurate business intelligence to predict events, identify threats and improve the customer experience (CX). The customer’s voice is the best source for this information through the many contact centre conversations. Historically there have been obstacles to accessing this information, including the high cost some legacy recording systems charge to their customers to access their own data. But with the advent of open speech-to-text (STT) systems and faster processors, companies can economically convert 100% of their voice data to text. This technology can power advanced speech analytics to obtain valuable insights that elevate customer service, increase sales and market share, reduce operating costs and meet compliance requirements.

Changing the face of contact centres Using advanced artificial intelligence (AI) and deep learning technologies, speech analytics solutions can find patterns in the large volumes of call centre data to identify trends and uncover opportunities. Product development and support teams can find out which product features are in greatest demand or are causing issues and marketing can hear how the competition is viewed or how customers are reacting to new pricing. Some of these advanced solutions can provide prescriptive and predictive analytics to provide greater insights into customer calls. These capabilities can be coupled with realtime STT to provide even greater value by delivering the right information to the right place at the right time. Prescriptive analytics identifies issues and suggests how to address them. Consider a software company that has a product feature with a high customer effort score and receives a disproportionate number of support calls questioning how to use that feature. By using AI capabilities to perform sentiment and emotion analysis, the speech analytics software can “discern” the gravity of the problem, “understand” the root cause(s) of why customers are unhappy and provide suggested solutions to the problems. Predictive analytics is built on a history of customer interactions and applies the knowledge from this historical data to current, correlated interactions with individuals. Advanced speech analytics platforms capable of delivering predictive analytics apply AI and machine learning to identify patterns and trends from the compiled data, enabling companies to spot opportunities or predict what will cause a customer to choose a particular product or service. These Contact management | 3


Operations platforms can also be used to acquire and retain customers through “understanding” the drivers that apply to specific individuals. Performing predictive analytics requires all calls to be monitored with state-of-the-art STT solutions that can economically convert 100% of the audio for analysis.

Transforming the CX The availability of graphic processing units or GPUs also has opened up new possibilities for contact centres by allowing STT systems to cost-effectively process large volumes of voice data in real time. This ability, coupled with running prescriptive and predictive analytics, means that actionable business insights can now be available in real time as agents are talking with customers. The ability to understand and respond to individual customers in real time elevates the customer experience to the next level. For example, real-time speech analytics platforms can be integrated with CRM systems so agents can have insight into customers’ histories during the calls and be able to respond more effectively to their needs. By delivering the right data at the right time, real-time analytics helps agents improve first call resolution (FCR) and the CX.

Enhancing operations, agent effectiveness In addition, speech analytics plays a critical role in improving agent monitoring and coaching, thereby improving agent performance. In contrast to post-call reviews that might occur days or more following the calls, real-time analytics can be used as a powerful training tool by enabling contact centre supervisors to provide immediate feedback to agents when coaching issues arise and simultaneously ensure compliance. Also, by using speech analytics to analyze 100% of calls, contact centres can identify top agents and determine which of their communication techniques are most successful with customers. That information can be incorporated into training to boost the effectiveness of new agents. For example, underperforming agents can learn how greater empathy on their part can create a more satisfying CX and improve their success rates. Moreover, contact centres can use predictive analytics for operational purposes. By analyzing past call volumes from different times of the day or on weekends and holidays, centres can adjust staffing levels to reduce costs when call volumes are predicted to be lower. And, they will know exactly how many additional agents to schedule to meet call demand during new product rollouts. By using advanced speech analytics to route calls to the best-matched agents, mitigate customer dissatisfaction and provide incentives and preferred service to customers, contact centres can greatly improve the CX and agent effectiveness. When customer experience improves, FCR tends to as well. That means higher customer satisfaction (CSAT) scores and Net Promoter Score (NPS) increases, too. Ultimately, speech analytics gives contact centres the ability to identify and leverage valuable customer insights. This provides significant advantage, enabling centres to seize previously unrealized opportunities and increase their competitiveness, while improving operations. It’s the way of the future, which forward-thinking contact centres are embracing today. It’s the way of the future. Anthony Gadient is executive vice chairman, chief strategy officer and co-founder of Voci Technologies, (www.vocitec.com).

4 | Contact management

Boosting customer support with AI By Chandrashekar LSP

C

ultivating long-term customer loyalty is the raison d’être of any sales and marketing team. It contributes significantly to the underlying health of every business. For this reason, companies are employing artificial intelligence (AI) to measure and manage the effectiveness of their customer experience (CX) strategies against their competition. According to a recent report, poor customer service costs businesses more than $75 billion a year, up from $13 billion since its last report in 20161. Clearly, the stakes are high. Creating the right environment for customer happiness—a sticky, somewhat nebulous goal—is critical to providing an excellent CX. Advancements in AI for customer support and retention offer a significant opportunity to businesses across industries. Several forward-looking businesses have already incorporated AI into their CX platforms. However, most companies have yet to take the plunge. According to a Deloitte survey of Canadian companies, in 2018 only 16% of all businesses reported using AI technologies over the past year, a number that has stayed constant since its last survey in 20142. With such a low adoption rate, incorporating AI can be a prime differentiator for willing businesses. Today, AI technology can be deployed across all functions and levels of a customer support team—from support agents and managers—to the customers themselves. And AI isn’t just for large companies: small midsized businesses can also take advantage of this technology. Here’s how AI is taking customer engagement to the next level.

Managers Managers must build and constantly adjust their customer service operations to help them stay ahead of their day-today tasks and equip sales agents with the tools they need to be successful. Incorporating AI can provide significant advantages for managers in the following ways: • Tracking anomalies in real time. By tracking the flow and content of incoming and outgoing ticket traffic, AI can identify anomalies in the amount and types of customer issues over a 24-hour period. Managers receive instant notifications about these anomalies and can quickly click through for information on probable causes. This helps decision-makers fix problems immediately; and • Identifying your customers’ most common pain points. Improving the CX starts by understanding what customers care about or are most dissatisfied with. By instantly identifying, collecting and analyzing this information, AI helps managers better plan and manage resources to fuel growth and customer satisfaction. Issue 2 • 2019


Operations Support agents

Customers

Customer support agents have many responsibilities, including helping sales teams with customer requests, responding to questions, documenting and flagging customer feedback and generally fighting (figuratively) fires. Juggling all these tasks can slow agent productivity. AI can help support agents focus on what’s most important and improve the CX. Here’s how: • Predicting sentiment to drive more meaningful conversations. AI can help determine the sentiment of every incoming response, giving agents the ability to determine whether individual customers are happy or not and how best to respond to tickets. If a new agent is assigned an existing ticket, they can see how the sentiment of the conversation has progressed over time and tailor their responses accordingly; • Organizing and managing tickets through keyword tagging. As each ticket comes in, AI can read the conversations and highlight key terms so that agents can quickly review the issues and prioritize accordingly; and • Responding faster with a reply assistant. AI can help determine your best response to a given ticket or customer inquiry by first analyzing the conversation and then suggesting paragraphs or sentences. AI can also align company policies related to refunds, for example, and determine if a specific ticket qualifies for a discount or replacement, saving agents time.

Customer interaction is what matters most to brands. Customers expect a personalized experience that resolves issues quickly, catered to their specific needs. AI provides businesses with solutions to adapt and thrive in this landscape. Customers benefit from AI by having it answer for them. Advances in voice commands have increased significantly with the adoption of AI solutions. Customers can connect with customer support via phone or e-mail and receive detailed steps to resolve their issues automatically: before engaging with customer support agents. For example, by analyzing a problem based on direct customer interaction, AI can retrieve relevant articles, or other documentation, and provide them to customers. If the information isn’t helpful, customer support agents can be notified to step in and provide assistance: without customers having to wait too long on hold or for call-backs. AI can adapt to any business

needs by learning the skills that help customers. Beyond just figuring out resolutions to customers’ issues, AI can be programmed to handle placing orders for products, updates on shipping and/or for specific customer dialogues related to business. AI won’t replace an organization’s customer service team, but it will make them smarter and more efficient. In today’s hyper-competitive landscape, these are big advantages to delivering high customer satisfaction and achieving long-term customer loyalty. Companies like Zoho are creating solutions that make it easier for businesses to incorporate AI into their customer support strategy. Chandrashekar LSP is the product evangelist for Zoho Corporation Canada. To learn more about Zoho’s AI offering, Zia, please visit: https://www.zoho.com/zia/. 1 Shep Hyken, “Businesses Lose $75 Billion Due To Poor Customer Service”, Forbes, May 17, 2018. 2 Deloitte, “Canada’s AI imperative: From predictions to prosperity,” 2019.

How brands can get it right By Michelle Burrows

C

ustomer experience (CX) is now the great brand differentiator— more than product or price— making the stakes for getting it right more critical than ever. There are sky-high expectations for exceptional or even good CX in an always-on, social-mediadriven world where bad reviews are easy to share and quick to do lasting damage. That’s why the data in a recently released report on the CX by Vanson Bourne is troubling: for reputations and bottom lines. Contact Centers: The Moment of Truth for Your Brand (https://bit.ly/2WgbkgP), commissioned by Serenova, finds most brands are getting the CX wrong. In simplest terms the research takeaway is this: most consumers use multiple channels to interact with multiple brands. But their experiences are often less than ideal because of inconsistent service across interactions and channels. And that matters, as survey respondents report that these experiences affect their future buying behaviours and how they talk about brands, online and off.

More choices + higher expectations = big opportunity Due to today’s digital transformation, people have more options when choosing the brands that get their trust and their money. Rising expectations make CX a powerful (and winning) differentiator. Good customer experiences build loyalty, which can mean recommendations, referrals and new business. In the Issue 2 • 2019

age of social media, a single positive post or online recommendation can equal a promotional juggernaut with far-reaching effects on shaping brand reputation. Getting it wrong, though, should keep executives up a night because there are serious consequences, ranging from increased service costs to loss of customers to damage to the company’s bottom-line. The lesson is this. As consumers interact with brands across channels, brands must deliver consistent and seamless experiences across (and regardless of) channels.

So how are brands doing? According to the research, not very well. The vast majority of respondents (80%) indicate that when they interact with brands across channels, they often have less-than-seamless—and usually inconsistent—experiences. In fact, 39% say they encounter varying levels of service and unpredictable speed of service, depending on the channel. This suggests the employees interacting with customers to try to

solve their issues may lack the tools and information to deliver good, cross-channel service. That’s a serious problem. But it is also a big, game-changing opportunity. 73% of survey respondents say they believe a seamless experience across channels is crucial or very important. Not delivering on that expectation can be damaging: reputationally and financially. But the brands that do deliver will stand out.

Knowledgeable staff the heart At the heart of seamless customer interactions and good experiences is the contact centre. When a contact centre agent has the knowledge and tools to effectively and quickly help resolve a customer’s issue, brands are on their way to happier customers. But what does good customer service look like? According to the survey, knowledgeable staff is key. More than 70% of respondents say they associate knowledgeable staff with good customer service. In fact, it’s the greatest measure of good service, according to the survey. Contact management | 5


Operations

Source: Contact Centers: The Moment of Truth for Your Brand.

Source: Contact Centers: The Moment of Truth for Your Brand.

And the pitfalls of getting it wrong

Successful contact centres ensure customers interact with the employees who have the most relevant knowledge. That requires they have access to—and can easily and effectively use—tools that provide that information. It takes contact centres with intelligent omnichannel routing that directs every customer interaction to the right location or person quickly, then provides full context on the customer, purchases, previous contact and issues raised. Real-time scripting to guide interactions enable agents to focus on quick resolution and empowers them to offer the experience customers want. Supervisors also need insights relating to the knowledge, competency and satisfaction of their agents, thus ensuring alignment with the contact centres’ and customers’ needs. A good experience depends on staff not only having the knowledge to resolve an issue, but also doing it quickly. In fact, 72% of respondents say speed of issue resolution affects whether a brand experience is considered good or bad. When making a complaint by phone, respondents report that waiting seven minutes or longer, on average, is too long. For online complaints, they expect a response within a day (under 20 hours). What’s clear is that speed counts. But consumers say they’re not getting the quick resolution they want. In the last 12 months alone, 69% of respondents say they have had to wait on hold for too long when contacting a brand by phone, and a similar proportion (64%), say they have had to wait too long for a response when contacting a brand online. 6 | Contact management

But knowledge and speed are not the whole equation. Consumers also want the option to contact brands through multiple channels: 34% say this is important to a positive experience. Brands that can quickly equip staff with relevant information and offer multi-channel contact options will win hearts, minds and wallets. The difference between happy, loyal customers who stick around and those who are easy targets for competitors is largely dependent on the efficiency and effectiveness of the contact centre.

The rewards of getting CX right Consumers say a good CX means they would return to purchase (73%) and/ or recommend the brand to friends and family (70%). Meanwhile 43% say they would be more likely to buy from a brand that delivers a positive CX. About a quarter (23%) would share their positive experience on social media.

Unfortunately, nearly 80% of consumers surveyed say they have received bad customer service in the last 12 months. And they want to talk about it. More damaging, 77% say they are more likely to share and remember bad customer experiences over good ones. And 96% say they would take some kind of action after receiving what they consider bad customer service. Almost two-thirds (62%) say they wouldn’t purchase from a brand again if they had a bad experience and over half (56%) would recommend that their family and friends do the same. That creates a damaging negative ripple effect because 73% of those surveyed say they are less likely to purchase from a brand if they know a friend or family member had a bad experience. Then there’s the other side of the power of social media. More than a quarter of respondents say that they would share their negative experience on social channels. You don’t have to look far for examples of how that can gain momentum and hurt a brand. The warning is clear: if brands can’t improve the CX, then they face a serious, uphill battle to get those customers back: and acquire necessary new ones So, what does bad customer service look like to consumers? Here, too, contact centre staff is central. About two in three (64%) of respondents consider it bad customer service when staff lacks knowledge. Good or bad, contact centres directly influence whether brand interactions leave customers satisfied: and they can significantly influence overall brand perception.

Turning the tide The vast majority of respondents (94%) say customer service affects brand loyalty. That’s why investment in better customer experiences is a strong bet. For when brands don’t invest the necessary time, money and effort to ensure they can deliver optimal experiences, the repercussions are clear: both in the short- and long-term. Given the current state of the CX, getting it right by making the investment now to deliver on expectations means leaping over the competition that’s still trying to figure it out. Michelle Burrows is chief marketing officer, Serenova (www.serenova.com).

Issue 2 • 2019


Operations

Your front is different than your back Matthew Storm

A

s business leaders contemplate the promise of artificial intelligence (AI) and automation on digital transformation, many are quickly realizing that a customer’s experience is the sum of each moment: good and bad, direct and indirect, automated and manual and digital and face-to-face. Given the significant impact that notably back-office automation has made on productivity over the last five years, it’s natural for you to gather your management and broadly find AI and robotic process automation (RPA) applicability across operations, finance, sales, service, bricks-and-mortar and beyond. But will the RPA of old, that supports back-office processes well today, stand up to serve a customer-facing employee dealing with the angry mom, the stranded traveler or the confused claimant? A word of caution: your front is different than your back. Let’s take a restaurant as an example. The front of the restaurant is about making someone feel welcome, delivering the finished product, selling in the moment and offering a patron a clean and fun environment. But if you’ve ever walked around to the back of a restaurant, you’d see the reality of all: the food going in and the garbage going out. But doesn’t the real magic happen in the kitchen? The chef would say yes; the host would say no. Both the “front of the house” and “back of the house” of a restaurant are important, but each has a different set of challenges to deliver an amazing experience.

applications on a contact centre agent desktop, you’re not alone. There is plenty of digital debt on the desktop of your average agent, and most applications can’t be or aren’t ready for replacement. The same is true for VAs: dozens of systems are often required to make a great experience. The time for attended RPA to step in and collaborate is now! Yes, now, and not after we migrate to “insert new CRM vendor here” or “rip out that old tool Larry made last year”. Digital debt will live on in some cases and because the front is different than the back, look to use well-designed contact centre automation to drive quick wins and increase agent engagement.

Why the differences

Second, back-office systems rarely and truly speak. But customers and agents speak all day long. Creating automation with conversational flow, grounded on natural language processing, is often more than what traditional RPA can handle. Instead, delight customers by creating good conversations in digital selfservice that will transition to agents seamlessly, as often these systems cannot provide the emotions needed for the front-office, like empathy. For customers interacting with the VAs expect faster transaction handling, satisfaction via one step resolution and most importantly a pleasant customer service experience.

The same is true today for customer-facing automation used to drive digital self-service and serve employees in the contact centre. These tools enable agents to find answers, solve problems and complete sales quickly and accurately and to the customers’ satisfaction. But the back office handles the processing of customers’ issues, such as inquiry forms, service and sales orders and documentation, like loan and mortgage applications that take longer and are more involved to handle. Typically integrating a few systems to solve a workflow or automating a task in the back-office won’t make your agents happier or more productive, just like a new oven or dishwasher will not help the waitstaff. The same is true for poorly designed virtual assistants or VAs, (euphemistically referred to as chatbots), which the equivalent in restaurants may be the point of sale terminals. These VAs often plague customer journeys with dead-ends and are certainly NOT a path to front-office employees. Now isn’t the time to open the back-office RPA toolkit and automate like before? There are two main reasons why your front is different than your back. Firstly, at Jacada we often see a dozen or more systems for integration while engaging in a backoffice project. But if you have 10, 20, 30 or even 40 running Issue 2 • 2019

connected to provide an excellent customer experience. Do so and your customers and your staff will thank you. Regardless of your digital debt, keep your customer dialogues conversational, guide your agents and create seamless self-service journeys. Savvy contact centres are reaping the benefits of AI and automation tools designed specifically for them to transform complex desktop environments into intelligent solutions for their employees. Remember that traditional backoffice RPA is powerful; however, attended RPA in the front-office should provide design-once, endto-end and low-code for both agent-

Always keep your customer and agent-facing experiences a high priority.

Connecting the front and back The human body will not work unless the front and back function as one. The same with business operations, whether restaurants or contact centres. They must be seamlessly

assisted interactions and self-service. So, the next time you visit your favourite restaurant, think of all the automation that makes the entire establishment run smoothly. And just like a restaurant, you will have systems and processes that span the front and back of your organization. Always keep your customer and agent-facing experiences a high priority. These experiences are the faces and “front doors of your brand”. Protect them. Serve them up well. Deliver them on a silver platter if you need to. Because in many cases, it’s our people who save us when the fish is bad, the wine is too warm or the table is wobbly. Remember to tip your waiter and always remember that your front is different than your back. Matthew Storm is vice president, marketing, Jacada (www.jacada.com).

Contact management | 7


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The Future of Mail Marketing

Direct mail in the summer? Continued from page 12

The summer is a great time for catalogues and flyers, making your information easy to find and keep for busy shoppers. Be sure to target your mailings too, using demographic data to laser-focus on your best customers. While things are slower, it is a good time to explore new social media for your business or consider a rebranding before life gets hectic again in the fall. And if you are part of the back-to-school season, be sure to send your direct mail pieces early and often! The summer season is short, especially in Canada, and that means we do our best to take advantage of every warm moment. But the warmer weather doesn’t mean customers aren’t paying attention to the marketing messages around them. Direct mail pieces that are relevant, targeted and with a seasonal twist will deliver return on investment (ROI) even as the population focuses on barbecuing and relaxing. As well, with other businesses scaling back their advertising for the season, your brand might be only one representing your industry in the consumers’ mailboxes. So, should you consider direct mail in the summer? Absolutely! Kristi Kanitz is the general manager of Flagship Software Ltd. (www.flagshipsoftware.com)

and the chair of the board of directors of the National Association of Major Mail Users (NAMMU), (www.nammu.ca) the Canadian mailing industry association. Kristi has been in the mailing industry for more than 20 years and is a frequent presenter at industry events. 1 Marissa Storrs and Adrienne Lobl, “4 Ways Shopping Habits Change in the Summer”, Pennington Creative, blog, 2019. 2 Sarah Hanford, “Retailers Need to Adapt As Consumer Habits Change in Summer”, European Supermarket Magazine, July 21, 2017.

To advertise Contact Mark Henry, mark@dmn.ca

What comes next? Continued from page 16

manage their entire lives through their voice-controlled mobile devices. Those devices will likely serve as gateways to an ecosystem of interconnected platforms, each of which will play a functional role in the life of a customer (e.g. think health and wellness, food delivery, home services, transportation). People will opt into a wide range of on-demand subscription services that support their everyday needs, aided by virtual agents that are intimate with their preferences and habits. All information will be personalized and presented in the context of the moment, driven by selflearning algorithms. Working with that one plausible hypothesis, the innovation team can start to reimagine the customer experience. Game of chance What happens when the idea deemed most likely to succeed actually makes it through the pitch stage and receives initial start-up capital? That’s when ideas enter what venture capitalists call the “Death Valley Curve”: the period between initial funding and revenue generation. For those ideas to survive, there must be an endto-end innovation process that protects them from being snuffed out before they can fend for themselves. Generally, a promising idea goes through some form of prototyping and minimum viable

product testing before it is greenlighted. An innovation lab may be set up to steward those ideas, just like Walmart has done with “Store No.8” whose mandate is to develop “strategic assets that will impact the enterprise on a 5 to 10+ year time horizon”. Alternatively, innovation specialists can be embedded in each line of business to champion the design thinking process. The more bets on the table, the greater the odds of success. But no matter how many checkpoints are put in place, no longer how long the incubation periods, no matter how big the wagers, innovation will always be a game of chance. Which is why most companies prefer to focus on recognizable near-term challenges rather than making the effort of conjuring a theoretical world that may never come to pass. But with the future approaching faster than anyone can imagine, companies can no longer afford the risk of being taken by surprise. Stephen Shaw is the chief strategy officer of Kenna, a

marketing solutions provider specializing in customer experience management. He is also the host of a regular podcast called Customer First Thinking. Stephen can be reached via e-mail at sshaw@kenna.ca. 1 Aaron Back and Carol Ryan, “The Failure of Kraft Heinz and the Future of Big Food”, Wall Street Journal, February 22, 2019. 2 Antoine Gara, “Jorge Paulo Lemann Says Era Of Disruption In Consumer Brands Caught 3G Capital By Surprise”, Forbes, April 30, 2018.


// 26

Excellent Execution

Innovations and dangers I

t almost goes without saying that when there are innovations there are, alas, growing dangers. It is not coincidental, then, that two top trends for 2019 focus on creating retail experiences and on stepped-up security and privacy.

Debbie Major is president, Data Direct

(www.datadirect.ca).

Experiential shopping The essence, in theory, of this marketing innovation is making your product or service a lasting impression in your consumers’ minds will ultimately sell more than the product/service itself. It becomes all about the experience and the ease for the consumer to buy from you: and evoking an emotion from them. As an example, a family member recently went for a haircut at a barber shop. The experiential part was he enjoyed his haircut while sipping a 12-year-old Scotch. This type of win-win situation is on the rise. As a marketer we see the connection to sensory marketing and the need to consider it in the revenue model moving forward. The Emerging Canadian Retail Trends for 2019: Technology, Partnerships and Experiential Concepts article in the March 13, 2019 issue of Retail Insider shows that companies are moving beyond their core expertise. The article, written by Larry Leung, looks at Vancouver, B.C.-based retailer MEC. The firm has new venture called MEC Adventures. It is a travel tour group that brings customers to different international locales, such as a trek to the base camp of Mount Everest. The goal is to encourage customers booking a trip online to visit MEC to purchase their gear. Mall operators are also offering experiential concepts to attract customers with pop-ups, temporary exhibits (also see last month’s DM Magazine) unique restaurants and even theme parks. The Retail Insider article walks us through today’s version of a consumer omnichannel experience of combining desktop, mobile, telephone and bricks-and mortar formats into the sales cycle. A new cycle might look like this: a consumer searching for an item online, then calling the store to reserve the item for review, next they apply credit and then from the store have the item shipped to their residence. That way they can continue shopping in the store or mall easier with less stress of carrying previous purchases around. Seamless, convenient and pleasing to the consumer is the new theme. The only limitation for experiential marketing becomes the creatively of the entrepreneur; it is an even playing field for businesses of all sizes. The challenge becomes determining what experience the consumer is looking for which leads to a great environment for testing. Moving forward I see the trend of protecting the client data and serving memorable experiences to the customer staying at the forefront. I believe it garners the largest opportunities for revenue growth over the next short-to-medium term for direct marketers. Security/privacy Security and privacy carry equal weight in 2019 and will remain one of the top trends for the foreseeable future,

❱ DMN.ca

which is why DM Magazine rightfully is focusing on them in the next issue. Canadians are used to hearing about potential and actual data and privacy violations. They have occurred at all levels of business, government and in our everyday lives for many years now. As marketers we have a vested interest to help our clients utilize and leverage insights they gather or have appended to their current data in accordance with current governance. Technology will definitely help monitor this process and we know it is constantly evolving. All businesses will require increased budgets for these evolving security and privacy requirements. They include such items as cyberattacks and active shooter and anti-money laundering (AML) insurance. Globally we wait to see the impacts of security threats, and security and privacy regulations, to social communication platforms and how the outcome may affect the platforms in the future. Some of the things I would think that would have to be reviewed would be how the platforms are used, monetized and monitored and how the information is stored or shared. An article published in Entrepreneur.com, Security Trends Your Company Needs to Embrace in 2019 on November 23, 2018 was written by Celu Ramasamy, CEO of Blockgenic, who states: “New technologies are always slightly ahead of the security designed to protect them. Whether it’s blockchain, supply chains or cyber security, the potential for devastating hacks is high.” His security trends include: ❯❯ Predictive cyber protection gets a boost with artificial intelligence (AI). Diagnosing and understanding security in real-time; ❯❯ Self-evaluating applications will continue to evolve. For human operators, it is not always easy to detect small vulnerabilities in massive networks. RASP (runtime application self-protection) software on the rise; ❯❯ The authentication revolution. Biometric verification, two-factor authentication and other methods have started replacing passwords; ❯❯ Perspectives changing on data security governance. Understanding the best practices for governing data and ensuring its security is paramount to safety; and ❯❯ BYOD (bring your own device) will continue expanding and adding security challenges. Accounting for every user’s security standards is a logistical nightmare for IT departments. Yes, it will be costly for business to replace their older platforms and systems of collecting and holding information. But the cost of not providing security and privacy means potentially losing the client relationship. So, what is the message for marketers? Adopt promising new methods like experiential shopping but do so anticipating that criminals will try to harm your business. With the right tools, and vigilance, your innovations can benefit both you and your customers. June 2019


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