B2C, B2B and CX: It’s Change or Else in the New Local Marketplace

Customer experience (CX) is a marketing buzzword, but it’s also a real thing. Often CMOs hype their CX, but the experience “on the ground” fails to live up to the ambitious rhetoric. One such example is my experience in 2016 with Hilton’s app-based room entry.

Another example lies in the fact that retailers, despite years of discussion, analysis and hand-wringing, have as a group been unable to respond to the challenge of Amazon. And while there are isolated examples of great store experiences and innovation (e.g., Nordstrom) most retailers are failing to execute.

This week Toys R Us said it would close 200 more stores. It’s only a matter of time before the store completely disappears, as will Sears. Many retailers and stores will continue to decline and ultimately die a slow (or not so slow) and painful death. Change is hard and most organizations don’t transform, even though everyone is constantly talking about transformation.

In retail, the way forward is conceptually clear but massive execution challenges remain:

  • Better integration of online and offline experiences and data
  • Better trained store associates, better customer service overall (including on the phone)
  • Be agnostic about channels; allow consumers to buy online or offline — use stores as return centers
  • Use technology more effectively
  • Eliminate lines and wait times in stores

At one point in 2011, then Nokia CEO Stephen Elop told his team “the platform is burning” to emphasize that the company was facing an existential threat. That’s the situation of many (though not all) retailers today. Amazon is the catalyst for change or death.

Accordingly, it’s being reported that Amazon Go will expand to multiple locations in Seattle and possibly Los Angeles. Go is a high-end convenience store; its chief feature is that there are no cashiers — users walk right out of the store without standing in line.

Some experts argue Amazon Go is not the future of retail. However if the stores do roll out more broadly they will condition user expectations across retail experiences, just as Amazon has set standards for all of e-commerce. People don’t want to wait in checkout lines and while most retailers won’t (or can’t) create a fully automated checkout experience, they can do a lot to improve upon the existing model.

But in a way focusing on Amazon Go is a red herring for retailers. It’s really about the larger topic of innovation and finding new ways to meet and exceed customer expectations. This is the challenge of the customer experience.

Uber (and Lyft) all but destroyed the taxi industry in the US because they offered a radically better user experience vs. conventional taxis. I was hooked the first time when I just got out of the car without conducting a transaction. People like to talk about this as “removing friction” from the process.

As I’ve suggested, Amazon Go and Uber are merely instances of a larger phenomenon: consumer expectations are evolving at rates faster the capacity of most organizations to adapt. This is partly what’s eroding brand loyalty. Consumers are fickle, have more access to information and more choices today.

In the past brand loyalty was partly about a lack information, choice and inertia. Today we have too many choices, which can create confusion and noise but it also shifts the balance of power. Today CX drives brand perception and loyalty. But CX is about more than the product itself; it’s the whole experience. And service is a key part of that.

We’ll be talking broadly about these themes and issues, from a B2B perspective, as well as the challenge of organizational transformation and change throughout LSA18. There will be plenty of “product” and competition discussions. But these big picture questions will be woven throughout the event.

We’ll address transformation and adapting to a changed marketplace with Groupon, GoDaddy and Sensis. But it will also show up in in highly tactical conversations (e.g., SMB retention all stars) as well. How are different organizations and their products evolving — or failing to?

Consumer experience design and innovation is driving B2B expectations in many sectors. A new generation of small business owners is bringing higher, consumer-inflected expectations to marketing and service providers. And the old universe of SMB service providers and marketing platforms is seeing new challenges from an expanded group of competitors — many of whom are bringing greater simplicity or convenience.

This is what we mean by “The New Local Marketplace,” which is the theme of LSA18. You can be damn sure this won’t be the “same old, same old.”

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