Welcome To The Era Of Competitive Convergence
Competition is ubiquitous. The frame of reference is no longer product to product or marketing message to marketing message. It is a head-to-head battle of experience to experience.
According to research from Gartner, marketers are allocating 18% of their budgets to customer experience for purposes of driving “differentiation, innovation, and profitable revenue growth.” As many as 89% of companies surveyed plan to compete based on leveraging customer experience. Gartner also found that “fewer than half of companies rate their customer experience as exceptional today.”
What does this mean for your brand? The race is not just on; it has already started.
If experience is the new battleground, we must also recognize that the very battleground itself has changed. Competitors now include industries outside of your own. That’s because consumers lump all their prior experiences, both good and bad, into one ball of wax that becomes their individually perceived standard against which every business is measured.
This is an all new form of convergence. Consumers don’t distinguish among vertical industries. These silos have all come down. Regardless of brand, product, or category, with every brand experience between customer and organization, experience is instantly compared to the best in class.
We’ve landed on competitive convergence and the considerable impact it can make on consumer expectations, as illustrated below:
Competition Is Not Limited, But Is Ubiquitous
The frame of reference is no longer product to product or marketing message to marketing message. It is a head-to-head battle of experience to experience. Many of the most recognizable brands began by disrupting their own industries. Now they are disrupting yours. Here’s a look at some of the experiences to which your brand is now being compared:
• How we buy: Brands like Amazon have proved how absolutely easy and seamless it can be to move from device to device–and even several concurrently–while the brand simply follows along. Shopping carts, “wish lists,” and recently browsed items flow flawlessly, profiling the shopper’s status. Amazon Dash and its Dash Replenishment Service (DRS), a handheld scanner stick for the home used to order and deliver items directly, is a great example of the Internet of Things.
• What we buy: Brands such as New Balance are disrupting traditional product and buying cycles by moving well beyond voice of customer (VoC) and all the way to product of customer (PoC) with self-designed individual products via an “endless aisle” strategy. Consumers are no longer limited to what’s available in store or online. They can design the products they want, pick the colors, etc. Meanwhile, 3D printing technology is advancing at such a rate that it will bring immediacy to many purchase decisions. The home improvement retailer Lowes is already testing out in-store 3D printing for customized and outdated products.
• How we pay: Offerings such as Apple Pay, Google Pay, LevelUp, and Square are disrupting the way we pay and potentially in the future how we accept payment. Walletless purchasing, electronic payments, and one-swipe purchasing are fast becoming the norm, making the process both faster and more convenient. Square is an especially interesting bridge concept, as it closes the gap between pure electronic wallet and electronic seamlessness by allowing people to use their credit cards across any Square merchant contiguously, with the experience being carried over. What it means for your brand is clear: Make it convenient. Make it effortless. Make it seamless.
• How we obtain: Brands such as Hulu, Spotify, and Netflix have changed our expectations for not just how we buy, but how we physically obtain and own our products. We no longer have to “own” music or subscribe to annual contracts. Consumers can bypass the cable company and even the Apple iTunes store entirely to gain always-on, infinite selection and anytime-immediacy to media entertainment products.
• How we access: Uber, Hailo, Lyft, Airbnb, and other members of the gig economy have shown how the infusion of instant gratification and real-time transparency into even seemingly commoditized offerings such as hotel rooms and taxi service can be completely disruptive. They appeared almost overnight and because of their sheer utility and ability to delight via convenience have become a staple on most smartphones.
• How we interact: Bank of America is infusing a more intimate, human level of service into its automated channels, in particular ATMs, through the use of video tellers. This real-time connection of two otherwise traditional touch points (call center, ATM) combines to make a powerful one-to-one interaction. Disney’s RFID electronic MagicBands connect individuals with the Disney brand throughout the entire Disney theme park experience, from resort and rollercoaster to restaurant. Patrons are connected seamlessly with their environment, enabling entirely personalized experiences (even addressing them magically by name) as they move throughout the park.
• How we are treated: Experience-driven brands like Southwest Airlines have shown customers that they really can have a positive experience, even on an airplane, of all places–and at low cost to boot. Consumers perceived that being friendly and personal doesn’t cost a dime during flight time. Brands like JetBlue took notice and soon followed suit.
• How we bypass friction: A better example of a broken experience cannot be found than commuting by car or air travel. EZ-Pass reduced long wait lines, fumbling for change, and more. The gold star award goes to digital/biometric passport programs such as the UK’s ePassport and USA’s Global Entry programs. These programs whisk participants around immigration and customs lines, circumventing the two-hour queue and getting travelers faster to their destinations.
These are just a few of your notable competitors when it comes to your customers’ ever-mounting expectations. Competitors come from everywhere. Brands that win in this new age experience battlefield will likely be first-movers at disrupting their own market first, before an Apple or a Google does it for them. Welcome to the new era of competitive convergence.