1. Temkin
Group
Insight
Report
Eight
Customer
Experience
Megatrends
Looking
Ahead
To
The
Next
3
To
5
Years
By
Bruce
Temkin
Customer
Experience
Transformist
&
Managing
Partner
Temkin
Group
May
2010
Temkin
Group
info@temkingroup.com
617-­‐916-­‐2075
www.temkingroup.com

2. Eight
Customer
Experience
Megatrends
As
we
examined
the
changes
going
on
across
companies,
we
idenQfied
the
following
eight
trends
that
would
have
a
major
impact
on
customer
experience
efforts
over
the
next
3
to
5
years.
1. Customer insight propagation… customer
insights will drive decisions across the company
2. Unstructured data appreciation… text
analytics will become a critical capability
3. Customer service rejuvenation online
interactions will increasingly use touch-screens
4. Loyalty intensification… loyalty metrics will be
a major element of executive dashboards
5. Interaction iPod-ization… online interactions
will increasingly use touch-screens
6. Social media assimilation… social media will
get absorbed into the fabric of companies
7. Digital/physical integration… experiences will
blend mobile devices with retail locations
8. Cultural renovation… engaging employees will
become a key stepping stone for engaging customers
Page
2
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

3. Megatrend
#1:
Customer
Insight
Propaga>on
Inside
of
companies,
most
decisions
are
made
without
any
real
customer
insight.
People
may
have
some
pieces
of
informaQon
about
something
that
has
to
do
with
customers.
But
oYen
Qmes
it’s
spo[y
or
outdated.
Companies
are
increasingly
recognizing
that
they
need
to
integrate
a
deeper
understanding
of
their
customers
throughout
their
company.
That’s
why
Voice
of
the
Customer
(VoC)
programs
are
one
of
the
most
popular
customer
experience
efforts.
A
new
cadre
of
vendors
are
making
it
easier
to
collect,
analyze,
and
share
customer
informaQon
broadly
across
just
about
any
organizaQon.
Key
implicaQons:
• More
companies
will
create
centralized
customer
insight
teams
to
capitalize
on
a
very
underuQlized
asset,
customer
insight.
• Market
research
budgets
will
shiY
away
from
project-­‐based
efforts
to
ongoing,
conQnuous
voice
of
the
customer
(VoC)
programs.
• Companies
will
develop
processes
for
reacQng
more
quickly
to
customer
feedback
Page
3
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

4. Megatrend
#2:
Unstructured
Data
Apprecia>on
Customers
have
shared
their
feedback
since
the
beginning
of
Qme.
But
companies
haven’t
had
a
way
to
deal
with
those
responses,
so
they’ve
forced
customers
to
translate
their
rich
thoughts
into
simplisQc
mulQple-­‐choice
responses.
Deep
feelings
about
a
company
get
truncated
into
a
5-­‐point,
7-­‐point,
or
even
11-­‐
point
scale;
making
it
difficult
to
uncover
unexpected
issues
or
dig
deep
into
“why”
things
are
happening.
New
applicaQons
are
making
it
considerably
easier
to
analyze
unstructured
data
like
comments
on
surveys,
call
center
verbaQms,
or
social
media
discussions.
These
text
analyQcs
applicaQons
can
quickly
process
thousands
of
pieces
of
unstructured
data
and
discern
what’s
making
customers
happy
or
what’s
making
them
upset.
Key
implicaQons:
• There
will
be
an
explosion
of
text
analyQcs
applicaQons
within
companies
as
they
see
the
power
of
this
emerging
tool
• Companies
will
increasingly
idenQfy
and
collect
unstructured
sources
of
data
from
inside
and
outside
their
organizaQon
• Customer
feedback
systems
will
become
less
reliant
on
mulQple
choice
survey
quesQons
Page
4
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

5. Megatrend
#3:
Customer
Service
Rejuvena>on
As
companies
have
become
more
“professional”
over
the
last
several
decades,
they’ve
labeled
customer
service
as
a
cost-­‐center.
As
a
result,
the
focus
has
been
on
cost-­‐reducQon
and
operaQonal
efficiency.
That’s
why
many
companies
moved
large
porQons
of
their
customer
contacts
to
lower-­‐cost
regions
of
the
world.
Unfortunately,
this
cost-­‐squeeze
has
created
many
poor
experiences
for
customers.
As
companies
do
touchpoint
analyses
and
customer
journey
maps,
they
oYen
find
that
customer
service
is
a
key
“moment
of
truth”
for
customers.
This
analysis
opens
their
eyes
to
the
reality
that
poor
customer
service
is
creaQng
a
very
negaQve
percepQon
of
their
brand.
Key
implicaQons:
• Customer
feedback
metrics
will
displace
some
purely
operaQonal
metrics
like
average
handle
Qme
(AHT)
as
key
measurements
for
contact
centers
• Companies
will
shiY
high-­‐impact
interacQons
away
from
purely
low-­‐cost
contact
center
locaQons
and
providers
• Companies
will
increased
investment
in
agent
desktop
technologies
and
training
Page
5
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

6. Megatrend
#4:
Interac>on
iPod-­‐iza>on
One
of
the
major
reasons
that
computers
became
mainstream
was
the
adopQon
of
a
common
entry
device,
the
QWERTY
keyboard,
which
was
invented
in
the
late
1800s
for
typewriters.
This
standard
interface
freed
technology
providers
from
invesQng
in
training
customers
on
data
input.
But
a
keyboard-­‐based
QWERTY
device
is
not
the
ideal
interface
for
the
next
generaQon
of
digital
devices.
Fortunately,
Apple’s
iPod
(and
iPhones,
iPads)
are
doing
the
same
thing
that
QWERTY
did
over
100
years
ago,
teaching
myriads
of
people
how
to
interact
with
a
touch-­‐screen.
Key
implicaQons:
• There
will
be
an
increasing
number
of
touch-­‐screen
interfaces
on
all
types
of
products,
especially
where
keyboards
are
impracQcal.
• New
soYware
applicaQons
will
emerge
that
take
advantage
of
this
richer,
quicker
interface.
Page
6
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

7. Megatrend
#5:
Loyalty
Intensifica>on
Since
the
Harvard
Business
School
was
created
100
years
ago,
a
cadre
of
MBAs
and
future
execuQves
have
been
trained
to
opQmize
shareholder
value.
So
companies
have
run
their
business
on
quarterly
results
like
sales,
profits,
and
capital
expenditures.
Why?
Because
they
had
access
to
that
data.
Over
the
last
several
years,
many
execuQves
have
realized
that
shareholder
value
is
not
an
objecQve;
it’s
actually
the
outcome
of
building
stronger
customer
loyalty.
Companies
have
started
to
use
measures
like
Net
Promoter
Scores
(NPS)
to
establish
clear
metrics
around
loyalty.
Key
implicaQons:
• ExecuQve
teams
will
increasingly
add
loyalty
metrics
to
their
monthly
and
quarterly
business
dashboards
• Financial
analysts
will
increasingly
look
for
loyalty
metrics
as
a
part
of
quarterly
earnings
calls
• Companies
will
increasingly
invest
in
understanding
and
affecQng
the
drivers
of
customer
loyalty
Page
7
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

8. Megatrend
#6:
Social
Media
Assimila>on
The
meteoric
rise
of
social
media
sites
like
Facebook,
TripAdvisor,
and
Twi[er
has
generated
a
lot
of
acQvity
and
interest.
Most
companies
have
established
some
Social
Media
teams
and
programs.
But
Social
Media
is
not
really
a
new
thing
for
companies;
it
represents
just
another
interacQon
channel
with
customers.
Companies
will
increasingly
fold
Social
Media
acQviQes
into
the
core
acQviQes
of
the
company.
Key
implicaQons:
• Customer
service
organizaQons
will
become
increasingly
social;
blending
agent
interacQons,
self-­‐service
applicaQons,
and
mulQ-­‐channel
knowledgebases
with
customer-­‐to-­‐
customer
interacQons
• Social
media
listening
efforts
will
get
incorporated
into
overall
voice
of
the
customer
(VoC)
programs.
• Social
media
tools
like
wikis,
Facebook,
and
blogs
will
be
increasingly
used
to
facilitate
and
sQmulate
communicaQons
within
organizaQons.
Page
8
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

9. Megatrend
#7:
Digital/Physical
Integra>on
As
mobile
phones
become
an
increasingly
important
digital
device,
online
experiences
are
no
longer
limited
to
homes
and
offices;
they
can
happen
anywhere.
Consumers
can
go
online
while
they
are
doing
acQviQes
like
browsing
through
a
mall
or
eaQng
at
a
restaurant.
In
addiQon,
iPhones
introduced
consumers
to
the
noQon
of
task-­‐specific
applicaQon
downloads.
In
this
environment,
companies
can
no
longer
think
about
online
as
a
separate
and
disQnct
channel.
They
will
need
to
design
experiences
that
blend
together
online
and
offline
interacQons.
Key
implicaQons:
• A
customer’s
locaQon
will
be
an
increasingly
important
piece
of
meta
data
that
companies
use
to
customize
interacQons
• MulQ-­‐channel
experience
teams
will
emerge
to
design
mobile
applicaQons
within
retail
stores
• MarkeQng
teams
will
increasingly
incorporate
mobile
devices
in
mulQ-­‐channel
markeQng
campaigns
Page
9
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

10. Megatrend
#8:
Cultural
Renova>on
Companies
are
increasingly
recognizing
that
“unengaged
employees
can’t
create
engaged
customers”
which
is
one
of
my
“6
Laws
Of
Customer
Experience.”
So
many
firms
are
starQng
the
process
of
focus
on
the
culture
of
their
firms;
making
sure
that
they
create
an
environment
that
aligns
employees
with
the
vision,
mission,
and
brand
of
the
company.
Cultural
change
takes
several
years
to
take
hold;
so
significant
changes
won’t
show
up
in
companies
immediately.
But
when
change
happens,
it
will
very
difficult
for
compeQtors
to
replicate.
Key
implicaQons:
• HR
execuQves
will
be
increasingly
tapped
to
lead
strategic
culture
iniQaQves
• “Manage-­‐by-­‐the-­‐numbers”
senior
execuQves
will
get
replaced
by
more
employee-­‐centric
leaders
• Companies
will
increasingly
define
and
discuss
their
core
values
Page
10
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

11. About
the
author,
Bruce
Temkin
Bruce Temkin, Customer Experience Transformist & Managing Partner of
Temkin Group, is widely viewed as a leading expert in how organizations
build differentiation with customer experience. He has worked with hundreds
of large organizations on the business strategies, operational processes,
organizational structures, leadership, and culture required to create and
sustain superior customer relationships.
Bruce is the author of the blog Customer Experience Matters
(experiencematters.wordpress.com) which is one of the most popular blogs
on customer experience. He regularly posts insights on topics such as
customer experience, branding, and leadership.
During his 12 years with Forrester Research, Bruce led the company's
business-to-business, financial services, and customer experience practices.
As a Vice President & Principal Analyst, he was the most-read analyst in the
company for 13 consecutive quarters and was one of the most highly
demanded consultants and speakers in the industry. Bruce authored several
Forrester’s most popular research reports on customer experience and
created Forrester’s Customer Experience Index, which rates more than 100
firms on their overall customer experience.
Bruce has been widely quoted in the press, including such media outlets as
New York Times, Los Angeles Times, and Business Week. An accomplished
public speaker, Bruce has delivered keynote speeches at many company
and industry events.
Bruce holds a master’s degree from the MIT Sloan School of Management,
where he concentrated in business strategy and operations. He also holds
an undergraduate degree in mechanical engineering from Union College.
Page
11
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com

12. About
the
Temkin
Group
Temkin Group is a customer experience consulting firm. We have one simple
goal for our clients: increase customer loyalty by becoming more customer-
centric.
Any company can improve portions of its customer experience. But it takes
more than a few superficial changes to create lasting differentiation.
The Temkin Group combines customer experience thought leadership with a
deep understanding of the dynamics of large organizations to help senior
executives accelerate their customer experience efforts. We work with our
clients to build four critical competencies: Purposeful Leadership, Engaged
Employees, Compelling Brand Values, and Customer-connectedness.
Temkin Group was founded based on four core beliefs:
1. Customer experience drives loyalty. Our research and work with
clients has shown that interactions with customers influences how much
business they’ll do with you in the future and how often they recommend
you to friends and colleagues.
2. Improvement requires systemic change. Companies can improve
customer interactions in isolated areas, but they can’t develop
competitive advantage until customer experience is embedded in their
operating fabric.
3. It’s a journey, not a project. Building the capabilities to consistently
delight customers doesn’t happen overnight. Companies need to plan
for a multi-year corporate change initiative.
4. We can help you make a difference. Transformation efforts aren’t easy,
but leading your company to be more customer-centric is worth the
effort. Temkin Group can help organizations accelerate their results and
avoid many of the bumps along the way.
Page
12
Copyright
©
2010
Temkin
Group.
All
rights
reserved.
www.temkingroup.com