Selling and Engaging the Digitally Forward Customer

© 2014 Pegasystems Inc.2
Speakers
Don Peppers
Founding Partner
Peppers & Rogers Group
Ed Burek
Director, Product Marketing
Pegasystems Inc.
Ed Burek has Product Marketing responsibility for Pega's
Next-Best-Action solution. He has supported clients in the
adoption and optimization of marketing strategy and web 2.0
technologies while addressing the needs of analytics.
Recognized for more than 20 years as one of the world's
leading authorities on customer-focused business strategies,
Don Peppers is an acclaimed author and a founding partner of
Peppers & Rogers Group, the world's premier customer-centric
management consulting firm. The Times of London has listed Don
among their "Top 50 Business Brains," Accenture has included
him in its global list of the "Top 100 Business Intellectuals," and the
U.K.'s Chartered Institute for Marketing put him on its list of
the "50 most influential thinkers in marketing and business today.
" In 2013, Don Peppers and Martha Rogers were inducted into the
Direct Marketing Association Hall of Fame.

The Future of Customer Engagement
CONVERSATION IS KEY

The Future of Customer Engagement
CONVERSATION IS KEY
How do you accomplish this with customers so empowered?

Every 20 years, computers get a
thousand times faster and cheaper
Moore’s Law

Technology changes
the dimension of competition
Product-Centric Competition
Share of
customer
Market share
Customer
Needs
Satisfied
Customers Reached
Relationships
are required
Customer-CentricCompetition

“With a single solution, we have lowered retention costs and
retained more customers, all while average call handling times
have held steady, even going down in some instances.”
Alex Ford
Customer Base Director
BUSINESS GOALS
REDUCED MONTHLY CHURN RATE TO
1.2% FROM OVER 2.0%
DECREASED SUBSCRIBER
RETENTION COST
 Increase revenue per customer
 Create a unique business case for every
retention interaction
 Radically improve retention rate for high-
value customers
 Provide a consistent experience across
all channels
RESULTS
4% ADDITIONAL RETENTION
of their most valuable customers each month
INCREASED CONVERSION RATE
of customers that accept retention offers
DRIVING AN INCREMENTAL £24 MILLION
IN ANNUAL OPERATING MARGIN AT UK’S LARGEST TELCO

© 2014 Pegasystems Inc.8 2013 1to1 Media. All rights reserved. 1to1 Media is a registered trademark of Peppers & Rogers Group.
“ZMOT” – The Zero Moment of Truth
A customer Googles a product to compare
prices while standing in the store aisle
ZMOT
Source: Winning the Zero Moment of Truth – ZMOT (2011)
A customer scans reviews of a product while sitting in a car
in the store’s parking lot
ZMOT
A customer checks the opinions of social-network friends about a
store before choosing which one to visit
ZMOT

 Getting an online referral from a friend
 Becoming a friend or follower of a brand
 Reading blogs where the product was discussed
 Seeing the brand mentioned on a social networking site like Facebook
9
ZMOT
Online social activities tracked by
Google's research:

© 2014 Pegasystems Inc.10 10
In 2010 the average shopper consulted
5 sources
But by 2011 they consulted 10!
ZMOT

© 2014 Pegasystems Inc.11 11
In 2010 just 19% of shoppers checked
social sources
But by 2011 37% did!
ZMOT

Your customer wants to have a conversation
DO YOU?
 How easy is it to find a phone number and actually make a voice
connection?
 What % of voice contacts are preceded by unsuccessful online
inquiries or issues?
 Does each interaction with a customer reflect what that customer has
already told you?

Competence
Customer trust has
always been
important
Good Intentions

Customer trust has
always been
important
Competence
Good Intentions
Doing things right
Doing the right thing

Zuckerberg’s Law
Every 20 years,
we interact a
thousand times
more
with others

And the more we interact, the more
trust we demand
We want our interactions to be more
efficient
Interactions generate transparency

“Digitally Forward” customers
have higher standards!
Proactive trustworthiness
It’s no longer enough simply to refrain from
cheating or deceiving customers
“Trustability”
Digitally forward customers demand:

means proactively protecting a customer’s interest even
when it costs money
Extreme Trust

Doing things right
Doing the right thing
Proactively
Trustability means:

Extreme Trust comes from empathy
“Treat the customer the way you
would want to be treated if you
were the customer.”
Applying the “Principle of Reciprocity”
…and for a company, empathy is the ultimate form
of customer insight
Empathy is a deeply human instinct…

Show empathy for others, and get
more empathy in return
After the first Persian Gulf War (1991)…
USAA proactively sent out
refunds for time spent abroad
by customers

USAA proactively sent out
refunds for time spent abroad
by customers
>2500 customers
mailed their refunds
back!
After the first Persian Gulf War (1991)…
Show empathy for others, and get
more empathy in return

Optimize Marketing with
Next-Best-Action
Strategies
Start Small and Prove it!
Personalize in Real-
Time, Across
Channels
Continuously
Monitor, Control,
and Adapt
Measure
Learn
Simulate
Unparalleled Marketing Agility
Closed loop marketing that increases operational effectiveness, reduces time-to-
value, and drives massive returns.

Manage marketing
effectiveness across all
channels, segments, and
products
Continuously Monitor, Control, and Adapt
Optimize strategies based
on detailed what-if
simulations
Adapt and learn from
changing customer
behavior
Next-Best-Action

x Profiting from a customer’s error
x Failing to notify
x Tricky pricing or renewal terms
Trustability
Previously acceptable marketing practices
will soon become “untrustable”
Because of rising customer expectations
with respect to

2013 study of 58,000 consumers
Welcome to The Age of Transparency
 70% of consumers trust the recommendations of their friends
 ~50% trust online recommendations from complete strangers
 Just 10% of consumers trust advertising

“Once the trust goes out of a relationship, it’s
really no fun lying to them anymore.”

Transparency is like a disinfectant
for businesses and governments.
It will clean things up, but first it’s
going to sting like hell.

Linda Kaplan Thaler, CEO, Kaplan Thaler Group
Screw up today, and the “news”
will be permanent
can’t
un-Google
“You

Grant Robertson, blog post, May 1, 2007
“Dude, you can't take something bad off the Internet. That's
like trying to take pee out of a swimming pool.”

How does Big Data help with Digitally Forward Customer?
Marketing
CRM Cloud apps
SOCIAL
Sensors Mobile
Sales
Customer Svc
Chat
Ops SuppliersCustomers
ERP

Customer
Desirable
Next-Best-Action makes the conversation trustworthy

Customer
Desirable
Economically
Viable
Brand
Identifiable
Operationally
FeasibleCourtesy Karen Larrimer, CMO, PNC Bank
The sweet spot: Next
Best Action

Customer
Desirable
Economically
Viable
Brand
Identifiable
Operationally
Best Action
The best kind of customer
experience: Frictionless

Customer
Desirable
Economically
Viable
Brand
Identifiable
Operationally
Best Action
Valuable
Reliable
Relevant
Trustable
The best kind of customer
experience: Frictionless

Summary
 Digitally Forward Customer is empowered and will
continue to gain more power
 The Zero Moment of Truth can occur anyplace at
anytime
 Empathy and “Trustability” are keys to conversing with
the customer
 Next-Best-Action enables you to have a “Frictionless”
customer relationship

Thank you!
Don Peppers
Founding Partner
Peppers & Rogers Group
Email: dpeppers@1to1.com
Twitter: @donpeppers
See all Don’s LinkedIn posts here:
bit.ly/donpeppers
Ed Burek
Director, Product Marketing
Pegasystems
Email: Edward.Burek@pega.com
Twitter: @edburek
http://www.linkedin.com/in/edburek

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