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Companies are losing the race against the development of new technologies and their customer’s experiences are suffering.

Originally published in the 2014 Customer Experience Predictions ebook.

The pace of development of new and exciting technologies continues to increase exponentially. Companies which are intuitive and disciplined enough to implement technology with focus can materially improve the experience of their customers. A perfect example of this is the ability for employees at Apple Stores to process payment on the spot, and later their introduction of self payments in the stores using an iPhone. Apple reduces friction in the payment process, which enhances the experience and the brand positioning of innovation and simplicity.

Most companies, however, either miss the opportunity to introduce experience enhancing technologies or do so in a way that actually puts more friction into the customer’s journey. Touch screens, while themselves not a destroyer of the customer’s experience, can be irritating when they don’t work, such as happens occasionally at information kiosks in Ikea or on newer inflight entertainment systems on United Airlines. While it can be humorous for other customers to watch someone pound on these screens out of frustration, it is districting for everyone involved.

Variable pricing is a technology-enabled development that has been around for years in with airlines, hotels and other travel related services. Variables can even be based on the type of computer the customer is using when booking, as Mac users are sometimes charged more for the service because the demographic of these customers indicates they have higher discretionary income. The typical travel customer has no way of knowing if they received the best price, and are left with a feeling of confusion and possibly distrust. The travel industry has made a science out of this cat-and-mouse game of trying to take more money from their customers for the same service.

Other industries are following the lead of the travel industry by adopting similar yield management strategies. Apple announced that they will be introducing variable pricing in the App Store based on the users previous purchase history and propensity to pay for previous purchases. Variable pricing isn’t restricted to digital transactions. Brick and mortar stores are already implementing and testing variable pricing, such as the B&Q, the DIY retailer in the United Kingdom, which is the strategy based on the customer’s profile, time of day, individual promotions and other variables. Customers are already looking at digital pricing tags on store shelves with curiosity, and the risk is they will soon look at these tiny screens with distrust.

A different perspective on how technology is distracting is coming from the customers themselves. A number of years ago, with the introduction of smartphones in the market, guests of Disney parks developed their own apps which allowed the community of other guests to upload the waiting time for the attractions. Disney later introduced their official apps which have the same functionality. This is an example of how customers will use technology to start managing their own experience outside whatever the company has attempted to stage for them. Frustrated or distrustful customers, for example in the case of being confronted with variable pricing, will use these types of community solutions to connect with other customers and develop their own strategies to get better pricing and better service.

Customers are also using technologies to take control of the brands of companies. There will continue to be an increasing number of examples where companies are exposed in ways which are not flattering or in support of their desired brand positioning. Target, the American retailer, has been a victim of this multiple times. Most recently due to another type of technology distraction when thousands of their customer’s credit card details was stolen. This happened just before the holiday shopping season at the end of the year, which is the worst time possible for a retailer to lose their customer’s confidence.

The personal political or religious views of employees of a company used to be less relevant, however now with the ability for a story to cause a social media flurry in a matter of hours, companies need to be prepared. Chik-fil-A, the American restaurant chain has positioned itself as family friendly with experiences such as ‘Daughter Date Night’ for fathers to take their daughters out for dinner and quality time. This traditional family focus was taken to the extreme when an executive made public statements opposing same-sex marriage. The brand now has this emotional and divisive topic connected to it in the minds of the customer.

It isn’t always a bad thing to have a bad reputation, as Ryanair has based it’s brand reputation on treating it’s customers poorly and they seem to appreciate any publicity which enforces this image. One example of this is their charging customers a high penalty if the customer doesn’t print their boarding pass before coming to the airport. Their CEO was quoted as publically saying that these customers are “stupid” and it’s their mistake if they don’t print these before coming to the airport. Although this could be considered bad customer service, Ryanair has made the choice to accept the customer distraction and frustration when they pushed the need for technology to print boarding passes back to their customer.

Companies are already running to keep up with the competition; however this is no longer enough. Companies now must run even faster to keep up with their own customers and the possibilities of future technologies. Using these quickly developing technologies inappropriately may erode customer trust and confidence over time, or in some cases distract them so much on the spot that they immediately defect to the competition. The companies that are winning the race are those who have a strong understanding of their brand positioning and are in control of how they are staging their customer’s experience to support that story. If a technology or strategy isn’t reducing friction or otherwise improving customer satisfaction, isn’t enhancing your brand position, or may lead to distrust over time, the investment should be reconsidered.
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Chris Parker specialises transforming organisations to embrace Customer Experience disciplines with a passionate focus on the role of technology. He is a member of the Customer Experience Professionals Association and the Global CX Panel of expert speakers and works with various affiliated organisations to create value for your business.