Customer experience. It’s one of the buzziest terms in business. And it should be. If you haven’t come to the conclusion that CX matters, volumes of research quantifies the value of providing an exceptional - or even decent - customer experience, and the perils of getting it wrong.
PwC conducted eye-popping research into the future of customer experience. If your job involves selling or marketing to, servicing, retaining, analyzing or acquiring customers, it is a must read. PwC surveyed a sample of 15,000 people from 12 countries. The report’s title sums up their findings, “Experience is Everything.” Many economic, behavioral, and demographic stats contained within back that up. Here are a few of my favorites:
- 43% of all consumers would pay more for greater convenience
- 73% of respondents said customer experience is an important factor in purchasing decisions
- 32% of all customers would stop doing business with a brand they loved after one bad experience
- 88% of U.S. consumers say that how much they trust a company determines how much they’re willing to share personal information
To know me is to love me
There is no way to fully satisfy customers unless you know who they are. And who they are goes far beyond name, address, gender, a phone number and email address. Useful customer profiles are holistic, accurate, up-to-date, and actionable. They provide historical perspective, current status, and a preview of future intent. Connected customer data from many sources is required to make this happen. Enterprises have pursued a 360 degree view of customers in many ways. A common one has been master data management (MDM).
And that brings me to the reason for this blog. The Gartner Magic Quadrant for Master Data Management Solutions, 2020 was just published. Cue the Customer 360 and CX hand-waving from vendors whose strengths lie in data integration, quality, matching, address validation, and other rudimentary data hygiene tasks. Clean data is important. But that’s just a starting point.
You’d be hard-pressed to find a definition of customer experience that doesn’t include the word “interactions.” Google it. Forrester defines customer experience as “how customers perceive their interactions with your company.” Simple sentence. Complex idea. Interactions occur in many ways and across multiple channels. Managing and making sense of it is challenging, but required.
So consider this: No legacy MDM system is capable of managing interaction data. Or transactional data. Or social data. Or third-party data in real-time. Or identifying and unlocking the value of relationships among customers and products, services, locations, channels, and brands. Or preparing data for downstream analytics by customer data platforms (CDP) and other marketing technologies.
Legacy MDM products were developed before the experience economy, when product was the focal point. Legacy MDM is linear, siloed, and latent in a customer experience world that is asymmetric, omnichannel, and real-time.
I read an excellent article by Brian Solis on ZDNet that sums up what’s wrong with legacy MDM. “It's incredibly difficult to be customer-centric if you're not actually centered around the customer. Business and data silos, incomplete or duplicate customer data records, incongruent touchpoints, disconnected apps, and incompatible systems and services -- and, to be honest, a lack of unified leadership driving toward strategic integration -- remain as common issues that require prioritization and escalation,” wrote Solis.
That’s what it comes down to. MDM isn’t an inherently wrong answer. But MDM isn’t the right answer for winning in the experience economy by truly understanding customers and giving them reasons to buy more, remain loyal, and become brand advocates.
And in 2020, legacy MDM vendors still do not provide their software as a service (SaaS). Which raises another important consideration when deciding what technology to deploy for strategic customer experience initiatives. Customers evolve. They are multi-dimensional. On-premises MDM systems lack the agility to adapt at the speed of the internet. And let’s face it, that’s the benchmark pace.
Customers expect brands to recognize and value them. At the point of interaction. In real-time.
Shouldn’t customer profiles reflect who the customer is in real-time? Attributes that define or provide information about a customer and their preferences and actions should change and grow with each transaction and interaction, shouldn’t they?
No legacy MDM solution can do that without a huge expenditure of time and money. They regularly require retaining professional services and 6 - 9 months to add or remove data sources or attributes. And they cannot support real-time operations at scale. For these reasons, many Chief Data Officers, Chief Information Officers, and heads of Enterprise Architecture and MDM have replaced their legacy master data management systems with Reltio Connected Customer 360, including many of the top 10 pharmaceutical manufacturers, financial services and insurance companies, and global technology companies.
Remarkably, sometimes the answer to legacy MDM solution inflexibility and inability to scale from the vendors that sell them is to deploy another instance. A current Reltio customer which runs a worldwide sandwich franchise had been using two separate MDM systems; an initial system to support marketing, and a second one for its loyalty program, which required very detailed customer information. The senior executive leading the transformation described it as having “two 180 degree views of our customers.” The pain associated with making the company’s first MDM silo do what it needed for the loyalty program was so great that the customer stood up another. When it came time to upgrade their on-prem legacy system...again...that was more than they could chew. They moved to Reltio Connected Customer 360.
The desire to consolidate applications and infrastructure is a common catalyst for moving from legacy MDM systems to Reltio Connected Customer 360. “At AstraZeneca, we're in the final year of a 3-year transformation to master, track and optimize the use of customer data throughout the organization. We're replacing 67 legacy master data management systems with 3 interlinked regional hubs in Europe, APAC and the US,” said Joanna Walker, Global MDM Architect, AstraZeneca.
And to that earlier PwC data point about trust and privacy, no pure-play MDM tool can manage consent and compliance.
So how does that play out? Brands lose out on buyer information. Remember, nearly 9 out of 10 US customers say trust determines how much data they will share. Companies risk violating GDPR and the California Consumer Protection Act (CCPA) and paying heavy financial penalties. And some enterprises may be so stymied by data privacy and protection mandates that they stop using customer data to its full potential.
There are other choices:
- Leading edge versus legacy.
- 2020 insight focused on winning in the experience economy through customer-centricity and connected customer data.
- Choosing to start the new decade by moving beyond MDM that hasn't changed in 10 years.
Learn how Reltio Connected Customer 360 can transform your business, free you from the constraints of legacy MDM, and help you win in the experience economy.
Moving beyond MDM doesn’t require Magic;
Just move beyond the Gartner Magic Quadrant for Master Data Management Solutions