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Let's get phygital: Using technology to create a new class of customer experiences

Posted March 26, 2019
Rock 'Em Sock 'Em Robots

Let’s say you’re in the market for a new smart watch.

You go to the store, look around, try on a few and settle on a model. But then you look at the long checkout lines, and consider abandoning your purchase altogether. Is there a way to make this shopping experience more pleasant and “frictionless”?

The early successes achieved by the Amazon Go model — in which you could simply walk out of the store and get charged automatically — shows that there is indeed room for improvement in the store checkout process.

Fast-evolving technologies such as computer vision, voice recognition and geospatial data, are driving new customer experience models. This merging of the physical and digital — or “phygital” — frontier is starting to catch brands’ attention, but customers’ uneven adoption signals that more work is required.

The phygital experience

Disney’s MagicBand is the perfect example of phygital customer experience in action. This RFID bracelet enables Disney resort visitors to get into their hotel rooms, pay their restaurant bills and buy snacks at the concession stand — all without having to take out their wallets.

Beyond the resort experience, the union of mobile push notifications and location services can introduce customers to time- and location-sensitive deals. Maybe you’d get an offer from an airport terminal coffee shop after going through security. Or, perhaps the new gourmet salad kiosk in the neighborhood wants to give passersbys a special coupon in an effort to build clientele.

These location-based experiences really shine in the physical realm, but how can they be transferred over to more remote experiences? Take, for instance, an eCommerce experience or interacting with a contact center.

When a customer reaches out to a brand to get help with a product, they are used to receiving verbal or textual explanations. But what if the brand could show customers, in real time, how to access or fix products? Augmented reality and virtual reality are tools that can help make that happen.

Putting the customer at the center

As novel and promising as these technologies may be, developing and implementing them requires a rigorous exercise in seeing things from the customer’s perspective.

For instance, augmented reality could help a customer try on an outfit in a variety of colors — but as would be expected, customers don’t love the idea of cameras and digital mirrors in fitting rooms.

The uneven adoption of such phygital experiences comes down to one problem: Technology isn’t a solution unto itself. “First of all, technology can sometimes be quite cumbersome and not always the easiest to use, so there is some resistance because of that,” says Neil Saunders, managing director of the retail division at GlobalData, an analytics and digital media company.

“And then there’s the application of the technology. Sometimes retailers get excited about the technology, but don’t actually stop to think ‘what problem is this solving?’” Saunders argues that if the technology is not customer-centric, it stands to suffer from shaky adoption.

Customer-service expert Shep Hyken agrees. “Companies have to deliver customers what they want — convenience — and technologies need to seamlessly drive that. The end goal is not the technology, it’s the convenience,” he says.

Escaping the FOMO trap

Brands may be driven to early adoption of technologies by the fear of missing out (FOMO), but that — says Ernez Dhondy, strategy director at design consultancy Paper Giant — is not a convincing enough reason to embrace technology. “If it’s not serving your customers or helping your business in a real way, it’s fine to say this technology is not right for us,” Dhondy says.

In the new experience economy, technologies such as augmented and virtual reality are increasingly expected as part of customer service delivery.

It’s true that being an experience-driven company is good for business, as research firm Forrester concluded in its 2018 report, The Business Impact Of Investing in Experience. The analyst firm found that these types of companies had 23 percent top-line growth, compared with other respondents’ 13 percent.

But Saunders says the “experience” doesn’t always have to be flash and sizzle. Sometimes using technology in the simplest applications can go a long way.

How to get phygital right

As novel as “phygital” might sound, it’s becoming an imperative for companies to think of ways to blend the physical and digital customer service experiences. “Those worlds aren’t separate any more. If you’re not thinking about how technology can enable you to be more efficient and deliver better service, then you’re not going to survive this digital age,” says Dhondy.

Figuring out how to integrate them is another matter. Saunders offers a good starting point: “Find the customer friction points and see if technology can solve those.”

Take the contact center for example. If a customer can’t visualize a representative’s directions, augmented reality might help. Or, if a customer is stuck while filling out a form, a conversational bot can guide the customer along. Be sure to always lead with the customer and not the technology, advises Saunders.

Next, eliminate company silos that might prevent the delivery of seamless phygital experiences. “A great phygital experience borrows from marketing, customer service, sales, technology. These teams will have to work together, so companies need to redistribute the organization so the teams are not at geometrically opposing ends of the same goal,” Dhondy says.

After that, test drive the technology slowly with select customer focus groups. “The airlines did this really well when encouraging customers to book online,” Hyken notes. “They said they’d give 500 extra miles to frequent flyers for testing out their system.”

Finally, don’t forget the human touch. No technology is perfect, and companies can’t rely on technology exclusively to relieve pain points.

In other words, phygital experiences are the way of the future but the human touch will remain king in both the digital and physical world.

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