Optimize Your Technology to Exceed Customer Expectations
Learn how a customer-centric approach can help you optimize your technology stack and future technology investments.
By Kat Saks, Heather Roth, and Logan Patterson
In today’s fast-paced digital landscape, companies are realizing the importance of the customer experience in driving success and maintaining a competitive edge. It is estimated that 80% of customers now consider the experience a company provides to be as important as its products and services. As consumer demands increase and place more importance on real-time, personalized engagement, businesses are grappling with the ability to deliver these experiences with their current data systems and technology stack.
The sticking point for businesses is rooted in their need to deliver on a customer demand. The business sees a need and wants to respond. If a business wants to respond to a need, there is a technology for that. It is no wonder that as customer demands have increased, so have the number of technologies to support these demands. As of 2023, there were more than 11,000 marketing technology vendors, according to the marketing technology supergraphic by Scott Brinker. This represents an incredible 215% increase compared to 2016 when there were around 3,500 vendors.
As customer demands have changed, companies have increasingly invested in the newest available solution to respond to demand. For many companies, the goal was to find a technology that filled a capability need, without taking a step back to determine how the technology fit into the macro view of delivering on the customer experience. This serial buying for customer “point-in-time” demands is now creating several challenges for companies:
- Over the past three years, more than a quarter of marketing budgets have been spent on technology. 2023 forecasts show a likelihood for increased spend between 6% and 20%, but many still do not fully utilize their existing technology stack.
- Businesses are struggling to connect data, which is foundational to higher-order customer experiences like personalization, and omnichannel activations.
- Disconnected systems are creating risks for customer data management as privacy regulations become more stringent.
These converging forces of customer demands, tighter budgets, increased focus on privacy, and the need to invest in data systems prior to third-party cookie deprecation offer companies a unique opportunity to approach their technology ecosystem in a different way. Not as a “one-size-fits-all” stack of required capabilities, but as a system where data and technology enable teams to deliver the exceptional customer experiences they aspire toward.
Organizations are seeking to resolve the divide between significant over-spending on technology and significant under-delivery on customer experience expectations. Solving for this disconnect requires a mindset shift and a fresh perspective on the place and purpose of technologies within the organization’s ecosystem.
Focus on outcomes while accounting for function-based solutions
Historically, organizations framed their technology strategy from a purely functional perspective. Technologies were purchased based on their ability to deliver specific features across branding, advertising, marketing, sales, service, and commerce. As organizations increasingly prioritize customer experience, they must shift their focus toward outcomes in advance of function. Rather than starting by identifying new features of interest, and technologies to enable those features, organizations must start by identifying their desired results. What customer or business objectives does the technology support? What experience should technology enable for customers and users? Establishing a foundational focus on outcomes sets the stage for exploring function-based solutions in a new light — one that puts the desired experience at the epicenter.
Defining the technology landscape through an experience lens
To widen the aperture of these technology decisions, Slalom encourages clients to redefine their technology focus areas. Rather than evaluating technologies in groupings such as “MarTech” or “AdTech,” we ask our clients to consider a more holistic definition:
Experience technology is an ecosystem of capabilities that sales, marketing, and service leverage to execute and optimize prospect, customer, and employee experiences throughout the user journey.
This framing helps organizations prioritize the experience of prospects, customers, and employees and breaks down siloes between function-based solution areas. An Experience technology lens leads with desired customer outcomes, while continuing to encompass function-based solutions across sales, marketing, and service, including:
- MarTech: A set of technologies that enables marketing capabilities, such as efficiently and effectively targeting, acquiring, and retaining customers
- AdTech: The tools and software advertisers use to reach audiences and deliver and measure digital advertising campaigns
- Sales tech: A set of tools and applications designed to support and augment the productivity of sales representatives
- Service tech: Tools that improve the customer experience and empower your agents to deliver better support
- Brand tech: The combination of solutions to monitor, listen, manage, and track customers brand experience
- Commerce tech: The core technology that enables customers to purchase goods and services through an interactive and usually self-service experience
By putting the experience first, then identifying the capabilities and functional technologies to enable the experience, organizations can take a more strategic and tailored approach to new investments across MarTech, AdTech, Sales tech, Service tech, and Commerce tech domains.
Experiences aren’t siloed. The technologies orchestrating experiences shouldn’t be either. A prospect might take a long, winding road before converting to a customer. Along the path, they may engage in many ways — from organic search, to paid search, to website, to chatbot, to text message, to display advertising, to broker interaction, to call center and beyond. Experience technology considers these interactions first as a journey, then drills down to identify the array of capabilities affecting each moment. This approach helps organizations engage in technology decisions with a clear vision of what they are seeking to accomplish, beyond a quick fix or a new feature.
Reframing advertising, sales, service, marketing, and commerce capabilities
The experience technology capability ecosystem reframes the common capabilities that enable customer experiences to uncover the many overlapping features and functions across advertising, sales, service, marketing, and commerce domains.
The experience technology capability ecosystem establishes five broad categories, each encompassing distinct capabilities:
- Advertising and awareness includes offline, hybrid, and digital advertising, as well as advertising execution (e.g., media planning and buying, media optimization) and reputation management (e.g., public relations, brand tracking).
- Experience management encompasses capabilities for experience organization and distribution (e.g., content management, asset management), commerce (e.g., promotion, product configuration), digital channel delivery (e.g., web, chat, AR/VR), and offline experience delivery (e.g., trade shows, point of sale).
- Relationship management includes capabilities in sales (e.g., sales automation, account-based marketing), service (e.g., customer relationship management, case management, knowledge base), and loyalty (e.g., referral programs, community management).
- Decisioning and orchestration focuses on targeting (e.g., lead scoring, segmentation), automated execution and activation (e.g., configure, price, quote, marketing automation), and testing and learning (e.g., A/B and multivariate testing, experience optimization).
- Data accounts for data management (e.g., master data management, audience data management), identity (e.g., data enrichment, identity resolution), insights and analytics (e.g., customer lifetime value, media mix modeling), and reporting and visualization (e.g., dashboards, business intelligence).
- Enterprise enablement folds in the underlying capabilities that support the organization in terms of project operations (e.g., workflow management, vendor management), creative operations (e.g., creative production and review), commerce execution (e.g., order management), resource management (e.g., vendor analysis, agile management), and compliance (e.g., privacy management, preference management).
Within these five broad categories and their subsets, a third, more granular set of capabilities exist, as per a few of the examples noted above.
Technologies deliver capabilities across multiple domains
One of the keys to unlocking the full potential of existing technology investments is to decouple platforms from capabilities. As technology platforms continue to mature, and major technology vendors continue to acquire point solutions, organizations can leverage a single platform to enable capabilities across many domains. For example, a customer relationship management system may fuel an organization’s needs across multiple relationship management capabilities — from sales to service and loyalty. A marketing automation platform may play a role in delivering advertising and channel activation, in addition to orchestrating automated journeys. These are just two of countless examples of how the platforms traditionally siloed by business functions of sales, service, marketing, advertising, and commerce can be leveraged across domains to drive lower cost, greater value, and more seamless experiences.
How to apply this mindset
Organizational leaders who are ready to reimagine their technology ecosystem with an experience-led view can focus on a few key steps:
Evaluate the experience your business wants to provide customers before the technology.
Rather than starting with questions like, “Do we need a customer data platform?” start by asking, “What’s the experience and outcome we seek to create?” then, “What capabilities will help our team deliver against that vision?” This mindset helps organizations make prudent new tech investments that can scale and drive greater business value.
Leverage prioritized capabilities and use cases to drive technology decisions.
Once a clear customer and business vision is established, prioritize the most crucial capabilities to deliver the experience, and drill down into specific use cases for those capabilities. Prioritized capabilities will shed light on the functional needs that new technology investments must deliver. Looking at priority capabilities and experience-driven use cases together clarifies the requirements by which to evaluate seemingly similar function-based solutions.
Implement, assess, optimize, and iterate.
Customer, business, and technology considerations are not static. They are ever-evolving as external factors and customer demands change. Continuously analyze customer behaviors and feedback to ensure that the technology stack is delivering on desired outcomes, then identify how or if the proposed future roadmap should evolve.
Wrap up
Choosing a technology stack is a daunting task. The vast array of options and the complexities of implementation and integrations can be overwhelming. However, investing in a technology stack that scales as business and customer demands change can yield a strong, long-term competitive advantage.
To reduce complexity and ensure longer-term return on investment, allow the customer experience to guide the business’s capability needs. Then build a flexible, interoperable tech stack that connects internal teams to deliver a consistent and adaptable customer experience. With the customer as a consistent guiding post, organizations can select the right technology investments to stay ahead of the curve in today’s rapidly evolving environment.
Slalom is a global consulting firm that helps people and organizations dream bigger, move faster, and build better tomorrows for all. Learn more and reach out today.
