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I have been involved in the contact center, CRM and customer engagement business for more than 25 years. Yet only in the past few years have I seen much change. Until recently nearly all organizations focused on handling customer interactions as efficiently and inexpensively as possible; few made much effort to manage customer relationships over the complete customer life cycle. However, over the last 18 months, the scene has begun to change very rapidly, and I expect that to continue and even accelerate during 2016.

What is driving that change? The simple answer is customers. They have changed the way they interact with each other, and this has impacted how they want to engage with organizations. Competition to win and retain customers has gotten fiercer, and with business easily available online, customers can change suppliers at the click of a button. The Internet, and the emerging Internet of Things (IoT), will connect more devices and are generating vast volumes of data that open up the possibility of organizations understanding their customers better and proactively influencing their decisions and behavior. These technologies also enable new business models, as what were physical products, such as music, video or software bought on a disk or printed photographs, become digital or Internet-based services that are paid for through different methods.

With these issues in mind our Customer Technology Research Agenda for 2016 will focus on three primary themes:

The Contact Center Revolution

Our benchmark research into next-generation customer engagement shows that customer engagement is an enterprise and multichannel issue. New research in 2016 will examine how companies are adopting cloud computing to support integrated channels of engagement and make access to all related systems possible from almost any location, including for employees handling interaction on mobile devices. It will also take into account how companies are deploying a new generation of self-service systems and digital channels of engagement that enable customers to serve themselves more easily and if necessary transfer to assisted service and agents without having to repeat tasks. It will examine the need to deploy integrated quality management systems that can connect all quality management processes and link agent-related tasks to the customer experience. Furthermore it will investigate the adoption of collaboration systems that allow any employees handling interactions to collaborate with expert colleagues who can help them resolve customer issues at the first point of contact.

Innovation in the Customer Experience

Much of the consumer research I read shows it is no longer sufficient for organizations to maintain the status quo in the way they engage with customers, which is largely reactive and conducted through a limited number of channels that the company determines. Rather they have to innovate by allowing customers to choose the channel of engagement of their choice, making it easy for them to use those channels and, when speaking to an employee, making responses personal and consistent. In short they need to become proactive in understanding and reaching out to customers, or they risk losing business. The first step is to gain a better understanding of their customers, including why and how they prefer to engage, and this requires advanced technology. Our research will examine how companies are using big data and multidimensional analytics to produce deeper analysis of all customer-related data and to visualize the outputs in more meaningful ways. This trend will extend to using predictive and cognitive capabilities so that the outputs can drive continuous improvement and new business opportunities.

Transforming Commerce and Subscription Processes

The software industry leads the way in using the Internet to change how people and organizations purchase and use technology. Many vendors have moved away from on-premises deployment and one-off pricing to provide services accessed over the Internet and invoiced on a subscription basis. Other types of business are following suit, providing for example music, video and healthcare consultation as on-demand services paid for on a usage basis. The old adage that “80 percent of a company’s profits come from 20 percent of its customers” is no longer relevant as it has become harder and more costly to win and retain customers. Our research will examine how organizations are adopting subscription-based services and billing systems that not only invoice on a more flexible basis but can help increase customer lifetime value.

Each of the above efforts will take into account how organizations are making use of innovative technologies such as cloud computing, big data, business and social collaboration, mobile computing, wearable devices and the Internet of Things, which connects various devices to each other digitally. As usual we will seek to identify both best practices and barriers organizations face in adopting new processes and systems to improve customer engagement.

Our extensive research over the last 10 years indicatesvr_NGCE_15_supporting_multiple_channels that none of this will be easy for organizations. For example, our research into next-generation customer engagement shows that organizations most often struggle to integrate systems (49%), manage communication systems in an integrated manner (47%) and provide consistent responses (33%) at all touch points. Successful change must be driven from the top of the organization and will require coordination of people, processes, information and systems across all business groups.

Perhaps most importantly it will require organizations to break down the barriers between business groups. Marketing will need more innovative ways to attract potential customers, sales will have to pay more attention to what it sells, and customer service and the contact center will have to do more than just respond to customers, instead becoming ambassadors for the organization. I believe organizations will have to pay more attention to customer lifetime value because winning and retaining new customers has become such a challenge. Customer experience again will be key, as any number of reports show that one bad experience can lose a customer. I expect this to be a challenging but exciting year, so please stay connected to keep track of developments.


Richard J. Snow – VP & Research Director

There were significant technology developments in customer experience management during 2015. Multichannel contact centers in the cloud took hold of the contact center infrastructure market; I counted 21 vendors offering such services. A variety of vendors entered the market for customer analytics, combining analysis of structured data, speech recordings, text, desktop data, Web contacts, and events and processes to provide a comprehensive “360-degree” view of the customer and customer journey maps to track individual interactions over time. In addition a range of self-service or digital customer service applications became available, including mobile apps, voice-activated virtual agents, interactive video and Q&A websites and chat driven by natural-language processing. Digitally connected devices (the Internet of Things [IoT]) and wearable devices began to emerge. In 2016 I will track and try to anticipate the impact these technologies have on the customer experience.

A review of the benchmark research I carried out in 2015, the debates I joined and consumer research I read shows that most organizations have yet to take advantage of many of them. For example, our research on next-generation customer engagement shows that many companies are immature in their customer experience practices and use of technology; 46 percent rank at the Tactical level of performance (the lowest of four levels) and only 14 percent at the highest Innovative level. Our research on next-generation customer analytics shows that organizations perform better (29% are Tactical and 19% Innovative) in the use of customer analytics, but spreadsheets, despite their limitations (such as increased manual effort and inability to process unstructured data), are still the most common tool used for analytics (by 52% of companies). Support of multiple channels of communication grew to an average of 7.5 channels, but omnichannel customer service remains some way off as the majority struggle to integrate their business apps and communication systems. Big data was a hot topic during 2015, yet our research shows that few companies understand the full extent of the customer-related data they have, and most struggle to access and make use of it.

Taking all this into consideration, the three technologies I predict will have the most impact on customer engagement and experience during 2016 are analytics, cloud computing and desktop systems.

Analytics can help organizations know their customers and predict purchasing patterns, plan and deliver high-quality customer service and engage with customers in the ways they prefer – all of which are critical to meeting business goals. To fully know their customers, organizations need information that includes demographics, responses to marketing campaigns, sales inquiries, purchases, invoices received and paid (or not), complaints, praise and recommendations, service cases raised and resolved, channels of engagement used and the outcome of each interaction. Given the volume and variety of the big data organizations are now generating about customers, the only way to  gain insights from it is by using advanced analytics. These systems should provide access to all customer-related data, such as structured data (as from CRM, ERP and billing systems), voice, text (including social media posts), agents’ desktop usage (tracking the systems and fields employees access as they handle interactions), and event and usage data such as a customer having downloaded a video, made a phone call, or entered data into a self-service system, and process data (such as the routing of a request for action from one person to another person). Analytics should visualize the outputs in ways suitable for users and the tasks at hand, such as charts, dashboards, heat maps and journey maps. Above all they should show the outcomes of customer engagement, such as whether the customer was satisfied, bought more, posted a comment on social media or recommended the company to others. Organizations should also look for capabilities that use historical data and comparisons with other customers to predict likely actions so companies are prepared to address them.

Cloud deployment of data and systems already has had a significant impact on contact centers and the customer experience, and I expect this to accelerate during 2016.vr_NGCE_15_supporting_multiple_channels Customers want omnichannel experiences – using the channel of their choice, at the time of their choice, through a process that is easy to navigate and provides consistent responses. However, not many companies are in a position to deliver it. Our research into next-generation customer engagement shows that the most common barriers, for nearly half of all organizations, are difficulty in integrating systems (49%) and communication channels managed as silos (47%). A contact center in the cloud can address these issues. Many organizations look to the cloud because it is less expensive in the short term, consumes fewer resources and can be implemented quickly. For me the key is that vendors have developed their cloud-based products with integration in mind; that is, most support multiple channels of engagement that are managed by a single set of rules, which can help organizations along the path to omnichannel customer engagement. As well as cloud-based infrastructure vendors, an increasing number of vendors offer customer analytics in the cloud, which can make it easier for companies to make use of all their customer data.

Much has been written about the need for organizations to focus on the customer, and this focus has to start from the top. However, my experience shows that even for companies that are customer-focused, four obstacles stand in the way of implementing this focus – people, processes, metrics and systems. Regarding the first, employees often are not trained well enough or empowered to meet customers’ expectations. This is especially true for contact center agents who are limited in the information they are allowed to access or the level of decisions they are empowered to make. Processes also get in the way when each business group has its own and there is little connection between them; for example, marketing may have a set process to send out marketing campaigns, which the contact center is unaware of and so cannot support inbound inquiries. The same is often true of metrics, when each business unit chases its targets without regard for how those efforts might impact another group or how information is shared; for example, sales might make its new customer targets, but this increases the burden on the contact center to explain how the product or service works. As for technology, most companies manage customer data in disconnected systems, without having one system of record. Many of these issues can be alleviated by deploying a smart agent desktop system. These enable users to access the systems and data they need. They can be programmed to manage and/or automate common processes and personalize responses, can display information drawn for multiple systems, can include rules-based capabilities that guide users on next actions and can allow users to collaborate with each other or customers to resolve issues. In simple terms, they sit above everything else and deliver customer-focused processes and information to any users, whether they are in the front or back office, mobile or fixed, and of any skill level.

As alluded to earlier, I have no doubt that in 2016 there will be exciting developments around big data, IoT, wearables and cognitive computing. However, in light of the current state of processes and systems and the limitations on budgets, I recommend that most companies that want to advance customer engagement and deliver what customers expect turn their attention to customer analytics, cloud-based contact center systems and advanced desktop systems to help with those efforts.


Richard J. Snow

VP & Research Director

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