Gartner Application Strategies & Solutions Summit

Summit 2017
4 – 6 December 2017 / Las Vegas, NV

The State of Customer Experience Technologies

and Their Impact to Your Application Strategy
Olive Huang

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 2017
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 Improved customer experience is
the top outcome for digital
business transformation.
In 2017

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CEO Survey: Improved Customer Experience and Loyalty Is
the Top Outcome for Digital Business Transformation
Q. What are the top three outcomes your organization has already realized as a result of its digital business transformation?
n = 178 Rank 1 Rank 2 Rank 3 SUM
Improved interactions thus loyalty with customers
and/or improved customer experience
15% 13% 15% 43%
Significant cost reduction 10% 7% 17% 34%
Gained competitive advantage 12% 11% 8% 31%
Superior operations through digitally
enabled business processes
11% 8% 11% 30%
Greater proportion of business through digital channels 11% 11% 7% 29%
Growing revenue through expanding to new geographies 10% 7% 9% 26%
Generating more revenue through creating completely
new (blue ocean) markets/fulfilling previously unfulfilled needs
11% 11% 2% 24%
More engaged and/or empowered employees 5% 12% 7% 24%
Growing revenue through expanding to new industries 10% 8% 5% 23%
Built tighter ecosystem partnerships and platforms 6% 7% 7% 20%
No impact as yet 2%

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 More than 80% of client calls to Gartner
about CRM and CX application are focused
on a specific business requirement for one
In 2017 department, and tend not to have the whole
enterprise in scope.

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CRM Applications Are Fragmented With 190 Subcategories
Digital Commerce: Cross-CRM: Marketing:
 Storefront  Enterprise Information Management  Digital Marketing Hub
 Merchandising  Web Content Management  Multichannel Campaign Management
 Product Management  Digital Asset Management  Marketing Resource Management
 Shopping Cart  Intelligent Business Process Management  Loyalty Management
 Order Management  Enterprise Application Integration  Marketing Voice of the Customer
 Payments  Personalization  Social Marketing
 Commerce Search  Digital Experience Platforms  Marketing Analytics
 Digital Goods and Service Sales  Voice of the Customer
 Mobile Commerce  Customer Analytics
 Social Commerce
 Commerce Analytics

Cross-
CRM

Field Service: Customer Service: Sales:

 Demand Management  Customer Engagement Center  Sales Execution
 Work Planning  Contact Center Workforce Engagement Management  Sales Enablement
 Mobile Technician Enablement  Contact Center Infrastructure  Sales Effectiveness
 Work Order Debrief  Customer Service Voice of the Customer  Sales Performance
 Operations  Social for Customer Service  Social Sales
 Field Service Analytics  Service Analytics  Sales Analytics

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 An estimated 50% of organizations are still
thinking of the customer life cycle from an
inside-out perspective — focusing on the
In 2017 idea of selling and service cycles, rather
than buying and ownership cycles.

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Gartner's Customer Life Cycle Model
Abandon

Activity Streams

Explore

Evaluate

Engage

Experience
Drives
Buy Advocacy
Buying Cycle Again

Inspiration Buy

Source: Gartner (2017) Abandon Owning Cycle

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 50% of all customer experience projects
In 2017 will make use of IT.
84% organizations expect an increase in
technology spend to improve CX.

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Many Technologies Can Be Used to Improve the CX
UX Loyalty Self-Service Social

Content Analytics Personalization

VoC

Cross-Channel Process Voice

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CX Innovation Survey:
Top 17 Technologies for CX Investment in 2017
expect their organization to increase
41% investment in customer analytics in 2017
More likely to be smaller orgs. — under 500M (36%)

27% 26% 26%

20% 19% 19% 18%

16% 16% 16%
13% 12%
10% 9% 8%
5% 4%

Base: n = 165, Gartner Research Circle Members

Q. Which, if any, of these technologies do you expect your organization to increase investment in for 2017 (versus investment in 2016)?
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CX Innovation Survey: Over the Next Three Years, Machine
Learning and VCA Will Be the Technologies to Watch
Plans for emerging technologies for customer experience projects
Implemented or plan to 55% 47% 40% 32% 28%
7% 7% 3% 3%
10% 8%
Have implemented 12%
14%
24% 14% 17%
Will implement within next 12 months 17%
20%
Will implement in next 3 years 22%
23%
No current plans to implement

68% 72%
60%
53%
45%

Machine Learning Virtual Customer VPA for Customers Augmented Reality VPA for Staff
Assistants or Chatbot

Base: n = 150/Excludes 'unsure' Gartner Research Circle Members

Q. And finally, what are your organization's plans for implementing emerging technologies for customer experience-related projects?
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 2020
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Gartner Predicts — AI

By 2020, 30% of all B2B companies will employ AI to augment at least

one of their primary sales processes.

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Current Gaps in Sales Process Execution and Technology

From To
Manual data entry Decision-making certainty

Process uncertainty Focus on buyer's journey

Decision-making risk Process optimization

Internal process focus Institutional knowledge

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Gartner Vision for the Algorithmic Future of
Sales Automation
Insights
Automated
Correlations
Variances

Sentiment
Contextual
Process Awareness Institutional Knowlege
Guided Intelligence
Automation Selling Customer
Health
Automated
Actions
Benchmarking

Revenue
Certainty Event-Driven
Interactions
Resourcing
Next Best
Actions
Planning Optimization Prescriptive

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Gartner Predicts — VCA

By 2020, 25% (up from 10% in 2015) of customer service and support
operations will integrate VCA technology across engagement channels.

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VCA and Bots Help Fulfill High Volume, Repetitive
Customer Service Requests Around the Clock

Source: Kasisto, Xiaoi, Creative Virtual

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Gartner Predicts — Customer MDM

By 2020, 75% of those organizations that neglect MDM and EIM while
creating a 360-degree view of their customers to support the CX will
adversely affect CX metrics via the use of inaccurate data during
customer interactions.

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How Can You Create the Single View of the Customer?

Tactical Strategic
Mashup/Portal? CRM, ERP or Vertical Master Data
Industry System? Management Hub
Core Banking Branch Systems Call Center Sales

Application Integration MDM

Payments Customer Service E-Commerce Billing

Easy to create. Low cost and Leverages existing systems and
time to value. data models. Can rise to the level
Doesn't solve the data quality of application data management.
issues or the semantic Only fit for purpose in data model
differences. Tactical. and data stewardship facilities for
application at hand.
Solves the data quality
issues and semantic
differences. Strategic.
Can be expensive and can
take time. Requires formal
data governance.

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MDM Is Information Management of Master Data

MDM is not for all data. MDM is only about data that is:
Widely shared among
organizational/functional units.
Are worth Consistent across viewpoints.
managing.
Foundational and valuable to the
operation and the business.

Understood by the business.

Can be
Stable over time.
managed.

What about the rest?

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Know What the Tools Do (and Don't Do) — Apply Them in
the Right Places
What Data Quality Tools Can Do: … and What They Can't:
 Profiling and measuring  Understand culture, politics, operating
 Visualizing metrics models or roadmaps
 Understand business and market
 Monitoring
drivers, opportunities and risks
 Parsing and standardization
 Apply options-based approaches to
 Matching, linking, merging, volatile scenarios
deduplication
 Understand and redirect data quality
 Generalized cleansing effort as organizational threats and
 Applying value-added opportunities emerge
data (enrichment)  Dealing with complex, cognitive issues
Jump-Start via Gartner's "Toolkit: RFP Template for Data Quality Tools" (G00322360)
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Gartner Predicts — Analytics

By 2020, more than 40% of all data analytics projects will relate to an
aspect of customer experience.

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Emerging Trends in Customer Analytics

Moments
Unified Real-Time,
and All Data AI/ML
Channels Personal
Journeys

1. Customer life cycle to moments and journeys

2. Omnichannel to unified channels
3. Batch to real time, personalized interactions
4. Big data to all data
5. Advanced analytics to artificial intelligence/machine learning
at scale

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The Predictive Approach: True Data-Driven Sales

Upsell/
Cross-Sell

Forecasting Opportunity
Scoring

Data Science/
Data Science/ Coaching Customer Machine
Machine and Guidance Learning Accounts and
Data Science/ Learning Products
Guided
Machine
Learning Buying Selling
Forecast
and Pipeline Sentiment
Visibility Analysis

External Data Data Warehouse

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Gartner Predicts — Immersive Experience

By 2020, augmented reality, virtual reality and mixed reality immersive

solutions will be evaluated and adopted in 20% of large enterprises as
part of their digital transformation strategy.

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Changes Are Expected in Blurring the Lines Between
the Physical and Digital Worlds

Source: Sephora
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Gartner Predicts — Event Driven

By 2020, event-sourced, real-time situational awareness will be a

required characteristic for 80% of digital business solutions.

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More Than Ever, "Time Is Money" …
Digital Business
Needs "Must-Have" Capabilities
Business
Moments
Timely reaction to unexpected, unplanned business events

Situation
Awareness
Decision makers' instant business-state understanding

Real-Time
Insights
Real-time, self-service, unconstrained analytics

Stream
Analytics
Absorbing large volumes of data "on the move"

Classic, "tried and tested" IT approaches won't work anymore!

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The Shift: Data-Driven Systems to Event-Driven Systems

Data-Driven Approach Model-Driven Approach Event-Driven Approach

First priority: First priority: First priority:
Preserve data Optimize processes React to events

App App App

Event Event Data

Data Processes Events

Svc Svc Svc

Source of truth is the data store Source of truth is the log of events

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Key Components of an Event-Driven System

Event visibility Automate, act and

and context achieve customer
over customer experience
journey

Event-driven
recommendations
and CRM
capabilities

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 2022
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By 2022, Nearly 2/3 of Customer Service Interactions Will
No Longer Require a Human Intermediary
2017 2022
Agent
interaction
15%

Customer
Agent
Agent self-service
assisted
interaction 48%
self-service
52% 21%
Customer
self-service
64%

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Rethink Customer Service Strategy
Map Where AI and Self-Service Can Replace Humans …
Reorder
Returns
Order confirmation
Prescription refill
Product information
Place my order
Authenticate user
Reset password
5% to 12%
Cancel order Cost
Activate account Containment
Link my account
Get my results
Explain benefits
Pay bill
Claim status
Refund
Payment history

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Create a Roadmap of the Right Tools by Engagement Need

Collaborative Kiosk
Interface Community
KM Search
Co-browsing Chat Email
VCA IoT
AR/VR *

Agent- Self-
Assisted Service

Social Media Chatbots Smart IVR

SMS/ Engagement
Video Chat Messaging
Visual IVR
Phone With CRS

* AR/VR — Augmented and Virtual Reality

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 Plan
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No Transformational CRM Initiative Succeeds Using Only
One CRM Application
Marketing Customer Service
Magic Quadrant for CRM Multichannel Campaign Management Magic Quadrant for the CRM Customer Engagement Center
Magic Quadrant for Digital Marketing Analytics Magic Quadrant for Workforce Engagement Management
Magic Quadrant for Digital Marketing Hubs Magic Quadrant for Field Service Management
Magic Quadrant for Contact Center Infrastructure, Worldwide
Sales Market Guide for Voice-of-the-Customer Solutions
Magic Quadrant for Sales Force Automation Market Guide for Social Customer Service Applications
Magic Quadrant for CRM Lead Management Market Guide for Virtual Customer Assistants
Magic Quadrant for Sales Performance Management Market Guide for Workforce Management Applications
Market Guide for Partner Relationship Management Applications Market Guide for Robotic Process Automation Software
Market Guide for Configure, Price and Quote Application Suites
Market Guide for B2B Price Optimization and Management Software Market Guide for Robotic Process Automation Software Cross-CRM
Market Guide for Digital Content Management for Sales Magic Quadrant for Intelligent Business Process Management Suites
Magic Quadrant for Master Data Management of Customer Data Solutions
Magic Quadrant for Web Content Management
Digital Commerce
Market Guide for SaaS-Based Predictive Analytics Applications for B2B Sales and Marketing
Magic Quadrant for Digital Commerce
Market Guide for Social Analytics Applications
Market Guide for Digital Personalization Engines
Market Guide for Web Analytics
Market Guide for Digital Payment Gateways and Payment Service Providers
Market Guide for Digital Wallet Solutions Service Providers
Market Guide for Digital Commerce Search Magic Quadrant for CRM and Customer Experience Implementation Services, Worldwide
Market Guide for Online Marketplaces, China Magic Quadrant for Customer Management Contact Center BPO
Market Guide for Digital Commerce Platforms, Asia/Pacific Magic Quadrant for Global Digital Marketing Agencies

The elusive CRM Magic Quadrant: 18 major market segments with a Magic Quadrant or MarketScope, plus a number of Market Guides for smaller segments.
See research "The Elusive Magic Quadrant for CRM" (G00337536)
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Apply Gartner Pace-Layered Technology Roadmap —
Example Sales Technologies
Predictive Analytics
Systems of Event-Driven Sales Business Graph for Virtual Digital Sales
for Forecast Sales Execution Assistant Apps
Innovation Streams
Management

Sales In-Time Mobile Sales

Guided Selling Sales Acceleration
Training Productivity
Systems of
Differentiation Account-Based Configure, Price,
Sales Enablement Customer Apps
Marketing Quote

Sales Order Sales Appraisal Activity Incentive

Management Management Management Compensation
Systems of
Record Opportunity
Firmographic Data Account Planning Sales Forecasts
Management

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Bimodal IT Capability Is Required to Support a
Pace-Layered CRM Application Strategy

Systems
+ Mode 2 of - By 2018, IT
Innovation organizations without
Mode a bimodal IT strategy

Governance
Change

Systems of
2 Differentiation will find 50% of new
Mode 1 CRM applications
sourced without
Systems
- of Record + their knowledge.

38 © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Use Gartner's Hype Cycles to Identify Your Portfolio of Innovation for the Next
3 to 5 Years — Example CRM Customer Service and customer Engagement
Emotion Detection/Recognition
expectations Expertise Location and Management
MDM and Social Data Video Chat for Customer Service
IoT for Customer Service Voice of the Customer
Digital Experience Platforms BPM for Customer Service and Support
Customer Journey Analytics In-App Mobile Customer Service
Customer Engagement Center Interaction Analytics
360-Degree View
Customer Psychographics
Analytics for Customer Intelligence
Customer Engagement Hub
Consumer Messaging Applications for CRM Recorded Video Customer Service
Customer Engagement
Chatbots Center Workforce Management
Voice-Driven Customer Service Apps Comprehensive CM BPO
Virtual Customer Assistants
Collaborative Customer Interfaces
Workforce Engagement Management
Knowledge Management for Customer Service Work at Home — CM BPO
Infonomics
Mobile Field Service Management Customer Engagement Center
Augmented Reality for Quality Management
Customer Support Speech Analytics
Social Media Engagement
Things as Customers Cloud-Based Applications
Customer
Engagement Center External P2P Communities
Field Service Drones
Social for CRM: Social On-Premises Customer Service Apps
Feedback Management MDM of Customer Data
E-Labeling Customer Self-Service Suites Field Service Workforce Optimization
Enterprise Feedback Customer Engagement Center Performance Management
Management
Blockchain for
Customer Service
As of July 2017
Peak of
Innovation Trough of Plateau of
Inflated Slope of Enlightenment
Trigger Disillusionment Productivity
Expectations
time
Years to mainstream adoption: obsolete
less than 2 years 2 to 5 years 5 to 10 years more than 10 years before plateau

From
39 © "Hype CycleInc.
2017 Gartner, forand/or
CRMitsCustomer
affiliates. All Service and Customer Engagement, 2017" 21 July 2017 (G00314325)
rights reserved.
 Adaptable Experiences Require:

Advanced
Machine
Learning
Real-Time Decision Predictive
Management Analytics

Case-Based Big,
Processes XaaS Open Data
Web-Scale Computing
Complex-Event Smart
Processing Internet of Things Machines
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Recommendations

 Get hold of and review your customer experience strategy and focus first on the
role data quality plays in it.
 Create a Top 10 CX technologies for your organization.
 Pilot technologies to capture internal and external events that could be used in
your organization to achieve your customer experience goals.
 Invest in analytics to understand how customers engage with your brand
and your products to determine where digital overlays can enhance the
physical experience.
 Encourage individual LOB owners across marketing, sales, digital commerce and
customer support and other relevant departments to work with IT leaders to create
an inventory of data analytics competencies.

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Recommended Gartner Research

 Future of Experience: A Gartner Theme Insight Report

Ed Thompson, Augie Ray, Lisa Callinan, Jessica Ekholm and Others (G00328631)
 The Future of CRM Sales Technology Promises New Algorithmic and Automation
Approaches
Tad Travis, Todd Berkowitz and Ilona Hansen (G00319524)
 Predicts 2017: CRM Customer Service and Support
Michael Maoz, Jim Davies, Jenny Sussin, Olive Huang and Others (G00316522)
 Shape the Future of Customer Experience With Customer Analytics
Melissa Davis (G00315125)
 Master Data Management: The Core of the Trusted 360-Degree View of the Customer
Bill O'Kane and Saul Judah (G00295289)
 Alternative Channels for Engaging Customers of the Future
Jenny Sussin, Jessica Ekholm, Adnan Zijadic, Jim Hare and Others (G00326391)
 Use an Event-Driven Approach to Deliver Superior Customer Experience
Tad Travis and Nadine LeBlanc (G00323118)
For more information, stop by Gartner Research Zone.
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