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Most companies still interact with customers only episodically, but authors of Connected Strategy Nicolaj Siggelkow and Christian Terwiesch say, “Instead of waiting for customers to come to them, firms are addressing customers’ needs the moment they arise—and sometimes even earlier. It’s a win-win: Through what we call connected strategies, customers get a dramatically improved experience, and companies boost operational efficiencies and lower costs.”

Instead of pursuing a one-size-fits all approach, businesses are using data to develop tailored experiences around their customers’ needs. Technology has enabled companies to use advanced tools for collecting customer data without interrupting the customer experience. Connected strategy allows companies to capture customer data and connect with them in a meaningful way.

Increasingly, the most successful companies are the ones that make it a point to integrate latest breakthroughs from artificial intelligence, data science and other disciplines into their business models. They understand that, in order to remain relevant in today’s marketplace, they must constantly innovate and transform to meet customers.

The magic of connected strategy

An example is Disney, which has quietly been investing in big data applications for a decade with an estimated 1,000 full-time employees dedicated to building advanced analytics capabilities.

In 2013, Disney released its “MagicBand” concept at the Walt Disney World Resort in Florida – a program that reportedly cost over $1B to develop and implement. Today, every guest of the Resort receives a wearable MagicBand bracelet that includes an RFID chip. The multi-functional device is not only the hotel room key, but it also provides access to the various theme parks and allows guests to make convenient payments. More importantly, the bracelet constantly communicates with sensors spread throughout the parks, generating huge amounts of data around the movements of each individual customer. Disney’s operations team already use this data to dynamically improve customer experience. The data might reveal, for example, that a group of visitors is waiting in a long line for a ride and prompt Disney’s team to offer up real-time incentives to redirect those customers to less congested areas of the park.

There is huge value created by optimising park logistics in this way – customer satisfaction grows, and resources can be used more efficiently. Further, this wealth of data allows Disney to develop all kinds of innovative features like predict a child’s favourite activities based on how the child behaves in the park and this has resulted in 70% return rate of first time Disney visitors.

This is not just for tech savvy companies

This kind of thinking isn’t only the domain of new companies, even established players can adopt the connected strategy. McGraw-Hill Education has evolved their offering, now extending customised learning experiences. As students use the company’s electronic texts to read and do assignments, digital technologies track their progress and feed data to their teachers and to the company. If a learner is struggling with an assignment, the teacher will find out right away, and McGraw-Hill will direct the student to a chapter or video offering helpful explanations.

And what these case studies demonstrate is that staying connected with customers is crucial when it comes to establishing strong relationships. It is effective, scalable and uses the most powerful tools available at a company’s disposal.  In the rapidly changing world of business, the ability to stay connected with your customers is at the heart of every win and loss.

Different from episodic engagement which usually occurs at irregular intervals, connected strategy is more constant and richer. However, connected strategy is not about churning out more messages or features but planning for the future, making sure your communications are as relevant as possible and that your special offers are attracting and retaining customers in your business.

Nicolaj Siggelkow and Christian Terwiesch assert that at every stage of the customer experience journey, there’s an opportunity to either delight customers, or discover a pain point that can be turned into an opportunity. Understanding the customer experience allows businesses to streamline or add value at certain stages across the journey.

Recognise, request, respond, repeat

Siggelkow and Terwiesch distinguish four phases of any customer journey:

  • Recognize – the part of the journey where a latent need of the customer surfaces and either the customer or the firm is made aware of it
  • Request – the part of the journey where the need is translated into a request for a solution to the particular need
  • Respond – the part of the journey where the customer receives and experiences the solution.
  • Repeat – After delivering on these steps, there’s another phase to build a truly connected customer relationship and that is to Repeat. If a company can learn from repeated engagements with a customer, it can improve its Recognize, Request and Response sequence.

How Nike connected its way to success

Some innovative businesses have trailblazed in this area, creating enviable connected ecosystems. One of the highest profiles belongs to Nike.

The sports apparel giant has a strong ecosystem that provides many entry points to its business outside of its core footwear products. in 2017 Nike launched its Consumer Direct Offence, an initiative it said was “fuelled by Nike’s Triple Double strategy: 2X Innovation, 2X Speed and 2X Direct connections with consumers.”

Nike generated over 7 billion brand impressions across social platforms globally in the last quarter of 2020, growing awareness for NIKE Running Club, NIKE Training Club and SNKRS, its app for limited-edition online drops. Earlier in 2020, Running Club and Training Club, which provides workouts, became free to use after formerly using a subscription model.

By the end of 2020, Nike reported its third straight quarter of online growth of approximately 80 percent. However, the bigger long-term benefit is expected to come from enhanced digital engagement that has added more than 70 million new members globally since the pandemic arrived.

Connected leadership

Forward looking leaders are leveraging data, technology in combination with their teams specialised knowledge and skills to build connected ecosystems aimed at solving their clients’ latent needs. If your company has an unnecessary number of customers that you’re not spending any time with (and potentially not even knowing that they exist) then you are slowing your growth. Today may be the day you consider a connected strategy approach.


By: Maanda Tshifularo: CEO – SuperLead Advisory

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