Comments The Impact of Context
One of the things I’ve talked about alot in this blog is the importance of putting yourself in your customer’s shoes to identify potential Moments of Truth. A big part of this is understanding the context of your customers at specific points in time. With the continued growth of mobile, this is becoming critical for many organizations, particularly consumer-facing.
On May 3, Gartner just released a new report titled, “Why CEOs in Consumer-Facing Organizations Can’t Afford to Ignore How Context Will Affect Sales”, by William Clark and Hung LeHong. (Note: If you are not a Gartner subscriber, you can purchase the report for $95). The findings are jaw dropping.
Here are just a few:
- “By 2015, context-aware technologies, will affect $96 billion of annual consumer spending worldwide.”
- The impact will be distributed across three modes of selection: “28% in e-commerce, 40% in bricks-and-mortar and 32% in m-commerce.”
- “Context-aware technology will primarily shfit consumer spending from one competitor to another.”
There is a lot more detail in the report that is worth a read, but that $96B figure really caught my eye. Basically, its saying that every customer journey has the potential to be detoured with moment of truth marketing.
Get the context right, and you’ve either kept a customer or taken one from a competitor.
Get it wrong, and you’ve probably lost a sale.
Personally, I believe that the impact they are discussing will happen. And it will come in two forms.
The first is proactive notifications, where providers use location awareness and other information to push promotions, notifications, and other information to customers at the moment of truth. Beyond location, this could be a simple as Lowe’s sending a reminder to your mobile device that its time to replace the air filters you bought for your home 3 months ago.
The second is reactive, where consumers will pull out their computing device of choice at the moment of truth and look for either validation of the purchase they are about to make or to research suitable alternatives (both products and providers). Like checking out Amazon prices while in a Barnes and Noble. As long as I can do this fast and painlessly, I’m game. Context should be used to streamline this approach.
In my opinion, the biggest risk to Gartner’s projections will be the proactive approach. If proactive efforts become more like spam, where the context is not right or you get inundated with offers that people think you care about (just because I walk by a Starbucks does not mean I want to save $0.50 on a cup of coffee since there are Starbucks everywhere), consumers might start rejecting and disabling proactive content. Even if that occurs, the reactive approach will still be used.
Ultimately, the use of context requires effective approaches to managing customer experiences and moments of truth. Use context in combination with your customer-centric (Outside-In) design approaches and you’ll find new ways to keep or capture customers. Adobe is a big believer in context-aware computing and will be leveraging it throughout or customer experience efforts.
-Hank Barnes (@HBatAdobe)
Great article. I’m glad people are talking about this. In regards to the second form you talk about – it is already here. I’ve got the Amazon Price Check app on my phone, which allows me to more easily compare prices, rather than through mobile browsing. For a price conscious consumer like me, price comparison apps will be invaluable.
As to your first point, while I think the proactive notification trend will eventually have tremendous value for consumers (and thus businesses), a key issue it needs to tackle first is consumer control over their own information. Personally, I don’t want businesses and corporations to have access to my location data. However, perhaps I would like to receive relevant updates such as your Lowe’s example.
The important distinction is to allow consumers to control how and when they interact with you as a business, but offer opportunities for context-aware interaction that will benefit them.
I’m in 100% agreement with you, although I’m okay with sharing location data, as long as it provides value to me. Your closing comment about letting consumers control these interactions is the key. If companies embrace user centric design and customer experience principles, then they will do just that. If they decide to try to push the agenda of their business onto customers, then the promise will fall far short of these expectations.
I wonder if we break context down into its categories if we need a crystal ball for the future or a magnifying glass for current implementations. Location-aware services (Layar, Groupon, etc) already here. Re-purchase based on previous activity has been in-market for a few years from various banner/campaign management tech firms. Context-aware content delivery is a part of many WCM and media delivery platforms (recommendations). Yahoo! has been selling behavioral categories across ad networks for a few years (and retaining one of the highest CPM averages in the business). Device detection is active technology. I agree that the scale may change.
What I really like about this post is the insight that users who have previously consented to having context detected in exchange for relevance may turn it off when it turns to awkwardly personal inundation.
It would be great to hear examples of using context well and poorly. I know for me, opt-in e-mail lists have now become totally useless because I get so many mailings from people that I opted into that I read none of them.
I do use Groupon (and like it)–they also let me know the “deal of the day” in the subject of their message, so i can choose to open or delete quickly.
Any others you love (or despise)?
I’m also a Groupon user – and one thing I’ve noticed is that you can control the amount and degree of information which you give to them. (I like that about them, in addition to the easy discernment of personal relevance you mentioned). You can just give them your general location and nothing more and they will send you every “deal of the day” for that city, or you can give them a little more information (age, gender, interests, etc) and they will send you an email only when the deal falls into your interests.
They encourage users to provide some of this information through unobtrusive prompts (I saw them after I had purchased something). I really appreciated that lack of the ‘hard sell’ and so chose to provide a little more info than I would have otherwise, though still not as much as they recommend.
I think degree is another key issue in allowing the user to control the interaction. This applies to both the information provided by the user as well as frequency of interactions. I may allow Groupon to know my city of residence, but I wouldn’t allow them to track my mobile phone. Similarly, as Ben said, I may have signed up for context-relevant notifications, but only want to receive them once a day, or under specific circumstances, and would be annoyed if they occurred more often.
Contrast this with Amazon, who I think has great opportunities to do some neat things with context, but is instead doing some not so great things. Their “Recommendation related to previous browsing” trigger emails are really annoying. I begin to think the company is being pushy and isn’t that focused on my experience. If, however, they were to note that I looked up a product through their Price Check app, or that I shared a link to their product; I would be much more receptive to the related items/sale notifications as those activities indicate a more serious interest on my part to purchase rather than casual browsing.
As you said above, a commitment to user experience is absolutely critical, but part of that is understanding that every user is different and so there is no one-size-fits-all solution.
To Ben’s points, I think an interesting direction will be how context and mobile become integrated in new ways. I haven’t thought about that enough yet.
Sorry for the novel!
@Kelly – good stuff.
That comment qualifies as a guest post!!
[...] insight in this article by Hank Barnes where he describes the value and impact of context-aware technologies and [...]