Are Customers Living In The Digital Era of Distrust?

by CXOtoday News Desk    Feb 09, 2016



At a time when businesses are seemingly taking the digital route for success, a new research by Gartner shows that widespread failures in realizing RoI in digital technologies for customer experience could create a sense of distrust among buyers and decision makers in India about the potential for digital business.

Gartner predicts that by 2017, 80 percent of consumer-facing companies will fail to realize ROI on investments in digital technologies focusing on customer experience because of the country’s market dynamics and economic environment.

“India’s consumer market, and economic dynamics, are completely different from the consumer dynamics observed in western markets,” said Arup Roy, research director at Gartner. “While consumer-facing companies in mature western markets are driven by value drivers, such as superior customer experience and product/service design, consumer-facing companies in India and other emerging markets, are driven by value drivers such as lower cost of product/service, being able to handle the problem of volumes, and being able to effectively reach the masses.”

Companies that intend to implement complex customer experience technologies in India, such as beacons, in-building navigation, facial recognition-driven marketing and promotions will not yield the expected ROI because customers’ basic needs, such as affordability, availability and ease of access, need to be fulfilled before they are able to appreciate the value of these technology-led experiences.

“Unfortunately, a significant proportion of consumer-facing companies are swayed by the shiny and successful examples of ‘customer experience’ initiatives of their western counterparts,” said Anshul Gupta, research director at Gartner. “They are making investments in front-end, customer-facing activities that leverage digital technologies and failing to invest in the back end necessities, such as enabling easier and faster process workflows, easier shopping and service experience and after sales.”

Gartner advises companies to leverage digital business to reinvent their business model so that it addresses the key issues affecting the Indian consumer industry - problems of plenty (volumes), cost sensitivity and the diversity and reach of consumers.

Gartner believes by 2018, more than 50 percent of Indian organizations will get lower than-expected results from their DevOps efforts because of an excessive focus on tools over people. While interest in DevOps as the high-speed, agile IT delivery approach is fast gaining popularity across the world, including in India and APAC, one of the key challenges commonly mentioned by DevOps early adopters is that a key success factor of DevOps is culture, hence DevOps focuses on people.

“When done well from the beginning, DevOps can bring in significant and differentiating benefits to the organization and can be a key success factor for digital businesses,” said Tapati Bandopadhyay, research director at Gartner. “Make people a focus for DevOps by starting with a small group of people with the right attitude, from different teams. Then proactively change and create the culture of collaborative and exploratory approaches embracing uncertainties as unexplored opportunities instead of avoiding them as risks.”

The Indian telecom industry will also reach nearly 50 percent of its revenue through data, demanding a change in network management approach, said Gartner. It is important for CSPs to leverage these trends in a holistic manner across consumers, small or midsize businesses and enterprises. Most CSPs are working toward digitalizing their operations. While there is a lot of focus on customer-facing areas (such as channels, portals and customer applications), service and network management transformation should complement these efforts in parallel.

“Positive leverage of these trends requires simplification of operations (network management, IT management and operations management), as well as utilization of analytics across the operational data, in real time gradually,” Gartner researchers believe.

Gartner also predicts, by 2020, more than 40 percent of the Indian urban households will use home automation/energy management solutions. Adoption of home automation in India is gaining momentum, but is still held back by industry challenges such as unstructured and fragmented ecosystems, price and perceived value, lack of any high-speed network coverage on a pan-India basis and the multiplicity of evolving network technologies.

Increasingly, home automation services will be delivered through gateways and use the cloud to enable users to manage their homes remotely through mobile apps, the research firm said.