2020 will be a remarkable year. A new decade has begun, giving us the feeling of a fresh start, of possibility, and the opportunity to reflect on the changes and progress we have made so far. The challenge is to find a relevant point in time, an anchor if you like, that we can use in order to establish a meaningful comparison.
When I think about the evolution of technology and the extent to which it has changed our lives, businesses and the concept of value creation, the first thing that comes to my mind is the Internet. However, it doesn’t strike me as a meaningful reference point as of yet, as it is a relatively young technology that keeps evolving; we cannot look back and say: “It’s done, what’s next?” The internet will probably never be “finished”.
I would suggest a better reference point would be the Apollo 11 programme, and how half a century ago it leveraged the technology available at the time to land humans on the moon. I can only imagine the challenges, constraints, risks and uncertainties of the project, not to mention the creativity and determination required to overcome all of these factors. Consider this: your current smartphone has more computing power than the computer aboard the Apollo 11.
When I think about the Apollo 11 programme (one of the biggest achievements in human history), I remember the John F. Kennedy speech about his vision for the space programme back in 1962. You may not remember his exact words, but I guarantee you remember him in colour, and this is important.
The camera may not be as sophisticated as a spaceship, but its impact on our culture cannot be overstated. Just think about how people recorded important moments before the invention of the camera; you needed an artist, someone who could accurately paint landscapes and scenes, preserving memories for generations to come. We refer to this pre-camera era as the ‘classic age’. We don’t need to be experts in history to identify a classical piece of art, it just looks like something you do when you don’t have a camera.
So why is this important? Well, consider what happened to all of these artists - talented professionals - when the camera was invented. Suddenly, there was no economic reason to hire someone to paint a scene if you could do that yourself, instantly, by pressing a single button.
And so the modern era began. From this point on, working as an artist was no longer about accurately reflecting a scene or landscape, but painting with emotion, aiming to make people feel something. This was the new state of the art.
Just like fish don’t know they are in water, I believe we are unknowingly going through a similar transition in our society right now. It’s not news that people are increasingly willing to spend more money and time on intangible experiences than in tangible products. That means that the human component of customer interactions with any business will become not only important, but fundamental for success.
One of the key benefits of the advent of the internet was the democratisation of technology. If you want to start a business today, the hardest part is not the technology (like it would have been fifty years ago), it’s coming up with a compelling proposition that changes and influences how people feel.
When customers interact with your brand, do they feel calm or anxious? Reassured or confused? Do they feel they are talking to a real person or a robotic assistant, someone (or something) mindlessly following a script? Do they feel they are gaining or losing status? What do they feel when the interaction ends? In a nutshell, can you say your customers experience some form of human connection when interacting with your brand?
These questions will become more and more relevant, just like during the transition from the classical to the modern age. Remember, the technology behind the relationship between business and customers is important for you, not for your customers. You don’t get extra points for each time you mention “digital”, “virtual”, “real-time”, “omnichannel” and, sorry, “blockchain” to your customers. Have you ever tried to compare two laptops? It’s frustrating.
The proliferation of fintech start-ups offering new, and somewhat similar, services is great for driving competition and innovation. However, the real differentiator will be how you make your customers feel when they use your service and, more importantly, how this may influence your customer to be a “sneezer”, spreading your value proposition as an “idea-virus”. This type of “word of mouth” marketing is more effective now than it ever has been before, owing to the fact that as a society we are far more connected than at any point in history.
Think about the “cool factor” that some fintechs try to promote for their customers and employees, or think about the latest successful consumer products, there is probably no better example than the iPhone. Technically speaking, there are several other smartphones on the market that are better (we’re talking miles ahead), and yet, people routinely sleep outdoors in a queue to buy the latest iPhone. Why? Because Apple created a product that changed how people feel. It is about novelty, signalling status, perceived good taste and uncomplicated technology.
This is the key reason why customer data is the most valuable asset in an open economy; it is the only thing that will allow your business to understand your customers’ expectations, emotions and feedback. Ensuring customer data is secure, portable and accessible based on consent is not only an important hygiene factor, but also a regulatory requirement. The real question is: does the data you have about your customers allow you to offer a service that changes the way that they feel? Are you flexible enough to constantly adapt your propositions based on customer feedback? Bear in mind this is a virtuous cycle that will never end, just like the internet.
The reason that this business capability is so valuable is because it is still very rare (for now), and scarcity always creates value.
How do you feel now? Happy 2020. Do get in touch if you have comments or thoughts on my thinking!