This is a blog from fall 2017. The opening sentences are still true two years later!!
Today’s blog addresses two trends. Customer experience (CX) is being enthusiastically embraced by businesses, and augmented reality (AR) is being observed with reservation. We suggest that there is a natural connection between these two trends and that opportunities are present in both.
AR: The Unknown
Let’s begin by stating the obvious: augmented reality (AR) is hot. Both Apple, as discussed in our last blog "AR X = The Next 10 Years", and Google are actively integrating AR into the underlying operating systems of their smartphones. The question for business: Is the mainstreaming of AR relevant, or just another (potentially distracting) source of entertainment and expense without return?
Many leaders have not yet grasped that AR can move beyond the realm of entertainment to become a measurable tool to improve results through customer engagement.
Mike Proulx’s article “Augmented Reality: The Hottest Thing Marketers Don’t Want” (Media Agency Daily, September 20, 2017) references a recent study that found that most marketing and corporate executives identified AR, virtual reality (VR) and mixed reality (MR) as low priorities for investment. Mr. Proulx suggests that businesses have yet to see the value in AR because they fail to envision applications moving beyond entertaining gimmicks. The author advises separating AR from VR and MR in this context, because AR is so much more broadly accessible. In fact, Mr. Proulx points out that “eMarketer [is] forecasting close to 50 million AR users in the US next year”. Thinking intuitively, I believe this group of AR users is an attractive market for entertainment-based businesses, such as casinos. These early adopters of AR have interest in experiences and money to spend.
I am going to call upon my experience working in advertising agencies in the 1990s when similar discussions were taking place about the Internet. At that time, businesses were trying to understand the potential in this new technology. Some, like Mr. Bezos at Amazon, saw the long-term opportunities. But across business sectors, many struggled to understand how to convert a website into an asset or revenue stream. Websites were viewed as a novelty, and an expense, with little substantial value. It took years for eCommerce to be accepted by consumers and for companies to create a business model that worked.
Times have changed! eMarketer estimates that eCommerce was valued at nearly $4 trillion in 2016.
Ten years after the Internet became part of mainstream consciousness, similar patterns were noted when businesses were learning how to activate social media networks to generate profitable results. The transition from engagement platform to revenue generating entity has been slow for many of the top social media sites. So, AR is the latest technology that needs to make the leap from customer-facing novelty to revenue driver.
CX: The Dogma of the Day
Customer experience, referred to as CX, is very present as a priority for businesses of all sizes. This is in marked contrast to the uncertainty and incredulity with which AR is being viewed. The commitment to CX is driven by the age of personalization and instant gratification, in which today's consumers are immersed, and has been enabled by social media and technology.
Knowing CX is important and can drive customer loyalty resulting in increased revenues is not the same thing as effectively implementing engaging customer experiences at each point of contact. I believe that most companies I do business with understand, in principle, that CX is important. That said, the delivery of memorable, customer-centric experiences is still the exception, not the rule. Why is this the case?
…customer experience (CX) is not just cleaning up a mess efficiently or sharing information nicely. The journey of a customer begins in the foothills of the psyche.
- Yuri Kruman, August 8, 2017, “The Importance of Customer Experience in the Age of Instant Gratification”, Forbes Coaches Council
In order to deliver truly memorable customer experiences, businesses need to be executing a number of tactical operational elements in real time, while concurrently establishing aspirational and personalized relationships with their customers and prospects. Since the beginning of the consumer era, customers have needed to see themselves in the business they patronize. (See our blog: "Telling my story through brands".) Personal identification with a brand and its values has, and continues to be, an important part of any purchasing decision. Of course, the product or service must also have tangible merits. The principles of CX enhance and update our relationship to brands by creating a new framework for understanding engagement.
AR and CX: The Opportunity
Augmented reality provides a means of engaging consumers with products and services such as has never been possible before. When you combine that new power with the kind of personalization possible through the application of artificial intelligence (AI), we have the potential for a major disruption – not unlike the introduction of eCommerce in the 1990s.
In this vein, I shall take this opportunity to mention that our business, Play the Field™, is leveraging the entertainment capabilities of AR to create amazing new customer experiences and activate an enterprise solution rooted in AI. We have been working on this initiative for more than a year now, and are engaged with several leading businesses from the casino industry (both operators and casino game manufactures) as well as some destination marketers, to pilot our concept.
Advice for the week
So as marketers finalize their budgets for 2018, they should plan to spend more on augmented reality initiatives because it will have a business-driving impact on both their digital and CX strategies—two things that we know are top priorities for them. It just requires designing AR for utility rather than entertainment.
- Mike Proulx, September 20, 2017, “Augmented Reality: The Hottest Thing Marketers Don’t Want” Media Agency Daily, September 20, 2017
Mr. Proulx's advice to businesses is excellent. We offer three additional considerations.
When you think of the potential of AR, try to imagine your business without an online presence or social media profile. Before you know it, AR will be just as integral to your operation as these channels for engagement that were once considered experimental.
Be an innovator and take initiative to think about how you can use AR to both create memorable customer experiences and grow your business. Your plans should consider moving one step beyond the AR experience to identify how you can track and monetize customer behaviour.
Don’t be left behind. Things move much more quickly now than they did 20 years ago. The businesses that adapt early will have the best opportunities to retain and grow their relationships through AR.