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Making Leaders Successful Every Day

January 18, 2011

How To Build Online Experiences Of The Futureby Moira Dorseyfor Customer Experience Professionals

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© 2011 Forrester Research, Inc. All rights reserved. Forrester, Forrester Wave, RoleView, Technographics, TechRankings, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective owners. Reproduction or sharing of this content in any form without prior written permission is strictly prohibited. To purchase reprints of this document, please email [email protected]. For additional reproduction and usage information, see Forrester’s Citation Policy located at www.forrester.com. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change.

For Customer Experience Professionals

ExECuTivE SuMMaryForrester believes that four attributes will characterize the next phase of development of the web. Online experiences will be: customized by the end user, aggregated at the point of use, relevant to the moment, and social as a rule, not an exception (CARS). For this report, we spoke with customer experience professionals who have already launched these types of online experiences. Our research revealed that there are four keys to designing, launching, and delivering successful CARS experiences: 1) start with consumers, not capabilities; 2) make aggregation central to your strategy; 3) turn your IT partners into your new best friends; and 4) introduce innovations with care.

TaBlE OF COnTEnTSOnline Experiences Will Be Customized, Aggregated, Relevant, And Social

Innovators Share Four Keys To Building Successful CARS Experiences

Start With Consumers, not Capabilities

Make aggregation Central To your Strategy

Turn your iT Partners into your new Best Friends

introduce innovations With Care

rECOMMEnDaTiOnS

Anticipate The Unexpected To Ensure Success With New Online Experiences

Supplemental Material

nOTES & rESOurCESForrester interviewed eight vendor and user companies, including Big in Japan, FedEx, Fidelity, insideTrip, livekick, Mobilizy, uSaa, and yellow Book.

Related Research Documents“Best Practices For launching Site redesigns”June 23, 2010

“The Future Of Online Customer Experiences”January 28, 2010

“Match iPhone Capabilities To Customer Goals”January 23, 2009

January 18, 2011

How To Build Online Experiences Of The FutureBest Practices From Firms That Created Experiences With CarS attributesby Moira Dorseywith Harley Manning, richard Gans, and Jennifer Peterson

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© 2011, Forrester research, inc. reproduction ProhibitedJanuary 18, 2011

How To Build Online Experiences Of The Future For Customer Experience Professionals

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ONlINE ExpERIENCES WIll BE CUSTOMIzED, AggREgATED, RElEvANT, AND SOCIAl

A little more than a year ago, Forrester predicted that online experiences were on the brink of a new era.1 The transformation is already underway, driven by rapid changes in technology capabilities, consumers’ online behavior, and increasing competition (see Figure 1). We concluded that trends in these areas would drive online experiences to be increasingly (see Figure 2):

· Customized by the end user. Consumers will control not only what they get online but also the form in which they get it to a much greater degree than they do today.

· Aggregated at the point of use. Content, function, and data will be pulled from different sources and organizations and combined at a common destination to create a unique experience.

· Relevant to the moment. This customized, aggregated content will appear on the devices, sites, apps, and widgets best suited to the customer’s context at a given point in time.

· Social as a rule, not an exception. Social content will be integrated into most online experiences, not just segregated in today’s blogs, microblogs, wikis, or community sites.

Figure 1 The Three C’s are Driving Changes in Future Online Customer Experiences

Source: Forrester Research, Inc.57903

Forrester believes that future online customer experiences will be driven by rapid changes in three areas:

Capabilities Changing technologyplatforms

Today’s default platform — a browser running on a PC — willrapidly give way to a host of highly diverse environments.

These new capabilities get a warm reception from amarketplace that’s hungry for innovation.

Information providers ranging from large companies toproli�c individuals �ood the Internet with a tsunami of onlineinformation targeted at increasingly wired consumers.

Evolving onlinebehavior

Millions of newentrants

Consumers

Competition

© 2011, Forrester research, inc. reproduction Prohibited January 18, 2011


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Figure 2 Consumers Embrace CarS Experiences


*Source: TNS Compete†Source: eBay‡Source: Nielsen

With widgets and apps, consumers now customize all browser types plus desktops,smartphones, and TVs.

The top 10 most-tra�cked Web sites aggregate content from multiple sources.*

Smart devices are game changers: Mobile shoppers spent $2 billion on eBay in2010.†

Consumer opinions posted online are now the most trusted source of advertising.‡

ustomized

ggregated

elevant

ocial

INNOvATORS ShARE FOUR KEyS TO BUIlDINg SUCCESSFUl CARS ExpERIENCES

We interviewed customer experience professionals who have developed innovative CARS experiences for their firms (see Figure 3). Our research revealed that there are four keys to designing, launching, and delivering successful CARS experiences:

1. Start with consumers, not capabilities. All of the successful CARS projects we heard about started by identifying consumer needs. Understanding those needs allowed the companies to innovate with a clear sense of direction and priorities.

2. Make aggregation central to your strategy. The ability to aggregate and be aggregated is the critical dependency for making online experiences relevant and social. Customer experience professionals need to create new offerings with the explicit intention of sharing content both internally and externally.

3. Turn your IT partners into your new best friends. Successful CARS projects include developers as core team members. Developers often contribute to strategy and design as well as technical implementation.

4. Introduce innovations with care. An innovation is “the introduction of something new.”2 But new things — even when they’re big improvements — often meet resistance.3 Our interviewees offered advice on how to successfully introduce CARS experiences to important stakeholders like executives and customers.



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Figure 3 interviewed Firms Developed innovative CarS Experiences


FedEx My FedEx lets userscustomize their viewsby allowinginformation modulesto be shown/hiddenas seen �t.

FedEx Desktopaggregates trackingdata to a user’sdesktop to provideup-to-date shippingstatus.

An iPhone appupdates customers onpackage deliverystatus.

FidelityInvestments

Articles fromSmartMoney andother sources appearalongside originalcontent on�delity.com.

Customers canmanage theiraccounts and tradewith iPhone and iPadapps.

The online teamreaches out tocustomers andprospects viaFacebook and Twitter.

Big in Japan

Customized Aggregated Relevant Social

InsideTrip

Users of the company’sShopSavvy app scan a product with their phone’s camera. The app returns pricinginformation at localand online stores. Shoppers can save results to awish list and set pricealerts.

Users can search for�ights based on theoptions that are mostimportant to them(e.g., on-timeperformance andlegroom).

ShopSavvy pulls pricing information from multiple retailer databases and directlyfrom users. It compiles driving directions, addresses, and phone numbers for local retailers that stock desired items.

ShopSavvy is available on iPhone, Android, Nokia, and Windows phones.

Users can viewcustomer ratings and reviews of products and add and edit product data. Users can add/sharereviews, prices, pictures — and the best deals.

InsideTrip compiles �ight informationfrom multiple travel databases.



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Figure 3 interviewed Firms Developed innovative CarS Experiences (Cont.)


Geographic �lters cutthrough the clutter.

Almost 4,000 salesreps enableaggregation of localinformation on agrand scale.

Mobile apps allowusers to accessinformation onAndroid, iPad, iPhone,BlackBerry, and Palmdevices.

User-generatedreviews add value tolistings.

Deposit@Mobile letsmembers depositchecks bysmartphone.

Members can rate andreview �nancialproducts.

USAA On the site, memberscan see all of theiraccounts, includingthose held at othercompanies.

An iPhone app bringstogether account info,an ATM locator, arental car locator, andan accident tool kit.

Yellow Book

Livekick Users can list theirfavorite artists or haveLivekick pull lists fromtheir favorite musicapps (e.g., iTunes,Pandora).

Livekick bringstogether information from multiple sourcesto help users �nd localconcerts for theirfavorite artists andthe best ticket pricesfor the concerts theywant to attend.

Users can receiveupdates on localconcerts from theirfavorite artists viatouchpoints likeemail, Twitter, RSSreaders, widgets, andiPhones.

Users can shareinformation aboutconcerts viacalendaring andsocial apps. The sitelinks to artist info onMySpace andWikipedia.

For tourists, landmark information is availableon the relevant mobiledevice.

Information aboutlandmarks is drawn from Wikipedia.

Mobilizy Wikitude uses location-based data to pull upinformation aboutlandmarks in their surroundings from Wikipedia.

The �rm’s Wikitude app provides users with information about landmarks in their surroundings.

Customized Aggregated Relevant Social

Members can get apersonalized budgetbased on their spending patterns and advice tailored to speci�c life events,including end-to-end support for car and home ownership.

Start With Consumers, Not Capabilities

New products fail when they don’t address user needs. To avoid launches that miss the mark, our interviewees recommend that online customer experience professionals:

· Let the needs of customers drive innovation efforts. USAA knew that its members were geographically dispersed, extremely mobile, and reluctant to mail checks to the few brick-and-mortar branches available to them. However, members also tend to be early adopters of technology. That drove USAA to create Deposit@Home, an application that allowed users to deposit checks by scanning them and emailing the image. Using the same infrastructure, USAA later deployed Deposit@Mobile, a smartphone app that allows users to deposit checks using the camera on their phone instead of a scanner (see Figure 4). This app brought the remote-deposit experience to the relevant device for members deployed around the world, letting them get access to their money quickly without the uncertainty of mailing a check.



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Figure 4 uSaa iPhone app allows Check Deposits


Source: USAA website

The web page shows USAA’s mobile appfor the iPhone.

· Create innovations that fulfill customers’ unmet needs. Fidelity treats capabilities like aggregation as a means of serving customers needs, not an end in themselves. Ever since the financial crisis of 2008, Fidelity’s customers have expressed a strong desire for the firm to help them understand what they need to do, instead of just telling them what happened. In order to layer advice on top of information, Fidelity expanded the role of the editorial staff that was originally created to aggregate site content from sources like SmartMoney and The Wall Street Journal. Now, when major developments occur, an editor in chief identifies an internal expert who creates content, which is then edited and distributed for review and approval (see Figure 5). For example, the day after the stock market bounced on May 6, 2010, Fidelity published proprietary content that put the event in context and offered guidance on how investors should react.



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Figure 5 Fidelity.com Offers aggregated Content


Source: Fidelity Investments website

Fidelity’s home page shows originalcontent created by Fidelity as well asmarket data aggregated from othersources.

· Create CARS experiences that add unique value. The online team at Yellow Book saw a gap in the market for helping users make informed decisions when looking for services, such as a plumber or tree cutter. Searching for services is not like searching for products, where users look for the best product they can afford. Instead, service shoppers want to find qualified providers that have a good history of working with other users in similar situations — information that customer reviews are perfectly suited for and that Yellow Book now provides (see Figure 6).

· Prioritize innovations and processes based on customer needs. In response to customers’ strong interest in proactive package tracking updates, FedEx created the My FedEx web application. It allows users to view all tracking information from one central location and personalize that experience with nicknames and custom views. Quantitative research revealed that proactive notification of order status changes had become the highest-priority feature to



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customers, leading to the creation of the FedEx Desktop widget and an iPhone application (see Figure 7). Both apps enable customers to provide real-time feedback, which drives ongoing prioritization of improvements. To enable quicker iterations, the team moved away from FedEx’s waterfall development process, which required each step to be complete before the next could begin and resulted in an 18-month development cycle. Instead, the new process allows multiple steps to occur at the same time and results in a product that meets customer needs much more quickly.

Figure 6 yellow Book lets users review listed Companies


Source: Yellow Book website

A Yellow Book web page showsconsumer ratings of regional businessesas well as the controls that let usersshare listings or begin writing a reviewof a business.



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Figure 7 The FedEx Desktop and iPhone apps Provide Proactive Tracking notifications


Source: FedEx desktop and iPhone apps

· Use social experiences — both positive and negative — to drive change. Alarm bells went off after some products averaged fewer than four stars in a five-star customer rating system on usaa.com (see Figure 8). Some USAA employees wanted to remove the negative reviews, but the online and social media teams argued that negative reviews were simply another way for customers to provide feedback and request change. The company concluded that it’s more important to focus on changing the business than to worry about the potential impact of negative reviews on public perceptions. As a result, USAA has kept the reviews live and makes product changes, where possible, in order to create a more positive user experience and address member pain points. Early indicators show that the approach is working: USAA sees higher close rates from site sales.



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Figure 8 uSaa’s Website lets Consumers rate Products

Make Aggregation Central To your Strategy

The definition of online experiences is rapidly changing from one where companies build a site that customers visit to one where companies must deliver an experience on whichever devices, sites, or apps their customers find relevant. In this new paradigm, our interviewees recommend that customer experience professionals:

· Design for distribution across a multidevice, multichannel world. When USAA collected and displayed ratings and reviews for its financial services products, it anticipated reusing the content across devices and potentially across third-party sites. But each line of business has

“arcane” back-end systems and its own development shop to deal with them. So USAA has turned to its internal innovation team to create a flexible services layer to accommodate the explosion of devices, platforms, and services that are entering the market. The firm also used selected partners to help scale its efforts, including Critical Mass for strategic design work and Bazaarvoice for moderating reviews.


Source: USAA website

USAA’s home page features productswith consumer ratings.



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· Build back-end services that allow reuse across multiple online channels. The FedEx team built the back-end systems for the My FedEx web application with reuse in mind. When it subsequently built FedEx Desktop, a widget that monitors shipment status and sends notifications, it was able to offer the same level of functionality in just five months — half the time to create My FedEx.

· Build application programming interfaces (APIs), not apps — make the data portable. Although counterintuitive, there are benefits to syndicating — rather than protecting — some proprietary data so that third parties can aggregate it into their experiences. For example, ShopSavvy collects data from hundreds of retailers. The app allows shoppers to scan a product’s bar code and find out where they can buy it locally or online and at what prices (see Figure 9). By doing this, it gives retailers that provide data to ShopSavvy a presence in their competitors’ stores. When ShopSavvy’s co-founder showed a chief marketing officer (CMO) a demo of the app in one of the CMO’s own stores, the CMO agreed to provide his firm’s data after just three scans. It was clear that when his competitors put their prices on ShopSavvy, they got to compete with him in his own store whether he liked it or not — so he needed to be able to do the same thing to them.

Figure 9 ShopSavvy aggregates Data To Help users Find The Best Price


Source: Big in Japan iPhone app

ShopSavvy aggregates data from multiple retailers, as well as the app’s users, and displays it on devicesthat shoppers can carry when visiting retail stores.



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· Autocustomize and help relevant data find the user. Concert goers use Livekick to find out when their favorite artists will be performing in their area. One of the firm’s founding concepts is to make it easy for users to customize the service by doing most of the work for them. Livekick’s chief executive officer (CEO) refers to this as autocustomization. Instead of forcing users to enter their favorite artists’ names, Livekick builds a profile for them based on playlists imported from their favorite music service like iTunes and Pandora (see Figure 10). Another founding principle of Livekick is to bring users information based on their customization. By enabling customization and then aggregating data from 15 events sites, the service delivers a personalized experience that’s different every day for every user.

Figure 10 livekick Makes it Easy For users To Customize Their Experience


Source: Livekick website

Livekick’s downloadablewidget pulls informationabout users’ favorite artistsfrom music services likeiTunes and Pandora.



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Turn your IT partners Into your New Best Friends

Our innovators all confirmed that collaboration with their colleagues in IT was key to the success of their initiatives. Some of their specific recommendations include:

· Seek IT partners with an understanding of customer experience. The idea to upgrade the My FedEx web application to Flex Desktop — which enabled a more customizable and rich user experience — came from the developer on the team. He was also the first to recognize the potential benefits of developing a tracking application for the iPhone. Since the footprint of the desktop application is similar to that of the iPhone app from a user experience (UX) perspective, the team was able to create the iPhone app in only two and a half months — half the time needed to create the FedEx Desktop. In terms of business results, the iPhone app had more than 500,000 downloads within the first year.

· Co-locate designers and developers. To ensure that the design stays closely aligned with business needs, Fidelity’s online team has built close relationships across functions. For example, when incorporating changes to its home page and creating the iPhone app, it had people from various departments sitting together to ensure that there was clear, spontaneous communication. While designing the iPhone app, the mobile product manager went so far as to hang out with the development team every day just to ensure proper levels of communication and address issues as they came up. Ultimately, the approach paid off in decreased cycle time and improved usability and design.

· Communicate expected experience benefits to get buy-in from IT. The yellowbook.com team added customizable searches on yellowbook.com through the use of geographic filters. This required a great deal of development work. The online team found that by taking the time to help people in IT understand what they were trying to do and why, their technical colleagues viewed the prospect of adding customization as an exciting challenge rather than an additional burden.

Introduce Innovations With Care

Change — even for the better — isn’t always welcome. To help ensure their new products would be embraced, our interviewees encouraged other customer experience professionals to:

· Position the launch of innovative products as beta versions. When USAA launched the Deposit@Mobile application, the experience was not initially perfect. Based on member feedback, the project team made adjustments that fixed a core problem, demonstrating that USAA takes member needs seriously. By positioning the release as an innovative new service and making changes in response to user feedback, USAA lowered the risks associated with the rollout and earned member trust. Today, members continue to provide feedback that helps direct changes to the already-improved solution.



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· Avoid forcing innovations on their users. Most of FedEx’s customers prefer a richer, more customized experience from My FedEx. But this isn’t true for all of its users. The FedEx team wanted to make sure that those users were not forced to accept the new version if they didn’t want it. That’s why the team incorporated a welcome message into the HTML version of My FedEx, giving users the option to upgrade to the “new and more powerful My FedEx” — or not.

· Favor rapid adoption over extreme innovation. USAA chose ratings and reviews as the first social feature to add to its site. Why? With a feature that was well established in the retail world, the USAA team knew customer ratings would be familiar to its members but still innovative for a financial services site. This approach worked, as shown not only by higher acquisition and conversion rates but also by the intangibles of deeper member relationships.

· Gain executive support through clear communication. The FedEx team used Flash movies to create concept demos of how My FedEx would work once it migrated to Flex. This helped both pave the way among stakeholders and develop a prototype, which the team used to gain executive and IT support for the project. The team also took care to socialize the changes it was making to the development process. The team communicated the process changes to executive management, along with the steps it took to ensure nothing important was lost along the way. This eased concerns among those who worried that doing some development steps in parallel would add risk.

r E C O M M E n D a T i O n S

ANTICIpATE ThE UNExpECTED TO ENSURE SUCCESS WITh NEW ONlINE ExpERIENCES

Our interviews revealed that designing, developing, and launching successful CarS online experiences also requires a willingness to embrace approaches that go against conventional wisdom, processes, and practices.

· give users more power but less complexity. Providing users with the most content and functionality relevant to their goal isn’t the path to providing a differentiated online experience. Putting the most relevant content and function at a user’s fingertips and making it easy to find and engage with is. insideTrip enables shoppers to customize their search based on criteria that are the most important to their needs, whether it’s traveling alone for business or taking an entire family on vacation. On the front end, users see a coherent view of their options, including comparisons of on-time performance, seat legroom, aircraft age, and lost-bag rankings. This elegant simplicity is enabled on the back end by insideTrip’s complex, custom-built relational database that imports data in a variety of incompatible formats and then integrates it seamlessly. Similarly, because music sites display their information in myriad inconsistent formats, liveKick has a layer in its database that normalizes data such as events that have four or five different names depending on which venue they’re appearing in.



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· Embrace the strengths and limitations of relevant touchpoints. automated systems and devices have strengths and weaknesses in terms of their capability to support user activities.4 Customer experience professionals should use these strengths and weaknesses to their advantage — offering users the capabilities they need, rather than every possible feature, in each touchpoint. For example, the success of FedEx’s iPhone app resulted from not requiring users to input a great deal of information — a task the device is not very good at supporting. Currently, the FedEx iPhone app limits itself to providing users with up-to-date tracking information, a valuable but fairly straightforward process. To add input-intensive functionality like creating and processing shipping orders, FedEx is exploring innovative concepts that will reduce the need for data entry. When uSaa migrated Deposit@Home from home scanners to the iPhone, its team learned that users were able to get a better image from the iPhone due to the preformatted size of the image — the app includes gridlines that frame the shot — and the iPhone’s superior ease of use.

· Anticipate changes to business process and technology investments. revamping some experiences will require customer experience professionals to push through new technology investments as well as changes to long-standing business processes. For example, Fidelity’s new responsiveness comes at the cost of changes to business processes and investments in technology. First, there is the ongoing human cost of the small editorial team as well as the time required from experts who write the articles and senior managers who review the articles before they’re published. in terms of technical cost, Fidelity had to upgrade its publishing platform to enable intraday posting of new content on an “as-needed” basis. This required the purchase and upgrade of software platforms from external vendors, including EMC Documentum. These investments won support from Fidelity executives because they served the end goal of building stronger customer relationships by adding value to the company’s highly trafficked website.



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SUpplEMENTAl MATERIAl

Companies Interviewed For This Document

Big in Japan

FedEx

Fidelity

InsideTrip

Livekick

Mobilizy

USAA

Yellow Book

ENDNOTES1 Forrester believes that four attributes will characterize the next phase of development of the web. Online

experiences will be: customized by the end user, aggregated at the point of use, relevant to the moment, and social as a rule, not an exception. In January 2010, we highlighted companies that were providing online experiences that already exhibited one or more of these characteristics. See the January 28, 2010, “The Future Of Online Customer Experience” report.

2 Source: Merriam-Webster (http://www.merriam-webster.com/dictionary/innovation).

3 When companies redesign sites, users’ aversion to change results in problems like spikes in call center traffic and social media backlash. That’s because changes in site design force users to learn new interfaces and new process flows in order to accomplish their goals. Customer experience professionals can minimize the pain of launching a redesign by following best practices like engaging users during the design process and educating executives on what to expect. See the June 23, 2010, “Best Practices For Launching Site Redesigns” report.

4 Instead of shrinking their desktop websites to make them accessible by mobile devices, firms are capitalizing on the power and popularity of devices like the iPhone to create mobile-specific data experiences in the forms of applications, websites, and integrated messaging features. But simply building these richer experiences doesn’t ensure success. Companies looking to harness the power of these devices must design experiences that match appropriate device capabilities with user goals. To design successful mobile data experiences, companies must understand how people want to use mobile data channels, fit those data channels into multichannel scenarios, and focus on their strongest capability — timeliness. See the January 23, 2009, “Match iPhone Capabilities To Customer Goals” report.





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