Customer Engagement and the Digital Transformation

There’s been a lot of talk about digital transformation for a while. However there’s no escaping the fact that when we apply digital technology to all aspects of human life, everything has to change.

The only way to make sense out of change is to plunge into it, move with it, and join the dance.”

Alan Watts


At Thunderhead we like to dance. We’re also interested in how we can help businesses like yours to build and maintain better relationships with your customers in a digital world.

Digital transformation is the most significant strategic challenge facing businesses in several decades.

Inside your business digital innovation has had a huge impact on every aspect of how your business operates: your internal processes, your operating model, what you sell and how you go to market, across every department. In a nutshell, your entire business model and value chain are affected. That’s everything in your business.

Surrounding your business the changes in digital technologies have also led to dramatic changes in your market, in customer demand and behaviour. How your customers perceive value in the moment when they interact with your brand has changed radically in recent years. They want it now, on their terms, their way. This means you have to completely rethink about the way your business approaches, interacts and builds relationships with your customers.

These parallel internal and external changes have coincided, resulting in businesses having to completely transform. Digital transformation is a byword for survival. The Brand graveyard is littered with those who didn’t: Tower Records (who started record mega stores) filed for bankruptcy in 2004 under too much pressure from online music downloads like iTunes; Blockbuster (the video rental library chain) filed for bankruptcy in 2010 unable to face pressure from online movie download market. Uber has dealt traditional taxi cabs an almost fatal blow. Got it?

To help brands like yours face these challenges at Thunderhead we decided to get to the heart of what would really make the biggest difference. The real value for businesses and customers comes from the strength of a brand’s relationship with its customers over time and involves understanding the entire customer journey. So, we took a fresh look at marketing theory, behavioural economics and other disciplines which shed light on the way in which consumers interact and behave. The result of that work is a framework for Customer Engagement which we call Engagement 3.0. We validated it with a number of leading analysts and thinkers in the area plus primary research with consumers and C-Suite execs. The Customer Engagement model is the answer to help you have more joined-up conversations with your customers in a world of constant digital innovation.

The fundamental insight that we got from Engagement 3.0 was the importance of value and making sure that every time a customer interacts with a business they come away with some form of value. Value and value co-creation are interesting ideas that have come from developments in marketing theory over the last decade. The basic idea is that only a customer can determine value, and the challenge facing businesses is how they can create propositions at the relevant time that deliver value to the customer.

The only real measure of your success is increased customer value. How tough can it be? If you’re forcing customers along a pre-defined path instead of supporting them on their preferred journey it’s almost certain that they’re not going to be happy customers.

Businesses think in terms of sales, service and marketing to customers. Your customers are only interested in what’s relevant to them. It’s a complex puzzle for you to solve: your customers have an ever-increasing choice of how they talk with you; your brand is already handling a raft of internal processes and systems. Because the best brands want happy customers it’s time to embrace digital transformation.

It’s time to join the dance. Or be another Blockbuster.