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The Three Ways AI Is Impacting Customers And Retailers This Holiday Season

This post is part of a series sponsored by IBM about Five Ways Marketers Can Win the Holidays

Artificial intelligence (AI) is impacting the way consumers are shopping for the holidays. It is also driving how companies are operating in order to deepen customer relationships. According to Lauren Kindzierski, VP at HGS, “Forward-thinking companies are already using a combination of bots and brains to deliver next-generation customer experiences and optimize operations.”

Photo Credit: Pixabay

Cognitive and machine learning is powering behaviour in three critical ways for customers and retailers this holiday season.

  1. How customers find gifts? Customers are looking for ease and convenience when holiday shopping. They want an experience that is personalized to their needs. The expectation is that each stage of the journey will be seamless. Voice is driving the beginning stage of their journey. According to Accenture, a majority of consumers are already using or would like to use a number of technologies that are powered by AI. Sixty-eight percent of those surveyed indicated that they were using or wanted to use Google Home, compared to 71 percent for Amazon’s Alexa. Similarly, voice-search enabled digital assistants such as Apple’s Siri and Microsoft’s Cortana and are becoming the go-to search mode for mobile. This trend is here to stay beyond the holidays. ComScore says that by 2020, 50 percent of all searches will be voice searches.
  2. Where and how customers buy? AI can help companies manage data and allow them to be predictive of customer behaviour. By leveraging information about weather, location, and preferences, it can help to create an optimal shopping experience. For retailers, AI can improve supply chain management. It can provide insights in to managing inventory levels and streamlining shipping management. The result is the right items are available and can be shipped to customers in a timely fashion.
  3. How companies manage customer service? During the holidays there is an increased need for seasonal staff to handle customer service issues. For companies, AI is playing a key role in handling many of the basic requests. IVR’s and chatbots powered by AI are handling tasks such as updates on orders, sharing return policies and answering FAQ’s. According to Narvar, customers are not noticing the difference. Their research found that 38% of consumers didn’t know whether a live chat or messenger app was a human being or AI. Only 10% knew it was not human. Gartner predicts that by 2020, the customer will manage 85% of its relationship with an enterprise without interacting with a human source.

To find out more about the five ways marketers can win the holidays, check out this series by IBM covering: 1 – Bridge Digital & Physical Experiences, 2 – Predict the Future to Improve Your Impact, 3 – Market in the Moments that Matter, 4 – Discover the Best Path to Purchase, and 5 – Get Alerted to High-Impact Situations.

Southwest Airlines Employee Demonstrates Heart In Saving A Lost Teddy Bear

Portions of this post were taken from one of my Forbes articles:

Good friend and fellow speaker Meredith Oliver texted me over the holidays.

“Just heard a news story about a Southwest Airlines employee going way above and beyond to find a lost teddy bear.” 

Here is a video from USA Today about the story:

This was a remarkable story. Steven Laudeman,  a Southwest employee for 13 years, demonstrated a great deal of heart to help an eight year old girl and family friend. He also had fun in the process.

The Heart Sets Things Apart

True advocacy begins only once you reach the heart of your customers. The heart has always been central to Southwest. One may point to the fact that airline was founded at Love Field in Dallas or that its stock ticker symbol is LUV. But according to Dr. Fathi El-NadiSouthwest‘s culture can be traced back to its founder. “Herb Kelleher encouraged informality and wanted staff to have fun at their jobs. Employees were valued, with Kelleher acknowledging births, marriages and deaths by notes and cards. Staff were encouraged to pitch in and help out, especially at check-in, giving Southwest turnaround times less than half the industry average.”

In 2014, Southwest made the heart a prominent part of its branding. It was added to the logo and is being painted on the underbelly of every plane.

The heart on the underbelly of the fuselage. Photo credit: southwest-heart.com

Start With Heart

How do you hire for heart? You need to put empathy front and central. Empathy is caring. Unlike a smile, you can’t fake empathy. It’s a vital aspect of customer experience. First of all, you need to make it a key hiring factor. In the past, Southwest employed a brilliant interviewing tactic when hiring flight attendants. The airline conducts group interviews. One by one, applicants will be asked to come to the front of the room. The task is to tell everyone their most embarrassing moment. Here’s the Judo-like application of the tactic. The applicant sharing their moment feels like they are being evaluated. Not so much. The interviewers are spending the majority of their focus on the audience. They are looking at the faces of the other interviewees. And they are looking for one thing: EMPATHY. Specifically, Southwest looks for three characteristics:

  • a warrior spirit
  • a servant’s heart
  • a fun-luving attitude

Differentiation is Now Further Downstream

According to marketing and branding expert Rohit Bhargava, “We now live in an age of equivalency.” It’s very difficult to differentiate with your product or service in our connected world. Professor Niraj Dawar asserts that this has forced differentiation to be further downstream. In an HBR article, he asserts the importance of shifting your strategy from products to customers. Marketing becomes your strategy. “ To compete effectively, companies must shift their focus upstream to downstream activities, emphasizing how they define their competitive set, influence customers’ purchase criteria, innovate to solve customer problems, and build advantage by accumulating customer data and harnessing network effect.”

Employees are Key to Experience

Southwest’s focus on employees is a smart move. Your employees bring the customer experience to life. You can’t make up for in training what you missed in hiring. Kelleher was famous for saying that, “You hire for attitude, train for skill.” You can’t train employees to care. In Kelleher’s view, “That was Mom and Dad’s job.” Front line employees are central to the experience. HCL Technologies CEO and best-selling author Vineet Nayar states, “We call this the ‘value zone.’ Every employee who works in the value zone is capable of creating more or less value. The whole intent of Employees First is to do everything we can to enable those employees to create the most possible value.

Logos as Symbols

What is a brand? For many, a simple definition is that, “a brand is a promise.” The symbol of the heart by Southwest is a promise to customers and a constant reminder to employees. According to the author of WTF – What’s the Future? Brian Solis, “Your brand is no longer what you say it is. Welcome to a new era of marketing and service in which your brand is defined by those who experience it.” I would only amend that slightly, “ Your brand is no longer what you say it is. Welcome to a new era of marketing and service in which your brand is defined by those who experience it and more importantly, by those who deliver it. ” Are you willing to put your heart into your brand?

Photo credit: Stan Phelps

Lagniappe (a little something extra thrown in for good measure) – Want more examples of how Southwest puts experience empowered by employees at the forefront of their brand? Here’s five inspiring case studies:

1. Holding a plane for a passenger going to see their dying grandson.

2. Recognizing the artistic efforts of a young passenger.

3. Stepping up to help a customer with a special need with JOY.

4. Party with a purpose.

5. A Creative Extra for a Customers’ Birthday