Natively-digital businesses are here and they are disrupting the most fundamental industries that we have come to know over the last 200 years.

Consider some of these examples from a previous post:

  • Travelocity changed how we purchase a hotel room. AirBnB is changing the very definition of a hotel room altogether.
  • Taxi medallions have been great investments. Until now, that is. Uber is changing the very definition of a cab.
  • Poshmark is poking a stick in the back of big-box retail with its peer-to-peer network that directly connects individual buyers and sellers of high-end used fashion accessories – currently a fragmented $18B market.
  • My new favorite example, Munchery, is taking aim at the restaurant industry with its digital network of the best chefs sending well-crafted meals straight to your dinner table, at a palatable price.

/wp-content/uploads/2015/06/mobile_innovation_cropped_610_716494.jpg

Every one of these examples is real or plausible, is here today, is digitally driven, and is fundamentally disruptive. More here.

Now let’s talk about the underlying technology that powers these very disruptive upstarts.

Quick – try to envision Uber or AirBnB using a traditional CRM system where someone is judiciously entering opportunities and leads in a system. Or doing manual customer segmentation for weeks on end to decide which pamphlet to send to your inbox. Or directing you to some stand-alone peer-to-peer community that hinges on their static marcom website to deflect customer support.

Exactly.

When you transact with any one of these digital-native businesses, you’re presented with an arrestingly simple user interface that gives you just the things you need but shields you from tremendously sophisticated back-end applications sitting on a data platform that spots highly qualified demand, locates supply in real time, and fulfills the transaction, all with a few clicks.

Let’s take how Uber works, for example:

  • The location-aware mobile app finds you when you fire up the app. That’s fully qualified demand.
  • It immediately makes you an offer based on your most preferred vehicle with the fare estimate and time. That’s a 100% targeted offer.
  • It fulfills the order with your credit card on file. That’s low-to-zero-friction commerce.
  • It begins to learn your preferences as you use the product. That’s always-up-to-date, dynamic customer profiles with near zero touch.
  • Feedback is baked into every gesture by measuring every click and every missed click. That’s low-latency optimization and customer success.
  • And finally, it leverages ratings on the network to make sure that both driver and passenger are legitimate and want to do business with each other. That embodies trust and significantly reduces customer acquisition cost.

All of that without the consumer or an army of professionals in sales and marketing lifting a finger. That’s how digitally native businesses operate.

This is the modern incarnation of CRM, something that goes beyond traditional CRM. This is Customer Engagement, where the true notion of Customer Relationship Management is the product.

This isn’t just for new upstarts. A recent PwC report found that “The majority of tech CEOs (71%) believe that companies will increasingly compete in new sectors in the next three years and 63% view competition (new and traditional) as likely to disrupt their industry landscape.”


The C-suite of leading incumbent companies should be looking for four accelerators from technology:

Presentation2.png1. Experience: This is not about software features. As CRM analyst Esteban Kolsky suggests, “It’s about data as a foundation,” and that “most organizations are not prepared to deliver those outcomes in the form of experience.” The question becomes this: How can you assemble the right intelligence in real time to drive customer, employee, and partner performance? For this, you need a commerce-centric platform that can wrap just the right elements of contact and opportunity management, support, collaboration, and marketing automation that generate data that is relevant to the customer’s purchase intention.

2. Agility: No point guessing technology needs over 2, 3, or 4 years. The target is a moving one. Can your technology platform truly power up the whole gamut of demand and supply chain capabilities as discrete services to help you quickly adjust to compete effectively? None of these upstarts are tethered to rigid software. This is the level of nimbleness required to keep optimizing the intended customer experience.

3. Industry differentiation: First-generation SaaS was designed to reallocate IT costs away from capital expense. The next-generation cloud is centered on driving competitive advantage and must infuse industry-focused digital capabilities that are hopelessly obvious to the service technician or truck driver or nurse or retail clerk.

4. Network effect: Stand-alone customer communities have too much friction, resulting in choppy adoption. The modern incarnation of communities are data driven, purpose-built networks that are the most effective sourcing engagement platform and marketing automation tools ever invented. What networks do you need to create or be part of to accelerate both growth and margin? Can you build and expose a rabid fan base inside the product and around every SKU? Can you galvanize your whole organization to collaborate around a customer’s request in seconds? Can you quickly tap into contingent worker and supplier networks to adjust to changing resource requirements?

This is the user experience that the customer will not only expect but also demand.

Does that mean that you don’t need CRM capabilities or commerce or support capabilities? Of course not. You absolutely do. But to truly serve the customer on her terms, you must be able to consume just the needed elements of sales force automation, customer and employee collaboration, quote-to-cash processes, commerce, support, fulfillment, and marketing capabilities from a modern, customer-centric platform.

This more modern version of CRM is enabling the natively-digital world to throw down the gauntlet on businesses that do not obsessively design and continuously optimize a customer-centric experience.

Per analyst Jeremiah Owyang, over $12 billion is being invested by venture capitalists to spark this digitally-native disruption. No question that the competition is well funded and is here. But so are the capabilities to help you compete.

Are you ready?

Sameer Patel is SVP of Products and Go to Market at SAP. SAP Jam, SAP’s flagship cloud collaboration product, has over 17 million subscribers and is used by global organizations to transform how they engage their employees, customers, and partners.

To report this post you need to login first.

1 Comment

You must be Logged on to comment or reply to a post.

  1. Joseph Brown

    Excellent blog.  I want to through one more item here:  the desire at C-suite to have rapid access to insight immediately that covers both operational and customer facing activities across all digital channels.  

    Looking forward to a follow-up on this blog in June 2016! I think we will both be amazed on how fast we are moving in CRM and digital space.

    (0) 

Leave a Reply