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Guest Blogger

By Colin Shaw, Founder and CEO, Beyond Philosophy

 

Most organisations want customer-driven growth and a strong sense of customer loyalty. It is becoming increasingly apparent how artificial intelligence (AI) will enhance your ability to foster this loyalty for customer-driven growth.

 

Customer loyalty is a function of memory. People do not come back to you based on the Customer Experience you provided; they return because of the Customer Experience they remember you provided. Therefore, let’s take a deeper dive into how memory works.

 

Current theories are that memory exists as a network structure. So, it’s a bunch of different ideas, thoughts, emotions, feelings that are all stored in your mind. Moreover, they connect in various ways.

 

The fishing net analogy

 

Specific memories are more closely tied to others. When you recall one of these memories, it triggers a phenomenon called spreading activation. Spreading activation means when you access a memory, you remember not only that single recollection, but also all the memories tied tightly to it.

 

 

 

 

The metaphor for these concepts is a fishing net. A fishing net has knots that are linked together. When it lies flat underwater, it spreads out. But when you grab one of the knots in the net (i.e. activating a memory) and pull it to the surface (i.e. your conscious awareness), you also pull up all the knots connected to it. However, the connected knots may not break the surface, so they hang out just under the water (i.e. your unconscious awareness). However, since they are connected to the knot you pulled up, they are close by.

 

Customer loyalty is a function of memory. So, if you’re trying to foster customer loyalty, the memory becomes essential. The fishing net is a great analogy because it describes how the memory of the customer’s interaction with the organisation works to help them choose to return.

 

However, it is not only the customer’s personal experiences that connect to their memory. They also remember what is happening in the marketplace. For example, when you hear about a terrible experience with my cable company last week or how great Apple is, those things sink into your memory and are part of that fishing net as well.

 

Building the fishing net artificially

 

Artificial Intelligence (AI) can understand all of those interactions between memory and build a fishing net. By using Big Data, AI can learn and process the information to make the possible connections for your customers. It can effectively establish a memory map that your customer might have based on the data the AI processed. Moreover, this process can also predict how customers are likely to feel when they contact you next.

 

What these predictions allow you to do is to be proactive in your response. You can offer the customer a personalized Customer Experience that works with the AI-generated memory map to encourage Customer Loyalty. It will allow you to customize your experience to appeal to the person with your words and actions at that moment in the most appropriate way.

 

However, as I have said before about Big Data, it is a ‘garbage in, garbage out’ situation. A significant hole in Big Data exists today caused by the lack of emotional data that there is out there about how the customer feels. Sure, there’s a ton of factual information, but nobody is recording how the facts of the situation make people feel.

 

Are machines taking over?

 

AI sounds like a dangerous thing. Based on all the Sci-Fi movies I have ever seen, the turning point before the post-apocalyptic tale I am watching was when the machines get intelligent. I am not alone in this irrational thought. Throw out the term AI onstage, and you can practically see people mentally stocking their doomsday bunkers with canned goods. However, the truth is quite different than fiction.

 

Part of the reason AI seems scary, aside from the movies mentioned above, is that AI is hard for the average person to comprehend. So, how it works can seem like magic. It is not magic, of course, but instead lots of serious math. For those that did not spend a lot of time wearing a sweatshirt with “mathlete” printed on it, it might as well be magic. However magical its inner-workings might seem, it is essential to understand that AI cannot magically solve problems

 

Machine learning is different than human learning. Humans approach data analysis with a top-down approach, meaning we impose the model structure, the variables to include, and everything else. AI does not approach data analysis this way. It tries things over and over again until it develops the relationship, which will be structured to meet the needs of the data.

 

My concern is that by using AI to build the memory map with the Big Data available today it is as if no one is minding the store. If the data is missing the emotional element of customer data, then it will not take that variable into account with its results. The result is AI can produce an excellent analysis for customer outcomes that may or may not relate to customer behaviour in reality.

 

The good news is that we are gathering more and more data all the time, and the lack of emotional capture will not be the problem in the future that it is today. Over time, machines will find these hidden relationships that emotion introduces into customer interaction.

 

So, now what? 

 

So, what should you do with this information, particularly in the context of wanting to facilitate customer-driven growth? If you’re looking to grow the organisation, my practical advice is don’t get left behind on AI. Tremendous opportunities exist here with understanding customer behaviour at an individual level, and improved predictions for what they want or will do next.

 

We recommend you consider how you will use AI for your organisation. Determining where AI fits into your strategic portfolio puts you in an excellent competitive advantage regarding customer-driven growth.

 

Also, it would be best to resist the temptation to consider AI from a cost-reduction or improving productivity perspective. While these are excellent business principles, and they should be part of the conversation, these areas tend to crowd the customer out of focus. In other words, the prevailing sentiment is that customer-focus is essential, just not as important as reducing costs and improving productivity.

 

I love the phrase “the humanizing of technology.” It would be best if you also prepared yourself to undertake this effort. You can plan for how you can take the technology you have available to you to provide an experience that is distinctly personal and emotional for people. An excellent way to start is understanding customer behaviour from a psychological point of view and how AI works with big data to produce outcomes.

 

From a practical standpoint, you can also start thinking about the experience you want to provide at an individual level that is in alignment with your brand. Defining your brand and what drives value for it is essential here, so researching to identify what those values are is crucial. Our Emotional Signature® research is an example of the type of research that identifies what customers want and what drives value for your brand.

 

Building excellent memories are essential to foster customer loyalty. Therefore, it is also crucial to manage the connected memories that are also attached to the customer’s memory of your experience. This effort is enhanced by AI, which can include controlling the outside influences that also connect to customer’s memories and help you improve your predictions for what customers want next at an individual level.

 

The organisations that embrace AI technology for personalizing their Customer Experience and plan for it will have a competitive advantage in the marketplace regarding customer-driven growth and building customer loyalty. Those who do not may sign up for a future for their organisations where customer-driven growth simply does not compute.

 

To find out more about Customer Memories listen to our recent podcast.

 

 

 

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