The 2014 Gartner MDM summit, which took place at the Venetian Hotel in Las Vegas on April 2-4, presented those in the data industry with an opportunity to learn about leading MDM technologies, use cases and trends. One such event was a presentation by Gene Alvarez of Gartner, which focused on the role of Big Data and CRM in eCommerce strategies. Gene’s talk highlighted a few key eCommerce trends as well as technological and strategic opportunities for the future of this industry.

First, the presentation kicked off with this prediction: “By 2017, due to internet-enabled price visibility, the digital customer experience will be the key differentiator of your organization.” At first glance, this concept is hardly new, as consumers have been shopping around for great deals for years now (thanks, Amazon!). However, two things did strike me about this prediction: the fact that the digital customer experience will be more differentiating than, say, the quality of the goods alone, and the fact that this is supposed to happen in just a few short years. But what is the ‘digital customer experience’ really? In a nutshell, the digital customer experience is a combination of what the vendor is displaying to the customer via digital channels, as well as how the customer is expected to intuitively interact with what has been displayed. According to Gene, retailers have begun adapting their strategies to more effectively address their consumers from two angles – by refining their data collection and analytics methodologies to more effectively identify who the customer is and what he wants (context awareness – more on this below), and by engaging with that customer via the channels through which he prefers to interact (consumerization – more on this below).

Second, Gene highlighted the evolution away from basic information to contextual awareness of the consumer. Data collection and analytics have evolved to the point where retailers can create a targeted and relevant digital customer experience. Specifically, over the years retailers have evolved through four key stages of understanding their customers:

  1. Engaging with them on a very basic level –name, address, email;
  2. Creating basic segmentations – age, gender, spend;
  3. Graduating to personalization – profiles, affinities, recommendations; and
  4. Arriving at the era of context-awareness

According to Gene, in the era of context awareness, retailers drive engagement and targeting strategies based on a customer’s location, intent, environment and community. But why have markets compelled companies to begin collecting, analyzing and acting on consumers’ actions in this way? This leads to the next insight from Gene’s talk…

Third, Gene refers to the concept of re-focusing and deploying products and services around the contextual awareness of the individual end user as ‘consumerization.’ Consumerization is about leveraging the insights arising from context awareness to interact with customers based on a wholistic view of who they are, rather than through a narrow view driven by individual campaigns. Social, mobile, information and cloud technologies have made it possible to build the context around individuals necessary for consumerization. As people become increasingly accustomed to interacting with each other via social and mobile media, these interactions have driven changes in behaviors around how consumers expect to receive and share information. Retailers have taken note of this, which has ushered in an era of focus on individuals over institutions, and on engagement over ‘telling’. In Gene’s view, this is the opposite of the Seinfeld ‘Soup Nazi’ situation, where the consumer is bullied by a service provider who creates his own offering and drives the consumer’s interaction on the company’s terms.

The shift to digital interaction has not only created the data that makes consumerization possible, but has also made it harder to execute as it has compounded the original problem retailers already face with respect to how to merchandise properly in-store. Now, their challenge has increased exponentially since they need to also figure out how to do so digitally and to integrate the two. And this is where I think the real turning point is for retailers, and what will ultimately determine whether Gene’s prediction from point #1 will become a reality in 3 short years or not. Will technologies and strategic implementations of said technologies be available to enable eCommerce companies to take advantage of the new ways in which consumers are searching for and purchasing goods and services?

For a context driven, consumerized eCommerce landscape to really take shape by 2017, most if not all of the technologies required to operate with a laser focus on the digital customer experience would already have to exist. Assuming that they do, the challenge companies will face is building out these technologies properly and integrating them effectively. For example, Master Data Management is a technology that’s been around for decades and which can provide a foundation for complete context by matching and consolidating consumers across all the channels through which they engage with you. However, a key challenge associated with MDM technologies is that they require a non-trivial amount of time to process all that data – meaning that 360-degree customer view isn’t available real-time. And oftentimes in eCommerce, taking real-time action is critical to ensuring a positive outcome (depending on the intended purpose, this could be a sale, a newsletter sign-up, and so on). One way to get around this high-latency processing issue is to perform any required minimal matching/consolidation manipulations on the streaming data and push it out real-time (e.g. with the help of AWS Kinesis – read our blog on this topic HERE), and then perform a separate batch load of the data through the MDM solution for more comprehensive matching and consolidation.

There are many other examples of how to leverage existing technologies in intelligent ways to engage with customers in the digital and consumerized way in which they will expect to interact with eCommerce vendors. For example, sentiment analysis tools can help you weed out the outliers (positive and negative) from the noise of your social media feeds, to ensure that you are paying attention to those customers who require extra attention.

Since eCommerce companies are generating so much transactional/browsing data already, they have most of the context already available, and just need a way to link it all together. Thoughtful application of MDM technologies can help with this, while behavior tracking tools can contribute to accumulating the context itself in a more structured and usable way. But the point of all this is that it’s really all about the strategy. It’s understanding exactly how consumerization will continue affecting buying habits tomorrow, and building the technology infrastructure today to be poised to take advantage of those future trends. This includes identifying and framing the problem, training the people, and developing the IP around the technology. And Gene’s concluding thoughts echo this concept: to succeed, eCommerce leaders will need to begin adopting a policy of intentional innovation, aka they will need to invest explicitly in R&D in order to beat the competition. Ultimately, the winners will be those retailers that invest in technologies and strategies which will enable them to effectively anticipate what product or service is shown to the consumer, and to then serve up that information to the consumer whenever/wherever/however he wants it in a seamless and natural way. But if a technological breakthrough is really what’s required between now and 2017 to have Gene’s prediction be realized, then I’d say that 2017 is too optimistic.