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The 10 Commandments Of Web Design; Not Quite June 28, 2008

Posted by Bruce Temkin in Customer experience, Online strategy.
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BusinessWeek recently published an article called The 10 Commandments of Web Design in which it describes these “must-follow rules:”

  1. Thou shalt not abuse Flash.
  2. Thou shalt not hide content.
  3. Thou shalt not clutter.
  4. Thou shalt not overuse glassy reflections.
  5. Thou shalt not name your Web 2.0 company with an unnecessary surplus or dearth of vowels.
  6. Thou shalt worship at the altar of typography.
  7. Thou shalt create immersive experiences.
  8. Thou shalt be social.
  9. Thou shalt embrace proven technologies.
  10. Thou shalt make content king.

While this wouldn’t have been my list of commandments, it contains mostly appropriate things for Web Designers to abide by.  But I need to take exception with two of the items on the list: #7 (Thou shalt create immersive experiences) and #8 (Thou shalt be social). It’s not that those are bad things to do, but they are not the right focus for ALL sites at ALL times. Many Web designs call for simple (non-immersive, non-social) experiences. So these items don’t really hold up as commandments unless you add “where appropriate” at the end of them.

Fyi, we just published our annual ”Best And Worst Of B2C Site Design, 2008” report which evaluated sites using Forrester’s 25 criteria. It turns out that the top 5 failures were in these areas: text legibility, task flow, error recovery, privacy policies, and information scent. I’ll discuss a bit more about this research in a later post.

The bottom line: 8 out of 10 right isn’t all that bad.

Facebook’s Simple Redesign Is Worth Noting May 16, 2008

Posted by Bruce Temkin in Customer experience, Disruptive customer experience strategies, Gen Y, Online strategy, Social computing.
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Matt Vella wrote an interesting article in BusinessWeek about the redesign of Facebook (which includes a few quotes from me). Here’s an excerpt:

<Facebook> is readying an extensive overhaul of its core profile pages in an attempt to bring back the sleek aesthetic that helped fuel its early popularity… The moves come in reaction to Facebook’s becoming “more cluttered and harder for users to parse,” according to Katie Geminder, the site’s director of user experience and design… the redesign represents a major simplification.

My take: I really like Facebook’s move to simplicity. As I’ve mentioned in my work on disruptive customer experience strategies, offerings tend to get overly complex over time as companies add new features and capabilities. So there’s an opportunity to disrupt many industries with an ultra-simple alternative.

Facebook must keep involving its users in the redesign. The relationship between Facebook and its users is like a landlord and her tenants. While tenants recognize that the landlors owns the building, they don’t want her to redecorate their apartment at will; it’s their space.

The bottom line: My advice to Facebook: Keep it simple, keep it real.

Lessons From Jay-Z, MySpace, And iTunes April 5, 2008

Posted by Bruce Temkin in Customer experience, Online strategy.
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A number of recent announcements in the music industry caught my attention:

My take: That’s quite a bit of news for one week. The music industry is clearly going through some significant changes. Here’s what I think we can learn from these moves:

  • Convenience matters. Why is iTunes so popular? It’s terribly convenient. Most people don’t have a desire to unwrap shrink-wrap, open a plastic case, and caress a metal CD. They want to hear music. iTunes provides the easiest way to fulfill that desire. Universal, Sony, and Warner are teaming up with MySpace because they recognize they they need to create an equally convenient option in order to dampen the growing power of Apple’s music retailing empire.
  • Money matters. MySpace may be a “Web 2.0″ company that grew up fostering connectivity across its members, but it still lives in a “Finance 1.0″ world where revenues and profits are really important. Especially when you are a part of a big conglomerate like News Corporation. And Jay-Z had no problem walking away from Def Jam (where he had been president) for some more, a LOT MORE, money.
  • Experience matters. Why on earth did Live Nation give Jay Z a $150 million deal when his record sales are declining? (His album from last year, “American Gangster,” sold one million copies in the US compared with ”The Black Album” from 2003 that sold more than three million.) Because the concert industry is booming. While people may buy fewer CD’s, the concert industry grew 8% last year to nearly $4 billion. Digital distribution hasn’t dampen people’s desires to have a memorable concert experience. And this opens up even more revenue streams.
The bottom line: Music might become a loss leader in the music industry.

Website Usability Is A Rapping Matter April 4, 2008

Posted by Bruce Temkin in Customer experience, Online strategy.
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I’ve evaluated the usability of hundreds of Websites and given advice on online strategy to dozens of large organizations. While I can always uncover opportunities for firms to improve their Web experiences, my recommendations are never as entertaining as this YouTube video.

The bottom line: Enjoy!

Web-Store Experiences Fail The Test February 24, 2008

Posted by Bruce Temkin in Customer experience, Online strategy, Store/branch strategy.
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In the previous three posts, I examined interactions in a single channel. But we all know that consumers use multiple channels. That’s why our research also examines multichannel interactions. In this post, I’ll look at some recent research on Web-store experiences.

Web-Store Cross Channel Interactions

In a survey of nearly 5,000 US consumers, we found consumers using multiple channels. Here’s some of what they do when they’re shopping online:

  • 37% call a phone number they found on the site
  • 34% print out information to bring into a store

In addition to analyzing the consumer data, we also evaluated Web-Store cross channel experiences for both electronics retailers (Best Buy, Circuit City, RadioShack, and Wal-Mart) and department stores (JC Penney, Kohl’s, Macy’s, and Sears).

For each of the 8 firms, we tried to accomplish a user goal along two paths: one that started on the Web and then continued in the store and another that started in the store and then continued online. Our channel transition review evaluates the experience against six criteria that get scored from -2 (severe failure) to +2 (best practice), so total scores can range from -12 to +12. We consider +6 a passing score. Here are some of the findings from those evaluations:

  • None passed: Scores ranged from +3 (Best Buy) to -9 (Macy’s)
  • Electronics firms (average: -1.5) did better than department stores (average: -5.5)
  • The firms struggled with most of the six criteria:
    • 1. Can the user complete her goal in all required channels?
      (5 passed/3 failed)
    • 2. Can the user control how he interacts with the company?
      (3 passed/5 failed)
    • 3. Is information consistent across all channels?
      (only Radio Shack passed)
    • 4. Is language consistent across all channels? 
      (3 passed/5 failed)
    • 5. Is the user presented with a clear transition path across channels?
      (only Best Buy passed)
    • 6. Is the user’s context preserved across channels?
      (only Radio Shack passed)
  • A couple of recommendations: Make it easy to print out product pages (to bring with them to the store) and provide a clear product number on price tags (to find the same product online when they go home). 

The bottom line: Most companies’ Web teams and store/branch operations live in completely separate parts of the organization. But customers will not accept that as a good excuse for broken experiences. To improve these cross-channel experiences, firms need to create a cross-functional team that incorporates key people from the stores and from the Web.

Web Satisfaction Snapshot: USAA And Schwab Top The List February 21, 2008

Posted by Bruce Temkin in Customer experience, Online strategy.
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This is the final post looking at US consumer satisfaction across nine different industries: banks, credit card providers, health plans, insurance firms, Internet service providers, investment firms, retailers, TV service providers, and wireless carriers. Today I’ll look at Web interactions.

Satisfaction With Web Interactions

Here are some highlights:

  • Credit card issuers and investment firms had the highest satifaction rates (84%)
  • Health plans had the lowest satisfaction rates (68%)
  • USAA, Charles Schwab, Old Navy, and Amazon.com led the pack with satisfaction rates of 90% or more
  • Comcast, Aetna, and Charter Communications fell to the bottom with satisfaction rates of 65% or less

The bottom line: Given the rising costs of healthcare, doesn’t it make sense to improve the low cost online channel?

Trend Watch #2: The McKinsey Quarterly “Eight Business Technology Trends To Watch” December 27, 2007

Posted by Bruce Temkin in 2008 trend watch, Branding, Customer experience, Marketing to Gen Y, Online strategy.
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In this Trend WatchI’m taking a closer look at the following article from The McKinsey Quarterly: Eight Business Technology Trends To Watch.” While you can see the full list of trends at the bottom of this post, here are the five items that I think are most important for customer experience:

#2) Using Consumers As Innovators. Excerpt: “As the Internet has evolved - an evolution prompted in part by new Web 2.0 technologies - it has become a more widespread platform for interaction, communication, and activism. Consumers increasingly want to engage online with one another and with organizations of all kinds.”

  • My take: What’s a trends doc without a reference to Web 2.0?!? I’m not sure that online consumers will become the core innovative force for companies in 2008, but firms definitely need to tap into the online voice of customers — as they blog, write customer reviews, and connect with each other in new ways on the Internet. This is particularly true if you’re going after younger consumers.

#3) Tapping Into A World Of Talent. Excerpt: “As more and more sophisticated work takes place interactively online and new collaboration and communications tools emerge, companies can outsource increasingly specialized aspects of their work and still maintain organizational coherence… The best person for a task may be a free agent in India or an employee of a small company in Italy.”

  • My take: The Net definitely makes it easier to tap into a variety of workers in new ways. But it’s hard enough to keep a centralized workforce aligned; think about how hard it is when the talent is ultra-dispersed. In this environment, it is even more important that companies have a clear sense of purpose and a well defined and internally-communicated brand (see principle #2 of Experience-Based Differentiation). These items will help maintain consistency across the myriad of activities and decisions that go one across your company.

#5) Expanding The Frontiers Of Automation. Excerpt: “Companies, governments, and other organizations have put in place systems to automate tasks and processes: forecasting and supply chain technologies; systems for enterprise resource planning, customer relationship management, and HR; product and customer databases; and Web sites. Now these systems are becoming interconnected through common standards for exchanging data and representing business processes in bits and bytes. What’s more, this information can be combined in new ways to automate an increasing array of broader activities.”

  • My take: The combination of service-oriented architecture (which connects disparate applications) and business process management systems (which can flexibly control processes) opens up the opportunity to automate many processes. Firms will squeeze inefficiencies out of customer-facing processes like applications, problem resolution, and credit approval. But don’t just automate processes; redesign them to better meet the needs of customers.

#6) Unbundling Production From Delivery. Excerpt: “Technology helps companies to utilize fixed assets more efficiently by disaggregating monolithic systems into reusable components, measuring and metering the use of each, and billing for that use in ever-smaller increments cost effectively… Unbundling is attractive from the supply side because it lets asset-intensive businesses raise their utilization rates and therefore their returns on invested capital. On the demand side, unbundling offers access to resources and assets that might otherwise require a large fixed investment”

  • My take: Interestingly, in 2000 we wrote a report called eBusiness Networks in which we predicted that: “Processes like customer care that span manufacturer, distributor, and retailer can be shared in eBusiness networks. Rather than design captive business processes, companies will plug into shared systems.”So I’m bought into this unbundling trend. Every firm needs to ask themselves: “How can my product/service be delivered as a metered service?”

#7) Putting More Science Into Management. Excerpt: “Just as the Internet and productivity tools extend the reach of and provide leverage to desk-based workers, technology is helping managers exploit ever-greater amounts of data to make smarter decisions and develop the insights that create competitive advantages and new business models… The holy grail of deep customer insight-more granular segmentation, low-cost experimentation, and mass customization-becomes increasingly accessible through technological innovations in data collection and processing.”

  • My take: No doubt; there’s more data than ever. So make sure you’ve got some strong left-brainers around to look at Web analytics and customer analytics; there’s a lot of valuable insights to be mined. But don’t get caught over-focusing on analysis — it’s only one part of the equation. Your organization needs to treat customers differently based on the insights and this often takes more ”art” than “science.”  

8 Business Technology Trends To Watch from McKinsey

Here are all of the items listed in The McKinsey Quarterly:

  1. Distribution co-creation
  2. Using Consumers As Innovators
  3. Tapping Into A World Of Talent
  4. Extracting More Value From Interactions
  5. Expanding The Frontiers Of Automation
  6. Unbundling Production From Delivery
  7. Putting More Science Into Management
  8. Making Businesses From Information.

Also see: Trend Watch #1: The Economist “The World In 2008 (Business) 

The bottom line: Look for a lot more connectivity; but temper it with common sense.

Designing Experiences For Gen Y December 5, 2007

Posted by Bruce Temkin in Customer experience, Gen Y, Marketing to Gen Y, Online strategy, Social computing.
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We just published a research report that I’ve alluded to in earlier posts called “The Gen Y Design Guide.” The research examines how Gen Y (ages 18 to 27) are different from older consumers and defines a set of implications for designing experiences. Here’s the executive summary from the research…

Gen Y consumers are a unique breed. But what exactly makes them different from their elders? Our research unearthed nine attributes of Gen Yers’ social, emotional, and mental makeup that shape their perception of interactions. To reach these young consumers, we’ve identified four design approaches: immediacy, Gen Y literacy, individualism, and social interactivity. To truly engage Gen Y, firms should create a Gen Y advisory board and apply Gen Y design approaches across touchpoints.

To get a sense of the world of Gen Yers, just take a look at the lyrics from a top-rated song “Crank That” from Soulja Boy:

Soulja Boy Crank That

What?!?! I have no idea what that means, but I’m pretty sure that I don’t want to know.

Our research uncovered the following key attributes of Gen Yers: 

  • Socially Fluid And Highly Networked. Having gone through high school, college, or a first job, many Generation Yers are breaking away from their families and forging their own paths and networks. We found three characteristics that define Gen Yers socially. They are continually connected, speak their own language, and are influenced by peers.
  • Emotionally Searching For Their Identities. Adolescents and early adults are at a period of self-discovery, shaped by their environment, education and activities, and social culture. That’s why they seek recognition and fame, enjoy absurdity - and humor with an odd slant, and embrace a variety of subcultures.
  • Mentally Fickle And Creative. Few Generation Yers can remember a time when technology - from DVDs to PCs - did not play an important part in their lives. Having grown up with deep exposure to media and devices, they skim text and information quickly, are easily bored, and are expressive and creative.

Based on the unique characteristics of Gen Y, we defined four design approaches for appealing to them:

  1. Design approach No. 1: immediacy. To overcome Generation Y’s fickle attention and broad use of media, firms need to hook Gen Yers in by quickly exposing value and then keeping them interested over time.
  2. Design approach No. 2: Gen Y literacy. Because Gen Yers are so influenced by peers and their own communication style, firms need to speak to them authentically and on their level.
  3. Design approach No. 3: individualism. Diverse and expressive, Generation Yers respond to experiences that allow them to personalize and customize their interactions.
  4. Design approach No. 4: social interactivity. Since Gen Y consumers are very social, firms should consider enabling them to communicate and express themselves.

The bottom line: If you want to attract and engage Gen Yers, stop treating them like Boomers. 

Best Buy Wants A Better Buy (ing experience) December 1, 2007

Posted by Bruce Temkin in Customer experience, Online strategy, Store/branch strategy, Voice of the customer.
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In Forrester’s Customer Experience Index, 2007, Best Buy was ranked #34 out of 112 firms — and 23rd out of 27 retailers on the list. That’s clearly not the best buying experience. But Best Buy is doing something about it.

In a recent press release from Best Buy, the retailer described what it had learned from a phone survey of 1,008 consumers. Here’s an excerpt…

… the factors consumers consider very or somewhat important include the return policy (92 percent) and the ability to speak to someone live when calling the store rather than hearing an automated message (91 percent). Other important elements include: customer assistance to help throughout the store (89 percent) and a helpful, easy-to-use Web site (70 percent).

In response to this insight, Best Buy also announced some new initiatives like:

  • Converting 30% of its floor personnel to a new position called ”Customer Assistant” that are cross-trained to help customers across all categories in the store and will work with “BlueShirts” who have deep knowledge in specific categories. 
  • Extended return policy that allows anything purchased after November 4th to be returned by January 31st. Best Buy hopes to remove the stress of holiday gifting by defining a specific date instead of a specific window (e.g., 14 days from purchase).
  • More Spanish language content in its Website (see BestBuy.com/espanol), in its call centers, and multilingual sales associates and signage in some stores. It is also adding Spanish language gift cards.

My take: You can always learn a lot from asking customers what they need, like, and want (which is why I push firms to develop a solid voice of the customer program). I’ll bet that many retailers would find that their customers want the same type of things as Best Buy customers – a clear return policy that works for holiday gift-giving, access to helpful employees, and an easy-to-use Website. Why not give it to them?!?

The bottom line: Your customers deserve the best buying experience.

Presidential Candidate Sites Fail On Privacy — AGAIN! November 15, 2007

Posted by Bruce Temkin in Customer experience, Online strategy.
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Privacy — NotI’ll start with the punchline: the Websites from 6 top presidential candidates FAILED our test for privacy.

In July 2004, I published  5 reports that applied a portion of Forrester’s Web Site Review methodology to the presidential candidate Websites for Bush and Kerry. Here are the titles and executive summaries:

  • Presidential Candidate Sites Fail The Privacy Test. Forrester evaluated how the presidential candidates’ Web sites handle their privacy policies. While both sites failed, the Bush site makes its privacy policy more difficult to find.
  • Bush’s Site Fails The Accessibility Test. Forrester evaluated how well the presidential candidates’ Web sites provide access to visually-impaired and hearing-impaired users. The Bush site failed against our criterion; while the Kerry site passed. But both sites could do a better job of making their sites accessible.
  • Candidate Sites Aren’t Easy For Physically Impaired. Forrester evaluated how well the Bush and Kerry Web sites provide access to physically impaired users. While both sites failed our test because key navigational elements require overly precise mouse movements, the Bush site makes it easier for users to select what they need from the key left-hand navigation bar.
  • Bush Site Mishandles User Errors. Forrester evaluated how well the Bush and Kerry Web sites recover from user errors. We found one major flaw: The Bush site fails to help users fix incorrect credit card information.
  • Presidential Candidate Sites Are Hard To Read. Forrester evaluated the text legibility of the Bush and Kerry Web sites. Both sites failed our test because of small fonts in major navigation options and poor color contrast in other text elements.

So I decided to do it again during this presidential campaign season. The first document, called “Presidential Candidate Sites Fail On Privacy,” examines how well 6 candidate sites performed in adhering to several of Forrester’s Web Site Review criteria around “trust.” Here’s the executive summary from that report:

Presidential candidates use their Web sites to reach out to a wide range of constituents. But how effective are they at building trust during the interactions their supporters have with those sites? To help answer that question, we evaluated the sites of Hillary Clinton, John Edwards, Rudy Giuliani, Barack Obama, Mitt Romney, and Fred Thompson. All of the sites failed our privacy and security criteria. Candidates should make trust a major element of their site design requirements.

That’s right, the presidential candidate sites once again failed our privacy criteria.

The bottom line: Hopefully the candidates care more about privacy than they show in the design of their Websites.

Welcome To Our Store — Now Get Lost November 1, 2007

Posted by Bruce Temkin in Customer experience, Online strategy, Store/branch strategy.
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We’ve been doing research on Web-to-store and store-to-Web experiences — evaluating what it’s like for cross-channel shoppers. The scenario: After printing out some information on a retailer’s Web site, a customer goes into a store to examine the digital cameras that she’s selected online. This type of customer is coming to the store to find a specific camera, so she really wants to locate it quickly. Sounds like a reasonable expectation — doesn’t it?!?

Well, most stores run into problems right from the beginning — at the front door. Take a look at the following entrance-way to a Wal-Mart….

Wal-Mart initial experience

Where do you go for digital cameras? There’s no way to tell. The customer needs to walk aimlessly and hope to spot the digital camera area. But this isn’t just a problem with Wal-Mart, other large stores have the same problem. I noted this issue in my post Why Don’t Stores Support Shoppers? when I discussed “confusing first impressions.”

Given the growing number of cross-channel shoppers, firms should relook at these first impressions.  Our upcoming research will shed more light on this area (the first report should go live on the Forrester Research site in December). In the meantime, any organization with a physical location (banks, hospitals, schools, retailers, etc.) should think about applying the 4 elements of a welcome experience that I outlined in my post Don’t Neglect Your “Welcome Experience:”

  1. Assume customers don’t know as much as you think.
  2. Make sure that customer know exactly how to start.
  3. Set the tone right away.
  4. Provide feedback along the way.

The bottom line: Online consumers shouldn’t dread what’s in store for them.

What Men And Woman Want — Online October 23, 2007

Posted by Bruce Temkin in Customer experience, Gen Y, Marketing to Gen Y, Online strategy.
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The title of this post (What Men And Woman Want — Online) is also the title of a research report that I published with Ross Popoff-Walker earlier this year (we had fun picking that title). In that report, we looked at what different consumer groups liked most about their online experiences. Since we had about 5,000 consumer responses, we were able to examine differences across both genders (male/famale) and generations (GenY, Gen X, Younger Boomers, Older Boomers, and Seniors). 

The survey asked consumers to select important elements in their most frequently visited site. One of the interesting pieces of insight came from looking at which consumers selected “it was fun.” Here’s what we found:

  • Young consumers are the most fun loving. No surprise; Gen Y (males and females) were the most likely to select “it was fun” from the list. About 40% of those younger consumers thought it was an important element of their favorite site.
  • Men become less interested in fun as they age. Gen Y males were slightly more likely to select “it was fun” than were Gen Y females. In older generations, however, females became more likely to say that fun was important. And the gap increases in every age group — growing from a 1% gap for Gen Xers (32% versus 31%) to a 6% gap in Seniors (24% versus 18%).

The bottom line: Consider infusing some ”fun” into your online efforts. It’s important for many Gen Yers and one-quarter of Senior females.

Web 2.0 (a.k.a. Web And Weberer) September 30, 2007

Posted by Bruce Temkin in Customer experience, Online strategy, Social computing.
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This wouldn’t be a real blog without at least one entry about Web 2.0. I’ve actually touched on the related topic in a previous post called The Death Of Web Pages? Great! – but that wasn’t enough to be a real “Web 2.0″ post. So here goes another blog post on Web 2.0…

To begin with, I hope you get my allusion to the movie sequel Dumb and Dumberer, which I really liked (despite its horrible reviews). It’s not that I think Web 2.0 is dumb (or dumberer), but I do think that they’re both packed with a whole bunch of silliness.

Let me start by saying that there are a number of very interesting things happening that are classified as Web 2.0. Social networking sites (like MySpace and Facebook); consumer-generated communications (blogs and product reviews); rich Internet applications (with technologies like Ajax and Flex); and aggregation technologies like RSS. All together, these things are definitely adding new ways for people (especially younger consumers) to interact online.

I’ve even heard the terminology being used around CRM — hence the new moniker “CRM 2.0.” But this is where I need to draw the line. Yes, Web 2.0 has some interesting opportunities for many businesses. But for most firms, it’s not nearly the most important thing they need to think about when it comes to their customers. Frankly, Web 2.0 hasn’t changed how you need to think about customer interactions. The fundamentals of customer experience remain the same: know more about what your customers need and figure out ways to better satisfy those needs. This is all about shifting your thinking from inside-out to outside-in.

But this isn’t new. As a matter of fact, it’s the same advice that we’ve been giving Forrester clients since the late 1990’s. Here’s a figure from a report in 2000 called Scenario Design.

 Sceanrio Design from 2000

In this report, we framed three key questions:

  1. Who are your target users?
  2. What are their goals?
  3. How can you help them accomplish those goals?

It turns out that we still push organizations to ask and answer those same three questions. I published an update to that report in 2004 called “Scenario Design: A Disciplined Approach To Customer Experience.” The report provides an updated argument for relying on those same three questions. And, yes, I am considering publishing another update to that report — which will absolutely reinforce the importance of those same three questions.

So, here’s how I put Web 2.0 in context:

After you figure out who your target customers are and gain an understanding of their needs, and then uncover their true goals in working with you, then you can apply Web 2.0 capabilities (along with all other capabilities) to help satisfy their needs.

The bottom line: Web 2.0 (and all of it’s “XYZ 2.0″companions) may enable companies to better serve customers — but only if they better understand them first.

My Takes On YouTube September 9, 2007

Posted by Bruce Temkin in Customer experience, Experience-Based Differentiation, Financial services, Online strategy, Social computing.
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A short post today — based on a couple of my recent interactions with/on YouTube.

We just published a research report, Uploading To Video Portals Isn’t Easy, that looked at the usability of five video portals (thanks to Ross Popoff-Walker who did most of the work). It turns out that YouTube’s usability was pretty good. Here’s a summary of the report:

Forrester applied an abridged version of its Web Site Review methodology to the site experiences at five major video portal sites: YouTube, Yahoo! Video, Metacafe, Dailymotion, and Veoh. Our evaluation looked at how well each site supports young adults trying to upload a new video clip. Only YouTube received a passing overall score. Some of the major problems we found across the sites: poor contextual help and deficient privacy information.

I also just found out that someone posted an excerpt of my speech from Forrester’s Finance Forum on YouTube. It was probably done by Forrester’s marketing department; hoping that the video would generate the same buzz on YouTube as coke + menthos or the dancing cadet. :-)

Well, I can assure you that my video is not nearly as exciting as the running Russian video. But if you want to see a portion of my keynote speech on Experience-Based Differentiation, then here it is.

Unfortunately, you only see me — and can’t see any of the slides. Maybe someone in the audience who was illegally taping the event will post a video that shows the slides as well. You never know.

The bottom line: YouTube makes it easy to upload anything.

WaMu Heads For Simplicity: Follow! August 27, 2007

Posted by Bruce Temkin in Customer experience, Disruptive customer experience strategies, Financial services, Online strategy.
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In the American Banker last week, there was an article called Web Simplicity Initiative Bearing Fruit for WamuAs an example of Washington Mutual’s (WaMu’s) focus on simplicity, the article described changes that WaMu made to the online application for its free checking account– cutting the process from 8 pages & 15 minutes to 3 steps & 6 minutes. And to eliminate the need for mailing forms to new customers, WaMu uses the first check as a signature card.

I really, really, really liked the this quote from Richard Blunck, a senior vice president and WaMu’s director of e-commerce:

Simple, for us, is critical

My take: Simple is critical for just about every bank (along with just about every investment firm and every insurer). Many customer-facing processes are based on outdated requirements, overly complex business rules, old technology, and organizational silos that discourage innovation. The result: A complicated experience for customers.  That’s why there’s enormous opportunity for financial services firms to apply a principle that I call ultrasimplicity, which is one of the Five Distruptive Customer Experience Strategies that I’ve written about in previous posts. 

The bottom line: When it comes to financial services, simpler is almost always better.

Build Desirable Online Experiences — Please! August 16, 2007

Posted by Bruce Temkin in Customer experience, Online strategy.
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A couple of analysts on Forrester’s customer experience research team, Kerry Bodine and Ross Popoff-Walker, just published a great new research report called Desirable Online Experiences: Taking Web Sites Beyond Useful And Usable. The document starts with a clear picture of today’s Web experiences:

Consumers are spending more and more time online, seeking out experiences that are relevant, engaging, and personal. However, many Web sites make users struggle to complete simple goals, have little to no emotional punch, and fail to embrace the diversity of consumers’ wants and needs.

The document discusses the three elements of an experience — useful (offers value), usable (provides easy access to value), and desirable (appeals to emotions). They note that since firms tend to struggle so much with the first two items, desirability takes the backburner. (Note: Take a look at an earlier post: Lessons Learned From 1,001 Web Site Reviews)

To overcome current lackluster online experiences, Kerry and Ross recommend three tactics for cultivating desirability:

  1. Provide engaging content and functionality. Consumers often visit Web sites with specific transactional goals in mind - like purchasing some throw pillows, booking a hotel room, or transferring money from one account to another. Increasingly, online consumers also have more exploratory online goals - like looking at photos or browsing their favorite blogs.
  2. Focus on aesthetics. The Web is a delivery channel for providing content and functionality, but it is also an aesthetic communication medium. Look and feel can’t be tacked on to the surface of an experience - an aesthetic blueprint needs to be integrated at its very inception.
  3. Incorporate elements of game design. Online gaming is a popular activity - 50% of US online households play online games. And the appeal cuts across age and gender lines. Some firms have tried to tap into the fun by adding games to their Web sites. However, site owners can take a subtler approach by infusing their sites with elements of game design.

My take: Kerry and Ross are right — companies need to make online experiences more desireable. It’s interesting to think about what firms are required to understand before they can deliver useful, usable, and desirable experiences. To make something useful, firms need a functional description of the task — which can be developed by a business analyst who knows very little about the customer. To make something usable, firms need to understand what customers know about the task and follow established usability standards. But to make something desirable, firms need to understand what motivates customers.

So desirability will require an even higher degree of customer insight (most likely from ethnographic research). That’s good, because that knowledge can also help firms make things more usable (as firms refine their understanding of how customers accomplish tasks) and more useful (as firms uncover requirements for functionality to fulfil unmet and latent needs).

The bottom line: Companies should shoot for more desirable online (and offline!) experiences — and they’ll likely become more useful and usable as well!

The Death Of Web Pages? Great! July 17, 2007

Posted by Bruce Temkin in Customer experience, Online strategy.
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Nielsen/NetRatings recently announced that it will be scrapping its long-time ranking of Websites based on the number of pages that people view on the site. Why? Because many applications now use rich Internet application (RIA) technologies like Flash and Ajax to build Internet applications that don’t need to load a new page every time a user does something. So the measure of “page views” no longer accurately reflects the actual usage of a Web site (in this new environment, for instance, a person could spend an hour just on one “page”).

Let me be the first one to say: good riddance to Web pages. When it comes to user experience, the Web was a major step backwards. It reminds me of a graphic that we created for a report that I worked on in April 2002 called The X Internet Revives UI Design:

user-interface-evolution_small.jpg

Don’t get me wrong, the Web page has been incredibly value. The simple paradigm of a Web page has taught hundreds of millions of people how to use a digital interface. But the simplicity of the basic Web page has used virtually none of the capabilities of today’s powerful computers. As a result, we end up waiting for an entire new page to load everytime that we try and do something on the Web. Believe me, there are better experiences to be had.

If you want to see what I’m talking about, try and find a bar that you’d like in a new town using Yahoo’s old page-based maps and then try it again with its new RIA maps.

But, alas, nothing comes for free. As we leave the era of the basic Web page, we’re likely to live through a lot of usability nightmares. Why? Because creating dynamic interactions that are easy to use requires very strong design and usability skills — much more than is required for simple Web pages. And our research shows that many companies don’t even do a good job designing basic Web pages. But in the hands of a good team, these new rich Internet applications provide a lot of great capabilities.

A colleague of mine, Ron Rogowski, evaluated the usability of 22 applications — 11 using HTML pages and 11 using RIAs. Here’s a summary of his findings:

We evaluated RIA and HTML applications in each of four categories: hotel search and reservation engines, mapping tools, PC configurators, and product finders. We found that, on average, RIAs outperform HTML interfaces; at the same time, RIA usability can fall prey to basic design mistakes. To make the most of their investments, firms planning to invest in RIAs must apply design best practices and run multiple tests on their RIAs before - and after - they go live.

The bottom line: Nothing changes overnight, so we’ll still see many, many basic Web pages even in 10 years. But RIAs will continue to pop-up, creating many usability miscues along the way — heading us towards a much more dynamic Internet experience in the future. A word to the wise: Treat your good RIA designers (in-house or in your agency) well, because people with those skills will be in high demand.

Webkinz: An example of a disruptive customer experience strategy June 28, 2007

Posted by Bruce Temkin in Customer experience, Disruptive customer experience strategies, Online strategy.
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I’m a big believer in good research practices — forming hypotheses and then developing plans for proving or disproving them. But sometimes, you have to leave open the possibility for serendipitous insights. One of those times happened to me a few months ago in a strange place, my home. After about the tenth time I had to yank my 10 year-old daughter away from the computer, I checked out what she was doing. Well, she was playing at the Webkinz.com Website. It turns out that this is the hottest thing for my daughter and all of her friends.

If you haven’t been exposed to Webkinz, here’s how it works — you buy a stuffed animal in the toy store that comes with a code, you input the code at the Webkinz site, and then you manage the life of your new animal on the Webkinz site. Well, my daughter and her friends are constantly playing games, nurturing their animals, and interacting with other Webkinz owners in this virtual world. As a parent, I was actually impressed with the Website — the kids have to take educational tests to get points and there’s no way to pass any personal information between “inhabitants.”

WebKinz is definitely a view into the future; here are just a few of the lessons that we can learn from it…

  • Social computing will only grow stronger. Forrester identified a growing phenomena where consumers interact with each other through emerging channels that we’ve called Social Computing. This trend explains the growing popularity of sites like MySpace, Second Life, and YouTube. After seeing all of the 10 year old kids flocking to Webkinz, it’s clear that this phenomena will continue to grow.
  • Experiences aren’t just bilateral anymore. Given that consumers will get increasingly comfortable interacting with each other through a wide host of mechanisms, companies can’t just think of creating experiences that connect the company with its customers. Firms will need to think about how they help customers connect up with each other. 
  • “Online infusion” can be a disruptive strategy. Webkinz does a great job of combining a physical product (stuffed anumal) with digital features (online virtual world). It’s also the case for NetFlix with it’s movie selection & queue management capabilities (digital) augmenting the DVDs delivered by mail (physical).  To some degree, the Nintendo Wii also crosses this line with it’s highly interactive controllers. Given the high degree of comfort that consumers have developed for doing things online, there are many more opportunities for crossing this physical/digital divide. (In my research report called Five Disruptive Customer Experience Strategies,” I labelled this as an ”online infusion” strategy.)  
  • Ganz is sitting on a gold mine. The parent company of the Webkinz site is Ganz, a privately held company that is headquartered in Toronto. Given the level of “addiction” to Webkinz that I’ve seen, the company has a lot of opportunities ahead.

If you haven’t experienced Webkinz yet, it’s worth taking a look. And if you have little kids, you may not have any other choice!

Banks Prepare For Customer Experience Wars June 26, 2007

Posted by Bruce Temkin in Customer advocacy, Customer experience, Experience-Based Differentiation, Online strategy, Store/branch strategy.
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Greetings from day 2 at Forrester’s Finance Forum 2007 in New York. There was a lot going on today. Bill Doyle, one of Forrester’s top analysts, kicked off today’s session by announcing the results from Forrester’s 2007 Customer Advocacy rankings. USAA, once again, topped our list (see my earlier post about USAA). These rankings are based on feedback by consumers about whether or not they think their financial insitutions act in their (the consumer’s) best interest. There’s too much to say about customer advocacy to squeeze it into this post, so I’ll be spending more time on this concept in future posts.

As I mentioned yesterday, we published the results from a joint survey on customer experience in banking that we did with the American Banker. My report that analyzed the data is called “Banks Prepare For Customer Experience Wars“ (full report is only available to Forrester clients) just went live on the Forrester Website. The research looked at some of Forrester’s consumer data alongside the survey of 190 North American banking executives that we did with American Banker. When we look at the overall responses from banks, we find that they:

  • Know that customer experience is important — 97% said that it was either very important or critical.
  • Are focusing on organic growth – outpacing the focus on customer acquisition.
  • Recognize that they aren’t meeting customers’ needs — especially online, where less than one-third of respondents gave their interactions a vote of confidence.
  • Lack a solid customer experience strategy — nearly half of the banks point to a lack of a clear customer experience strategy as a major problem.

Then we looked at the difference in responses between large banks (>$30 billion in assets) and smaller banks (<$30 billion in assets). Here’s some of what we found:

  • Customer acquisition is more important to smaller banks.
  • Online experiences plague all banks — especially smaller ones.
  • Branch experiences are better at smaller banks.
  • The lack of cooperation causes major problems for large banks.
  • There are more customer experience activities underway at large banks.

If banks know that customer experience is important, why do they deliver such poor experiences? Often times the issue comes down to one word: “Silos.” Banks have created stovepiped organizations; each group focuses on its own channel (e.g., Web, call center, agent, branch), its own product (e.g., deposit, mortgage, credit card, brokerage, insurance), or its own functional area (e.g., marketing, IT, retail delivery). As a result, most banks lack enough of a coordinated effort to meet their customers’ needs.

But times are changing. The convergence of three factors - consumers, competition, and capabilities - will put enormous pressure on financial services firms to break down their rigid silos and improve their customer experiences.

What do banks need to do? If you’ve been reading my blog posts, then I think you can guess what I’m about to say. They need to head towards Experience-Based Differentiation.

USAA: A Positive Example Of Customer Experience June 18, 2007

Posted by Bruce Temkin in Call center customer experience, Customer experience, Customer loyalty, Online strategy.
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I was recently giving a speech to a group of executives at a large financial services firm; talking about my favorite topic: Experience-Based Differentiation. After I was done, one of the attendees came up to me and shared a recent experience that she had with USAA. (Note: USAA was not the organization that I was speaking to at the time).

She told me that she was looking for an auto loan and had called around to get a number of different quotes. Before she picked one, she thought she’d give USAA a call (she’s a member of USAA). While she was on the phone, the USAA phone agent asked her a few questions and then said that she could beat the lowest rate that the woman had received by a point. That’s right – one full percentage point lower than any other provider. The phone agent asked her how much she needed for the loan, but she wasn’t sure. So the phone agent said that they’d send her a blank check and that she could fill in the amount up to a specific amount (well above what she needed for the car). The phone agent told her that all she had to do was to go to the Website and answer 5 questions to finish the process.

Well, the woman went to the Website and answered 5 questions and received a blank check the next day.

Let’s disect what went right.

  1. It was a great sales process. All large financial institutions want to cross-sell products, but not many make it quite as easy as this. The combination of a low rate and a no-nonsense process immediately closed the sale.  
  2. USAA acted like it knew her. How was USAA able to offer such a great rate? She was a member of USAA, so they have  a lot of information about her. They used the information to deliver a rate that reflected what they already knew about her. 
  3. The phone agent was empowered to solve problems... How many financial institutions allow phone reps to send blank checks to customers overnight? Probably not too many. But that’s part of what was needed to meet the customer’s needs.
  4. … And the agent knew the online process. In many organizations, phone agents aren’t very familiar with what happens when a customer goes online. In this case, the agent clearly understood (and communicated) the process that the customer needed to go through online
  5. The online process was simplified. The only way that USAA can cut the online process down to 5 questions is by limiting their questions to things that they don’t know about the person. Since the loan applicant was a member, USAA didn’t make her input information that it already knew about her.
  6. USAA did what it said that it would do. When a company doesn’t live up to its promises, you can say goodbye to customer goodwill. But that’s wasn’t an issue here. USAA set clear expectations with the customer — and delivered exactly what itpromissed.

This type of experience is not a random occurance for USAA — they have very high levels of member loyalty. As a matter of fact, USAA has been at the top of Forrester’s Customer Advocacy rankings for the last three years. It wouldn’t hurt if other financial institutions (and companies from other industries) learned a thing or two from USAA.

Lessons Learned From 1,001 Web Site Reviews June 15, 2007

Posted by Bruce Temkin in Customer experience, Online strategy.
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Hi everyone:

This is my first blog posting — so HELLO!

I’m excited to start the blogging process by looking back at lessons we’ve learned from doing expert reviews since 1999. At Forrester, we do Web Site Reviews for our research efforts as well as for client projects.  Based on my analysis of those evaluations, I recently published a research report called “Lessons Learned From 1,001 Web Site Reviews.” (Note: Only Forrester clients can see the full report). You can also read about this research in a Q&A with Lee Gomes in the Wall Street Journal.

One of the most interesting findings from the data is that the problems have shifted over the years. Our criteria fall into 4 buckets: Value, Navigation, Presentation, and Trust. From 1999 through 2001, most sites failed to pass our value criteria. Today, the average site does a much better job of offering customers the value they came for, but they fail to provide adequate navigation — which currently represents the most severe category of problems for sites.

Our analysis also loked at individual criteira. The criteria that sites currently fail the most turned out to be ”Home pages that provide evidence that the user goals can be completed.” It’s hard to get a user to do something online if they don’t know that it’s possible. Ironically, two of the easiest flaws to fix — weak text legibility and poor security policies — have been nagging problems for several years.

The Web Site Review scores over the previous eight years provide insights into the state of Web site experiences, but they don’t tell the whole story. I also gave some thought to what lessons we’ve learned along the way. In my research, I identified eight of them. Rather than make my first blog continue on too long, I’ll only discuss one of the lessons learned — the most important one. So, what is this lesson learned?

It’s that Scenario Design remains the key ingredient to great experiences. While Forrester’s Web Site Review criteria have changed over the years, the guiding principle behind our customer experience recommendations and evaluations has remained the same: Scenario Design. This framework is based on the answers to three basic questions: Who are your users? What are their goals? And how can you help them achieve those goals? Firms wanting to know what content and function to provide, and how to make that content easy to find and use on their Web sites — or any channel — should constantly ask and answer those questions. The concept is simple, yet powerful. There’s a lot of change that can happen at firms when people start internalizing those questions.

So, I’ll end my first post here with two words: Scenario Design

Hopefully this is a start of a long-term dialogue. Feel free to post your comments.