Topics addressed in this article
1/ A general contextualisation of customer relationship digitisation to understand how important it is for all companies to go digital.
2/ The different opportunities offered by the digitisation of customer relationships: commercial site, e-commerce, email, customer journey, acquisition, etc.
We are talking about digitising businesses by creating digital tools.
We are not talking about digital marketing such as SEO, Google Ads, social networks, etc.
To back up our observations and take our analysis a step further, we interviewed Nicolas Neysen, professor in charge of 'Digital Transformation' courses at the University of Liege Business School (HEC Liege) and promoter of the HEC Digital Lab.
The HEC Digital Lab is a service platform that is part of HEC Liège and supports cutting-edge research and training in digital technologies. Its aim is to encourage collaboration between digital players to understand the challenges of this sector and develop the skills needed in the digital world.
History of digitalisation
The digitalisation of companies began in the 1970s with the integration of robots into production processes.
Gradually, companies realized that these tools could significantly improve their productivity.
Initially confined to production, digitalisation later expanded to all aspects of a company's operations.
The evolution of technology facilitated the widespread adoption of digitalisation by businesses.
The advent of the internet in the 1990s, followed by the use of mobile technology and more recently, the Internet of Things (IoT), smart homes, and machine learning, allowed companies to become increasingly efficient and profitable.
Technology continues to evolve, requiring companies to constantly adapt to make the most of these tools.
The first customer relationship management (CRM) tools:
In the 1990s, the first tools such as e-commerce and CRM emerged.
The first online purchase was made in 1994, and in 1995, Amazon sent its first book. It's important to note that Amazon was initially just an online bookshop before diversifying and becoming the web giant it is today.
The precursor to CRM, the tool that helps manage customer relationships, was Contact Management software that appeared in the 1980s. It primarily consisted of a computerized database that allowed salespeople to prospect leads.
Subsequently, software applications were developed to manage various aspects of customer relationships, but they were inconvenient because data was scattered across different tools and not accessible to all departments within a company.
When Enterprise Resource Planning (ERP) systems, which manage all aspects of a company's processes, arrived in the 1990s, it was believed that this would solve the problem of scattered data, but the CRM functionalities of ERP systems were limited.
This is when modern CRM systems began to emerge.
CRM systems evolved alongside technology, adapting to each new development.
"Software is eating the world," a quote from Marc Andreessen that summarizes the omnipresence of technology.
Marc Andreessen is the co-founder and general partner of the venture capital firm Andreessen Horowitz, which has invested in companies like Facebook, Twitter, Groupon, and Skype, and is considered a global authority in his field.
He is also the creator of the first web browser, Mosaic (1993), and quickly developed a second browser in 1994 that took its place: Netscape.
He emphasizes that there are increasingly more companies in the market that are managed by software and offer online services.
This ubiquity of technology is evident both in personal and professional aspects of life.
For example, you use technology to purchase concert tickets, buy shoes, book vacations, work from home, manage billing, and more.
All sectors are impacted by digitalisation.
The importance of digitalisation
Today, consumers have access to almost all information through their smartphones in just a few seconds. This immediate accessibility has elevated the consumer above the company in their relationship.
If the consumer doesn't quickly receive a comprehensive offering, they will choose another company, leading to intense competition.
Digitalisation has brought about many changes for businesses, forcing them to adapt, change their economic models, and re-educate themselves to keep up with changing practices.
In the past, digitalisation was something nice to have, something you did to stay ahead and be progressive.
Now it's a necessity, an obligation to avoid becoming outdated.
Today, a bank that doesn't offer a mobile app for payments will no longer attract new customers. It has become a consumer requirement.
Here are some examples to illustrate the importance and impact of digitalisation:
The world's most highly valued companies are digital companies: Google, Apple, Amazon, Microsoft, and more.
Some examples of digital disruption in various industries, where innovation using technology has enabled these companies to create new models:
Uber: uses technology to make users' lives easier by allowing them to book a driver through the app. This model is transforming traditional taxi companies.
Netflix: initially offered DVDs ordered online by subscribers. In 2007, Netflix adopted a new strategy and became an online streaming platform. Since then, it has become a global reference.
Amazon: initially described itself as the world's largest bookstore. It then promoted Kindle e-books to become even more of a digital company and expanded its offerings to become the internet giant it is today.
Deliveroo: changed the restaurant system. Initially seen as a restaurant delivery service, it became a significant player in the restaurant industry thanks to its delivery application.
Airbnb: Revolutionized the hotel industry. Its daily operations are based on technology, and the platform benefits both renters and hosts. Hotels sometimes struggle to compete with Airbnb's innovation.
Some statistics on technology use in 2022:
- 67.1% of the world's population uses a mobile phone.
- Users spend 4 hours and 48 minutes on their mobile phones daily.
- 92.1% of the world's population uses a mobile phone to access the internet.
- There are 4.95 billion internet users worldwide.
- There are approximately 30 billion connected devices in the world.
Examples of companies that have improved their processes and profitability through digitalisation:
Banks are removing counters to promote the use of mobile apps and online banking. The majority of transfers now happen online, saving both banks and users a significant amount of time.
The Belgian railway company (NMBS/SNCB) has replaced many counters with kiosks and a mobile app that allows users to reserve tickets in advance.
It's worth noting that, even in the digital age, Nicolas Neysen believes that we are moving away from the 'all-digital' mindset and don't want to close offices and counters at any cost.
According to him, the goal for these companies is to find a balance between the physical and digital, referred to as "fygital."
"The idea is to leverage the best of both worlds, namely, in the physical world, there's the relational and emotional aspect that is crucial to creating authentic connections, and then there's the whole digital aspect, with the ability to have all kinds of information and answers at your fingertips (on your smartphone) without needing to go to an office."
The goal is to create the best possible customer experience by integrating the two worlds and leveraging their advantages: freeing internal teams from repetitive, low-value tasks through digitalisation and focusing on more complex interactions and answering questions that digitalisation cannot yet provide.
Real-life examples of digitalised businesses
Here are some companies we have assisted in their digitalisation:
Electric by D’Ieteren (EDI):
EDI, a startup launched in 2019 by the D’Ieteren Group to meet the growing demand for electric vehicles, enlisted our services to help support their growth by improving and optimizing a part of their marketing processes.
The group needed a digital solution to unite its 2,000 employees around a single project. We developed a mobile app that allowed them to address three issues: engaging in more physical activities, raising funds for charities, and strengthening their community.
Skechers, a major player in the sports footwear industry, employs hundreds of temporary workers annually, resulting in thousands of job interviews and training sessions. We developed an e-learning software to streamline the recruitment process. This tool allows for taking tests and participating in training, significantly reducing the time spent on interviews.
We have also worked with Fluxys, Elia, Bridgestone, Infrabel, STIB, Dufrais, Magotteaux, Metal Group, BMI Icopal, the University of Liege,...
Potential for innovation: the benefits of digitalisation
Digitalisation offers two key levers for your business:
1/ Customer relations and everything stemming from it: increased sales, enhanced customer satisfaction, simplification of the customer's purchasing process, delivering a customized and unique message to each customer, and building a relationship with them.
2/ Enhancement of processes within your business: reduction/automation of administrative tasks, effective reporting, improvement of production processes, inventory management, management of prospects and customers, enhancement in the speed and accuracy of information transfer between different departments/companies.
The goal of digitalisation is to make businesses more efficient. According to Peter Thiel, "Technology is miraculous because it allows us to do more with less."
According to Fabien Pinckaers, the founder of Odoo, "SMEs are inefficient, and the worst part is that they are not aware of it. Often, they have been doing the same thing for years and cannot imagine working differently." These statements may be seen as extreme, but fundamentally, they have a point. With suitable digital tools, these SMEs can achieve efficiency and productivity.
Today, businesses are often more advanced in digitalising their processes than in digitalising customer relations. There are many opportunities in both areas.
We will start with the development of customer relations. If you are not interested in this part, we will soon offer you the opportunity to read our article on digitalising processes in your business.
Digitalising customer relations
You want to digitalise your customer relationships, which is good, but where and how should you start?
Digitalising your customer relationships represents a significant change, and it is difficult, if not impossible, to provide you with a ready-made recipe to ensure the success of your digitalisation. It all depends on your needs, your current situation, and your budget.
It's important to remember that digitalisation comes with costs.
First and foremost, we will provide you with advice to help you get started with the digitalisation of your customer relationships.
One of the key recommendations from Nicolas Neysen is to start with the basics before proceeding further.
For example, in terms of visibility, he considers having a user-friendly website with the right information and a presence on social media as fundamental.
Subsequently, when the basics are well mastered, you can move forward. If it's internal, a CRM to manage your customer contacts can be a good solution.
The idea is to proceed gradually.
Before you start, you must define your needs, of course. Why do you want to digitalise your customer relationships?
If it's just to mimic your competitor, that's not a good reason. You must have a clear vision of what you want to achieve with this digitalisation.
Nicolas Neysen also recommends aligning the size of your company, your needs, and the technical solutions, which simply means, "we won't offer a Rolls-Royce solution if all we need is a basic one."
To effectively implement this transformation, you need to break through your preconceptions and your current way of thinking.
The evolution of technology has disrupted all the rules, so you need to think differently, dare to brainstorm, and reinvent yourself.
To innovate, Peter Thiel advises to "question conventional ideas, rethink your business from scratch," as well as your way of working.
Get inspired by what others are doing: your competitors, but also companies outside your industry. You might find ideas that can be applied to your sector as well.
And don't hesitate to look at what the largest multinational companies are doing in the field of digitalisation, the tech giants: the GAFAM for Google, Apple, Facebook, Amazon, and Microsoft, and also the NATU for Netflix, Airbnb, Tesla, and Uber.
In the following sections, we will address various questions that you need to ask to understand how to best digitalise your customer relationships (your customers, the aspects of customer relations to be digitalised, the channels to use, and so on).
Who is my customer and how do they behave?
Understanding your customers and their buying journey is essential and should be central to all your considerations. It's one of the first steps in your digitalisation.
You must provide the best customer experience. You should think about how to improve it or address any issues rather than how to use the latest technologies on the market.
To do this, you need to start by correctly defining your target audience.
Next, it is necessary to ask yourself some questions:
- Is your target audience online?
- If so, what is their level of technology usage?
- Which channels do they use?
- Are they active on social media?
- At what time of the day is your target audience online?
- When do your customers get in touch with you in their purchase journey?
Answering these questions will help you better understand your target audience, their behaviour, and expectations, allowing you to provide them with a customer relationship that meets their needs.
What part(s) of the relationship would I like to digitalise?
You can digitalise your entire customer relationship or only certain parts of it, depending on your needs. Don't forget to proceed gradually.
Attracting new customers:
If you want to facilitate your sales and attract new customers, there are various digitalisation possibilities:
A landing page:
A successful landing page (well-structured, with a proper title, polished design, clear call-to-action, etc.) can increase your conversion rate. Since it is a single page with only one action, you can easily measure the effects and tailor it to meet visitors' expectations. We recommend creating multiple landing pages (depending on your offerings) to determine which ones work best and adjust the ones that convert less to improve your performance.
If you have a physical store, developing an E-commerce platform to sell your products online is an excellent way to boost your sales. E-commerce allows you to reach a larger customer base and have better visibility. You can run targeted advertising to reach the right people. E-commerce also simplifies purchases for existing customers. You can use marketing tools to promote purchases, such as cross-selling, upselling, email marketing, and more. You can also easily reach potential customers who have placed products in their shopping carts but haven't completed the purchase. You can truly enhance and personalize the buying experience, with many more possibilities compared to a physical store.
Your website represents more than just your digital business card; it is a true commercial tool. Nowadays, most people will research your business before making a purchase (of services or goods). You must ensure that visitors trust you and consider you an expert in your field. Key pages to have on your website include the homepage (an overview of your business), the contact page, the 'about us' page (your company's history and team), and the presentation of services/products. Each page serves a purpose and should be optimized to achieve that purpose. The goal is to get visitors to contact you and attract new customers.
There are many digital marketing techniques to improve your customer relationship, such as social media, SEO, or SEA, but these are not discussed in this article.
The customer journey:
Digitalising the customer journey makes it easier to track your business processes and enhance the customer experience. By digitalising certain processes, you save time and reduce the risk of errors. Examples of digitalisation include the order process, invoice processing, information sharing, order tracking, and more.
Banks: They offer apps and/or web platforms to view your account balance and make transfers. Although there are more possibilities, these apps are still not capable of doing everything because banks have not fully digitalised all their processes. It's not always necessary to digitalise everything. Digitalising some of their processes allows them to reduce their workload and meet customer expectations.
Electricity and gas suppliers: In the past, suppliers had to send meter reading forms to all their customers by mail. This was time-consuming for both suppliers and customers. Nowadays, suppliers have an app where customers can input their meter readings directly. This is much faster and more convenient for both parties.
Quote calculation and configuration tools: For example, if you want to buy a new car, you no longer need to visit multiple dealerships to get information and compare quotes. Today, you can visit the websites of different car brands, where you'll find a configurator that allows you to select all the desired options for your car and get a price. You no longer need to travel, which significantly reduces the workload for dealers and makes it faster and easier for customers.
Insurance: If you want to purchase a new insurance policy, you can search for information and compare prices on the internet, just like with cars. Then, when you're in the process of drafting the insurance policy or negotiating, you can have an initial human contact, but this can be done remotely at this stage. Later, in case of a claim, you can file a report and submit your statement without the need for an appointment or sending it by mail. Digital technology allows claims to be processed quickly, making it much easier for customers.
Another example from Nicolas Neysen: insurance:
As with cars, if you want to take out a new insurance policy, you can search for information and compare prices on the internet without going to an agency.
Then, when you are in the process of drafting the insurance policy or negotiating, you can have an initial human contact, but at this stage it can be done remotely.
After that, if you want, you can visit the agency to ask your questions and meet your broker, thus building a relationship of trust.
Later, in case of a claim, you can prepare a report and send your statement without having to make an appointment or send it by post. Digital technology means claims can be processed quickly, making life much easier for customers.
The goal is to improve customer comfort throughout the entire purchasing process, including:
After-sales service: for example, you can use a chatbot to schedule an appointment with an expert from your company in case of a problem or to better understand your customer's issue.
Returns: if the product doesn't meet expectations, you can offer returns through an app or a web platform, similar to what Zalando does. It's very straightforward: you log into the Zalando app, select your order, and choose the return option. With just a few clicks, your return is registered, and you only need to take your package to the post office. You should make it as easy as possible for the customer, even when they want to return their purchase.
Customer reviews: you can ask customers to leave reviews automatically via email or SMS, depending on how you communicate with them. We recommend using this technique since reviews increase future prospects' trust in your business.
Complaints: for example, you can offer a complaint form on your website or use customer service software to help you manage customer complaints. Providing customers with a way to express their dissatisfaction is beneficial for your business, as some users might leave a negative review on Facebook or Google instead of using the complaint form, which can damage your reputation.
There are numerous possibilities to digitalise different aspects of the customer relationship. Depending on your needs, you can attract new customers with a landing page, an E-commerce platform, a commercial website, or digital marketing techniques. You can also digitalise a portion or the entire customer journey, as well as after-sales service (after-sales service, returns, complaints, customer reviews). You don't necessarily have to digitalise everything; it's up to you to determine what you need.
How would I like to reach my target?
How can you efficiently reach your target audience? Which media should you use?
There are several possible channels: mobile, web, messaging (email, SMS, push notifications, instant messaging like Whatsapp and Messenger),...
There are increasingly new contact points, "touchpoints," between companies and customers/users. These are additional opportunities to generate the best possible customer experience.
To choose the right channels, you need to pay attention to the behavior of your customers.
In general, it is advisable to use multiple channels to satisfy as many customers as possible.
Each channel has its advantages and disadvantages.
Let's start by distinguishing between the use of web and mobile:
Choosing mobile is interesting for regular use on the go, when you need the features of a smartphone, or if your target audience is young.
The web is a good choice if you have a significant digital marketing strategy, need to publish a lot of content, or if certain tasks cannot be performed on a mobile device.
Various messaging options:
A widely used and proven channel.
The costs for email marketing campaigns are relatively low.
Email allows you to build a close relationship with your customers. They can respond directly to you.
If you prepare and segment your contact list, you can target your emails correctly and send the right messages to the right audiences.
This is not possible with all channels; for example, on social media, everyone can see your posts.
Be sure to send valuable information and avoid spamming people.
Examples from Deuse:
In our IT company, we have implemented various email automation systems.
On our website, some articles are locked; to read them, visitors must enter their email addresses.
They then receive the article by email, and we add their email address to our newsletter list.
In addition to this system, we send email marketing campaigns: a newsletter with professional information such as case studies, articles, and guides to showcase our expertise, and a newsletter about our team to highlight the human side of our company.
Many companies use email automation, such as Airbnb, which sends emails to visitors who have visited the site (and have entered their email address) but have not booked to re-engage them.
The most well-known are Messenger and WhatsApp.
These allow you to reach customers on their smartphones, which is more intimate and creates an even closer bond than email.
This is direct communication. Therefore, you must be very responsive if you decide to use instant messaging.
If you do not have the resources to respond quickly to your customers, do not prioritize this channel.
The risk of instant messaging is receiving non-relevant questions. People ask their questions more easily via Messenger or WhatsApp, sometimes without much thought...
SMS is often used to announce promotions, flash sales, or make announcements.
There is no interaction as with instant messaging or email because you cannot respond to these SMS messages, but it is a good way to directly reach your customers.
Some stores ask for a phone number to accumulate points for purchases, replacing the loyalty card. They can then send SMS messages later.
Be careful when using SMS, as this channel can be quite intrusive and could alienate your customer base.
Example: Vet'Ardent, a home veterinary emergency service, changed its name and to inform its customers, they sent an SMS in addition to an email and social media posts.
They used multiple channels to reach as many people as possible.
If you have a mobile app, using push notifications is a good way to remind your customers of your company's existence.
Start by explaining the importance of push notifications to your customers; you need to convince them to accept them.
Like SMS, you can notify your customers of promotions or new products, but we recommend not overdoing purely marketing notifications.
Instead, send useful notifications to your customers, and occasionally do some marketing.
If you abuse marketing notifications, your users will block them.
Example: Deliveroo sends the menu to its customers in the morning via a push notification to entice them to order lunch.
Is my business model right?
Depending on what you want to digitalise, your business model may change.
You may need to adapt your way of operating and you might not even earn your money in the same way anymore.
Here are a few examples to better understand:
A water pump seller:
They decide to launch an app to monitor the pump remotely. They will still sell pumps, but they might also charge customers a monthly fee for the app's license. This way, they have an additional source of income and recurring revenue from existing customers.
An online accounting service for small freelancers:
They offer an annual rate and send their annual invoice to the client. To simplify their work and avoid payment delays, they decide to digitalise the invoicing process with a web interface where clients can upload their documents.
They maintain the same rate but make more profit because their workload is reduced thanks to the new way of collecting documents. In this case, their business model doesn't change.
If customers, when registering on the web platform, have to enter their bank details and pay an automated monthly invoice, like the water pump seller, they have recurring income, and their business model changes slightly.
The company connects drivers and users and takes a commission on the rides. Uber hasn't changed its business model, but compared to a traditional taxi company, it's a completely different model.
Initially, Odoo was primarily open source and made money through low licensing fees and software implementation at customer sites. The company later shifted to a monthly license, which altered the business model. You don't buy the software; you pay for a license.
By digitalising your customer relationships, you might have to change the way you've always operated.
These examples pertain to companies already operating in the digital space.
However, even more traditional companies with established business models can (and should) digitalise to adapt to the market and avoid falling behind.
Digitalisation has changed the rules of the game, as Nicolas Neysen explains; the threat no longer necessarily comes from traditional competition but can now come from actors who have simply seized an opportunity through digitalisation.
Therefore, it's important for a company that's functioning relatively well and has a traditional business model to start paying attention to these new developments.
The idea is to offer services in the most innovative way possible without necessarily disrupting your current business model that works.
Nicolas Neysen recommends, first of all, understanding the challenges and external threats and evaluating them (low, medium, or high).
Depending on the severity of this threat, you could, for example, create a new business unit while maintaining your traditional model for a part of your activities and launch a new offering. Test it in the market with different rules to see how it performs.
Be careful not to harm your traditional model; avoid 'cannibalisation' and simply shift your revenues to a new market.
You should be able to test new things without opting for a 180-degree change, especially if you have a well-functioning business.
Conclusion: what can be done in practical terms?
If you want to digitalise your customer relationship, or a part of it, start by asking yourself the following fundamental question: "Why do I want to digitalise?"
It's important to know why you want to take this step. If it's just because digitalisation is good, that's not a sufficient reason. Nicolas Neysen rightly emphasizes that "Digitalisation is not an end in itself; it is merely a means."
Once you have defined the reasons for your digitalisation, it's time to let go of your preconceptions. You need to think differently to implement a new way of working that will increase your efficiency and boost your performance.
Consider the various options and choose which ones to pursue to achieve your goals.
There are several possible paths, and you must choose the most appropriate one, without the certainty that it will work on the first try.
You need to let go of the idea that digitalisation works automatically. That's not always the case. You may need to adjust your expectations and proceed gradually.
To choose the best options, you can draw inspiration from what is available in the market, your competitors, and major players on the web. Many companies have already gone through this digitalisation process; see how they have handled it.
Next, you should identify your customers and analyse their behaviour. Understanding your customers will help you determine what to digitalise in your process and how to do it to meet their expectations.
Then comes the moment when you need to decide which part of the customer relationship you want to digitalise.
There are numerous possibilities:
For customer acquisition, you can opt for a landing page, e-commerce, a business website, or digital marketing techniques. The choice depends on what you offer to your customers (your products/services).
For the customer journey, you can digitalise certain processes such as invoice processing, information sharing, or the ordering process. This will save you time and enhance your customers' experience.
For after-sales, you can implement digital tools to assist with the management of after-sales service, returns, complaints, and customer reviews. These tools will streamline your tasks and also benefit your customers.
Then, you need to consider the channels you want to use to reach your customers. Again, there are numerous opportunities:
Both the web and mobile offer many advantages; you need to determine what best suits your needs. You can use communication channels such as email, SMS, push notifications, or instant messaging services like WhatsApp or Messenger.
It's important to send relevant information to your customers and not overdo it.
Lastly, you may need to adapt your business model based on what you digitalise in your customer relationship. Sometimes, only minor adjustments are required, while in other cases, if you have a traditional model, you may need to experiment with new approaches, such as creating a business unit, to adapt to the new market.
Digitalising your customer relationship is a significant project. Therefore, we recommend selecting individuals internally who are interested in participating in this transformation, but often, that may not be sufficient.
It's better to have an external perspective to gain inspiration and be willing to break free from your company's established framework.
Ideally, in our opinion, being guided by professionals is the best approach. They can not only help you develop your digital tools but also assist in choosing the best solutions that will truly make your company more efficient.