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Digital Marketing's Impact on Customer Experience: Jim Sterne Interview

Tony Simonovsky  |  November 9, 2016

Tony Simonovsky  |  November 9, 2016

        

In his interview with Tony Simonovsky, renowned digital analytics expert Jim Sterne talks about the impact digital analytics and online marketing have had on consumer behavior and customer experience. He also discusses the challenges and temptations companies face as a result of having access to sensitive information about their clients, and advises on how businesses should establish stable and trusting relationships with their customers.

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Jim Sterne


Digital marketing and online commerce have been around for about 20 years now. Would you say they've had a substantial influence on customer behavior?  

Of course. Firstly, people accepted online shopping, although in some countries this process took longer than in the others. Back in the 90s, when I traveled to Germany and asked locals about credit cards, they responded they did not use them. I was surprised and inquired how they sold products online. They replied that after a purchase, they shipped products to consumers, mailed an invoice and these people mailed them checks back. ‘What about fraud? What if you send goods and they don’t pay?’ I asked. ‘We do not have fraud. It just does not happen here’ was their answer. Today such a scheme seems rudimentary because people have become more comfortable with purchasing goods online and sharing their credit card information to pay for them. They have developed trust in delivery services and started seeing themselves as part of a commercial process.

Secondly, in parallel with getting used to online shopping, people have also become more demanding. They expect everything to work as well as Amazon does, to be quick and easy to understand, and, if your website is just a bit confusing, they will not trust your company.


Does that mean that the average quality and usability of websites has improved significantly?

No, and sometimes it can be really painful. It is not cheap to make a good website. It is really difficult, complex, and, therefore, expensive. Also, there is not always an incentive for companies to do anything about this situation. If my bad website is inexpensive to make and maintain and it is bringing in a profit, I do not care. You, the customer, will still leave money on the table. And then a competitor comes along. This is what made Amazon great. They just kept improving, so the customer experience was better, better, and better, and now... I buy everything from Amazon.


Continuously advancing technologies have definitely helped digital analysts collect a lot of data on people. Does it mean that now we know our customers really well?

There is still an infinite number of things to improve about measuring across various channels. You need to go back in history. We started with a website and immediately had email metrics and then link metrics. Later, Google came along, and made a business out of links. That’s what they measure. How many people point to your website? How much do we trust them? So, website traffic, email measurement and link measurement, and then online advertising. With this we are going to measure banner ads and clickthrough rates. Now, of course, there is social media, and interactive apps, and new variables, and God knows what else.

As all these channels are constantly evolving, it is incredibly difficult to take a whole new dataset and measure that against phone traffic, desktop traffic, tablet traffic, and what you measure in the store when somebody's beacon walks in. It is a complex and classic data integration problem. However, the real difficulty is convincing people that it is a good idea for them to help you. I want Amazon to recognize me on every device. I want Facebook to recognize me on every device and have a lock on me all the time, because that is so much more convenient. It is super easy for this social network to know who I am and follow every step I take, but it is very hard for a retail store and manufacturer to do the same thing. This is a problem that is never going to be solved.


Do you think that it should be addressed in situations where the public is really concerned that their personal information available to social networks and other websites can be misused?

It is both a made-up problem and a very serious problem. The made-up part lays in the fact that people are frightened of the things that they do not understand. I remember talking to the head of online privacy policy for the UK government, who said, 'People on the web should be clear and concise about how they are using data.' I answered 'I am sorry, but those things are mutually exclusive.' I cannot be clear in a few words. If you want me to be clear, it is going to take a long time. I will have to create a user agreement that goes on for pages and pages. At the same time, if you want me to be concise, then this agreement has to be general. 'I have been collecting data about you for your benefit. Thank you, very much.'

The danger is that there is a whole bunch of data on the Internet that can be, and is being, misused. My relationship with a specific vendor is such that I want them to remember my credit card number and protect it. If my knowledge of the way the Internet works is rudimentary, then I am afraid. That’s just human nature. I simply do not like people looking over my shoulder watching what I am doing. It is rude and creepy.  

As a marketing person, my job is to create a relationship with each customer, and learn about them over time, just as we do with humans. So, you and I are having a conversation about online marketing, but you do not know anything about my family, you do not even know how old I am, and that is normal. However, over time, we will get to know each other and the trust will grow. Eventually, you will know as much about me as Google knows. This is the way marketers need to build relationships with clients. My fear is that you will know about me as much as Google knows, but I will not know you and your intentions about the information you will have. So, it is a complex technical, social, and psychological problem.


In this context, how do you see the role of the Internet of Things in the process of collecting valuable information about clients?

The question is how we are going to use this data. Now, that is a challenge. And it is all the same challenges we have faced before: data access, data quality, data integration. Finally, is there any value at the end of that long road? People who make bad mistakes like telling your wristwatch that you are about to have a heart attack when you are not, will end up in the newspapers, but those who use this information well will benefit.


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Customer Experience Report

Tony Simonovsky

Written on November 9, 2016 by:

Tony Simonovsky

Tony Simonovsky has more than 10 years experience in digital marketing, but his story begins on 12 September 2012, when he left his office job in Moscow and completely changed his life. Since then he’s been living in India, Thailand, Sri-Lanka and Brazil, rode 30,000 km around Europe by motorcycle, practiced capoeira and has been working as Google Analytics, Google Tag Manager and conversion rate optimization consultant, together with his team helping internet-companies worldwide become data driven.

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