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Innovation Inside - Email on the Edge

The Technology Lever

Deloitte’s Center for the Edge recently published the 2011 Shift Index, which confirms an unsettling long term downward trend: publicly traded US companies show a 75% decline in Return on Assets (ROA) from 1965 to today. 

 I asked Center for the Edge co-chairman John Hagel how companies can survive, and thrive, in this increasingly challenging environment (and was über-gratified when he took time out of his busy SXSW schedule to share his insights).

“Every available market advantage commoditizes over time. Ultimately, products and services become less differentiated, against a backdrop of increased customer lifecycle costs and dwindling loyalty. Only growth in another form of ROI - the Return on Information, can reverse this trend.”

Let’s take the practical example of paperless communication for high volume B2C environments. A successful paperless approach not only dramatically cuts operating costs, but also acts as a lever to reverse the downward ROA tendency by leveraging the power of Big Data to yield better analytics in order to improve customer experience… and increase revenues.

The Power of Default: Opt-in by Opting OUT

Worldwide, B2C paperless adoption hovers near the abysmally low 10 – 15% mark. It should be a no-brainer (save money and trees), but we have not seen electronic replacement of the vast numbers of paper documents that are sent on a regular basis to service subscribers, whether credit card statements, utility bills, insurance policies, digital TV or phone bills.

Even when a customer signs on to paperless services, ironically enough, they ‘double dip’ and still receive paper versions sent by post. 

There are a variety of factors at work here, but the greatest failure occurs in offering a paperless process in which customers must actively choose to participate. The key to success is to provide a default option that migrates the customer automatically.

Nobel laureate Danny Kahnemann describes the proven effect of an opt-out approach; “You can help people make good decisions without forcing them to make good decisions…the effect of default options is enormous.” 

The eBilling Example

Now, let’s imagine a world in which organizations understand not only “opt-out” but also the value of what the Earnest about B2B blog terms, “’Interactive One-to-One personalization”.   

This is how your triple play Broadband, Digital TV & Telco billing experience unfolds:

·         After an email from your biller explaining the new paperless process, you now receive your monthly Digital TV eBill by email.

·         It arrives as a securely encrypted attachment, but you can open it “from memory” – NO NEW PASSWORD REQUIRED. Easy!

·         The bill opens up and looks like a mini-website – with tabs for HOME, BILL etc.  You sort and and pull out all your landline calls to Italy to submit to your client as part of your project expenses.

·         You click the PAY NOW button to pay with one click directly from the bill (nothing to remember, no To Do list to update)

·         Just as you hit PAY NOW, you notice a button (use your imagination here, people!) that says, “LET US HELP YOU SAVE - TRY THE SPORTSPACK”. 

“That’s funny,” you think. “I didn’t know there was a SportsPack option or I would have signed up for it as part of my subscription.” Your Digital TV provider just became your trusted advisor. 

Unbeknownst to you, marketers call that little box you clicked “transpromo” – a promotion that uses your customer profile to imbue the expected and trusted digital document (translation: exceptionally high click rate!) with a highly relevant call to action.

Now, back to the real world. Does your DigitalTV bill arrive this way? Water, electricity, mobile? More and more providers are embracing this kind of eBilling approach, so...perhaps it is time to shop around!

Drilling Down:

·         The Shift Index measures the long term forces driving change; the full study is available online and in downloadable PDF format

You can catch all of Danny Kahnemann’s recent interview with Charlie Rose here. Time-impaired? The fascinating “power of opt-out” segment (based on organ donation programs) starts at approximately 21:45.