Modern customer engagement means using data and analytics to create personalized, relevant, and timely interactions across every channel. Because customer engagements occur at every point in the buying cycle — from initial contact to ongoing customer support — getting these interactions right is essential to improving customer satisfaction, loyalty, revenue, brand experience, and customer lifetime value.
Modern customer engagement means using data and analytics to create personalized, relevant, and timely interactions across every channel.
Because customer engagements occur at every point in the buying cycle — from initial contact to ongoing customer support — getting these interactions right is essential to improving customer satisfaction, loyalty, revenue, brand experience, and customer lifetime value.
To learn how to create great customer engagement, we spoke with Dan Bodner, CEO and Chairman of Verint (NASDAQ: VRNT). Dan has served as CEO of Verint since its inception in 1994. In August 2017, he became chairman of the Board of Directors
In this conversation, we cover the following topics:
- About Verint and customer engagement
- What is customer engagement?
- How can business leaders drive customer engagement?
- Role of platforms and data in customer engagement
- Typical challenges to creating seamless customer experience
- How does customer engagement improve business outcomes?
Dan Bodner: The idea of Verint when we started was to bring inside some unstructured data, and we've been working at this now for 27 years. It's still a very difficult and complex exercise, but the benefits (when you bring in all that data and harness the data) are enormous because it's really a goldmine.
Michael Krigsman: We're talking about customer engagement with Dan Bodner, CEO and Chairman of the Board of Verint. Dan, tell us about Verint and tell us about your role as well.
Dan Bodner: Verint is headquartered in Melville, New York. It's powered by more than 4,000 dedicated professionals who are focusing on customer engagement. The company started in 1994, and we went public in 2002, so we are on the Nasdaq exchange with close to $900 million of revenue.
We have more than 10,000 customers around the world, and these are across many industries, so you'll find financial services, insurance, healthcare, government, telecom, retail – B2C companies, business-to-consumer companies. We have 85% of the Fortune 100 as customers, so you will recognize many brand names such as Mastercard or HSBC, Cigna, Humana, Verizon, AT&T. What's common to all these customers is that they have a very large number of consumers that they service, so customer engagement is very, very important for them. It's critical to their business.
Michael Krigsman: Customer engagement and customer experience have become real buzzwords. You've been involved in this field for years and years (before most people have heard those terms).
Dan Bodner: What's interesting about the market, it's changed quite a bit over time from what used to be very telephony-centric customer service and very reactive to one that is now across many, many different channels (digital and social) and more proactive customer service.
The strategy in Verint is mostly focused on technology, so bringing artificial intelligence and automation to customer engagement. It's focused on the cloud platform, making it easier for customers to consume applications from the platform. In our partner ecosystem, we have a partner strategy where we see partners as an extension of Verint, and we're growing the partner network.
Lastly, obviously, it's M&A. The company has been inquisitive and we're looking to accelerate innovation when we acquire other companies.
Michael Krigsman: Dan, when we talk about customer engagement, what does it actually mean?
Dan Bodner: An organization that has a large number of consumers and needs to service their needs. Whether they sell something or they just respond to a question or solve an issue, they are focused on creating that engagement to be productive and to elevate the customer experience every time they just touch a customer so they can improve the business, create more retention, customer retention, and customer loyalty, and a great brand reputation.
Michael Krigsman: Maybe this is an obvious question, but why is customer engagement so important?
Dan Bodner: It's even more important than ever because customers have choices. Consumers can choose the banks they work with. They can choose the retailer that they want to shop online.
The experience with how they engage with that organization has a tremendous impact on their loyalty and revenues that our customers are generating from their customers. Elevating customer experience became very important to our customers.
Ten years ago, it was mostly about responding to customers when they call. Today, our customers are engaging customers proactively, reaching out, and finding ways to elevate the customer experience every time they touch a customer.
Michael Krigsman: This is not just anecdotal. This is not just likes on Facebook, but there are business outcomes and business performance metrics that you focus on when it comes to customer engagement.
Dan Bodner: The business outcomes increase revenue, reduce cost, and create a brand reputation that will create lasting growth for the organization. These are very measurable.
Many of our customers are measuring the revenue they generate from the base. They are measuring the customer experience by metrics like NPS (which is net promoter score), customer retention, customer loyalty. These are all very important metrics that eventually can be translated to business outcomes.
Michael Krigsman: I know that you've done research about the gaps in customer engagement that many companies experience, as well as how to address those shortcomings. Can you talk about that for us, please?
Dan Bodner: Many organizations are going through digital transformation and, as part of that, they're providing consumers more ways to engage. It's through chat, through email, through social channels such as Facebook, Messenger, or Twitter.
The more customers engage, there is a large number of interactions. There are a growing number of interactions that our customers need to process.
The gap is that in order to process more interactions, at the same time to address the consumer expectations for fast, personalized, and contextual responses, they need to add more people.
The industry already is employing 50 million workers around the world, so this is a cost of about $2 trillion a year just to be able to engage consumers. So, the increase in expectations and increase in the number of interactions is causing our customers to add more people, which is unsustainable. But, at the same time, they need to elevate the customer experience, so they can't cut their resources.
That's the gap. The gap, which we call the engagement capacity gap, needs to be addressed and the way to address it is with technology. With AI (artificial intelligence) and automation, many of these interactions are now self-service, so they are answered by a bot instead of a person.
Overall, organizations that use automation effectively are able to achieve both. They're able to reduce the costs to operate the customer service organization. At the same time, they elevate the customer experience.
That today is really the big pain point. As that gap is growing and widening, the more our customers are moving into digital channels and social channels.
Michael Krigsman: This seems like a very important point. If I can summarize (to make sure that I have this right), consumers have become more sophisticated. They're becoming more familiar with technology. Their expectations have grown, and that has driven up costs for companies of every type (product companies, services companies) and, therefore, the cost of satisfying those consumers has risen just astronomically. The solution is technology such as AI, as you were just describing. Do I have that right?
Dan Bodner: Yes. That's correct.
Michael Krigsman: All this begs the question; how do we create engaged customers?
Dan Bodner: Yes. It really starts with the culture. Organizations need to develop a culture that is customer-centric.
It continues with breaking down silos in an organization because the consumer doesn't care that you're organized with departments and one department doesn't know about the other. More and more organizations need to act jointly and break down silos so they can respond to questions regardless of who has the answer.
We see, for example, contact center departments are now working closer with the marketing department. Why? Because if you're on the website, you're trying to shop for something, and you get stuck, you call the contact center. You would expect them to know and say, "Yes, Michael. I know you were trying to do this. Let me help you finish your transaction."
Obviously, it doesn't happen everywhere – yet. Many contact center agents are just not able to understand your entire journey. For an organization to fully engage customers, they really need to be able to track the customer journey and be able to respond to their journey in a very effective manner.
Michael Krigsman: Dan, you've mentioned customer experience several times. How does customer experience fit into the context of customer engagement?
Dan Bodner: Every customer engagement is a set of activities that need to result in a very elevated customer experience. But engagement is done by different departments at different times.
Let's take an example when you have claim insurance. You may call the agent and report that I've been in a car accident. They'll take the details and somebody else will get back to you.
That person is no longer a contact center agent. Now you're getting a callback from the back office. Someone is doing the claim processing and have further questions. To create that connectivity so you would be able to contact the organization and every touchpoint that you have will be continuous and the journey that you have as a customer will be uninterrupted because there are different departments in the organization.
Michael Krigsman: What are some of the challenges in creating this type of seamless customer experience that demands moving across silos and going across different channels, whether it's email, chat, Web, and so forth?
Dan Bodner: Our customers need to solve a number of issues to really be good at customer engagement. One is they need to bring the data together from all these silos. Regardless of where the interaction with the consumer occurred, all that data needs to be captured and analyzed so they can learn from each and every interaction to improve the overall organization.
Once they have that knowledge – they have the data, they have the AI, and analytics – that comes from that data, they unlock the value in all these interactions. Some of these interactions could be surveys where they directly ask the customers for feedback. Some will be just conversations on the phone or chat where there's indirect feedback that they can learn from how to improve the customer engagement. Very important is to be able to harness that data and unlock the value in the data.
Now, all those insights that come from that data need to be delivered to every employee, everyone in the workforce that has a customer touchpoint. These employees could be in the contact center, in the back office, in the branch, and also in digital and e-commerce marketing with online experiences.
Once you connect all the employees with the right insights, you can start to create that elevated customer experience. That is the goal.
Michael Krigsman: A core part of this is the data. What are the challenges that companies face when trying to collect and aggregate the kind of data that they need in order to create these digital experiences in the right way?
Dan Bodner: The data is mostly unstructured. It could be voice. It could be unstructured text. It could be video.
The interaction could be on many, many different channels. You could be talking to a customer over Zoom. That will be a video conference call, and you need to capture that. You can be obviously on the phone. It can be on social media.
There will be different channels, so there are a lot of different channel providers. Each one is creating data, but it's unstructured data. It's difficult to capture it in real-time, bring it together, and unify it to a database where you can start to apply AI and analytics and get insights.
That's a challenge that all customers are obviously focused on but it's not that easy because it's not just that data sits in a lot of different places in the organization, but it's also locked down in many different systems that have been deployed in the organization by different vendors. That's not an easy way to bring data, like structured data that sits in a database.
That's the technology that we actually innovated when we started the company in 1994. Obviously, technology went a long way since then. But the idea of Verint when we started was to bring insights from unstructured data, and we've been working at this now for 27 years.
It's become much easier, but it's still a very difficult and complex exercise. The benefits (when you bring all that data and you harness the data) are enormous. It's really a goldmine.
Michael Krigsman: What kind of system or platform needs to be in place in order to collect this data?
Dan Bodner: This is easier to do in the cloud, so you need a cloud platform that has a lot of connectors or adapters to a lot of different systems. That's something that Verint has developed over many years to be able to capture the data in real-time. But that data obviously comes from different systems and different silos, so what's really important about the platform is the ability to unify that data, to bring it together to a structure that can be searchable.
Then once you have that unification, you can start to apply AI to the data, machine learning, which basically improves your ability to, for example, understand intent. Intent recognition, which is one of the AI technologies, is about really understanding not just the words that a person speaks or writes, but also what is the underlying purpose, what is the intent of the discussion?
Being able to get intent from analyzing the data provides the ability to create. Well, it's not just to service the customers but to also service employees.
Michael Krigsman: Obviously, that's a core part of what you're building.
Dan Bodner: We need to bring all this technology to our customers in a way that people can use it. It's very, very complex technology, but the products that are really successful are products that make it easy for the employee to consume.
Think about a customer service employee. They have a lot of pressure. They have a customer at the other end of the phone call, chat, or email, and they need to respond. They need to do all that in real-time, and they can't take their time because they're being also measured on what's the length of the interaction.
Bringing all that technology together in a cloud platform and making the UI (the user interface) simple enough that regular people can actually harness those insights is really the secret sauce of making our customers successful.
Michael Krigsman: What are some of the challenges that organizations face as they try to create a better experience for their employees?
Dan Bodner: There's a big shift in expectations and also with the hybrid workforce. For example, in a good-old contact center, when an agent is stuck because they have a customer on the other end and they can't resolve, they would just raise their hand. The supervisor would reach out and help them.
That doesn't work when they work from home. They need a different type of technology now to have the assistance at home and be able to perform the job in the way that they feel like they satisfy the customer on the other end.
There are many, many things that are changing. I'll give you a different example.
I spoke about social channels before. One of the things that is very, very impactful to the workforce is the nature of the social channel is that it's not a synchronous interaction anymore.
On the phone, you call, you have a two-minute conversation, and it ends. When you are on a social channel, when you are in Facebook Messenger and you send a message, the agent may respond to you right away, but you don't have to respond right away to that. This is asynchronous communication.
You may respond two hours later and maybe send a picture of something together with your response. Two hours later, I'm not working anymore. I completed my shift.
Now there is another employee that needs to take that over and continue from the same place, so that's also creating a lot of changes in terms of how you schedule employees, how you focus the work, and how many types of interactions we expect in a day.
If you expect, let's say, 100,000 interactions today, and you expect 20% of those interactions to be in Spanish, you need 20% of the workforce available that speak Spanish.
Now think about how digital is changing everything because you need to focus on how many phone calls, how many chats, how many Facebook and What's App messages, how many employees I have that can respond to all these things. It's not synchronous anymore.
There are a lot of changes that change the work for employees and an organization needs to address that with technology.
Michael Krigsman: Dan, as we finish up, how can business leaders leverage customer engagement to improve business outcomes?
Dan Bodner: Today, boards and senior management are very aware of the connection between good customer experience and strong growth and business outcomes. I can say that ten years ago when I tried to get a meeting with the CEO of one of our customers, they were not so interested. Customer service was more of a contact center problem and they were very happy that the call center is doing their job and were not very focused on the customer experience.
We know that ten years ago it was very telephony-centric, very reactive type of responses. We, as consumers, had to wait quite some time to be able to talk to a person.
Today, I think that executives understand that consumers have choices. They could easily switch. They understand that customer experience is directly tied to customer loyalty, to repeat business with customers, and also to their brand reputation.
They are very sensitive to customers that have high net promoter scores and will promote the brand to their friends. They can measure it pretty well and see the correlation between the customer experience, customer sentiment, and the business results in terms of revenue growth and the bottom line.
Published Date: Oct 18, 2021
Author: Michael Krigsman
Episode ID: 725