Adaptive Apps: Reimagining The Future

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Adaptive Apps: Reimagining The Future Mike Gualtieri, Principal Analyst Forrester

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Adaptive Apps: Reimagining The Future Mike Gualtieri, Principal Analyst September 9, 2014

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We have entered the age of the customer

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Trend Consumers want to be treated like royalty.

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Royalty experiences have contextual awareness and adapt to serve a single consumer.

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Treat consumers like royalty to get their loyalty.

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How well do you know this consumer? Male 35 years old Single Resides in New York City Makes $100,000 per year What do you predict he would do if the bank accidently transferred $5,000 into his bank account? Give the money back Take the money and run Quiz

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George Costanza

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Trend Big Data means all your data++.

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Base: 452 North American technology decision-makers Respondents answering “don’t know” are not shown Source: Global Data and Analytics Survey, 2014 Base: 249 North American business decision-makers Respondents answering “don’t know” are not shown Source: Global Data and Analytics Survey, 2014 Most technology decision makers get it; 30% of business decision makers are confused.

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Big Data gushes from many sources…

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eCommerce MRP Web analytics eCommerce Web Mobile Finance Customer Service CRM Claims BPM Excel & Access Data warehouse Planning Email Customer Service ERP Marketing Social Media POS Field Operations VOC

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What percentage of enterprise data do firms use for analytics? 12% 34% 53% 76% Enterprise Data Quiz

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What percentage of enterprise data do firms use for analytics? 12% 34% 53% 76% Enterprise Data Quiz Source: Forrester Research

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110010011011001 010010011011001 010011001101101 010010011011001 Historical Transactions Customer data Ops

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Gather all your data to breakdown silos and prepare it for deeper analysis. Data

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Now, analyze the heck out of it - every which way. Process

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Predictive analytics and streaming analytics have momentum. “What is your firm's/business unit's current use of the following technologies?” Base: : Forrsights BI/Big Data Survey, Q3 2012: 634 Business Intelligence users and planners Reporting is the only ‘widely’ used BI technology Base: : Forrsights BI/Big Data Survey, Q2 2014: 452 Tech decision makers Advanced analytics is growing strongly +30% +62% +52%

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Trend Predictive models can predict customer attributes and behavior.

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DEFINITION FORRESTER Techniques, tools, and technologies that use data to find models – models that can anticipate outcomes with a significant probability of accuracy.

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Predictive models can be very powerful and profitable, but understand that: Predictive models are about probabilities, not absolutes Predictive models may not exist for every question But, when they work they give you an “unfair” advantage.

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Predictive models can have a delightful, multiplicative effect on the bottom line Traditional Predictive * Profit calculation does not include other expenses

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Predictive analytics is very different from the traditional analytics approach Traditional Analytics Data Science

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Big Data is the fuel of predictive analytics; statistical and machine learning algorithms are the engine.

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How can you provide a perfect , individualized product recommendation? Recommend

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Turkey How can you predict where customers will be on Thanksgiving.

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Repeat Should you make an offer she can’t refuse or send a gentle nudge?

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Stop What if you knew your customer was near your store on a sunny day?

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How can Spotify use accelerometer data generated by customers while they listen? Activity

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How can you boost performance and retain your employees? Performance

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Data in motion is as valuable as data at rest. Trend

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Apps are blind – use APIs to make them see.

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If you can measure it, then you can use it

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Streaming analytics can uniquely enable three new tiers of app functionality Source: April 22, 2014, “Use Sensors To Take Apps To The Next Level Of Customer Engagement” Forrester report

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Adaptive apps anticipates a customer’s intent and adapts to serve them. Trend

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Design principles for adaptive apps Learning who the customer really is Detect the customer’s intent in the moment Morph functionality and content to match intent Optimize for the device (or channel)

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Trip 1 Easy. Buy a copper tube ice maker kit.

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Trip 2 Buy a shut-off valve for the copper tubing.

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Trip 3 Buy a T-connector to tap the cold water supply line.

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Trip 4 Whoops. Also need to buy a hacksaw to cut the copper pipe.

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Trip 5 Finally. A special drill bit to make a hole in the kitchen floor for the copper tubing.

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Adaptive apps can make your customers feel intensely loyal.

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You must infuse your app architecture with predictive components...

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…and expose them as APIs

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Perfect opportunity! Your competitors are busy with other priorities. Source: “The State Of Retailing Online 2014” a Shop.org study conducted by Forrester Research “What are your top three initiatives and priorities for your online (digital) business in 2014?”

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Customers are ready.

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What kinds of apps could you develop if could predict and adapt to what customers need in the moment?

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Mike Gualtieri mgualtieri@forrester.com