Dumb pipe vs. smart pipe: A futile discussion?

Monica Zlotogorski
14 Apr 2010

But in this new retail scenario, the network may work and a CSP may offer the latest gadget, but they may still deliver a bad experience (that is, not what a customer desires), and unavoidably end up having their customers move over to a different retail service. As opposed to traditional communications services, the new retail services inevitably would put the power in the hands of the consumer, who can actually decide to move (and when to move) to a new “department store.”

In this new scenario, customers have more options, more power and the experience is measured in every interaction and across multiple channels. So what will be the Achilles’ heel for communications service provider in the “communications retail era”? When we talk about retail, differentiation can only be demonstrated, so business survival becomes essentially about one thing – the retail experience. Each transaction counts and the experience received would determine whether the customer will come back again. Here’s where things get a bit uncharacteristic, and strong marketing departments comes into play.

The communications retail experience

In a retail scenario, when a store cannot differentiate itself, the customer will almost always base the buying decision on perceived lowest price or convenience. But as we can learn from retail, differentiation must be not only demonstrated, but also communicated, and it is not just about advertisement.

The communications retail experience is everywhere, not merely when the service is delivered or charged for, as is mostly the case with traditional communications models. For example, mobile operators would require integrating their physical retail stores to their overall customer experience. It is not just about having a physical store, but about the experience it delivers. The quality of the in-store experience is an important aspect in a customer’s decision to do business with a communications service provider. Is the product that I want available at the store? Is the stuff on the ball about a specific product or feature? How are they dressed? How do they “walk the walk”? How do they treat me? Is there a lounge where I can hang out? How fast do I get served?

Physical retail stores for communications service providers are not going anywhere but actually are becoming more relevant to the experience. Apple knows the importance of retail stores all too well, but that is just one channel in the experience. I could have a good experience at the physical retail store, but then I go home and what is my online experience like? What if I contact them by phone? If I have a billing or service issue, what kind of service do I get?

A consistent and integrated experience across all channels is essential, and every shopping experience or interaction must be delivered with a smooth image, whatever that image may be. The physical retail store, online, phone and actual user experience are different aspects of the same experience. In fact, when the retail experience becomes seamless, the consumer‘s issue becomes not about which retail service to use, but rather which provider to trust. But in retail, not everybody goes to a Starbucks shop seeking the exact same experience. For instance, I don’t care whether they have Wi-Fi; I go for the cinnamon scones I like. One retail store can mean different things to different types of consumers.


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