What makes customers tick? IBM announced the launch of the new Customer Experience Lab, to help businesses research and develop innovations that get to the heart of this question.

The Lab will look at how mobile, social, cloud and analytics tech can be used to create new ways by which customers can experience brands. Scientists from IBM Research and business consultants will work with clients to individualize experiences, find patterns, create context using Big Data and help to scale the costs. The Lab will be based at the company’s research center in Yorktown Heights, New York.

Insight and Engagement

Mahmoud Naghshineh, vice president of Services Research at IBM, said in a statement that businesses know “they need to continuously transform their customer experience in order to be relevant and competitive,” including innovating in the perception of value, the quality of the interaction and the economics of delivery. Success last year, he said, does not guarantee the company will “be competitive in the future,” so the Lab will look at new kinds of engagement.

The innovation modeled in the Lab will be based on IBM researchers’ experience in over 1000 IT business process and consulting client services engagements, and more than 30,000 client engagements over the last few years by 9,000 business analytics consultants.

Research will focus on three areas of innovation breakthroughs -- customer insight, customer engagement and employee engagement.

In customer insight, machine learning and visual analytics will be utilized to predict how individual customers will behave across multiple channels. Companies are regularly being advised these days to consider a unified customer experience across all channels, but there is little information available about how that experience might result in different reactions because of the capabilities of a channel or the addition of new tools, such as predictive analytics.

Virtual Closet

Customer engagement will look at how new kinds of personalization can add value, compared to straightforward transactions.

As one example, IBM noted that personalized recommendations on sites are “not really that personal,” but utilize collaborative filtering to compare your purchase with other customers who have purchased that same item, and then see what the others also bought.

Instead of that approach, IBM suggests a “virtual closet” approach which focuses entirely on your recent purchases, and then looks at characteristics like color, type of print, and genre, to create a “taste model” that can predict what the customer will like. Other techniques, such as image recognition technologies, could be used to find commonalities among images that customers share on social networks, with their permission, in order to inform the taste model.

IBM taste profile.png
IBM Customer Experience Lab's steps toward a "taste profile."

Employee engagement will utilize semantic, collaborative and multimedia technologies to develop ways for employees to become more involved in a product or service -- which can also add competitive value, such as in customer service.