First, take an everyday physical object – a watch, fridge or even a car. Second, embed it with smart functions, such as sensors, which allow the monitoring of the performance of the physical objects. Third, add connectivity to allow centralised data analytics. Fourth, by Internet of Things research nudging customer experiences, we mean the constant monitoring of a product or a service so that organisations can fix, or respond to, problems before we consumers even notice something is wrong.

Internet of Things might include an app warning of a late train or a car involved in an accident, alerting emergency services of its location, when the airbag is activated.

Despite this amazing technology, in many cases, businesses may not be able to provide a smart customer experience because they have not understood consumers’ needs and concerns. In short, no consumer wants something bleeping or messaging him or her unless it meets his or her needs.

We think smartwatches are largely failing to deliver smart customer experiences. For instance, they have not quite managed to captivate and excite UK consumers, because they do not yet meet our needs well enough. According to our online research completed in late 2015, with a nationally representative sample of 500 UK consumers, 50% would be interested in having the number of steps they have walked calculated and 50% say they would like to know how many calories they have burned each day. Many wearables have this functionality, yet they do not force us to exercise, nor do they force us to stop eating, although they may nudge us in the right direction.

 UK consumers are keen to see Smart customer experiences play a greater role but it needs to fit into their lives.

  • 60% would like to be notified if their current account balances go below a specified minimum balance
  • 70% in the UK would want to be told by their smartphone about a break-in or fire at their home when they are absent
  • 70% want their utility usage monitored
  • 40% say they are in favour of driverless cars.

Clearly, interest in Smart customer experience is strong. Smart Service is not only about new Internet of Things technology – sometimes Smart customer experiences are delivered by a shop assistant anticipating and understanding what shoppers need and want. The specific role that Internet of Things technology should play varies according to the industry.

Businesses interested in providing Smart customer experiences need to guard against putting a foot wrong. We know from our Internet of Things research that 90% of consumers are concerned about:

– invasion of their privacy
– marketing bombardment
– ID and card payment fraud with hackers infiltrating company databases.

If organisations prioritise consumers’ needs and security concerns Smart customer experiences could revolutionise customer service, as we know it today.