Know Your Client

Revisiting An Old Truth In A New Technology Renaissance

Jon Tyson on Unsplash

Thinking about the bottom line first is not a good long term strategy. In fact, it is not a strategy at all. A good strategy begins with how well a business knows its clients. To a large extent, it is about looking around and finding out how a business can make people’s lives easier and better. For example, great economists not only talk to influential people but also to crowds of ordinary people on the ground to form an opinion on an economy. Similarly, a business that stops listening to the voices on the ground soon loses its grip on reality.

Secondly, a business is about creating a fundamentally beautiful experience for clients even if the experience involves something as mundane as using a phone. The iPhone is fundamentally a phone which has morphed into a computer. A phone call using Siri is just a simple and natural way of ‘making a call’. Another example is that of the furniture giant IKEA. IKEA is easily associated with economy and function. However, it also has a partnership with a prominent designer — Ilse Crawford, the designer of the SINNERLIG collection. That’s because even simple pieces of furniture can be made really aesthetic. A product or service needs to be wrapped in a dream.

Thirdly, technology has changed our lives but it is a medium through which a product or service is delivered to a customer. We use Google to search, Facebook to connect and Amazon to order. These things were more physical before now they are ‘phygital’. Even though we use Facebook to connect, it is not a substitute for meeting over a dinner. It just enhances our ability to connect further. Many of us search for good restaurants on Yelp!. However, given a choice, we love to consult our friends who have a similar taste in food. Even then, there is no guarantee that the restaurant turns out to be of our liking.

Technology doesn’t change the fundamental nature of business. It only changes the last mile experience for a client. The key to designing this experience is how well a business knows its clients. This story explains why knowing a client is at the heart of any business even though technology is eating the world.

Simplicity is the Antidote to a Very Fast Moving World

On March 25th, Apple announced a unique partnership with Goldman Sachs.In the summer of 2019, Apple will offer its clients a branded credit card. The Unique Selling Point (USP) of this card is that it offers 2% cash back ‘daily’. In addition, the physical credit card is Titanium with nothing but the Apple logo, the client name and a chip on its face. It does not have any expiry date or a CVV number printed on it. Those details can be accessed through the wallet app on an Apple device. The card also tracks spending not just category wise but also merchant wise.This card is a great example why the world of financial services is feeling the onslaught of technology companies. The card is aspirational, it simplifies life and is decluttered. I am not an Apple evangelist. All I am trying to do is to use a credit card as an example of simplicty and of truly solving customer pain points.

Today, Blockchain based startups want to make cross border remittances instant while charging very little or low fees. That’s because they can. The fundamental difference between technology companies and legacy financial institutions is first principles design. Technology companies are establishing the pipelines from the ground up whereas traditional financial service companies have to upgrade, dismantle or totally destroy the old legacy systems. That’s the difference between a country like Estonia and the USA. Estonia could become the most digital country because it built its infrastructure from scratch. However, what technology companies are teaching traditional industries is to start reimagining their businesses from a client point of view. The status quo is never good enough.

In the future, digital assistants that have a higher level of Artificial Intelligence (AI) built in which allows them to truly know their masters will hold the key to personalization. That’s because we live in a world of abundance. If you go to a local grocery store, the dizzying varieties of cheese, milk or shampoo can give you a headache. Similarly, the leading media giants are now competing with influencers who are vying for people’s attention. Therefore, a simple interface that declutters the noise and provides clients with more relevant content is key. The challenge they need to solve for is privacy. How to find a healthy middle ground between personalization and invasion of privacy is a trillion dollar question.

Good Design is Never Good Enough

Steve Jobs was a fan of the Bauhaus style of architecture. There are a couple of examples of why Jobs’ way of thinking about design proves Andy Grove’s point ‘only the paranoid survive’. For one, there is an amazing story in Walter Isaacsons’ biography of Steve Jobs. Jobs famously left his home empty because he was a perfectionist. He couldn’t find the right type of furniture to fill his home. There is also another story which says Jobs was maniacal not just about how the product looked from the outside but also how it looked on the inside. Both these are examples of how businesses need to weave design as one of the core pillars of their product or service.

Zaha Hadid is known to have built some of the most incredulous looking buildings and even a boat that can blow your mind. If Zaha’s creations are any indication, clients around the world are looking for a unique experience even if they are just gazing at a boat. Sailing on the superyacht is a whole new experience altogether. From the most luxurious to the most mundane, design and user interface are the difference between failure and multi-generational success.

Lastly, there is a famous story about the first outside investor in Facebook. LinkedIn founder Reid Hoffman introduced Peter Thiel to Mark Zuckerberg. Mark was seeking to raise capital at a time when social media networks such as friendster and MySpace already existed. Many outside investors did not lend money to Facebook. However, Peter Thiel noticed that the social networks of the time need a very good user interface. It wasn’t that people weren’t spending time on friendster. It was just that the user experience needed to be enhanced even further. Peter spotted the opportunity and invested $500,000 in Facebook making him the first outside investor in Facebook in 2004. In 2012, when Facebook had an IPO, Thiel cashed in 17 million shares for a cool $638 million.

Every website, product, platform or service today needs to deeply understand their clients and then offer them the best design experience possible. Design is the first impression and perhaps the last.

Solve for Scarcity of Time

Have you ever looked at a universal remote control and tried to figure out what each of the hundred buttons on it does? Have you ever looked at a coffee machine that is so incredibly complex that you cannot figure out which button is used to actually ‘brew’ the coffee? We live in an incredibly complex world which is at times deliberately made more complex. This is also because businesses often make money from the accessories to a coffee machine rather than on the machine itself.

The most important resource that people have today is their time. Apps that read the heart rate simply because the user is wearing a watch, Customer Relationship Management (CRM) software that allow relationship managers to analyze the likes and dislikes of their clients are all solving for scarcity of time. In an age when technology exponentially enhances loneliness, a different tact is needed. Technologies that free up people to be less ‘alone’ and be more around other people are gaining ground.

In order to free up time, businesses need to know where people are ‘wasting’ their time. Recommendation engines in Netflix and Amazon are trying to save the time people spend trying to figure out a movie to watch. The ultimate example of an exponential technology that is touted to free up humans for more creative and spiritual pursuits (including finding the purpose of life) is Artificial Intelligence (AI). However, good AI is only as good as the data it is fed. Therefore, if a business’ database has input errors or duplicate names for the same client, it is hard for an AI engine to customize the client experience.

It doesn’t matter if you are an automobile manufacturer or a soap manufacturer, your products need to be so intuitive that they don’t ‘waste’ people’s time in figuring out how to use it. Similarly, it doesn’t matter if you are a cloud service provider or a Financial Advisor (FA), your services should free up your clients’ time to do other higher order things. If Abraham Maslow were alive, he would say the function of a business is to maximize time for clients’ to pursue their self-actualization needs.

The new reality for most businesses is that the last mile to the client is getting progressively digitized. However, some things never change. In business, nothing exemplifies this truth better than the need for personalization.

Writer @ The Intersection of Finance, Tech & Humanity. Stories of a Global Language: “Money”. Contributor @ Startup Grind, HackerNoon, HBR. Twitter@akothari_mba

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