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Customer experience is king in mobile loyalty programs

Speakers at Oracle OpenWorld demonstrated the importance of the cloud and mobile technology to the customer experience. From connected cars to mobile loyalty programs, speakers from 7-Eleven, Walgreens and Mazda shared their stories.

SAN FRANCISCO -- At Oracle OpenWorld 2014, it was clear that from cars to convenience stores, the customer experience is king. Now, big-name companies like 7-Eleven, Walgreens and Mazda are turning to the cloud and mobile devices to improve the experiences they offer their customers. 

For example, 7-Eleven launched a new loyalty program mobile application in an effort to connect better with its customers. Walgreens moved to the cloud in part to give its salespeople better access to tools to help customers while they are in its stores. Mazda USA is working toward connected cars that will enable it to gather data from customers on the go and use it to tailor the customer experience to the customer.

During a session at the conference, Greg Haertling, senior director for enterprise architecture at 7-Eleven, explained that the Dallas-based convenience store chain's customer demographic is changing. Previously, most 7-Eleven customers were blue collar, male and middle-aged or older. But Haertling said people from the millennial generation and beyond have increasingly started coming to 7-Eleven stores -- and, unsurprisingly, they have different needs and desires than earlier generations of customers.

Innovation and the customer experience

The smartphone-based application extends 7-Eleven's loyalty program to mobile devices, enabling the company to personalize and accelerate its marketing outreach to its new customer base. The application runs on an Oracle database that sits on top of an Exalogic appliance in 7-Eleven's private cloud. The company uses OracleSOA Suite middleware tools to connect the mobile app to an Oracle-based customer relationship management (CRM) system. In the past, "we didn't have real-time interaction with the customer," Haertling said. Now, he added, the mobile app provides "loyalty at the speed of light."

Among other things, it can function as an interactive punch card. Haertling gave the example of a rewards offer that lets customers who buy five coffees get their next one for free. With each coffee that is purchased, the application automatically ticks a box, so that the sixth coffee rings up as free without customers having to do anything. It comes up free of charge even if it's bought alongside the fifth coffee. Haertling said the mobile app is configured for sub-second response times, which means it can contact the CRM system and get confirmation of the fifth purchase back before the transaction is completed.

Walgreens also has a loyalty program designed, in part, to gather customer data to help the Deerfield, Ill., drug store chain figure out exactly what items each store needs to stock. "We're moving toward a more personal relationship with our customers," CIO Tim Theriault said in another conference session. "Nothing is going to replace the wonderful experience a customer has with one of our employees, but we need to give [store workers] the tools they need to do that."

The project includes moving to the cloud. In fact, Theriault plans to have separate cloud systems for the pharmacy and other healthcare services and regular front-of-the-store retail operations. He explained the advantage for Walgreens of a cloud-based setup managed by Oracle: "We don't want to be in the business of connecting things." Using the Oracle cloud platform lets Walgreens focus on the customer experience without having to worry about how everything fits together on the technology end, Theriault said.

Dealing with the difficulties

Cars such as the Mazda 3, Mazda 6 and Mazda CX-5 have won 40 awards from publications like Car and Driver, Road & Track and Automobile Magazine. However, Mazda remains ranked near the bottom in terms of customer experience according to the annual U.S. Customer Service Index Study conducted by J.D. Power and Associates, said James DiMarzio, CIO at the auto maker's North American operations in Irvine, Calif. DiMarzio and his team are involved in efforts to improve that. "It's not just about the product," he said in a third session. "It's about the experience, and the customer won't come back if they don't have a good experience."

Step one, according to DiMarzio, was getting into the cloud. He said Mazda also adopted Oracle's Siebel CRM software because it had a built-in automotive option and didn't require any customization. With the help of IT services provider Wipro Ltd., it took six months to convert the company's customer experience management system to Siebel. DiMarzio said that after making the move, the length of customer service calls was reduced by 20% because call center agents could get to necessary information more quickly. "Agents are spending more time talking to customers and less time looking stuff up," he said.

The process of moving customer experience management to the cloud isn't an easy one. To get sub-second responses for its mobile application, 7-Eleven set up dedicated networks between its CRM system and its stores. "One of the things you have to consider is bandwidth," Haertling said, adding that the project team did extensive testing for performance bottlenecks using the Oracle Application Testing Suite.

According to DiMarzio, Mazda's customer experience cloud is still very much a work in progress, and he believes that connected cars are the next big thing. "The vehicle will be spewing data out to the cloud," he said. The plan is then for Mazda to be able to send personal messages to drivers based on the data collected from their cars. That could range from a reminder for an oil check to assistance with a car malfunction via maintenance services. But, DiMarzio said, "The foundation is key. If we don't have the right system in place, we can't do any of this."

Jessica Sirkin is associate site editor of SearchOracle. Email her at jsirkin@techtarget.com and follow us on Twitter: @SearchOracle.

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Yes, of course, if we slice-and-dice our customers' experience we can glean bits of data that might help us help them. Which, of course, helps us, which was the point of the whole thing. The more we know about our customers, the better we can serve them. OTOH, while it's nice to get a free cup of coffee at The Grind House, it tastes far better when the barista leans over the counter, shakes my hand and congratulates my by name. Data is important but society will be at great risk if we lose the human touch.