GUIDELINES FOR EFFECTIVE USE OF TECHNOLOGY - Principles of service marketing management

It's appropriate to conclude this chapter as we began it with a reminder that although technology will change the way many service firms interface with their customers in the future, not all new technical innovations will succeed. How should established service businesses and especially retailers approach the challenge of adapting to new technologies? Some guidelines for choosing and using technological innovations effectively are provided below.

1. Use technology to create an immediate, tangible benefit for customers. If consumers don't see how it is going to help them, they often assume it's going to be used against them (hence their concern that data-gathering technologies are becoming too intrusive).
2. Make the technology easy to use. From the consumer's viewpoint, many technologies actually make shopping more difficult. For example, research shows that it takes customers 20 to 30 minutes to learn how to use most text-based Internet grocery shopping programs. By contrast, it takes them only 2 to 3 minutes to learn in a three-dimensional virtual store modeled after a bricks-and mortar store, because the latter is more intuitive.
3. Execution matters: prototype, test, and refine. Many potentially viable concepts fail from poor execution. For instance, when customers tried to use a "meal solution" video kiosk at one supermarket, they became frustrated by their inability to print out a menu and the machine fell into disuse. The source of the problem? The printer was out of paper, but there was no screen message to communicate this fact!
4. Recognize that customers' responses to technology vary. Certain personal characteristics are associated with customer readiness to embrace new technologies. These attributes include innovativeness, a positive view of technology, and the belief that it offers people increased control, flexibility, and efficiency in their lives. Factors that reduce customers' receptiveness to new technologies include distrust, a perceived lack of control, feelings of being overwhelmed by technology, and skepticism about its ability to work properly. Research on technology anxiety has shown that customers may avoid using new technologies even if they understand the benefits. Educational efforts, including hands-on training, may be needed to minimize the impact of technology anxiety among both customers and employees. Providing alternative service delivery options allows customers to select the delivery method that best fits their needs.
5. Build systems that are compatible with the way customers make decisions. Designers need to learn more about consumers' behaviors and observe them in action. One Internet start-up launched a grocery shopping system that grouped cold cereals by their main ingredients rice, corn, wheat, etc. Unfortunately, many shoppers had trouble finding their favorite brands because they didn't know the ingredients!
6. Study the effects of technology on what people buy and on how they shop. Research in the United States shows that text-based home-shopping systems make consumers more price-sensitive than systems that display realistic images of the merchandise. In Sweden, a grocery store experimented with electronically adjusting prices according to the time of day. It found that a strategy of reducing prices in the evening increased sales by 40 percent during that time and doubled store traffic.
7. Coordinate all technologies that touch the customer. Whether a customer encounters a retailer via the Internet, a catalog, by telephone, or in the physical store, there should be some commonalities to the experience. Customers are often channel-blind. When they view a business as a single entity rather than a multi-channel operation, they expect a specific firm to offer the same merchandise at the same prices accompanied by the same knowledgeable and courteous service in all of its delivery channels, including the Internet.
8. Use technology to tailor marketing programs to individual customers' requirements. Treating all customers alike puts traditional retailers at a disadvantage, since electronic retailers can use their databases to customize marketing programs instantly to match the needs of individual shoppers.
9. Build systems that leverage existing competitive advantages. Despite the role of cyberspace in electronic retailing, the constraints of time and space still exist. Consumers may not want to wait for a physical product to be shipped to them (assuming that it can be shipped at all).They may feel that a picture and specifications on a computer screen cannot fully compensate for not being able to see and touch the real thing. Bricks-and-mortar retailers should use technology in ways that magnify the positive differences separating them from their purely electronic competitors.