How to be more strategic?

a UX researcher or any kind of UX practitioner, what would you do if you were asked to come up with an experience strategy to help an insurance company grow its user base? You might start with understanding the existing user experience and journey, identifying gaps and pain points along the way, and come up with what to do and what to stop within the existing product scope.

Ping An Insurance, China’s biggest insurer, took a different approach. They realized most people in the addressable market already had basic insurance, and there was not much more to optimize within the existing offerings. In order to reach their business goals, they needed to create reasons for people to buy more insurance. How do they plant those seeds in people’s heads? By solving foundational needs such as healthcare, food, housing, transportation, and entertainment, first and then gradually direct users to related insurance products at appropriate times.

Multiple products were developed under this strategy. Ping An Good Doctor is one of them. The app provides services like free 24/7 consultation with authoritative doctors, medication delivery, online appointment scheduling (it wasn’t common in China), E-commerce specialized in healthcare products, etc. Meanwhile, it prompts you to purchase insurance packages that include premium services in the app, such as personalized health plans from top-notch doctors in the country. Since the app knows your medical-related behaviors, including when and where you made a medical appointment, it can provide you with more targeted insurance products.

Source: Bloomberg

The same logic applies to Ping An Auto Owner. The app provides all kinds of services for cars, such as search and pay for parking, top-up gas station cash cards, search for body shops, track driving data, file claims…, and eventually introduce you to different kinds of auto insurance or insurance upgrades.

Source: Ping An official website

This, in my opinion, is an experience strategy. The services addressed customers’ pain points, and also reached business goals. It was not limited to the experience within a feature or a product, but rather thinking from the entire business standpoint.

Many UX researchers strive to shape strategy, yet it isn’t always easy. There are two main reasons:

1. We function more like “digital product” designers/researchers, instead of “holistic user experience” designers/researchers.

2. Our outlook and responsibility are mostly tied to products, instead of the business.

In <<Good Strategy, Bad Strategy>>, Richard Rumelt defined strategy as “a coherent set of analyses, concepts, policies, arguments, and actions that are in response to a high-stakes challenge”. Note that there are two key points here:

1. Strategy comprises a set of activities, not a standalone decision or goal.

2. Strategy is aimed at addressing some of the most critical challenges.

Both points reinforce the importance of looking at problems and opportunities from a holistic perspective, instead of through a specific product/feature, such as the search function in Microsoft Outlook, or a particular problem space, such as Skype user growth.

Users don’t distinguish their experience with a company by channels or features. The experience in any touch point, be it a website or a support call, would affect their sentiment toward the brand or other channels. “User experience” by default should be holistic.

What does it look like to be responsible for a holistic experience?

Let’s illustrate this with a real example from Hema, Alibaba’s futuristic grocery shop. Hema offers physical and digital stores. An important business goal is to direct customers to its online shops. However, a big concern regarding buying groceries online, especially seafood, Hema’s specialty, is quality. How would the UX team address this concern?

Shopping at Hema. Source: Business Insider

In a typical tech company setting, there will probably be some researchers working on the grocery app, while others work on the store experience. If trust is a barrier for online grocery shopping, Hema’s digital experience team might come up with solutions like customer reviews, photos, certification badges, etc.

Instead, Hema looked at the comprehensive experience and addressed the online trust issue by leveraging the offline channel. They set up dining areas in brick and mortar stores. Before ordering anything online, users come to the store — which was usually their first touch point with the brand anyways — and pay just a little fee to have the chefs turn the seafood they picked into cuisines. This not only creates a great experience — enjoying fresh seafood at the retail price— but also removes their concerns about product qualities. On the branding side, Hema’s in-store dining experience became something iconic and unique that traditional grocery stores don’t offer.

Dinning area in Hema. Source: WalkTheChat

Products are just a part of the business, and you can’t form a strategy by solely improving products.

Take Olay’s masstige strategy for example. No matter how much time the R&D team put into making Olay a more effective product, the business wouldn’t be able to turn around without updating its pricing, sales channels, and branding.

The same logic applies to the tech world. It takes more than product teams to design and execute experience strategies. We need brand and marketing teams to communicate the new product/services with customers, the support team to address issues when things fall short, the operation team sets up backstage processes, and the people team to provide necessary training to frontline workers to deliver the experience.

In an ideal world, UX research would take all those factors into consideration, and would work hand in hand with marketing, sales, customer support, operations…. The UX team would define an ideal experience, and the cross-functional teams work together to support a seamless, holistic experience — not just the experience within a product line or business unit.

1. Redefine the role of UX research and form a horizontal cross-functional team that oversees the end to end experience, reporting to Chief Experience Officer

The bad news is, this change needs to come from the top-down. Key business decision makers need to acknowledge what UX researchers can do beyond product research, and bring them onboard in helping with company strategy.

The good news is, some companies already have a CX function, looking at “Customer Experience” from a more end-to-end perspective. Currently, the CX team is either focused on customer success, relying mostly on customer support and sales calls for customer inputs; or formed by people with management consulting or marketing backgrounds. Since most people in the CX team do not have a background in in-depth human research, UX researchers can be a valuable addition in getting deep customer insights and nuances.

At present, the CX team and the UX researcher team are usually not in close contact with each other. The two functions are often under different departments and work on separate projects, leading to either duplicate work or insights from both parties being underutilized.

Ideally, the CX team could be turned into a horizontal team under CXO (Chief Experience Officer) that oversees the overall user experience — across touchpoints, channels, products, and customer life cycle. UX researchers should be brought onto the team, together with other functions that can either help improve the experience or provide user insights.

Should research now be centralized instead of embedded? No. Product teams still need research on feature specific problems from time to time. The horizontal team is an additional add-on to ensure the end to end experience is being attended to, and the company can create coherent and seamless experience strategies.

2. UX researchers need to evolve, too, by leveraging operational data and gaining business acumen

To formulate a business strategy and to persuade leaderships to act on it, user data, especially qualitative data, is not enough. Combining operational data (indicators of business performance, such as how many days it took for a package to be received) with user experience data (how customers feel about the performance, such as the perceived wait time of how fast a package is delivered) would be a much more powerful way to inform business decisions.

It doesn’t mean UX people now also need to do business analytic works, but we need to at least know how to better work with teams like business operations, strategy, and planning, just as we learned how to work with product managers, data scientists, and engineers.

It would also be helpful to gain business acumen and judgment, understand how business works, and know what kind of business data exists and how to leverage it.

In User Experience vs. Customer Experience: What’s The Difference?, Kim Flaherty from NN/g categorized three levels of UX: interaction, journey, and relationship level. The relationship level is the widest scope of user experience. It is concerned with all interactions and journeys between a person and the company, everything from branding, customer service, to campaigns, should all be part of consideration.

Source: NN/g

In my opinion, the relationship level is what UX researchers should be working on in order to really influence business strategies.

Of course, working on a higher level of experience and influencing business strategy are not the only pursuit or aspirations for UX researchers. Some researchers are inspired by horning in on different methodologies, while others are fascinated by different ways of storytelling. In any case, we need to keep in mind that understanding users is only the first step in making great experiences happen, and a user’s experience is beyond the product or feature we are assigned to.

Categorized as UX

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