Four Chinese customer experience kings
As part of my podcast interview series (subscribe here) and on the occasion of the upcoming publication of his book China’s New Normal, I had the pleasure to talk to nexxworks keynote speaker and China expert Pascal Coppens about how China is setting new standards for innovation. I really wanted to share the part of our conversation that’s very useful for the readers of my blog here as well: the names and approaches of some lesser known champions of customer experience.
When people think about innovation in China, they always tend to consider the usual suspects: mostly Tencent, Alibaba and Baidu. But if I remember one thing from my company nexxworks’ many Innovation Tours to China, is that it’s home to hundreds of exceedingly innovative unicorns which have a huge impact on society and the economy, but which are (sometimes) completely unknown in the rest of the world. Last year, China had a total of 186 unicorn start-ups, with a combined valuation of more than 5 trillion yuan (US$736 billion). During that year, a Chinese unicorn was ‘born’ every 3.8 days.
When I asked Pascal to list some of his favorite Chinese companies that are creating a new kind of customer experience, he quipped that he had a list of at least 100 favorite companies, and I really believe that he does. But for now, let’s get to know DiDi, Xiaomi, Ctrip and Meituan Dianping. Here’s what Pascal thinks makes those unicorns so special.
DiDi is the Uber of China. But it’ bigger. A LOT bigger. It counts more car-sharing rides a day than all the other companies of the same type in the world combined, … multiplied by two. That’s 25 million rides a day and 400 million customers in 400 cities worldwide. The beauty of that is that they have more data at hand than all their competitors (75 terabytes of data per day, to be exact), allowing them to better understand customers, and what they expect from mobility.
Though are there of course many similarities with Uber and Lyft, there’s also one huge difference. Through their many partners, they offer a lot more types of transportation services: for instance designated drivers, taxi hailing, private car hailing, social ride-sharing, bus, minibus, car rental, and enterprise solutions. So on top of having more customer data, their data is also a lot more diversified which means that they are much better at predicting than all the others. One of their goals is to use big data and AI to understand and predict where vehicles should be. Even before people realise they need them. They can see averages and know for instance that person X always orders a car at her office on Friday at 17.00 to drive to the train station. Today they can predict this type of events up to 15 minutes up front, but they want to be able to do that 1 hour up front to move even more efficiently and quicker.
Ctrip is a large travel company with one of the biggest customer service centers in the world. Suffices to say that customer service would present a real challenge in such a significant environment, but they solved that in the most brilliant of manners: 80% of all their responses are resolved with a chatbot today. The surprising thing is that, since the introduction of the chatbot, they did not downsize their customer service team: there are till multiple thousands of them manning the desks, but they use the chatbots to respond faster and, whenever needed, they take over for a more personalized answer. It’s a beautiful case of digital making a company more human.
They too are real Data Kings, able to predict where streams of tourists will want to go and when. If a certain city – let’s say the Vatican, or Venice – is in danger of being saturated at a certain time, they can redirect the crowd to other ones, through for instance reward systems. Knowing the vast and fast-rising numbers of Chinese tourists, it’s crucial to manage and solve trends in tourism, so as not to let things get out of hand and spoil the experience of everyone. So how do they influence people? They do that through communication between people that are travelling at that time. Chinese travelling that don’t know each other will start communicating with each other to help each other to figure out what to do and they can predict what is going to happen.
Xiaomi is often called the iPhone of China. But they are a lot more than that. They have the largest offer of IoT wearable devices available in the world: they sell basically every connected device that can be used in our house, at our work or when we travel. Same here: their data-munching systems are able to predict what their customers need. Like refrigerators telling them when they need to purchase a new supply of milk, possibly even automating the buying of it.
Now, when you only possess one IoT device, that type of data-driven approach is cool, but imagine what that means if a company sells hundreds of that type of devices and connects them all through the same platform. Image what type of predictability, and faster than real time automation you could deliver. That’s the type of customer experience that most European companies can only dream of, yet Xiaomi is very close to attaining. That might in part have to do with the Chinese sense of holistic thinking: realizing the contextual nature of customer experience to the fullest and measuring as much as possible to duplicate that in their systems.
And then there’s a company like Meituan Dianping. Its apps connect consumers with local businesses for food takeout, hotel bookings, and movie tickets, among other services. Meituan is the biggest O-to-O company: offline to online or online to offline. With more than 600.000 employees riding around on scooters to transport packages everywhere around China, they are in fact the biggest delivery company. It’s impressive how they know exactly when and where packages need to be delivered, sometimes even before they are ordered. The reason is that they work closely together with companies like for example Alibaba, which is just as data driven and often knows in advance what people will want to order. So they can perfectly predict what logistic companies needs to be where, where the trucks need to be or where the scooters need to be to ensure that people will get their package in time. And that type of partnership makes Meituan Dianping even smarter.
The real customer experience innovators are Chinese
No surprise that Meituan Dianping was listed number one in the Fast Company top 100 most innovative companies list. Grab, the ride-sharing company from Singapore was elected as second. For me, it’s definitely a sign that the number one and two companies on the list are not from the US. It shows that, finally, big influential media outlets in the United States are starting to understand that the real innovation in terms of customer service and experience is coming from China. And, as all of Pascal’s examples here above prove, the reason for that is that all of their innovations start from the customers and from perfectly understanding – through their data – what they want, and then give them that, and really fast. China is definitely becoming the pioneer in data-driven customer experience.