TechTalk ep2: UX for dummies

Paramita: Hello and welcome to PwC Luxembourg TechTalk. UX, CX, UI… well these are some of the buzzwords that we keep hearing in technology. What are they? And what's all the rage about these words. I found out during my conversation with our experience designer Armin Prljaca.

P: Hi Armin

Armin: Hi Paramita.

P: Welcome to PwC Luxembourg TechTalk. It is our second episode and I'm really happy to have you here.

A:  It's my pleasure to be here.

P: Thank you. As you know our podcast is basically technology focused and you being the designer, experience designer guy, you know that the buzzwords in the industry today are UX UI CX. So could you enlighten me a little bit about these acronyms and why do we use all these acronyms and can they be used interchangeably.

A: That's a great question to kick off this conversation actually because there is so much confusion around what is user interface what is user experience what is customer experience and so on. So people often confuse and then they use them interchangeably and well we can think a bit of it sort of as a scale. So you would have customer experience at the top which is the highest level of granularity and then you would have somewhere in the middle user experience and in the bottom which is the more specific part would be kind of a user interface. So user interface is referring to the interface of an application of a software. It's just interfacing, it's extracting the technology that the user is using in a visual way to facilitate the user interaction. Hence it's called the user interface. So it's everything that you see on your phone on your screen that you touch and so on. The user experience is more talking about how a certain application is structured. Why it even exists and what purpose does it serve and user experience is about creating experiences that are not only enjoyable to use but are beneficial to users on day to day basis and the customer experience is even going a step beyond and it's taking into account all the online and offline touch points.

P: Sorry to interrupt. How is user experience and customer experience different?

A: That's a great question. A user experience is predominantly and only limited to the digital part. While the customer experience is taking into account everything that is both physical and digital. So for example in the customer experience when we make the customer journey we could say while a certain customer is having interaction at the counter in our physical premises and so on or the experience that a customer has with a printed advertising and so on. So. And also taking into account the digital part. So it's really trying to get the complete picture of a customer journey and all the interactions that it has with a certain brand product or service.

P: Right. Before we go into any further detail tell me why did we first start thinking about user experience?

A: We started thinking about the user experience way back in the 50s and 60s when IBM was developing new kinds of computers. They were huge, football stadium sized computers.

P: If I remember well while talking to you in one of our previous conversations you mentioned somebody who created a…

A: Yes, J. C. R. Licklider. He was basically this psychologist who worked for the government. He was the head of ARPA, now called DARPA, the Advanced Research Projects Agency. And he saw that at that time if computers were to survive and thrive and if they were to be used by the masses they had to become interactive so computers back then were so boring to use. You had to type in something in the box and two hours later the result is printed out somewhere on a sheet of paper. You pick it up and you read through the list of gibberish to find what you're looking for. And then he thought wow how can we turn this around because we have this amazing computing power in all of these amazing brains that are building these great computers and how can we make them interactive. How can we make computers fun to use. And then what they started to do was kind of a method like little bit like design thinking now and making prototypes so they thought let's try to prototype something small and something fun to use.

And they managed to do this. And what they observed was that people really felt connected to the computers all of a sudden because the computers were able to, in real time, talk back to them. And thus this idea of intractability came to life. What Licklider saw at that point was that a world world will exist where the personal computers are extension of the human capacity and that they will argument the human capabilities in every way.

And now actually this is a fact. This is the world we are living in nowadays. If you look at Microsoft Excel and its predecessor, if you look at VisiCalc, for example, which popularised the personal computers in the office, it served a very specific purpose. It introduced spreadsheets. So you didn't have to do anything manually anymore. You had the computer to help you do that. So it became the extension of a human in a way.

P: So basically what you're saying is that he saw this need of interactivity for the computer to become popular. So was it based on really the needs of people, did he see the need in people to be more interactive with the machine? Is that so?

A: He saw the need but more importantly he saw the frustration, or the pain points.

I've read his biography and what I saw there was that this idea was born basically looking at people and their frustration with using the old computers. And the frustration was huge. The pain points were identified, were addressed and then tackled systematically and now we have what we know of as a personal computer. If we arrived at this point it’s because a certain number of key pain points were identified, we had some key insights and those were tackled systematically. In case of user experience, it's the same process. What we try to do is we observe in the current process what are the key elements in which the user is struggling, what are the pain points and what are the key learnings. So we try finding out what has worked, what hasn't and how we can co-create, with the user, a new solution that would alleviate the pain points.

P: We actually got to know how the process of designing an improved user experience happens… identifying the pain points and then trying to understand the needs of the clients. So basically the concept of user experience has always been there, in the sense, I'm sure even before the computers came into existence, for example, whenever you’re selling something like any product…

A: I think what you're hinting at is an important shift that happened that thrusted UX in the spotlight. Now if you think of any kind of product or service that you yourself would want to sell like hey I'm going to go out there and make a start-up doing this and that you just google it and you see oh OK there's already a company doing that. And then we see a market that gets saturated with a lot of new entrants doing all kinds of things that’s imaginable.

And so the conversation in the past years has shifted from how we can do something to why should we do something. And this is a tremendous and important shift to that it has put Apple where it is nowadays because Steve Jobs has at many occasions asked why we should something. It's not about how it looks. It's about how it functions. What purpose does it serve? And you know Apple was going to great lengths to put the customer first… understanding what the customers’ needs are and would they need a certain product of service.

Well if the answer is yes then we go in and investigate further but we don't just create things for the sake of creating things. Hence the focus on user experience and the current approach in which we really try to understand the customer well where we try to facilitate something that could be of benefit to you as a customer...

P: So we understand where it started. Coming back to today why is it so important for businesses to think about users and customer experience.

A: Well I thought the importance comes from three key factors. First one is that digital disruption is lowering the barriers for new companies to enter the market. What we mean by that is if you take a company like Netflix, for example, their barrier for entry into an old market was quite low. Thanks to digital technology, and for all other companies like Uber, for them the cost to enter a market is very low. What we now think of as the old industries they are quite easily disrupted because the new entrants can easily come in with lower cost and with new business models and disrupt the industry. And the second one is about hyper adoption that is reducing customer loyalty. Here we are talking about a different scenario in which companies are finding out that their customers are easily leaving even though they have been loyal customers for many years, they're easily leaving to go and seek new products and services from competitors. Why? Because thanks again to digital it's so easy to go out there and to download an app on your phone and just start using a different company and different products and services.

And third one is about the changing workforce. Here we are talking about a very specific problem. That is it's becoming very difficult for companies to retain their talent. Companies are realising that investing in creating a great employee journey and employee experience yields real benefits in retaining a talent.

P: So let's say I'm the client. And you want to sell or pitch a UX service. What is the business case behind? Is there a concrete ROI?

A: Of course. And it's a very good question because it's the one that has been asked a lot lately. And it's been one that we constantly tried to go back to with our customers and demonstrate the value in saying that first of all it's about customer retention.

Also in a world as we said where you have hyper adoption that is reducing customer loyalty, customer retention is really important because over the years you've invested so much in your own customers… not just to have them walk out the door the next day. That’s not the ideal scenario. So what we do is we emphasise that UX is helping client retention by fostering a new kind of loyalty centred around the experience of a brand. Secondly, it's also about attracting new customers. If you have great experiences people will talk about it. They will become natural brand ambassadors and you will gain new customers simply by word of mouth or by reaching out to new markets that you couldn't reach before because maybe you were lacking on some digital aspect. Then there is price premiums.

P: What’s a price premium?

A: Price premium is a price difference that customers are willing to pay for an extra experience, let’s put it like that and we have seen that customers are willing to pay extra for that. Take a look at Starbucks for example. When you go to Starbucks it's not that you go to get maybe a very good cup of coffee but you also go for that entire experience… for the smell, the colours, the smile, the handwritten name on the cup. Then we have cross-selling and up-selling. Great user experiences can facilitate the user to move from one product and service to another quite easily. So this is another advantage of the user experience. Then we have also some other kinds of returns on investments that you can look at for example the acquisition costs for a customer. We see that in a digital world, the acquisition cost for a customer is much lower than what we know now to be in the physical world. Then we also have the employee acquisition costs which are much lower. And the cost to serve the customer again is much lower, thanks to a great user experience.

P: Thank you so much Armin for your insight. It's really enlightening… I know we keep hearing all these terms - I'm a complete novice of course - I understand these concepts a lot better now thanks to you. And we should sit together once more… many times more.

A: I'm sure that we have tons of topics that we could cover and that our listeners would love to hear about. And user experience is just one of these buzzwords. I'm always happy to be here. Thank you so much.

P: So that was my conversation with Armin Prljaca, our experience design officer. Hope you enjoyed the episode. If you did, don't forget to comment with the #PwCTechTalk and I'll see you next time.