best practices award template - luminoso(web/mobile self-service, chatbots/virtual assistants,...

FROST & SULLIVAN BEST PRACTICES AWARD

Customer Value Leadership 2019

AI-ENHANCED NATURAL LANGUAGE UNDERSTANDING SOLUTIONS - GLOBAL

BEST PRACTICES RESEARCH

© Frost & Sullivan 2019 2 "We Accelerate Growth"

Contents

Background and Company Performance ...................................................................... 3

Customer Impact and Business Impact ................................................................. 4

Conclusion ........................................................................................................ 7

Significance of Customer Value Leadership .................................................................. 8

Understanding Customer Value Leadership .................................................................. 8

Key Benchmarking Criteria .................................................................................. 9

Customer Impact ............................................................................................... 9

Business Impact ................................................................................................ 9

Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices ............................................................................................................... 10

The Intersection between 360-Degree Research and Best Practices Awards .................... 11

Research Methodology ...................................................................................... 11

About Frost & Sullivan ............................................................................................ 11



Background and Company Performance

Industry Challenges

An Era of Rapid Technological Change

Exponential technological change, characterized by trends such as digitization and deep

learning, are fundamentally changing how businesses gain and retain customers.

Companies that don’t embrace the digital revolution that is gaining speed will pay a heavy

price.

Consider what has happened in the retail space of late.

Over the course of just two months back in 2016, the consequences of not keeping pace

with today’s rate of change became particularly clear. Back in March, 2016, buckling under

pressure from mobile and online competition, retail giant Sports Authority filed for

bankruptcy. Weeks later, in May, 2016, Aeropostale also filed for bankruptcy, and according

to analysts, the primary reason was that it couldn’t keep up with fast-changing consumer

behaviors and the speed of emerging fashion trends at the same rate as its online

competitors. And then that same month, UK-based BHS also filed for bankruptcy. According

to reports, the company had fallen far behind its digital competitors and fast-changing

consumer trends. The consensus among retail analysts was that all three of these

companies failed to digitally transform quickly enough, which resulted in lost ground to

more tech-savvy competitors.

Clearly, understanding which digital technologies are required today, and which will be

important tomorrow, is critical for developing an agile and digitally transformed enterprise

capable of acting and reacting to all the perpetually changing data – all the digital flux – fast

enough to matter. The need for new models and processes is clear.

After all, according to authors Erik Brynjolfsson and Andrew McAfee in their 2012 book,

Race Against the Machine, we’re in the early throes of a “Great Restructuring,” a time when

“our technologies are racing ahead, but our skills and organizations are lagging behind.”

In 2019, this new reality is manifesting itself through automated customer engagements

(web/mobile self-service, chatbots/virtual assistants, automated SMS, proactive outbound

customer contact, and finally IVR and speech). These applications both divert contacts from

agents but they also shorten conversations. Automation is also occurring within the contact

center through voice biometrics screening, desktop automation (including logins and call

dispositions), guided assistance, knowledge management, and robotic process automation

(RPA).

CX as Competitive Differentiator

As a recent Frost & Sullivan report on conversational AI articulated, by 2020, customer

experience will overtake product and price as the number one way for companies to



differentiate themselves. US companies are now losing more than $83 billion annually due

to poor customer experiences, an effect compounded by the reality that it costs six to seven

times more to attract a new customer than to retain an existing one.

Yet, while consumers punish poor experiences by taking their business elsewhere, they

also reward companies that get customer experience right: 74% have spent more with a

business due to a history of good service. These statistics emphasize the importance of

synergizing customer experience with marketing and sales, to enhance both retention and

revenue generation.

Most organizations also understand the direct correlation between customer experience

and business performance. The question is how to make those experiences pay off even

more through higher revenue per interaction. Smart companies are achieving just these

types of results through new tools, including artificial intelligence (AI) and Natural

Language Processing technologies, that help better understand and more effectively

engage with customers.

Customer Impact and Business Impact

Clearly, the customer experience (CX) is a key part of today’s competitive battlefield.

Luminoso Technologies, based on over ten years of research at the Media Lab at the

Massachusetts Institute of Technology (MIT) in Cambridge, Massachusetts, was founded in

2010. The company applies AI-based natural language understanding (NLU) technology to

assist clients with improving their CX. It does this by automatically pulling the most

relevant themes from any open-ended text data.

Customer Purchase Experience

Luminoso has found that too many companies lack an understanding and appreciation for

the nuances of natural language understanding (NLU). And too often, they initially attempt

to develop their own natural language solution through Open Source methods,

underestimating the complexities and difficulties involved in such an undertaking.

Attempting to research and study the ins-and-outs of natural language processing is an

endeavor fraught with traps and pitfalls.

It’s only after so many of those companies inevitably fail at their attempts that they

ultimately turn to Luminoso. Ironically, those are typically the clients that most appreciate

what Luminoso has to offer. Such companies become truly informed buyers that

understand that oftentimes Open Source methods are not what many companies think

they are. In essence, Luminoso’s customers discover that they are buying an optimal

solution that addresses both their unique needs and their unique constraints.

Customer Ownership Experience

As Luminoso notes, its products leverage the power of artificial intelligence (AI), natural

language understanding (NLU), and machine learning (ML) to accelerate the speed with



which clients can understand and derive meaning from text. And Luminoso’s use of

QuickLearn technology has a distinct advantage for users in that it reflects how customers

actually talk (the QuickLearn tech is based on ConceptNet, a system which describes over

28 million relationships about the world in multiple languages; this includes the ability to

ascertain not only what specific words and emojis mean, but the emotions they’re

associated with as well).

Moreover, because the company also uses Transfer Learning technology, it has the

advantage of being able to work with even tiny amounts of data. The end result is

“common sense natural language.” This type of AI-infused natural language is gaining

traction and having a real impact on businesses.

The software product set comprises the following:

Luminoso Daylight – Its core offering. Automatically analyzes all feedback so that

clients can discover hot topics, identify top complaints, track critical trends over

time, and act on those insights (ie, “What’s going on with the product, what’s in the

data set?”).

Luminoso Compass – Intelligent automation and routing. Makes it easy to

categorize and classify data into digestible topics and auto-respond to high volumes

of streaming data in the form of support tickets, call transcripts, or chatbot data (ie,

“Route customers where they need to go based on a trouble ticket”)

Luminoso Conceptual Search – Intuitive search. “A combo of the above two

offerings that possesses the ability to peruse a catalogue of information and guide

customers.”

Luminoso’s product set is particularly strong when applied in areas like product reviews,

surveys, and support tickets. In other words, in situations where documents have a lot of

information that form patterns (typically not things like boilerplate legal documents,

radiology reports, or things that are computer generated). Usually, the documents are

written by a person for a person.

Luminoso also is integrating data with more visualization features into their product

solutions. And as trouble tickets are handled by different vendors all over the world,

Luminoso can actually help tell client companies what makes some agents better than

others. Finally, the ability to work with mixed data sets (structured and unstructured)

truly helps clients understand which data has the most impact (what’s driving higher or

lower ratings, for example).

Customer Service Experience

Luminoso has aimed to steer its technology solutions toward helping organizations

improve the CX in altogether new ways. The company understands that people are often

overwhelmed with the sheer volume and speed of today’s omni-channel conversations,

and that reams of incoming unstructured information presents a very real challenge for



organizations trying to make sense of it all.

Luminoso’s solutions therefore mine for insights from troves of otherwise untapped

customer feedback (such as support tickets, open-ended survey responses, or reviews),

turning masses of disjointed information into valuable and actionable intelligence that

improves customer service practices and product plans. Uniquely, the company offers

capabilities in fourteen languages (including, Japanese, Indonesian, Chinese, and

Russian).

The company’s solutions are particularly relevant for CX teams that may want to sift

through Voice of the Customer (VoC) information; HR departments that want to gain more

insights on employee feedback so as to improve employee engagement; design and

developer teams that seek instant feedback on products after Agile deployments, for

example; game developers looking for insight into their latest releases; financial

institutions firms that want to discover how well web portals are functioning, for example;

healthcare providers that want to confirm that new services are working as anticipated;

contact centers making sure that inquiries are routed correctly (to a human being or

automated system). All these examples have clear returns on investment (ROI) by way of

increasing satisfaction and lowering costs.

Brand Equity

Early on, Luminoso’s objective was to democratize the use of natural language and data in

the enterprise, to make information relevant and useful in new ways. Its target companies

tend to be large with significant amounts of customers – enterprises that can benefit from

a new paradigm.

And yet all throughout its evolution, Luminoso has separated itself from most competitors

in the natural language realm, many of which tend to be Big Data-focused, working with

huge data sets but lacking the capability to solve very specific problems for companies

that also might have smaller sets of data to work with. Many competitors also tend to be

strictly focused on English language specifically, to the exclusion of other languages.

In other words, Luminoso is a company gaining in prominence as a somewhat unique

entity which appeals to companies across industries that receive text-based feedback

about their products or services and seek to quickly and automatically discover business-

changing answers to questions often hiding in complex data sets. In this sense, Luminoso

is an ambassador for the potential impacts natural language processing can have for

enterprises now and in the future.

Operational Efficiency

To best understand the operational efficiency of Luminoso’s products, Frost & Sullivan

went through an impressive client demo that featured thousands of comments and ratings

from customers related to some 50,000 products. During the demo, the Luminoso product

produced “concept clouds” that grouped together terms associated with each other (the



size of a word represented how important the system judged that concept was to the data

set). The colored concept cloud adjusted and morphed depending on the metadata. That

metadata clearly allows clients to zero-in on useful information and adapt to shifting

circumstances accordingly.

Frost & Sullivan found that scanning through tailored visuals revealing newly relevant data

was highly efficient. Clients can leverage both Luminoso’s U.S. cloud product and a

separate cloud product for the E.U., which complies with the new requirements around

GDPR (Luminoso also sells a private cloud and on-prem model).

Growth Potential

Luminoso can offer Voice of the Customer solutions (for example, to spot defects in a

recent software launch) as well as Voice of the Employee solutions (for example, an online

retailer dealing with employee churn), and has a few clients using both solutions

(hospitality is a vertical where there tends to be significant crossover, for instance).

Annual contracts are based on the number of documents clients consume.

Currently, the company is seeing particular opportunity in the following industries –

Marketing

Consumer Finance

Retail

Consumer Electronics

But there also are emerging industries such as mobile gaming that have considerable

potential for Luminoso. Because the “language” in gaming (lingo and “gamer talk”)

changes all the time, along with new updates and features (such as emojis), gaming

companys’ systems need to be able to understand what that ever-shifting information

landscape means and then get the routing correct while keeping players engaged.

Luminoso is a company offering solutions that can ascertain the sudden changes that

happen in gaming in real-time.

As a final vote of confidence, in December, 2018, Luminoso received an additional $10

million in Series B funding.

Conclusion

With its strong overall performance, Luminoso Technologies has earned Frost & Sullivan’s

2019 Customer Value Leadership Award for its AI-Enhanced Natural Language

Understanding solutions.



Significance of Customer Value Leadership

Ultimately, growth in any organization depends on customers purchasing from a company

and then making the decision to return time and again. Satisfying customers is the

cornerstone of any successful growth strategy. To achieve this, an organization must be

best in class in 3 key areas: understanding demand, nurturing the brand, and

differentiating from the competition.

Understanding Customer Value Leadership

Customer Value Leadership is defined and measured by 2 macro-level categories:

Customer Impact and Business Impact. These two sides work together to make customers

feel valued and confident in their products’ quality and performance. This dual satisfaction

translates into repeat purchases and a lifetime of customer value.



Key Benchmarking Criteria

For the Customer Value Leadership Award, Frost & Sullivan analysts independently

evaluated Customer Impact and Business Impact according to the criteria identified below.

Customer Impact

Criterion 1: Price/Performance Value

Requirement: Products or services offer the best value for the price, compared to similar

offerings in the market.

Criterion 2: Customer Purchase Experience

Requirement: Customers feel they are buying the optimal solution that addresses both

their unique needs and their unique constraints.

Criterion 3: Customer Ownership Experience

Requirement: Customers are proud to own the company’s product or service and have a

positive experience throughout the life of the product or service.

Criterion 4: Customer Service Experience

Requirement: Customer service is accessible, fast, stress-free, and of high quality.

Criterion 5: Brand Equity

Requirement: Customers have a positive view of the brand and exhibit high brand loyalty.

Business Impact

Criterion 1: Financial Performance

Requirement: Overall financial performance is strong in terms of revenue, revenue

growth, operating margin, and other key financial metrics.

Criterion 2: Customer Acquisition

Requirement: Customer-facing processes support the efficient and consistent acquisition

of new customers, even as it enhances retention of current customers.

Criterion 3: Operational Efficiency

Requirement: Staff is able to perform assigned tasks productively, quickly, and to a high

quality standard.

Criterion 4: Growth Potential

Requirements: Customer focus strengthens brand, reinforces customer loyalty, and

enhances growth potential.

Criterion 5: Human Capital

Requirement: Company culture is characterized by a strong commitment to quality and

customers, which in turn enhances employee morale and retention.



Best Practices Recognition: 10 Steps to Researching,

Identifying, and Recognizing Best Practices

Frost & Sullivan analysts follow a 10-step process to evaluate award candidates and

assess their fit with select best practices criteria. The reputation and integrity of the

awards are based on close adherence to this process.

STEP OBJECTIVE KEY ACTIVITIES OUTPUT

1 Monitor,

target, and

screen

Identify award recipient

candidates from around the

world

Conduct in-depth industry

research

Identify emerging industries

Scan multiple regions

Pipeline of candidates that

potentially meet all best

practices criteria

2 Perform

360-degree

research

Perform comprehensive,

360-degree research on all

candidates in the pipeline

Interview thought leaders

and industry practitioners

Assess candidates’ fit with

best practices criteria

Rank all candidates

Matrix positioning of all

candidates’ performance

relative to one another

3

Invite

thought

leadership in

best

practices

Perform in-depth

examination of all candidates

Confirm best practices

criteria

Examine eligibility of all

candidates

Identify any information gaps

Detailed profiles of all

ranked candidates

4

Initiate

research

director

review

Conduct an unbiased

evaluation of all candidate

profiles

Brainstorm ranking options

Invite multiple perspectives

on candidates’ performance

Update candidate profiles

Final prioritization of all

eligible candidates and

companion best practices

positioning paper

5

Assemble

panel of

industry

experts

Present findings to an expert

panel of industry thought

leaders

Share findings

Strengthen cases for

candidate eligibility

Prioritize candidates

Refined list of prioritized

award candidates

6

Conduct

global

industry

review

Build consensus on award

candidates’ eligibility

Hold global team meeting to

review all candidates

Pressure-test fit with criteria

Confirm inclusion of all

eligible candidates

Final list of eligible award

candidates, representing

success stories worldwide

7 Perform

quality check

Develop official award

consideration materials

Perform final performance

benchmarking activities

Write nominations

Perform quality review

High-quality, accurate, and

creative presentation of

nominees’ successes

8

Reconnect

with panel of

industry

experts

Finalize the selection of the

best practices award

recipient

Review analysis with panel

Build consensus

Select recipient

Decision on which company

performs best against all

best practices criteria

9 Communicate

recognition

Inform award recipient of

award recognition

Present award to the CEO

Inspire the organization for

continued success

Celebrate the recipient’s

performance

Announcement of award

and plan for how recipient

can use the award to

enhance the brand

10 Take

strategic

action

Upon licensing, company is

able to share award news

with stakeholders and

customers

Coordinate media outreach

Design a marketing plan

Assess award’s role in

strategic planning

Widespread awareness of

recipient’s award status

among investors, media

personnel, and employees



The Intersection between 360-Degree Research and Best

Practices Awards

Research Methodology

Frost & Sullivan’s 360-degree research

methodology represents the analytical

rigor of the research process. It offers a

360-degree-view of industry challenges,

trends, and issues by integrating all 7 of

Frost & Sullivan’s research methodologies.

Too often companies make important

growth decisions based on a narrow

understanding of their environment,

resulting in errors of both omission and

commission. Successful growth strategies

are founded on a thorough understanding

of market, technical, economic, financial,

customer, best practices, and

demographic analyses. The integration of

these research disciplines into the 360-

degree research methodology provides an

evaluation platform for benchmarking

industry participants and for identifying those performing at best-in-class levels.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, helps clients accelerate growth and

achieve best-in-class positions in growth, innovation and leadership. The company's

Growth Partnership Service provides the CEO and the CEO's growth team with disciplined

research and best practices models to drive the generation, evaluation, and

implementation of powerful growth strategies. Frost & Sullivan leverages nearly 60 years

of experience in partnering with Global 1000 companies, emerging businesses, and the

investment community from 45 offices on 6 continents. To join Frost & Sullivan’s Growth

Partnership, visit http://www.frost.com.

360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS

http://www.frost.com/

best practices award template - luminoso(web/mobile self-service, chatbots/virtual assistants,...

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