From product-led innovation to a service-led experience model - Interview with Deborah Honig of Samsung UK & Ireland

0:00So welcome to the next edition of the Punk CX podcast. With me today I have Deborah Honnick, who is the Chief Customer Officer at Samsung UK and Ireland. Hello, Deborah. How are you doing? Great, Adrian. Thanks for having me on the show. How are you? Well, I'm splendid, thank you. Now, for people, obviously, who will be familiar with Samsung for all sorts of different reasons, but they might not be familiar with you. So I wonder if you could tell me a little bit about you and a bit about the work that you do. Well, I am at Samsung as the Chief Customer Officer, And that work involves everything that talks about bringing our amazing technology to life for our customers here in the UK and Ireland, from marketing aspects to the experience touch points and to a lot of the integrated work we do with partners around the country.

0:51Perfect. Now, Chief Customer Officer at Samsung is quite a big deal because it's actually, I think you're one of the first ever Chief Customer Officers at Samsung and you've been there now for just over two years, coming on three years now, I think that's about right? That's correct. now i understand and this is one of the reasons i wanted to kind of talk to you is because a lot of times we kind of talk about you know people that are in this sort of service experience sort of space that maybe to do with technology or they might be kind of outsource providers or whatever or even just brands doing their their their own thing but you're an interesting case or samsung is an interesting case because it's always been led by innovation and innovation led to focus around products.

1:42But now you're moving it into, my understanding is moving it into more of a service-led experience sort of like play, as it were. And I wanted to understand, because in the power ones, apparently that's called servitization. And so I wanted to understand, just give me a bit of a flavor of what you've gone about in order to achieve that sort of servitalization and move from being product-led and innovation-led to being more service-focused. And what's some of the stages you've gone through and how's it going, where are you on the process? Because I just think it's an interesting angle, really, because many of the talk right now is about software, but it sort of negates the fact that we use stuff, right?

2:31And how that stuff is getting smarter and how we need to sort of support it and things. And so I was really interested to hear from you about kind of some of the steps that Samsung has gone through and you've helped them go through to move from being this product-led to being kind of more a service-oriented sort of organization. Adrian, it's a great question. Samsung is still a fantastic, innovative, R &D-led company in one sense. What we're doing is complementing that, that amazing power to innovate, use technology to break through all kinds of barriers and capability of tech to support us. and really think about then how do we actually bring that from a product, both a single product experience into a more connected experience, which is enabled by some of the innovation that is happening.

3:22But also, as we've reached this point where the reality is most people have a lot of technology in their lives and different technology in their lives, how do we actually think about bringing more value to the customer? And in so doing, as a brand, be more valuable to that customer and have more customer loyalty as a result. And that really starts to come from thinking about how do we solve everyday challenges for our customers and needs, wants in their day-to-day and then working backwards from that into our products, how they work individually, how they work together and helping change the communication from techs and SPACs to really benefit-led, benefit outcomes that consumers actually care about more than the techs and SPACs.

4:07Now, the techs will always be important because they help us deliver that. But it's changing the focus both of our communication, but also even sometimes of our tech and development priorities, certainly more and more now about what matters more in time. And so I think that's the evolution. And then in terms of roles, so as the chief customer officer here in the UK and Ireland, and a lot of our audience will have those roles, my role is to make sure that the UK and the UK and Ireland customers are represented in that conversation. and that we're translating that into a really helpful context for the lived reality of people here in the UK.

4:51It might be quite different from those in Korea or in America. Indeed. And that also means we move on to working with things like partnerships that are relevant to our local customers. So you might find, as an example, we want a genuine benefit to customers as to helping them reduce their energy bill. So, you know, you wouldn't expect a company like us to have an energy tariff, but we've just launched one in partnership with BG, a weekend saver to reduce your energy on weekends if you're a Samsung customer. Okay. And that integrates with our amazingly energy efficient products, but it takes both to be able to deliver a lower energy bill, doesn't it?

5:30Yeah. Right. And so we'll start thinking about expanding from just what we're doing in a single product to make it amazingly valuable to how it connects and to how we add value on top of that with the partnerships of the people we work. I think one other interesting insight that we've built in to both what we're bringing to market, but how we're helping people is this idea of decision overload and fatigue. So we know, for example, here in the UK, that over half of our population found it was like the small everyday chores and tasks that they needed to get done that were causing them the most stress.

6:07And in fact, by 11 a.m., most of us feel mentally exhausted. You know, you think about the number of things you do from the time you get up to whether it's washing your clothes and walking the dog to figuring out if there's anything in the fridge that you're going to need for dinner to locking the house down, closing all the lights, making sure the energy is turned down if you haven't automated it. All these things to get yourself to your first meeting and beyond. And you're already exhausted. Have you made a healthy choice for breakfast? Has that affected your energy scores? You think about the number of things that makes me laugh that you could think about if you read all these documents or listen to all these podcasts about how to have the perfect life, right?

6:46And I'm already exhausted. And so what we're trying to do is figure out how to take that lived reality and use our products and our suite of products to just make that easier, right? And what has been the journey to that? Because that's quite a, from an engagement and sort of positioning sort of perspective. And that's quite a big shift from being somebody that, from being an organization, which is, as you say, it's been, Simon's been around for decades and has always been known for having really strong, innovative, you know, market leading kind of products. And so, has that been a big sort of mindset shift?

7:25And if so, kind of like, you know, are you done? Is it cool? Or where are you at on the journey? Look, I have to give up. I've only been with the company for just over two years, but I certainly see the architecture of this in the making for a long time. But as a really conservative and humble company, I would say, we're only at a point we feel like that we're speaking and able to communicate it because the level of benefit has reached a different height. And so you think about the fact that our product ecosystem spans your home and outside of your home from domestic appliances to audiovisual and TV to mobile.

8:08So we can connect what you think is truly your day to day. That's not really by mistake, I would imagine, in the design of the products we've developed and the products we've expanded to. How can we actually serve more of that day to day need? And that AI, we've been working in AI for over a decade. And our big part of the advances in what we're able to do now are because we've put AI in a really useful way onto our whole product suite, which means our products now have a new level of intelligence, allowing them to learn and adapt individually, but also as a connected ecosystem so that we can now deliver different benefits.

8:50And all those things have sort of been built up over time with a huge, I'd say, step change in 2024 when we announced the first AI phone that kicked off and moved AI into the rest of our product suite. But now also as we build on that and really get that integrated offering that we can now start to really tell the story because the benefits are here today, right? They're not a future imagined scenario anymore. And you don't have to have everything to get a lot of these benefits already. You can have a few products. You know, because we have an open ecosystem, we have a platform called SmartThings, we can actually help you enable some of these realities really easily today with the few products you have, sometimes add a TP link and, you know, connect them to something that wasn't smart, make it smarter and connect it to an ecosystem to start doing things like automatically opening your house up in the morning or turning it down at night, managing your lights and energy, you know, your security.

9:55Yeah, I wanted to ask about that because you talk about building into the first AI powered phone or phone with AI in it and then it's been infused into your other products. And you say you've also been using it in the past. And I imagine that's in the background in the past when you were using it for optimization and efficiency and those type of things. But now I guess it's moving forward into that sort of consumer kind of interface that people are starting to... I guess my question would be is that, you know, I mean, everybody's talking about kind of AI and I get slightly bored when people talk about AI first and this, that.

10:33I'm like going, yeah, well, what about customer first or outcome first or all that sort of things? And so my question would be, because it also feels like there's like, there's the people are just, it becomes like the latest thing that people are just jumping on. so I wanted to understand specifically the principles that you're using to infuse artificial intelligence into your products, what is it designed to do, how is it helping people and also what's the reaction from customers being like because I guess that's the thing there's all this stuff going out and then you're like going the true test as if people use it and feel that they're getting value out of it, surely.

11:21Absolutely. And I think as I started, I think AI has enabled us to do things. AI for AI's sake or tech for tech's sake has never been a direction we take. We actually have these general design principles which apply, AI would be included. AI is just a tech we use to deliver the outcomes. And they have evolved over time, but they're still at the heart of the same core, which is making sure that innovation is actually adding a real tangible benefit to the intended use and then the secondary use. So, you know, we're not going to add bells and whistles to a washing machine that doesn't deliver first the core function, which is helping you wash your clothes, easier, better, less energy, less thought.

12:12Those are all good things. And from a style standpoint, making sure that like fits into your aesthetics in your home as well. And from a sustainability perspective, always making sure we're making steps forward to do better by the planet. So those things all still fit into the way we think about design. AI is an enabler to different things that we can do, and that's how we think about them. I guess the thing that I'm trying to get to, the primary thing I'm trying to get to is, the technology is great, right? And it's super interesting, but I guess it's a bit like if you've been around long enough, you'll kind of remember the sort of the last dot-com kind of boom.

13:02And the thing that kind of struck me about that sort of time is that there's a difference between what is possibly going to happen and what is probably going to happen. And the probably bit is like people designed, the things that succeeded were people that designed stuff that people got went, oh, that's cool. And it will continue to be cool because it works. you know and and that's where i'm thinking that with this sort of the ai sort of stuff is a bit like going you know of course yeah we'll keep using it because yeah so i think that's why if if i go back to that i didn't not to repeat but i feel like we think about it i think the key the customer back version of this is really where i started which is in the lived reality of people today, there is so much happening and there's a huge burden to start, a huge burden of things that people would say have to be done in a given day.

14:02So we start with how do we use both our individual products, but also that, how do we use that connected technology enhanced by AI because AI learns and adapts and integrates your information in a way we couldn't do before to make that easier and more possible, right? So to take some of the weight of that, some of the simplicity of that out, to start with just giving people more time and headspace back for doing the other things they want to do, because it starts with that on our foundation. And then we move into, it can also do some amazing things for you on the creativity side, right? So we really lean into, because we know for our customers, creativity is a huge source of enjoyment but also livelihoods, employment, other things that they do with that.

14:51So how do we put, because we have mobile phones, for example, and we have multiple screens, if you have a TV, monitor, desktop, how do we leverage AI to enhance what they can do creatively? So we have very simple things like sketch to image, which I use with my son, which he could take small drawings and create all really professional, interesting art with, and that inspires him and us to do more to actual generative edit where you're trying to take photos, whether it's professional or for your Christmas holiday, and remove people and get a good shot. All those things that people spend a lot of time doing and really get enjoyment from.

15:30Okay, we're using AI to enhance that. To take it to another place, which is something like the burden of care. So we know over 6 million people in the UK are looking after people in an unpaid capacity. How do we create and use now this system that we have between smart things and our products? We call it smart things home care. And it offers you the ability to do everything from sensing, detecting, scheduling, all these types of services that really help people give the people they're caring for some independence, but also allow them to care for it without debilitating their lives, their ability to care.

16:09So we can move into very different territories with the same set of capabilities that we've now delivered. Truly some of it enabled by AI and AI's ability to sense, detect, adapt on top of our products and capabilities. So I think that's where for us, AI has been a real enhancement of a customer centric mission rather than AI for AI's sake. And I think our desire to talk about AI is more from a transparency perspective and also so that people understand what we're using it for and what they can get out of having that additional capability in the product and in the technology. And is that the, are you doing that because, I mean, there's also a lot of news and talk and discussion around trust and the use of kind of AI and people are like, well, it's kind of new and we don't know what it's going to do with our data.

17:13and we're not quite sure how it's going to impact kind of jobs but it also feels really exciting and interesting and things and many people are kind of torn by it. And that's both, in some places some people say it's hindering kind of adoption. I mean, so what's been your approach to trying to, I guess, build that trust to try and encourage adoption? Because it feels like it's an increasingly real thing for many people. Yeah. No, I think that's a really important point. And I think we start internally making sure that we have an aligned view that we can live by on how we develop and use. So we have, you know, the ethical principles internally, called fairness, accountability, transparency, and we and we live by those in our design, how we talk about it.

18:17But I think it then it also moves into thinking about some of the areas where people rightly are thinking about AI and have concerns and having a point of view on them that we feel like builds trust, and is a reflection of what people want. And so that starts with this concept of AI for all. So again, technology could be quite polarizing in its outcomes in terms of who it serves, and that everyone has access to it. And so for us, it's really about making sure that AI is more democratized through our product portfolio, not just at the top, going down through the price points. It means using it as much for the fully abled as to those people who have different accessibility challenges and ai is fantastic for that in a number of ways audio to void audio issues to vision issues to being able to personalize the experience by knowing who's using it in the household so it really can help us on some of those areas and then we also then go ai as a choice i think we started to talk about that before being really transparent when we're using AI features, allowing you to opt in.

19:30So things like your now brief or health assist features on our phones and wearables, like you have a choice. It tells you how the data is processing. Actually, when you're setting them up, it asks you to make those choices and does them in as simplistic a way as possible to security, right? And data privacy, which is a huge topic, right? And so the way we approach it is we've built, we've used Samsung Knox, we built this amazing system that's trusted by militaries and government and deployed it to a personal level. So we've got a vault that helps you keep your information safe. We allow you to choose whether you're going to only use on device processing of AI capabilities or cloud, and even And still everything is encrypted.

20:18So we're just building in those like sets of options. And we're also really working on making sure that we can deliver more and more in a individual on device way over time, which for those people who don't want their data going to a cloud, they still get benefit. So we've addressed it in those ways. And then I'd say, importantly, this conversation we're having about how do we, you know, in my role, how do we communicate? I think it's also about helping people see what we're doing with it very transparently. And the benefits that we think it delivers, understanding what they're looking for and letting them then conclude.

20:56Yeah. Is it adding the value? And that's on us to make sure it is when we use it adding the value that they think is what they'd expect to get out of a new tech innovation. Yeah, because it strikes me that there's so much momentum in the market right now about people talking about AI and it's infusing all software across our personal lives and our business lives and across the piece. And it's almost a bit like people are getting carried away, not getting carried away, but they're getting swept along. Many brands are getting swept along. And sometimes I feel like consumer concerns or customer concerns aren't necessarily, I mean, I'm not saying they're being ignored, but sometimes I don't think they're necessarily being communicated to as well as they might, if you know what I mean.

21:57And I'm not pointing the finger at anybody in particular. I just think it's one of those kind of things. I think the pace of change and innovation is such that you can't do everything and you will try and prioritize. So it's really heartening to actually hear that you're walking people through this sort of stuff and allow them to make choices. It's not just like, it's this or nothing. You've got to say, they're great products, they work really well. And you can zhuzh them up with some AI or you can just have them as great products, just as themselves and it's completely up to you. And I guess, you know, that's for me, that's the interesting thing because, again, it's about choice, right?

22:41And it's also about the fact that you're not abandoning your kind of mission of being a, you know, a company that makes great innovative kind of products that work in and of themselves and don't have to rely on operating kind of software that is powered by AI to get the best out of them because actually they're just great products, great physical products in and of themselves. And so I think that's really heartening to hear. And to your point, I think also just making sure we're not having a general conversation with our customers about AI and having a specific one. So in the context of someone buying a TV, you say, well, would you like a TV that auto-adjusts to the noise level behind you in the room so that you can hear better.

23:34If your grandkids run in behind you or your kids or your dog and you're listening to an important part of a movie or a news clip, well, most people would say, yeah, that sounds great. Certainly, as I feel like my hearing's going, I would love that it auto-adjusts or the light and the picture auto-adjusts because all of a sudden the lights change behind me or in the room that, you know, someone else wants it really dim and the way it's been thing. You know, that's some of the ways that AI is being used to make the purchase you made and your viewing experience amazing. And people, oh, you know, in that context, we're talking about, you know, we're going to start with how do we make that experience like in the TV context?

24:26And then you work back and go, and it's Wi-Fi connected in a hub. It can now be the hub of your home when the screen's off or the art hub. But if someone's at the door, it can pop up on your TV. Or if you guys want to talk about the schedule for today, you can put your now brief and calendar up there so everyone can see it and debate whether you can do the six things you planned. Right. So that's the conversation we need to have. And then you go, oh, how do we do it? Sort of the secondary one. And you're right. And I think sometimes we end up too much, I think, as a set of communicators or Marcom people talking and tech companies, we can talk too much initially about the AI and we need to be transparent and talk about it.

25:09But actually, we need to start with, here's the feature or the benefit more or less that I would say, and work back into it. how are we using it? And do you want that? Indeed. And the other thing I wanted to circle back on is the idea that you talked about democratizing the AI. So it's not just a premium feature, it's actually kind of infused throughout your kind of products. And I think that's good because actually, you also mentioned earlier about the lived reality of kind of people. And the lived reality of kind of people also for many people right now is that their cost of living is still quite high.

25:48And you also mentioned that your products exist in a vacuum. And then you mentioned this energy ecosystem and this partnership with British Gas. And I wanted to better understand how the products and the AI and the partnerships are speaking to that broader, if you like, living challenge around managing budgets dynamically. And how is that working? What's been the impact of some of that sort of stuff? I think that we've had to, first of all, get a bit sharper on understanding what is it that will make the most difference to people in that equation that we can affect, right? So that starts with being just sharper on customer insights to work back, which we know, for example, that's how we've learned energy.

26:47And it sounds obvious, but energy remains kind of one of the key priorities. So we as a business here decide we will focus on that, right? And we'll focus on that, not just in our single product, but in everything we can do to support a customer having a better outcome when it comes to energy. And so we took that from, okay, let's make sure we bring and explain the best product benefits that we have to support that. Let's make sure we help people. We keep adding services to our SmartThings free platform that includes how do you do AI energy mode and optimization and auto scheduling, things that will help people do that in an easier way.

27:30because we've also, as we said, discovered people are extremely busy and it needs to be easy in order to reduce their burden, and then extend it out into partnerships. So energy is one example. We know people are extremely worried about their health, both a positive and a general sense as the population ages. So that's why we've then focused on extending it from making sure our devices, like our wearables, certainly are playing a bigger role in prevention and detection, but also we've formed partnerships. An example is one that we formed, announced recently called Zelf, which basically connects people through that to a broad network of getting access to the right health solutions, even care, doctors, appointments, et cetera, that might be warranted.

28:17So we're taking the idea or the, not the idea, I'd say, we're leveraging the insight about what people care about, ensuring our products are developing along that lines, but ensuring that they also, we extend that ecosystem, both are in our own system across our devices, so that, you know, your ring, your watch, everything can build on each other, and then bring it out into partners that can deliver an even better benefit. And so that's kind of one of the ways that we're really thinking about that. I think the other way is, again, And making sure when we say we deliver value, you know, people are getting value beyond a sticker price.

29:01So, you know, I kind of think about that as longevity, the quality of the product, making sure that that product, for example, will get software upgrades as our advancements come through software, not to them over the next years. Of course, we always have hardware improvements, but you're not going to buy a new piece of tech. So the software that becomes your way to make that product continue to enhance. Also to make sure like the quality of it you buy. I always have this saying of like buy cheap, buy twice. You know, so again, because we're thinking about how do we make sure products that endure longer are delivered at the end point.

29:39And then really, again, allowing people to be able to customize their own experience with our products. Not everybody has the same reality in their life, in their home life, their homework life, their setup, how many people they have that they're living and caring for, as we said. So also being able to allow people to get more value by being able to customize how they use it so that it suits their lives. And I think those are the ways that we've really focused on, you know, in a cost of living crisis or an increasing concern about how to pay for things. make sure what they buy adds the most value to them, can live a long time in their life because it will continue to evolve and can be used for multiple very personalized purposes, not just one.

30:27And so I think that's a big part of it. Cool. And so you seem to have come a long way. So what's next for Samsung and this move towards service-led experiences? I mean, what can we expect? Can we expect a Samsung house?

30:52Well, I think, as we said, I think one thing I was like, you know, trust is so key in this. So I know it sounds funny. It's less about the service, but like it's never one and done. So I think that we have a lot to continue. We've done a lot, but I think we will have to, we will continue this journey of refining the way that both we communicate, but also that we deliver this ecosystem to people. And that includes our open ecosystem and the support we give to that, right? Recognizing people don't just have one brand or one piece of tech in their life. So we are continuing down that path, investing heavily in making sure that we're advancing what it we're capable of, we're communicating and getting hands on and actually getting out with consumers to help them actually be able to do it and making it easier, making it happen more seamlessly if they'd like it.