In everyday life, context matters. Take the simple example of an ice-cream vendor trying to sell their stock.

They not only weigh up a suitable price and location, but also gauge the weather and time of day to help shape the best offers.

This is an intrinsically simple idea to grasp; yet only a tiny minority of digital services currently take context, where you are and what you’re doing, into account. 

Some early examples are emerging though.

Take Shopkick, a mobile app. It aims to enhance a consumer’s shopping experience by giving them rewards for visiting stores and browsing items, even before they choose to buy something.

To do so effectively, it draws on a range of information.

It uses a person’s location, via their smartphone, to know when they enter an eligible store. It identifies what their potential buying interests might be, through the item barcodes that they scan.

And it taps into social context, by assessing aggregate shifts in interest from across its three million users.

Across all of these stages, Shopkick provides shoppers with both points and targeted deals, at the specific time and place when they’re most likely to use them.

This gives people new incentives to visit stores, while retailers get a new way of attracting shoppers.

Who you are, where you are, what you’re doing
The simple idea behind context is that businesses will need to increasingly draw on a range of inputs, all at the same time, to take the user experience that they offer their customers to the next level.

There are several elements to this: one is in being able to identify someone; another, knowing something about their location or environment; and third, understanding what they’re doing—and, in some instances, what their friends or colleagues are saying about it.

IT provider Misys, for example, offers a tool called GeoGuard, which helps link a user’s activity and location with a bank’s fraud department, to help provide a more seamless way of identifying potentially fraudulent activity and avoiding annoying calls to check up on this.

And context is just as applicable in B2B environments.

A maintenance technician might make use of a tool that automatically takes into account his location and the product code of the item he’s working on to access relevant repair and parts information, along with specific details of delivery times and costs for that particular location.

Of course, there are challenges here too. Privacy is clearly one.

But the reality is that firms can already infer a huge range of information about their customers, based solely on their existing interactions with them, or with their peers, or simply by asking users to share new information themselves.

A surprisingly large number of people are happy to do so.

By 2015, analyst firm Gartner estimates that 40 per cent of the world’s smartphone users will opt-in to context service providers, which track their movements and digital habits, in exchange for better services.

Preparing for a context-based world
For CIOs, context is a major opportunity. They are ideally placed to help identify the possibilities, advise on any potential issues, and pull together the necessary data and inputs to bring it all to life.

So what’s the next step? To prepare for a context-based world, CIOs ought to use the year ahead to pursue the following:

 - Build closer links with business functions that directly influence the consumer experience, to compile a list of possible services
 - Form a pilot team that draws on both user experience and data specialists to experiment with new ideas
 - Start developing a data platform that can handle contextual data and analytics, including appropriate privacy controls
 - Create a data roadmap that details how the necessary data will be gathered to support these next generation services

Getting this right will be at the heart of the next wave of customer innovation, both in the virtual world, and the real world.

Those who embrace this first will do most to differentiate themselves from their rivals.

Gavin Michael  is Chief Technology Innovation Officer at Accenture.

Follow Gavin on Twitter @gavinmichael

Pic: Anaru cc2.0