Will 2020 be the true year of the customer?
3 reasons why Customer Experience matters in an increasingly digital world
For good or bad we are digitally connected everywhere we turn – from the phone in our hand to the watch on our wrist; even our doorbells have become a highly connected and sophisticated system.
These digital tools help to foster the experiences that we have and interactions with brands. Given that our transactions have become both highly digitized and highly convenient, they sometimes begin to look all the same. So, what is a brand to do to break through the noise and truly stand out? It is all about the experience. From the exceptional to the horrific, experiences can look and feel very different and can also be the tipping point for the customer.
So why is 2020 different?
Over the last decade we witnessed a proliferation of the tech giants which enabled a digital connectedness like we have never seen before. Over this time there was a greater focus on building efficiencies and easing customer interactions. And that digital support is not going anywhere, but it is becoming table stakes.
Moving into the next decade we will see a desire for authentic connections and experiences that help to set brands apart and become engrained in consumers lives. In fact, this desire for exceptional experiences translates to dollars with upwards of 86% of buyers are willing to pay more for a great customer experience.
Moving into 2020 there are key reasons that experiences matter more today than ever:
Experience is a Battleground
Because consumers can share their experiences anytime and nearly anywhere it is imperative to maintain a positive experience or risk losing brand value. Gartner estimates that 89% of companies compete primarily based on customer experience – up from just 36% in 2010. This puts major pressure on companies to exceed customer expectations but also offers major upside potential if the experience provided is deemed exceptional.
The trend toward fostering greater CX translates to the budgeting process as well. The value of CX technologies was estimated to reach $508 billion by the end of 2019 – an increase of 2.9% from 2018; with the industry estimated to be worth $641 billion by 2022. Companies have realized the financial impact of poor customer experience and are willing to put their money where their mouth is and enhance the experience for their customers.
Personal Data in Exchange for Experience
Experience is reaching a level where consumers are actively seeking out the better experience and they are willing to give more personal information for it. Among US consumers there’s a sharp increase in willingness to give up personal data, with 63% noting they would share more information with a company that offers a great experience. This can present a potential win-win for both companies and customers, one that companies should pay greater attention to in the effort to build loyalty and the size of their customer base in the long run.
However, companies today appear to have a gap to close…
73% of all people point to customer experience as an important factor in purchasing decisions. Yet only 49% of US consumers say companies provide a good customer experience today.4
Consumers today generally understand that companies are looking to harvest their data to provide a more personalized experience. Millennials and Gen Z are most aware and open to exchanging personal information for a better experience. In fact, a recent Salesforce study pointed to the fact that 67% of Millennials/Gen Z expect their offers from companies to be personalized; this compares to 53% for all consumers. What this says is that the consumer is more aware than ever how their information is being used and, they want, and expect, to see clear benefits for them.
Bots are Big but the Human Touch Matters
It is no secret that customer service interactions are increasingly taken over by digital support, AI and chatbot technology. Some observers may call an end to human interactions; however, technology can enhance human service interactions, allowing for a predictive approach to address service issues.
The use of tech-enabled support allows for a closer focus on more personalized needs, that is simply supported by technology. A recent Salesforce study found that 64% of agents with AI chatbots are able to spend most of their time solving complex problems, versus 50% of agents without AI chatbots. The expectation is that there will be more tech-supported service that will allow humans to focus on providing the highly personalized experiences that consumers have come to love, and increasingly expect, from companies.
Getting to Know your Customers
At Big Village Insights we know that the customer experience is paramount and central to business success. The key is truly understanding these customers and tailoring services and products that meet their specific needs, wants and desires. Our CX approaches hinge on combining customer beliefs (through primary explorations) with their behaviors (both digital and offline) combined with the broader market context to offer a full view of the customer and creating the foundation for actionable insights. Our approaches are not defined as measurement programs, they provide targeted insights to support more predictive modeling approaches.