Customer Experience – Driving Customer Experience With Digital Transformation
The digital revolution has been a disruptive trend for every industry, sector, and domain of business. Digital transformation has brought about fundamental changes in business models of corporations of all sizes. Most importantly it has reshaped how businesses deliver value to their customers, and interact with them. Digital transformation is driven by growth opportunities, increased market competition, and new regulatory standards. For most businesses, (both B2B and B2C), digital transformation starts with customer experience. They have understood that an experience based differentiation is critical to remain competitive, and a vital driver for profit and sustainable revenue. In fact, according to PwC research, nearly half of the enterprises interviewed cited customer experience and customer satisfaction as their primary motivation for digital transformation.
The rise of inbound marketing and customer centric businesses is due to the fact that today’s consumerism trends are driven by customers, and not by organisations. The new generation of customers, who are referred to as the net generation, have higher digital literacy compared to their ancestors. They have accessibility to a wider variety of options, and have higher expectations from businesses they support and interact with. Hence more organisations are making significant investment in digital transformation solutions. The global expenditure on these transformations is expected to reach $2.1 trillion by 2021.
Impact of digital transformation on customer experience
The proliferation of modern technology has been beneficial to organisations through acceleration of operational efficiency, faster marketing time, and the ability to meet customer expectations. Technological improvements in e-commerce, hyper-personalisation, and communication channels, have facilitated customer centric strategies, further enhancing customer satisfaction. As customer demands for fast, responsive, and interactive experience continue to soar, a digital first approach is the only solution for survival and sustainability. A survey by HBR stated that 72% of respondents said they expect to shift to digital to create a closer relationship with their customers. Digital transformation and customer experience go hand in hand.
Companies that focus digital transformation to drive customer experience can generate a 20-30% increase in customer satisfaction, and 20-50% increase in revenue. The advent of the “age of customer”, has given customer centric businesses the competitive advantage over those who aren’t. Consumers who have an emotional connection with a brand have a 306% higher lifetime value. 67% of today’s consumers will pay more for a great experience. This is why experience-led businesses have 1.6 times higher customer satisfactions, and 1.9 times higher average order value, compared to their competitors.
While customer centric strategies can be hugely profitable for businesses, poorly designed CX transformation can actually worsen customer experience. It can lead to missed opportunities to improve brand awareness, customer acquisition, and retention. The stepping stone to any CX transformation is thorough data analysis, and an in-depth understanding of customer patterns and market trends. Technologies like AI and machine learning can enable development of new CX business models that elicits greater ROI. Data driven insights on customer journeys and touch points can create enhanced differentiation, which generate better experience-led strategies.
Today, omnichannel experience is critical to ensure that customers receive a seamless experience across all devices and platforms. While most pre-digital corporations are struggling today, others are thriving because they have adopted and implemented fully integrated omnichannel strategy to connect their brick-and-mortar stores and digital stores experience. Examples of such success stories are brands like Nike, Walmart, Starbucks, and IKEA.
How can companies start their digital transformation to drive customer experience?
Establishing an agile IT environment
Almost 86% of executives believe that cloud technology is critical to digital transformation. Technology enables companies to be fast, productive, efficient and agile in an ever evolving business environment. The ability of technologies like AI and analytics to crunch large amounts of data, means companies have a 360 degree of all their customer data. This data helps companies to build strategies that elevate customer experience and satisfaction.
Personalised customer experience
Personalisation is one of the top customer demands. Augmentation of technology such as Iot, AI, and big data analytics can help businesses to offer their customers an unmatched, bespoke experience. Personalised customer experience is vital for customer retention. Just one bad experience is enough for customers to abandon a business and choose the competitor. Investing in a CRM system will ease the pressure on marketers and sales teams to manage all customer interactions across multiple platforms effortlessly.
As mentioned earlier, omnichannel experience is vital for business growth. Today’s consumer, especially millennials, wants a great experience on all channels as well as in stores. Companies with the strongest omnichannel experiences retain 89% of their customers on average, compared to a 33% retention for companies with weak omnichannel customer experience.
There is no stopping digital proliferation. Embracing digital transformation will ultimately help companies to meet customer expectations and achieve strategic long term goals. At Alkye, we help our clients to develop comprehensive customer centric strategies that enable them to deliver value and unified brand experiences to their customers.