By Partha Ghosh, Head of Consulting, Digital Experience, Europe, Infosys
Customer experience, defined as the perception of a brand by a consumer, plays a decisive role in business success. Amidst a worsening economy and cautious belt tightening, creating a superior customer experience can help brands drive not just customer retention, brand loyalty, and brand advocacy, but also gain competitive advantage.
A customer experience management (CXM) strategy, a process of understanding, managing, and improving all customer interactions with your brand, is critical. According to Bain & Company, when companies focus on providing better a customer experience, it can increase their revenue by 4 to 8% above their market.
Companies in the United Kingdom (UK) are listening. A UK-based study indicates that the region’s top 10 companies have improved the quality of the experience by 2.4% and the top 100 by 0.9%. However, providing the ultimate customer experience will require them to double down on their CXM strategy, perfect their personalisation initiatives and implement capabilities with the right objectives in mind.
According to Infosys’s Digital Commerce Radar 2023 which surveyed 2,500 companies across 12 industries and analyzed the practices behind exceptional digital commerce outcomes, customer delight was the top priority for respondents. Over the past two years, their digital commerce initiatives have focused on complaint reduction and improvement of customer retention rates.
While it is recommended that companies add as many digital commerce capabilities as possible, personalisation has the highest impact, making it the ideal enabler of great customer experience. The Infosys research found that two personalisation initiatives improve performance – personalised offers and pricing, and personalised customer service and context persistence across channels.
Implementing personalised customer service, personalised offers, and co-browsing to help customer experience products was found to correlate with top performance (6%, 8%, and 7%, respectively). Personalised product or service-specific content was seen to lead to an 8% higher chance of significantly improving cart-to-order conversions.
Challenges related to personalisation
Implementing a CXM strategy and ensuring consistent delivery of the strategy across touch points can be difficult and costly, particularly if resources are limited or complex organisational structure. And measuring the effectiveness of the CXM strategy and demonstration of ROI isn’t easy.
Also, CX differentiation is likely to get more and more difficult as the laggards start to catch up and the leader (or above-average) brands decline or stagnate.
There has been close to a 60% increase in UK consumers who feel frustrated with a brand when its personalisation initiatives are not able to get their unique needs right. Yet they have been reported as stating that their retail experiences are more personalised, as compared to consumers in US. Clearly UK companies have been putting in effort to personalise digital experiences for their consumers. However, as per the Infosys study, though these capabilities hugely increase companies’ chances of reaching the top-performing quartile performance by 13%, only a minority have implemented them.
Besides, assessing the impact of a CXM strategy is particularly hard in the areas of personalisation where there are less-defined means of measuring impact.
Also, several companies are facing challenges with personalisation due to the lack of leadership that can pinpoint customer needs specific to personalisation.
Getting personalisation right
For companies to navigate the ongoing wave of digitisation, prioritising personalisation experiences is all-important. Personalising customer service across digital channels, and creating personalised offers and pricing for up-selling and cross-selling, have shown favorable results.
- While companies would prefer to tackle easier capabilities first – such as establishing a brand website with digital commerce enablement, search engine optimisation, or live chat with human agents – it is important for them to realise that personalisation and more complex capabilities like AI agents are what will help them perform better regarding their business objectives in the long term.
- They must also consider implementing capabilities with the right objectives in mind – for instance, personalised customer service best drives customer retention rate and online traffic.
- It is imperative to have the right technology to drive personalisation as efficiently as possible. This means, data and systems that produce relevant data, analytics systems that generate insights, and tools that help plan actionable next steps.
- Customer assistance, through co-browsing, is top priority for respondents. Co-browsing – through remote screen sharing by sales representatives to assist customers in experiencing and using products or services – will help businesses instill confidence in their customers.
- For personalisation to be used optimally, the leadership must comprise sales leaders and marketing leaders, who know the pulse of the customers, working alongside technology leaders who are adept at implementing the right technology required for the business to drive desirable outcomes.
- There is more to personalisation than in-person and online experiences. Technologies like customer journey orchestration, AI-powered contact center agent assistance, and
- real-time feedbacks can now be personalised and makes Proactive Service Recovery (PSR) initiatives viable, which is a key CX strategy. Also, 3D immersive environments such as 3D virtual environments, avatars, digital twins, and devices (headsets) are the next big thing. They create scope for customisation of ads, product recommendations, pricing, and user interface, depending on which stage of the customer journey. Virtual reality (VR) and augmented reality (AR) based realistic 3D product trials can help companies reduce returns, and lead to customer satisfaction.
The study also recommends other digital commerce capabilities, aside from personalisation, due to their positive outcomes. Verified reviews of products are seen to increase the chances of improving footfall or traffic to website, expand product portfolio and/or markets, and reduce costs of customer acquisition, fulfillment, and returns. Delivery within two hours of order placement can help expand product portfolios. Automated order placement via customers’ IoT networks has been associated with better payment capabilities and reduced costs.
In the current inflationary scenario where customers are looking to seek empathy and comfort while shopping, ensuring that they have a smooth and tailored experience can do wonders for customer experience. It can help businesses create loyal customers and advocacy, in turn, grow their business.
