Thought Leadership

Customer Experience Trends and the Business Impacts of 2020

Customer experience (CX) is the heart of most businesses today. A Gartner survey prior to COVID indicated more than two-thirds of companies compete almost entirely on the basis of their CX. But, what exactly is customer experience and what should your organization focus on going forward? Let’s take a look.

Customer Experience Defined

There are a couple of schools of thought where CX is concerned. Some believe both the product and the people contribute to the customer experience, as both are part of the overall customer journey and both impact how customers feel about your brand. Others look at it almost exclusively from a people standpoint—whether their interactions with the company, especially in relation to customer care, are positive and help cultivate strong relationships. We’ll be mostly focusing on the latter on this page.

Why Customer Experience Matters

There’s a direct correlation between CX and loyalty-related behaviors, such as remaining with a company, making additional purchases, and brand evangelism. Research from the XM Institute shows that 89 percent of companies that rate their customer experience management (XM) as “significantly above average” also report better revenue growth than competitors, while 90 percent report greater profitability. Interestingly, the agency reports a strong link between XM and employee experience (EX) too. This means organizations that focus on XM aren’t merely boosting profits from addressing customer needs, but through areas like employee retention too.

The Customer Experience in the COVID-19 Era

There’s very little room for error when CX is what sets your company apart from competitors. We all saw blunders from various brands as COVID emerged—the cruise line that continued promoting getaways or the beverage line that shared the virus’ moniker hyping up spring break. And, we also saw some who used advertising to demonstrate that their CX was still in touch with the new reality, such as the insurance company that spoke about how it was crediting premiums back to drivers due to financial hardships caused by COVID and how little people were driving.

All the same, CX isn’t just what we see in advertising either. It’s what happens on the frontlines too. For companies that build their brands on things like top-notch customer care, each query that went unanswered, each minute spent on hold, and each disconnect in the system during the pandemic was a broken promise to the customer.

Customer Experience Management Moving Forward

Organizations are placing a greater focus on CX to hone in their strategies and ensure the customer journey is seamless. Below, we’ll explore some of the biggest CX trends emerging from the pandemic and how organizations are pivoting to keep their brands relevant and customers happy.

Customers Are Digital

The rise of digital interactions with brands cannot be overstated. Nearly three-quarters of consumers say their digital experience with brands has changed since COVID-19 emerged, according to Acquia data. Moving into 2021, Forrester estimates digital interactions will see a further 40 percent hike as well. These stats echo our own findings on increased demand and the shift to digital channels.

Businesses Are Made or Lost on Trust

Research from HubSpot shows that consumer trust is eroding. The vast majority of people do not trust press releases, advertisements, or sponsored ads on social networks. They also do not trust sales or marketing professionals as sources of information like they used to. In all, just 45 percent say they continue to trust brands as they always did. That’s worrisome, considering the Edelman Trust Barometer shows 67 percent of customers will stop buying from a company they don’t trust.

On the other hand, approximately 90 percent of customers who rate an organization’s CX as “very good” also say they trust the business to take care of their needs, per XM Institute Data. The rate varies by industry. For example, in banking, it’s 92 percent of customers and, in insurance, it’s 93 percent. That means in industries where trust seemingly matters most, it’s also more easily earned through delivering on CX.

Low-Effort Interactions Are a Must

In “The Effortless Experience,” a book authored by Gartner Group Vice President Nick Toman, he, along with co-authors Matthew Dixon and Rick Delis, contend that it’s not delighting customers with “feel-good moments” that wins them over. It’s creating effortless interactions that do. Per their research, 96 percent of customers with high-effort customer care interaction become disloyal. Key sources of effort, according to their findings, include:

While their research is not necessarily new, it hits home for companies struggling to keep up with increased contact center volume amid reduced agent coverage.

AI and Automation Are Surging

While artificial intelligence and automation utilization have been growing for quite some time, tech adoption is now essential. This ties back to increased volume and diminished availability of agents, and customer acceptance of tech. In “4 Reasons AI Won’t Replace Contact Center Agents,” we break down how AI and automation are central to delivering great customer experiences, as well as the types of tech being leveraged. However, it’s worth noting that it’s cost-effective to leverage this technology too. According to Gartner, organizations will lower operational costs by 30 percent by 2024 by combining hyper-automation tech with redesigned operational processes.

Cybersecurity is a Top Priority

Adopting new technology paired with remote workers and cloud environments has forced organizations to take a hard look at their data security processes. As we explained in “Data Security: How DATAMARK Protects its Clients,” American companies lose an average of $8.64 million per breach, which provides an apparent fiscal incentive to shore things up. Despite this, McKinsey research shows more than 70 percent of CISOs expect their budgets to shrink in 2021. If their predictions are correct, it could spell out major trouble for their organizations and diminish consumer trust even more.

Work from Home is Here to Stay

Prior to COVID-19, only seven percent of full-time employees worked from home, according to Willis Towers Watson. By August 2020, the number skyrocketed to 44 percent. Though organizations intend to start bringing employees back to their former workplaces, almost 20 percent will remain remote—nearly three-times the pre-pandemic level.

Business Process Analysis is Getting More Attention

Suffice it to say, each of these trends presents major challenges for organizations.

These aren’t things that can be fixed with band-aid solutions. They require business process analysis—a complete look at how each process is being carried out now, what the goal for each process is, and how it can be re-engineered to achieve its goals cost-effectively. With that in mind, companies are turning to customer experience management experts and business process re-engineering specialists to redefine their customer experiences and strengthen their companies going forward.

Explore Outsourcing to Improve Your Customer Experience

DATAMARK has helped enterprise-level organizations, Fortune 100 companies, and government agencies redefine their customer experiences for more than three decades. By exploring each process, including individual customer touchpoints, and bringing in the right technology, people, and processes, we help companies cost-effectively achieve their goals. If your company is struggling with its next steps or how to bring everything together, contact us for a consultation.

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