This interview was originally published at Financial Express.
Brands investing their resources in CX will be successful in driving value-based competitive advantage
Customer behavior and sentiments have evolved drastically. Their loyalty towards brands has plummeted with an increase in awareness of privacy rights and maturity about their actions across all digital platforms. To keep up with the evolution and perhaps have an influence, brands must lean into empowering customers to take control of their data and gain a competitive edge. In contemplation of shaping these emerging habits, marketers must leverage deep customer insights to back every business decision.
The shift in customer behavior has had brands push their limits and experiment with innovative approaches to enhance customer experience. The transition has sparked the ‘experience’ factor in customers’ mindset, leading them to re-think their entire marketing proposition. Organisations now must go beyond the metrics, user personas and segments, instead of focusing on understanding their customers as individuals. It is an absolute necessity to cornerstone the emotional factor every customer experiences during their unique, multi-channel and complex journeys before making their purchase decision. Brands investing their resources in CX will be successful in driving value-based competitive advantage.
In the current digital ecosystem, brands are prioritising a digital-first customer approach and technology is playing a gigantic role in bridging the gap between brands and customers. CX starts building the moment a customer gets to know a brand. It further continues till they purchase the brand’s product or service and much after! CX is not just about optimising user interface to create frictionless conversion journeys. Every pre and post-purchase brand interaction or micro-moments either in the virtual or physical world is registered under the CX bucket. The series of connected moments form experiences, which grow into loyal relationships and brand advocacy over time. Mountains (or lakes, pun intended) of data are at the disposal of the marketers, which they must learn to collect, analyze and utilise to their advantage to further create delightful, personalised moments for customers within the means of their privacy.
United endeavors: The foundation of great CX
CXM is often mistaken as the responsibility of one department within the organisation. Whereas, a strong CX foundation builds through the undivided effort of creating meaningful experiences at every touchpoint of the customer cycle by the entire organisation. It starts with the C-suite embracing a panoramic vision for the enterprise from a customer-centred lens first, but it does not stop there. It must involve the whole enterprise from data to digital to organisational infrastructure and the entire customer journey – from marketing to sales to service.
Customers need to be valued at every stage of the funnel to drive the desired outcomes and achieve its goal. The CX narrative must flow as a cross-functional organisational activity. Consistency is the key to attaining a customer’s trust and building brand reputation. Building CX and relationships is a constant process of evolution, there is no end to it. Understanding the audience to build a strategy aligning with the brand’s goals is the first step to building a unified CX strategy.
The pre-pandemic brands that actively endorsed upscaling technology and prioritising CX are reaping the fruitful gains. An organisation’s CX strategies must cater to the emotional journey of the customer, every minute detail must be considered while designing their product lines, which will further help brands to make well-informed decisions. Gaining knowledge of the customer’s interests, passions and behavior will assist brands in curating products and services around their needs. A brand’s CX strategy must revolve around its customer’s wants and needs.
Due to technological advancements, it is easier for brands to design highly interactive assets that will boost ROI. Measuring the success of digital campaigns helps brands gain insights into the effectiveness of their approaches that align with the ultimate goal. Right from the beginning, the CX agenda must be acknowledged and embraced within the brand to collectively establish long-term customer relationships that further continue to benefit the brand’s growth.
Priority: Transparency of customer data
Data is no more about collecting every insight but about selectively picking out the information that fits in a brand’s CX puzzle. To deliver flawless CX, brands must inculcate the digital-first approach and equip themselves for a human-centric marketing era. Every business decision in the CX ecosystem must be backed by data. Data privacy regulations are on a rise and extracting the right data is vital. These privacy regulations help customers gain transparency and help brands gain their customer’s trust.
Third-party data is diminishing and marketers need to pivot their focus on first-party data. An effective way to leverage first-party data is through efficient use of customer data platform (CDP), which collects, unifies, analyses and measures first-party user data for actionable results that create long-lasting customer relationships.
CDP acts as a centralised data hub for organisations, it serves as a consistent data platform for them. CDP is capable of unifying data in silos and supporting omnichannel personalised customer campaigns. Especially for the e-commerce industry, CDP is a boon as it unifies the in-store and online customer purchase data, which can be connected to customer loyalty programs for transmitting effective personalisation.
Customers are comfortable with sharing their data on the sole condition of data privacy. One of the primary advantages of using CDP is that it creates a dynamic profile of each customer along with their data privacy preference, which further helps brands gain better insights into customer behavior and deliver hyper-personalised experiences. CDP not only smoothens the cross-channel engagement for a brand but also strengthens customer trust through data transparency. Delivering personally and yet, contextually relevant experiences for customers, requires critical data management and digital transformation capabilities. Even with the right capabilities, brands may face many challenges to realising a true CX transformation.
These capabilities are often housed in silos across departments and platforms and are exceedingly difficult to automate and rely on manual coordination across teams. Tech investments like CDP are a step towards building a unified customer profile (single customer view) across platforms and multiple touchpoints but unlocking actionable user behavior insights needs a strategy that goes beyond tech investments.
This helps in amplifying personalisation, it is crucial to have a well-consolidated customer database to safeguard your marketing efforts for the future. Another advantage of focusing on data transparency is retaining customers, as the brand gains the title of being trustworthy. Brands adopting to the lucidity with customers will witness a hike in customer acquisition, retention and loyalty. The key is to strike the right balance between privacy and experience.
Personalisation = Increased customer loyalty
With the acceleration of cloud migration and digital channel usage, the new magisterial for brands is to shift focus on personalisation. Brands have ample customer data and making effective use of that data to drive conversions through omnichannel and data-driven marketing is vital. The optimum goal is customer satisfaction and retention, the organisations rooting for are the ones investing in CXM.
A strong CX strategy not only retains customers but also attracts new customers by helping them reach the desired outcomes through a faster, easier and seamless UX. A tailor-made design for customer experience around their digital habits and behavior is groundbreaking. Apart from seamless experiences, brands need to know when, where and how to deliver a personalised experience. From more data-driven and addressable advertising and extending the marketing experience to the site, app and commerce platforms, digital messaging has seen meteoric growth in the past decades, considering the current digital marketing ecosystem, it is no surprise. Brands need to identify the channels used by their audience and utilise the power of strategic omnichannel marketing. Investing in the right technology and tools will help brands unleash the power of personalised campaigns.
The key ingredients to effective personalisation are engagement, relevance and trust; and to attain these goals, having the right mix of data sets is crucial. Personalisation is the key differentiator that sets a competitive advantage for brands.
By Anubhav Sonthalia, CEO, CXM, dentsu India