Why the Digital Customer Experience is Crucial - Part One
The ability to deliver informative and appealing digital customer experiences across a range of touchpoints continues to grow in importance to organizations of all sizes and across industries. When customers have a poor or fragmentary experience, the consequences for a brand can be immediate and severe. The opportunities to both disappoint and delight customers proliferate as new means of interaction emerge, be it voice search, customer-facing chatbots or IoT devices. Regardless of the channel, customers expect consistent experiences across the board.
Digital Customer Experience Is Growing in Importance
Against this background, it’s not surprising that 41 percent of those surveyed called digital customer experience “extremely important” to their organization, with a further 33 percent of those polled positioning digital customer experience as “very important.” Add in an additional 20 percent who described DCX as “moderately important” and 94 percent of the entire 2018 survey group see digital customer experience as important to extremely important to their organizations. That 94 percent DCX importance figure is up from 2017 survey finding (91 percent), which in turn was an increase on our 2016 survey (88 percent). It’s also worth noting a five percent increase in the “extremely important” group of respondents between 2017 (36 percent) and 2018 (41 percent) surveys and a four percent increase between 2016 (32 percent) and 2017 (36 percent) surveys. In general, the larger the organization, the more importance they place on DCX. Among large organizations (those with headcount above 1,000 employees), 44 percent of respondents ranked DCX as “extremely important, with 32 percent for “very important” and 19 percent for “moderately important.” For midsize organizations (where headcount is between 100 and 999 employees), the breakdown was DCX is “extremely important” (36 percent), “very important” (35 percent) and “moderately important” (22 percent). Then, for small organizations (with headcount under 100 staff), 32 percent rated DCX as “extremely important” compared to “very important” (40 percent) and “moderately important” (21 percent).
2018 results indicate that organizations are now more strongly focused on reshaping their entire operations in order to meet the needs of their customers. Although the number-one priority in the 2017 survey was to improve customer success and customer services (72 percent), in second place was the more internal goal to realize competitive differentiation and to stay ahead within one’s industry (52 percent). In 2017, the third-ranking priority was to preserve or strengthen brand value (49 percent), while “it’s a part of our digital transformation strategy” was chosen by 42 percent of respondents. In 2018, digital transformation has moved up to third position (49 percent), with competitive differentiation represented by “It’s about survival to stay ahead and keep up” only meriting a mention by 33 percent of respondents. The larger profile of digital transformation projects in 2018 underscores that organizations now see the benefit of tying their continued improvements in digital customer experience directly to the much broader initiative of re-imagining the entire organization through an ongoing digital transformation project.
CHALLENGES TO DELIVERING COMPELLING EXPERIENCES
Respondents were candid in assessing the general effectiveness of their current digital customer experience platforms and tools. Nearly half of those surveyed (46 percent) rate their DCX technologies as “needing work” compared with a slighter smaller set who see those platforms and tools as “satisfactory” (41 percent) and a much smaller group (13 percent) who think their DCX technologies are already “working well.” Interestingly, when isolating respondents who work in IT or engineering, only three percent of that group reported their organizations’ digital customer experience platforms and tools were “working well,” while 47 percent said the technologies “needed work” and 50 percent described them as “satisfactory.” The responses weren’t that different when looking specifically at their peers who work in marketing and communication, where “working well” was at seven percent, “needed work” was at 49 percent, and “satisfactory” was at 43 percent.
However, it’s not only technology problems that organizations have to deal with today; organizational and budgetary issues also play a significant role. An Ongoing Need for Internal Alignment When asked to name the top-three challenges standing in the way of their organizations delivering digital customer experiences, respondents highlighted limited cross-departmental alignment and collaboration (44 percent), siloed systems and customer data (also 44 percent) and limited budget and resources (40 percent). In fourth and fifth position were outdated and limited technology, operations or processes (33 percent) and lack of strategy and executive support (31 percent).
When comparing the challenges for different sizes of organizations in 2018, we noted some major differences. For small organizations (with headcount below 100 employees), the challenges were:
Looking at the aggregate, the number-one digital customer experience challenge for survey respondents in 2017 was budget constraints cited by 48 percent, with the second-rated challenge of siloed systems and customer data lower at 35 percent. A year ago, lack of cross-departmental collaboration (26 percent) was also considered less of an issue than it is in 2018. With a stronger focus on digital transformation, organizations today are more keenly aware of where gaps exist internally between different departments both in terms of communication and alignment. It’s informative to look back to the results of the 2015 DCX survey, when respondents also chose limited cross-functional alignment as their numberone challenge to creating digital customer experiences. Interestingly, this once again marks an instance when results came full circle, as 2016’s top challenge was a lack of strategic direction, and 2017 named budget constraints as their top DCX challenge. One of the reasons why organizations are finding it hard to develop internal unity when it comes to investing in digital customer experience technology is the different sets of primary decision-makers. Among respondents, 41 percent see executive leadership as taking the lead in DCX technology investments compared to marketing (28 percent), IT (14 percent), a distinct digital department (12 percent), and customer service (five percent).