Are Retail CIOs Ready to Meet Customer Experience KPIs? Accedian Research Says No
Today’s retail landscape is undoubtedly competitive. As customers flock to direct-to-consumer (DTC) e-commerce brands (e.g., Warby Parker, Casper, Dollar Shave Club), many traditional brick-and-mortar retailers are struggling to stay afloat. This is evidenced by recent store closures from Dressbarn, Charlotte Russe, Payless ShoeSource, and Gymboree. With Coresight Research predicting that U.S. store closures could reach 12,000 by the end of 2019, this barely even scratches the surface.
With the proliferation of DTC brands, consumers are spoiled for choice when it comes to shopping options. As a result, consumers have an enormous amount of power, and brands are finding that catering to their needs and expectations is the best way to cultivate any kind of brand loyalty. In fact, a study by Harris Group found that 72 percent of millennials prefer to spend money on experiences. While those experiences pertain to things like travel and entertainment, it's not a far leap for that quality of experience to extend to an interaction or experience with a retailer, whether online or in the physical world. In today’s experience economy that’s fueled by digital transformation, it’s critical for retailers to seamlessly merge online and in-store experiences. Take Nordstrom, for example. The upscale department store chain has managed to evolve with the times by successfully improving the customer experience across channels as part of its digital transformation efforts.
In today’s increasingly cutthroat marketplace, retailers are finding that building an exceptional customer experience is the best way to differentiate themselves in a crowded market. According to Gartner, “89 percent of companies expect to compete mostly on the basis of customer experience.”
Traditionally, customer experience has been a companywide effort, with marketing and sales contributing to developing and driving the strategy. However, as brands evolve to keep up with the pace of digital transformation, the delivery of customer experience key performance indicators (KPIs) have shifted to the purview of chief information officers.
To examine the impact of digital transformation and cloud migration on CIOs, Accedian, the leader in performance analytics and end user experience solutions, conducted a survey of 400 enterprise IT decision makers in organizations of more than 1,000 employees in the U.K., France and the U.S. The findings reflect the evolving role of CIOs, and highlight their readiness to meet the needs of their new responsibilities. Key findings include:
- 100 percent of retail CIOs feel at least slightly, partially or completely responsible for customer service excellence, yet only 33 percent of those CIOs feel they have some access to the right tools, resources and capabilities to deliver.
- In order to meet internal and external demands, almost half (43 percent) of retail CIOs say that migrating IT environments to deliver industry-leading performance and customer experience is a top priority for the coming two years.
As retailers prioritize optimizing the customer experience, the role of the CIO has evolved to meet these needs — all while keeping a focus on security, network performance, and cost. Therefore, C-level executives will need to work with CIOs to assess their brand's readiness to deliver on customer experience KPIs, and based on their assessments, they’ll need to empower CIOs with the tools needed to meet KPIs.
The host of tools and capabilities now required by CIOs includes an understanding of customer experience at the deepest application level, as well as the broad spectrum of performance data needed to monitor the health of their physical and virtual digital environments. Furthermore, IT teams need to know where degradations are occurring and pinpoint where the faults are taking place. Many are expected to rise to these new challenges with fewer resources, greater pressures to deliver, and at a faster pace than ever before.
In order to win in today’s customer-centric environment, retailers will need to be mindful of these new business requirements introduced by digital transformation. Identifying a full-stack solution that provides CIOs and IT teams comprehensive visibility into the entire digital landscape will be crucial for improving performance and customer experience.
Richard Piasentin is chief strategy and chief marketing officer at Accedian, the leader in performance analytics and end-user experience solutions.
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