In a world of struggling supply chains and pandemic fatigue, providing an unparalleled digital customer experience (CX) is more important than ever.
Improving CX became a top five initiative for 54 percent of marketing organizations during the pandemic, particularly in the retail sector, with CX budgets increasing by 10 percent on average since the early days of the pandemic.
What’s driving this increased focus on digital CX? Here are three primary factors:
- Consumer demand: Consumers say they will pay up to 16 percent more for products and services that provide a great customer experience, and 63 percent say they will share more information and data with a company that provides great CX. Meanwhile, one in three shoppers will walk away after a single bad experience.
- Increased competition: 35 percent of customers have tried a new brand during the pandemic. At the same time, they're more interested in digital offerings from brands.
- Shift to digital: Today, organizations are three times more likely than they were pre-pandemic to say that 80 percent of their customer interactions are digital. Moreover, 84 percent of marketers report that their audiences care more about digital experiences than before.
For brands to stay relevant, their digital CX must attract — not detract — customers. And, with customer interactions increasingly shifting online, it’s essential that organizations rise to the occasion with a digital CX that wows and delights. Here’s a look at the next-gen tech that organizations are relying on to attract, acquire and retain customers today.
AI Goes Mainstream: It’s All About the Data
In recent years, artificial intelligence (AI) has become easier for brands to use and leverage, feeding adoption. During the pandemic alone, AI investment increased 25 percent to 61 percent.
AI has become so ubiquitous that it’s now being baked into popular digital experience platforms (DXPs). With marketers reeling from the iOS 14 privacy update and Google’s upcoming phase-out of third-party cookies, these platforms have a newfound purpose for organizations: leveraging first-party data to foster customer loyalty and retention. Increased privacy regulations have forced marketers to guess more — and consequently spend more — on their marketing efforts and advertising campaigns.
For the best return on investment, marketers may need to turn their focus inwards, with a goal of maximizing customer retention and lifetime value with their existing customer base. DXPs can be invaluable here. Harnessing AI and first-party data, DXP platforms can deliver personalized product recommendations that drive content to the right people at the right time, influencing purchases and engagement. DXPs can help organizations seize micro-moments when consumers are in the mood to buy.
DXPs Help Organizations Own the Entire Marketing Experience
The power behind DXPs is that they're constantly iterating — gathering data and learning from it in order to provide increasingly personalized, more effective customer experiences. The same philosophy drives the business strategy of DXPs themselves. DXPs continuously grow in their capabilities through software acquisitions, to the benefit of the marketers and organizations using them.
For example, in 2021, Optimizely acquired Zaius, a customer data platform (CDP), along with Welcome, an all-in-one suite that includes content marketing, market resource management, and digital asset management. Sitecore spent the year acquiring multiple SaaS platforms, including marketing automation platform Moosend, CDP Boxever, and e-commerce solution Four51. And Adobe has spent the last decade acquiring apps for its DXP, Adobe Experience Cloud, such as marketing automation provider Marketo in 2018 and workflow management platform Workfront in 2020.
By integrating these apps into their respective platforms, DXP market leaders provide marketers with powerful tools for managing workflows and content creation, executing those digital content experiences, and then optimizing them through experiments — all from a single platform. From ideation to creation and experimentation, dozens of disparate tools have been replaced with a single, more robust platform designed with the needs of marketers in mind.
By bringing everything into one platform — including the data collected by these tools — it’s easier for marketers to develop and deliver an outstanding digital CX.
From Optional to Essential: Experimentation Becomes Commonplace
Mirroring the rise of DXPs is the rise of experimentation. Experimentation as an idea isn't new. Most, if not all, organizations have been split testing their emails for years now.
What’s different today is the reliance on experimentation to transform the entire customer experience. A/B testing, and even its more advanced counterpart, multivariate testing, deliver personalization based on a one-to-many experience. Thanks to the maturing experimentation capabilities offered by today’s DXPs, one-to-one personalization is finally possible.
AI experimentation can connect data across channels, testing and optimizing the digital CX for each individual customer, in real time. Based on an individual user’s behavior, in addition to broader group data and trends, DXPs can test limitless variations of copy, images, layout and more to deliver the single most optimized experience for each person in your audience, improving performance.
Putting the Personal in Personalization
Personalization is challenging in a cookie-less world. However, customers still expect hyperpersonalized experiences that feel consistent across channels.
The answer may be in making the digital experience feel more real. After nearly two years of a demoralizing pandemic, finding ways to bring a sense of connection and humanize the e-commerce experience can deepen customer loyalty, while rewarding organizations with data-rich insights.
For example, pet e-tailer Chewy uses data to provide not just personalized, but personal, experiences. It sends birthday and holiday cards to pets via snail mail. Customers have received oil portraits of their pets “just because,” or flowers after they ended a product subscription due to their pet’s death.
“I thought if I could deliver the same kind of personalized experience as the neighborhood pet store, but do it online and deliver a really convenient value proposition, that we could build a really big business,” Chewy Co-Founder Ryan Cohen told Business Insider. His strategy paid off. The company reported net sales of $7.15 billion in 2020, a 47 percent increase year-over-year.
With its annual Starbucks For Life and Star Bingo games, Starbucks provides another example of a loyalty-deepening digital customer experience. These online games require no purchase to participate, yet generate purchases nonetheless by gamifying the coffee customer experience. While customers rush to earn extra plays with their purchases (all in the hopes of winning a grand prize or scoring a free download or playlist), the brand collects valuable data that enables it to deliver personalized offers via email and its branded mobile app — driving more future purchases.
It’s Time to Redefine the Digital CX
During the pandemic, brands were forced to invest and implement technology they had been sitting on in order to engage consumers across devices and channels — from mobile to desktop, and online to offline. Now, it’s time for brands to start fully leveraging that technology to provide digital customer experiences that excel.
Vice president of client success and marketing for digital agency Whereoware, Randi Mohr ensures clients’ digital services achieve intended business objectives.
Related story: Top 3 Retail CX Trends for 2022