In the competitive business landscape, prioritising customer experience (CX) is crucial as it directly impacts a company’s revenue. However, many customer experiences fall short for three primary reasons: unclear pathways to desired outcomes, products not meeting customer needs, and constant marketplace changes driven by technological shifts. To excel, companies must focus on technology, data, and business processes, effectively managing customer data and aligning operations to support customer engagement.
The Challenges of Providing a Great Customer Experience
When products and prices are nearly identical, the customer experience becomes the differentiator. Recent surveys indicate that almost one-third of companies prioritise customer satisfaction and improving customer experience over revenue growth. However, businesses today face more challenging markets, with concerns about inflation and recession impacting technology strategies. The shift towards ubiquitous experiences and generative AI (GenAI) is expected to enable customers to create their own experience journeys by 2027 (Source: IDC).
Top Business Priorities for Companies
Providing a great customer experience has never been a static effort. Today, technology constantly shifts how customers engage with brands. By 2027, 60% of Fortune 500 firms are predicted to leverage ubiquitous experiences, edge analytics, and generative AI to enable customers to create their own experience journeys (Source: IDC). Improving customer experiences remains the top business priority for enterprises globally, leading to other benefits such as revenue growth, faster innovation, and better long-term positioning in a competitive market.
However, businesses are now operating in much more challenging markets. A Survey found that top concerns around executives’ technology strategies for the next 12 months are inflationary pressures and the impact of the recession on expected business revenue (Source: IDC). Executives are concerned about how to use technology to improve underlying operations that support a better customer experience, such as supply chain and labour efficiency.
Generative AI and other emerging technologies are poised to have a significant impact on future customer engagements. Advances in AI and automation can help enterprises scale empathetic customer outcomes through innovative products and services and new business models. However, companies still struggle to provide experiences that engage and connect with customers beyond a superficial level, leading to a “sea of digital sameness” where apps, product features, and offerings deliver essentially the same mundane experiences.
Finding a Footing for a Differentiated Digital Customer Experience
Companies are adopting new digital initiatives and business models, integrating AI and product customisation, and modernising their CX technology stacks. The evolution of customer expectations demands ongoing innovation and improved experiences. B2B companies, influenced by consumer-facing interactions, are now adopting digital self-service, self-directed sales discovery journeys, and value-based outcomes.
Key CX Improvement Initiatives
Businesses are working on various initiatives to improve customer experience. These include developing new direct-to-consumer (D2C) and B2B business models, digitalising mid- and back-office parts of customer journeys, and using AI and automation to guide workflows for employees across various applications. There’s a focus on customer-centric leadership and culture, modernising CX technology stacks, and improving organisational customer centricity. This indicates a significant shift towards technology-driven customer experiences.
Technology and Data: The Pillars of Customer Experience
The future of CX lies in data and intelligence. Customer data and insights create an intelligent customer context, foundational for value creation. Technologies like data analytics and experience automation are essential for scaling interactions. Successful CX requires organisational customer-centricity, activated across employees, business processes, and operations.
Where Technology Improves Customer Experience
Technology plays a crucial role in improving customer experience by enhancing how customers get information, conduct product research, and personalise their experiences. It also makes interactions more efficient and enjoyable. Technologies such as AI, machine learning-based recommendation engines, customer data platforms (CDPs), and services integration can reduce friction and enable businesses to meet customer outcomes more effectively.
Beyond the basics, C-suite executives are looking to technology to make experiences more enjoyable for customers. This includes using AI for personalised recommendations, integrating customer data across different platforms, and ensuring seamless interactions. A unified data fabric that combines customer behaviour, actions, sentiment, and operational data is essential for delivering personalised and efficient customer experiences.
Technology Builds Brand Stickiness
The rapid advancement of digital technologies, such as GenAI, outpaces innovation cycles and challenges current business models. The shift towards retaining customers over acquisition highlights the importance of building and maintaining strong customer relationships. Enterprises now focus on delivering value-based experiences earlier in the customer lifecycle, integrating digital business models and intelligent automation.
Strategic Business Outcomes
Enterprises are shifting their focus towards growing and nurturing customer relationships rather than just making sales. Building customer loyalty and brand stickiness is a primary strategic outcome for many companies. This involves empowering employees with the right data and tools, improving brand awareness, offering differentiated experiences, and creating new business models and revenue streams.
While customer loyalty was traditionally considered a post-sale focus, it now begins far earlier in the customer lifecycle. Customers demand greater value, more memorable experiences, and control over their interactions with brands. Enterprises are prioritising digital business models and mid- and back-office digitalisation efforts, which indicates a still-developing CX market. Transforming and integrating system and operational workflows with intelligent automation and unifying data stacks across the enterprise is critical for positive CX outcomes.
Overcoming Technology Challenges in Next-Gen CX
Transforming beyond the engagement layer remains a critical challenge. Integration with other key business processes, managing data silos, and updating legacy infrastructure are essential for CX success. Enterprises must address external market shifts, secure customer data, and manage data flows to build customer trust and achieve strategic goals.
Top CX Transformation Challenges
Companies face several challenges in transforming and improving customer experience. These include integrating CX with other key business processes, refocusing IT/digital initiatives on improving CX efficiency, proving the business value/ROI of CX transformation initiatives, and dealing with a plethora of different applications/tools across business functions. Other challenges include a lack of a unified customer view due to data silos, legacy infrastructure, and skills and staff shortages.
Enterprises also struggle with establishing a strategic vision for CX initiatives from executive leadership and dealing with organisational silos that hinder CX implementations. Security and privacy around customer data are also critical, contributing to customer trust—a prerequisite for achieving strategic business outcomes like improving customer loyalty and brand awareness.
Data Transformation Drives Digital Transformation
Digital transformation relies on technology to improve data flows, enhancing experiences, efficiency, and effectiveness. Accurate, trustworthy, and transparent information, coupled with secure data handling, is critical for customer trust. Enterprises must invest in a unified data infrastructure, integrating front- and back-office functions for real-time accuracy.
Impactful External Market Shifts
Data transformation drives digital transformation by enabling better data flows that improve experiences and operational efficiency. However, businesses must also consider the broader market-level shifts that impact their future CX strategy. These include the need for accurate and trustworthy information, accelerating technology capabilities, and addressing customer data privacy and security risks.
The volume of customer and business process data is expected to grow significantly, impacting enterprises’ ability to harness value from data and generate actionable customer insights. Ensuring data quality, compliance, and regulatory concerns are critical for successful data management and governance. Organisations must establish a unified data infrastructure, integrating front- and back-office functions for real-time data accuracy and transparency.
Next Steps
To stay competitive, businesses must adapt to the rapidly changing digital landscape by leveraging technology, data, and customer-centric strategies. Connecting data across the enterprise, championing CX as a discipline, and prioritising customer trust are essential steps. As next-generation technologies like GenAI become more prevalent, enterprises must prepare for accelerated innovation and its impact on customer engagement.
Langia, with its deep expertise in e-commerce and proficiency in SAP Commerce Cloud, is uniquely positioned to elevate your business’s customer experience to new heights. By leveraging advanced e-commerce solutions and the robust capabilities of SAP Commerce Cloud, Langia can streamline your digital commerce operations, enhance product personalisation, and ensure seamless integration across all customer touchpoints. This not only improves operational efficiency but also delivers a cohesive and engaging shopping experience for your customers, driving satisfaction, loyalty, and ultimately, revenue growth. Langia’s tailored approach ensures that your business stays ahead in the competitive digital marketplace, adapting swiftly to changing consumer demands and technological advancements. Contact us today to learn more!