Brands and vendors may be rushing to rebrand themselves as customer experience(CX)-driven but new research has revealed a disconnect between CX strategy and customers’ expectations.
According to Oracle’s Global Insights on Succeeding in the Customer Experience Era report, 93% of senior executives say that improving CX is one of the top three priorities for the next two years whilst 97% state CX is critical to business success.
Additionally, the report showed that executives estimate that the average potential revenue loss for not offering a positive, consistent and brand-relevant customer experience is 18% of annual revenue.
But whilst businesses understand the importance of customer service to their profitability many are failing to cement their ideas: 91% want to be a CX leader, but 37% are just getting started with a formal CX initiative and only 20% consider their initiative to be at an ‘advanced’ stage, the figures showed.
The survey of more than 1,300 senior executives across 18 countries in North America, Latin America, Europe, and Asia Pacific to assess the state of business’ customer experience initiatives, showed that customers’ expectations outpace CX delivery.
Nearly half of execs believe customers will switch brands due to poor CX but the reality is that a whopping 89% of customers say they have switched because of poor CX. Additionally, the report revealed that whilst 44% of execs believe customers are willing to pay for great CX, 86% of customers claim they are already doing so already.
In terms of CX tools, social media – agreed by 81% to be critical for success – is used by just 35% of respondents for sales or service. Additionally, businesses are recording slow adoption rates of customer expected capabilities and failing to implement flexible technology across multiple channels, the report showed.
But why this increasing focus on CX? According to the report, the top driver for organizations’ focus on customer experience is due to rising expectations from customers (59%) and the impact of social media on customers’ ability to broadcast good and bad experiences (37%).
So what are the biggest obstacles firms encounter when attempting to deliver the best possible customer experience? Limitations of inflexible technology and application infrastructure was shown to be the biggest challenge in technology (29%); followed by siloed organizations/ conflicting key performance indicators (KPIs)/incentives between different channels/ business units (27%); and lack of money allocated to customer experience initiatives (27%).
To create a successful CX initiative, Oracle suggested that organizations must select priority focus areas and identify and deploy the people, process, and technology changes that will deliver real improvements and foster a customer-centric culture that transcends internal silos. Offering multichannel choice as well as conducting timely, targeted customer surveys to gauge feedback can also help improve your approach.
Danny Rippon, CRM Business Solutions director at Oracle, said of the findings: “European businesses are increasingly finding that their customers are more empowered than ever before. The Global Insights study shows that the majority is aware of this, but is not doing enough to bring customer experience up to the standards required by the modern market.
“Organizations should deploy platforms that enable them to communicate with customers across multiple channels using open and integrated technologies. When this is overlaid with advanced analytics that deliver deep customer insights, businesses will find they can engage with their customers in a more natural and meaningful way.”