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Rating the accuracy of last year's CX predictions - and sharing 12 more for 2022

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Last February, Peter Dorrington shared 12 predictions for the coming year. Here he examines how many came to pass - and shares what he believes may be in store for 2022. 

17th Feb 2022
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In February of 2021, I wrote an article "12 new strategies making us optimistic for the future of CX". At the time, the pandemic was in full swing, but the UK's vaccination programme was also well underway, so forecasters were ambivalent about the future. My article discussed my predictions for the rest of 2021 as presented during the International CX Summit.

This year, I had the good fortune to be asked to present my thoughts again at the summit, and this article reviews my predictions for the last year and my new expectations for the year ahead.

Last year's predictions for CX in 2021

During 2021, the pandemic took some unexpected twists and turns; the Delta variant emerged (as did Omicron), borders opened and closed at unpredictable intervals, business sectors like travel and hospitality were badly hit, as were international supply chains. 

In short, 2021 was a rollercoaster ride of a year and this obviously had an impact on what I thought would be priorities at the time:

  •  The ‘new normal’ will not be the ‘old normal’  - I believed that businesses and customers would not return to previous levels of high consumer confidence, and uncertainty would dominate, and I think I got that mostly right.

  • Organisations would focus on their 'purpose' - and that customers, employees, and stakeholders would ‘value’ more than just wealth creation, and whilst there was movement in this area, it was not as far as I had hoped.

  • Enhanced stakeholder inclusion - as part of defining their purpose, I expected businesses to think beyond their immediate stakeholders’ interests to a wider group, and while some environmental, social and governance (ESG) initiatives got shelved in the fight for survival, COP26 showed that others recognised the strength of customer feeling.

  • The rise of value chain management - with customer expectations rising, businesses needed to address the ‘value chain’ as a whole, and most did; recognising that irrespective of where a service failure originated, customers blamed the brand.

  • Organisational culture - taking the business into the future would require thinking about a ‘humane’ organisation which serves everyone, and this too happened; partly because of changes in working conditions but also to maintain employee wellbeing and motivation.

  • Empathy & human-centric design would take centre stage - with multiple research reports documenting the value of empathy to the bottom line, some leading brand businesses started to consistently display compassion in their dealings with customers, employees, and suppliers.

  • More businesses leverage cloud platforms and partners - this initiative gained momentum as the need for agility and a more diverse talent pool prompted a continuing shift to the cloud and digital transformation.

  • More focus on interaction and experience management - as businesses went beyond customer journeys and touchpoints. Indeed, we started to see the rise of the 'megaplatform', formed from a partner ecosystem to offer holistic, end-to-end experiences. 

  • After the initial ‘dash to digital’ - businesses extended their digital transformation initiatives into more areas of operation (such as CX, procurement, and day-to-day operations).

  • Business will embed more insights into their operations - using more data and insights to drive core operations, including CX. This did not play out the way that I originally thought, as many businesses struggled with historic data not reflecting the new reality on the ground.

  • Hyper personalisation - I foresaw technology (including AI) being used to offer more personalised experiences, and the greater use of digital and RPA (e.g., for self-service) did go some way towards achieving this, but consistency across channels was problematic for many.

  • The emergence of new measures of (CX) performance - where measures of production were blended with measures of experience, this was the least accurate of my predictions; many businesses were too busy reacting to a volatile market to spend resources developing new ways of measuring their performance.

My twelve strategies for CX in 2021

In addition to completing the 'unfinished business' of 2021, much of the world is transitioning into a new phase of the pandemic; we are learning to live with COVID. Part of this transition is a recognition that there is substantial pent-up demand, so businesses are looking to the future and figuring out how they are going to meet this demand and possibly increase market share by becoming the first choice of more customers.

  1. Disruption will continue – I expect COVID to continue to disrupt everyday life in the first half of 2022, but other factors continue gaining importance, including political, economic, social, and technological influences. CX professionals need to think about how unexpected changes at any point along the value chain can impact the customer experience. Customers typically don't care about why their expectations aren't meant, only that they are. So, be proactive in communicating delays or cancellations and don't wait for them to complain (or assume that they will just accept the disappointment).

  2. We need to get comfortable with uncertainty - the impact of changes in customer behaviour has been compounded by disruption and a lack of reliable data; making predictive modelling problematic. Think about a range of scenarios (good and bad) that may play out in the future, and how you can retain agility and build resilience into customer journeys; how can you avoid one domino falling taking all the others with it?

  3. The ‘new normal’ will give way to the ‘new exceptional’ - operating in competitive online marketplaces will force businesses to focus on delivering exceptional experiences, not just competence. As mentioned before, customers expect businesses to be good at what they are paid for, but they want more than that. How can your business deliver 'stand out' customer experiences that separate you from the competition? 

  4. ESG will go mainstream - demand by customers will make businesses more transparent about their impact on the environment and wider society. As customers become more aware of the environmental and social impact of their purchase decisions, some will focus on things like sustainability, sourcing locally and ethically. An increasing number are also concerned about the way businesses are led and governed, for example, in the ways in which their data is gathered and used.

  5. Rise of ‘values based’ CX - going beyond ESG reporting, leading brands will become increasingly focused on their ‘purpose’ and what customers care about (‘shared’ values). Part of what customers 'experience' is how brands align to the things that they care about; for example, veganism, child-labour, etc. CX professionals need to design experiences that acknowledge and reflect these values so that customers can feel good about the choices they make.

  6. Trust will become a critical differentiator - customers place a premium on brands that share their values as well as keeping their promises, i.e. do what they say they will do. Trust in a brand to keep their promises (as well as those promises aligning with their values) is one of the biggest determinants in whether a customer will shop with a brand or not. CX programs need to ensure that the operations of the brand are consistently delivering on those promises. When a customer trusts a brand, they are more prepared to accept new offerings or forgive the occasional misstep.

  7. More CX programmes will fall under the CMO - recognising that ‘customer journeys’ start well before the first interaction, more businesses put CX under the control of Marketing or Sales (or other invested stakeholder). This is partly a reflection of the maturity of mainstream CX; for many organisations, it has stopped being the domain of a few specialists and become part of all employee's job.

  8. The war for talent and the ‘great resignation’ will hamper recovery and growth - as economies recover, more businesses will struggle to fill vacancies with skilled staff or hold on to existing employees. For many organisations, a significant proportion of the customer experience is delivered by frontline staff. But many industries and regions have far more vacancies than applicants. CX professionals should partner with HR professionals to explore what attracts new employees, how to help them become productive, what motivates them, and what can be done to retain them (and it is often not simply about paying more).

  9. CX will span the value chain - CX becomes an issue for everyone; suppliers, employees, and partners, as customers hold brands to account for poor / failed performance. Whilst some organisations have made great progress in this area, not enough businesses are thinking about the links between customer, employee, and supplier experience as an integrated strategy, and how technology and process change can enable transformative end-to-end innovation. The customer experience is often the end of a very long sequence of events, any one of which could fail, so CX professionals need to end-to-end.

  10. Increasing costs drives more transformation - rising costs, including wage inflation, is making the business case for accelerating digital transformation more compelling. Because businesses often cannot fully pass along increases in costs to customers, many are looking at ways to reduce costs by reducing the expense of operations or improving its value delivery. Taking labour costs as an example; some tasks can be eliminated through automation, or resources reallocated to more valuable work (such as dealing with the complex, emotive or unexpected issues). However, there is risk in adopting a poorly thought-out automation strategy.

  11. There will be lots more [bad] automation and AI - a significant number of businesses that introduce automation and AI, will fail to achieve their stated goals, or to meet customer expectations. During the pandemic, lots of businesses made the 'dash to digital', some more successfully than others. The winners understood where AI and automation work effectively (e.g., when a customer wants and can self-serve) and where it doesn't (e.g. when a customer wants to talk to a human, or has a complex query). Whilst businesses are still gaining experience of where and when to use automation, we will continue to see examples of poor implementation and frustrated customers.

  12. Increasing use of first & second-party data - challenges with accessing reliable third-party data will stimulate more businesses to focus on their own data and data shared by partners. This has been a major issue during the pandemic; historic data doesn't always reflect the new reality. At the same time, third-party cookies are being eliminated from digital interactions. So CX professionals need to look at the data the organisation already has (first-party data) and legitimate data sharing with partners (second-party data). For example, customers want more personalised experiences, and that in turn will need them to share data about their needs and preferences. However, they will only do so with organisations they trust (see above).

Conclusions

Many CX programmes struggled to make innovations during the pandemic; businesses were often more focussed on operational challenges than reinventing the customer experience. However, as we enter a new phase, one that holds significant opportunities, CX professionals will once again be challenged to demonstrate how their work will directly impact bottom line performance and allow businesses to increase market share.

If you would like to know more about what your customers really care about and why, and how that influences their decision-making so that you can deliver more humane experiences at scale and speed, we would be delighted to show you - contact us at [email protected]

 

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