$1.6 trillion economy “up for grabs” thanks to digital convergence failuresby
Accenture’s latest research into customer attitudes and experiences claims that a $1.6 trillion economy is emerging in the US, as a result of businesses “struggling to keep pace with their customers’ always-on nature”, and their greater use of digital channels.
The Global Consumer Pulse Research, now in its tenth year and covering over 20,000 consumer opinions on marketing, sales and customer service, calculated that a huge “switching economy” was emerging in the US as a result of businesses failing to effectively converge digital, mobile and social with traditional channels.
56% of consumers report that the number of brands they consider has increased significantly over the past 10 years, and 46% believe they are more likely to switch providers compared to 10 years ago.
78% of respondents use at least one online channel when looking for a new service provider, and nearly one-quarter want more digital interactions from providers. Only 11% of consumers strongly agree companies are successfully converging digital, mobile, social and traditional channels.
“There is a $1.6 trillion market in the United States just waiting to be tapped, so one would expect a rush of companies seeking growth from it,” says Robert Wollan, senior managing director, Accenture Strategy. “Instead, many established companies are reacting too slowly to the needs of today’s ‘non-stop customers’, and consequently, they are seeing both a customer exodus and a decrease in their revenue potential.”
“While many companies have been chasing the opportunity digital brings, they have not addressed the root causes of the problems that are exposed when they don’t execute well. Companies have been focused only on ‘doing the same things better’ when these issues really require them to ‘do things differently’.”
Digital convergence and managing customer experiences has long been one of the most complex issues facing established businesses, especially within customer service teams where managing the customer experience across multiple channels is rated as their biggest challenge.
One of the consequences of such a large proportion of businesses failing to deliver digital convergence is said to be a decline customer loyalty.
Just 28% of Accenture’s respondents stated they feel very loyal towards any brands, and only about one in three said they recommend brands to others.
Cognizant’s Shannon Warner recently suggested that many brands, especially in the retail sector, were too focused on driving customer loyalty through traditional loyalty programmes when the new focus for convergence should be more engagement.
In Cognizant’s annual Shopper Study it found that engaged customers are 23% more profitable, while actively disengaged consumers cost 13%. Around 80% of Americans indicate they are more likely to become loyal to retailers who provide a seamless shopping experience across devices.
“Today’s customer’s sense of loyalty to an existing provider is often eclipsed by a competitor’s personalised and tailored experience,” says Kevin Quiring, managing director, Accenture Strategy.
“Our research shows that some companies are opening the door to ‘non-traditional’ competitors who are often more willing to ‘do things differently’ and offer prospective customers more opportunities for customisation.”
Chris is Editor of MyCustomer. He is a practiced editor, having worked as a copywriter for creative agency, Stranger Collective from 2009 to 2011 and subsequently as a journalist covering technology, marketing and customer service from 2011-2014 as editor of Business Cloud News. He joined MyCustomer in 2014.