Written by Sphere Guest Blogger: Dinara Davlembayeva
During the pandemic, companies have seen huge changes in customer behaviour in the way in which they see brands, interact with them and engage in transactions. To dive deeper into the role of customer experience in the new era, the July Sphere Network event welcomed the talk by Helena Hill, an Experience Strategist and Consultant at Helena Hill Consulting.
Customer centricity has been considered as a critical approach underpinning business decisions over a decade. This approach transcends across all stages of the customer journey, starting with customers’ need recognition and ending with customer retention. The pandemic has accelerated the speed at which customer experience has been overtaking price and product as key brand differentiators.
Helena has worked with start-ups and big global companies in areas of digital product management, UX, user design, data strategy development and implementation. Helena shared her thoughts about how the current reality has been shaping customer behaviour, what characterises “the age of the customer” we now live in, and what role digitally-enabled services play in customer behaviour. She also shared her insights about the importance of exploring and predicting customer habits, understanding customer journey touchpoints and meeting the needs of customers.
The Age of the Customer – Shift to Online Services
In 2010, preceded by the economic downturn and internet adoption, the world entered the age of the customer, with high empowerment, demands and expectations. The economic and infrastructural changes have led to the development of digital channels for customer-brand communication, product/service promotion and delivery, and purchase transactions.
Against the backdrop of ample supply, internet connectedness and the diversity of offerings, buyers now hold the bargaining power and unprecedented access to product/service information, upon which they make purchase decisions. Such developments have naturally led to the reduced importance of prices and a higher focus on customisation.
The focus on customer experience has been accelerated with the outbreak of the pandemic. The crisis has impacted economies, reshaped the psychology of customers and dramatically increased digital adoption. Instability, uncertainty, crisis, travel restrictions and changing customer needs brought about by the pandemic are the key forces defining customer behaviour and driving the trend towards customer experience in the future.
The shift to online services and the focus on customer experiences means that businesses need to understand how customers’ habits have changed over the past months and predict what habits will stick in the future. Secondly, brands need to explore the touchpoints in the customer journey and be knowledgeable about the use of customer data to reach informed decisions and actionable insights. Thirdly, companies need to understand buyers’ motivations and expectations to ensure customer retention and acquisition.
Whilst before the pandemic buyer personas had to be looked into every 9-12 months, during the pandemic they need to be examined a minimum of every 3-6 months. The evaluation of customer habits should be done in relation to each of the five stages of the customer journey.
The first stage is the awareness of a brand or the need for a brand’s product or service. The second stage is the evaluation of alternatives, in terms of brands and offerings, which drive customer decisions. The third stage is a purchase, while the fourth stage is post-purchase engagement. The final stage is raising advocacy and word of mouth (WoM), which help attract new customers.
During and after the pandemic, the touchpoints at every stage of customer-brand interaction are different compared to the pre-pandemic customer journey. Nowadays, social networking platforms/apps, private communication channels, internet live streaming, e-commerce services and online advertisement at the stages of product-service awareness, decision-making and purchase transactions are more important than before.
On the other hand, in-store communication, purchases through agents and traditional outdoor advertisement have become less effective or ineffective. At the stage of post-purchase engagement and retention, brands should take control over customer satisfaction by monitoring and managing memberships, SMS, WoM, reviews, and public media followers.
It is important to reach out to customers pro-actively and ensure their positive experience. Apart from the transformational impact on customer experiences, the pandemic has affected customer preferences. There has been a fall in discretionary spending, such as vacation/holiday spending, automobile purchases, white goods, luxury items, home decoration, real estate, apparel, insurance products and investment schemes. In contrast, due to convenience and safety, e-commerce is forecast to prevail in the future. It will provide more diversified products and services and offer better logistics.
Understanding Customer Journey Touchpoints
To understand customer journey touchpoints, companies need to collect data about customer attitudes, preferences and behaviour and act upon them. One of the ways of collecting such data is to use a Net Promoter Score (NPS). This metric provides the core measurement for customer experience management programs and can help predict the impact of the brand on future customer engagement. In addition, given the current digital adoption dynamic, it is predicted that the digitalization of services will be at the same or even at a higher rate. This trend makes it possible to assume the growing importance of personalized experiences, and better use of search and shopping recommendations. Such a trend shapes consumer behaviour in three ways: 1) consumers will be less risk-aversive and open to trying out new things, 2) they will prioritise enjoyment over price, and 3) they will look for better satisfaction.
How to anticipate the needs of customers
The adoption of unified and agile systems and processes is important to anticipate the needs of customers. Customers will seek blended experiences, combining physical and online elements of brand interaction at all stages of the customer journey. Differentiation is key to making the brand stand out. If customer expectations are not met, they are likely to switch to alternative brands. In terms of decision-making, firms need to start making decisions based on the insights about their customers. Qualitative and quantitative data need to be leveraged to validate KPIs that are used for transformation. To understand what customers want, brands need to listen to what they say, review their complaints and feedback, be appreciative of customers and make them feel special, heard, and valued.
- The pandemic has emphasised the importance of the customer-centric approach.
- Customer experience has overtaken price and product as key brand differentiators, making customers more empowered, demanding and having higher expectations.
- The age of the customer is characterised by the shift to online services and the enhanced role of online channels of communication, transaction and delivery at all stages of the customer journey.
- Businesses need to understand how customers’ habits have changed and predict what habits will stay.
- Businesses need to explore the touchpoints in the customer journey and be knowledgeable about the use of customer data to act upon it.
- Customers need to understand buyers’ motivations and expectations to ensure customer retention and acquisition.
- The adoption of unified and agile systems and processes is important to deliver a differentiated and unique experience that will make the brand stand out.