Companies continue to focus on and invest in customer experience (CX), and it is no surprise why. Companies identified as CX leaders generate an average three-times greater return in stock performance. In another survey, almost all executives agreed that an unimproved CX exposes considerable risk in losing market share and revenue.
While customers already had an extensive choice and more access to brands than ever before, the pandemic forcefully accelerated digital adoption with a boom in e-commerce and in many cases permanently changed the shopping journey and how users interact with brands. On top of the complications of trying to provide the great customer experience expected of companies, there is an increasing number of channels of discovery, purchase and service which those companies may or may not own. This makes it harder for companies to maintain a consistent implementation of their customer experience strategy across the entire user journey.
A good product or service alone is simply not a good enough reason to expect customer loyalty. In a recent study by Forbes, 75 per cent of customers said they are likely to buy on experience alone and consider their experience just as important as the quality of products and services they are purchasing. Complementary to this, research also indicates customers are likely to pay a 16-17 per cent price premium for brands that consistently provide great experiences.
In the GCC region, customer experience has been identified as a top priority, as agreed by 96 per cent of the region’s IT decision-makers in a YouGov study, with 80 per cent ranking customer experience as a high priority for martech investments. According to the CMO Council, the C-suite believe they have leadership gaps in the amount of modern tech employed and used, as well as in the use of data to better understand customers and make better-informed decisions.
The martech landscape continued its strong growth against last year, with customer experience, data and governance being the fastest-growing categories. Testament to the fast growth, one in five companies listed were new entrants.
So, what does it take to be successful and why is data central?
We are emotional creatures that make emotional choices, no matter how much we may post-rationalise our decisions. There have been plenty of studies conducted on how emotions drive our choices. To address the emotional side, we need to personalise and be relevant in our communication. To do so, we need to know and understand our customers and make their journey as frictionless as possible.
This starts with having a first-party data strategy and the right data and analytics infrastructure in place to be able to inform and act on our audiences. Businesses should at a minimum look at how they can strengthen their first-party data position, such as with data already collected through their web and app analytics. Organised correctly, this data can inform on what your audiences are interested in the most, what topics are providing the best conversions, as well as any friction points that need to be dealt with. Ideally, businesses should further build PII (personally identifiable information) audience data through user registrations and seek ways to enrich that.
Customer data platforms (CDPs) are powerful marketing tech to collect, centralise and activate first-party audience data. A CDP collects first-party data from your website, CRM and any system that holds customer data, creating real-time unified and persistent IDs of each customer. These audience profiles are further enriched with information from how they have interacted with your business. The CDP then allows you to leverage those audience segments by activating them on different channels, such as paid media, email marketing or dynamically offering a more personalised web experience in real-time.
The recent rise of CDPs has largely been aided by new regulations in data privacy, as well as the continued depreciation of third-party cookies and device tracking. Both of these have resulted in the loss of data and insight, making it apparent to advertisers that they need to own and be in control of their customer data while they slowly lose third-party data. CDP adoption is expected to increase globally by four times, to top $10bn in 2025, with the MENA region playing catch-up at 4.7 times by 2025 to almost $1bn.
While CDPs are typically linked to marketing teams, every customer-facing department, such as sales or customer service, can access and benefit from centralised and enriched customer profiles to get a better understanding of their customers and offer a seamless experience no matter what channel they interact with. Centralising and unifying customer profiles creates a collective asset that greatly improves the agility of a business beyond its marketing.
In conclusion, developing and implementing an effective customer experience strategy is challenging enough considering the changing landscape. Businesses should take control of their valuable data by using a CDP to centralise and unify it for all customer-facing departments to harness the full potential of that data for a more effective, better informed and optimised customer experience strategy. Ensure you’re making the most out of data you already own, centralise it for better access, and organise it to generate meaningful insights to ultimately leverage those audience profiles to better attract and engage with your customers.