Future of Customer Outlook
In today's technology-driven world, customer experience is a crucial aspect of any engagement or customer journey. Where once a few experiences may have been sufficient to build a relationship, nowadays organizations need to go beyond the basics by better understanding their customer base and building a deeper sense of customer empathy. Today, and for the foreseeable future, brands will be increasingly competing for customers and their loyalty. See here how IDC has broken down the concept of Future of Customer and the relationship between customers and businesses into three pieces:
- The first part defines the nature of the relationship - It is an empathetic relationship between customers and brands.
- The second part is all about the customer - what the customer wants and how they want to be treated. It’s very contextual and cognitive empathy is the key in responding to the customer successfully.
- The third component is through the lens or prism of technology - We use the concept of a prism because any type of interaction or engagement generally involves technology. Obviously, technology plays a key role in enhancing customers’ interpretation of a brand.
The Prism of Data and Technology
To better understand and explain this relationship, IDC has built a prism or framework to describe this beautifully complex relationship between customer and brand through the lens of technology. The model has three layers — the customer at the center, the data and technology lens, and the business outcomes from the engagement.
The Future Starts with the Customer
Customers want to be understood and treated fairly, this results in a desired outcome; which is essentially the same for B2B as B2C. IDC had broken these down into four areas.
- Conversations - Customers don't want to just be spoken to and bombarded with advertising and marketing. They want a more human conversation where there is a clear exchange of information, knowledge, and understanding.
- Journeys - Customers want a clear journey and typically prefer multichannel journeys that are easy to follow.
- Experience - For so many customers today, it is all about the experience, and everything is part of the experience.
- Satisfaction- If things go perfect, then everyone is happy and satisfied. Customers have needs they want to fulfill; regardless of the issues, they want satisfaction.
Engagement Through Data and Technology
The final and outer set of circles are the business outcomes — those outcomes that tie back to the reasons why businesses interact and engage with customers.
Predictable communication - Communication is the foundation for every interaction and every engagement between a brand and a customer during all steps of the customer journey, and the focus is on making it more predictable for the customer and the brand.
Lifetime value - Every company needs to make money in order to survive and thrive. However, this exchange of value, for both the company and the customer, too often gets lost. Companies are employing technology to equalize that experience.
Applied intelligence - The third is building a portfolio of intelligence. Intelligence about the customer, the market, and the world that can then be used to customize and personalize the experience for the customer.
Mutual trust- The fourth is mutual trust between the company and the customer. The customer wants to be able to trust a company with their data. Companies also want long-term relationships built on trust where they become trusted partners with the customer.
Customer Experience - Top Business Function
The engagement between customer and company, whether B2B or B2C, is a key reason why companies spent US$1.4 trillion on digital transformation efforts in 2020 according to IDC's Worldwide Digital Transformation Spending Guide. Customer experience (CX) is the top business function and the reason for digital transformation efforts. Almost 34% of executives point to transforming the customer experience as the top business function. Close behind that was another business function closely related to the customer experience — marketing at 32.6%. Further down the list but still in the top 10 was the sales function at 27.8%. Although the below chart is from 2019, these numbers still hold true in the post-Covid world, in fact the pandemic has further accelerated customer experience efforts across companies.
In a nutshell, this space is in major flux, but everyone wants to be understood, every customer, every decision-maker — anyone that can benefit from an engagement. It is that understanding that makes us human; that makes our interactions human. The future for successful brands is going to be all about employing awareness, engagement, learning, and measurement to provide what customers desire — a more human experience in a world eclipsed by technology.
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International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. To learn more about IDC Canada, please visit www.idc.com/ca or follow on Twitter at @idccanada and LinkedIn.