81% of marketers expect to be competing mostly or completely on the basis of customer experience with their competition in two years. (Gartner)
Nearly half of all companies say improving customer experience and customer satisfaction were the leading influences to start a digital transformation. (PwC)
Two-thirds of a company’s competitive edge comes from its customer experience. (Deloitte)
What do these quotes tell us? Customer experience is the new battlefield. But why is customer experience a big factor?
Two reasons: customer acquisition and customer loyalty. Simply put, a good CX (customer experience) will not only attract new customers from your competition, but also prevent your existing customers to go elsewhere.
It’s no surprise that a recent survey of 1,920 business professionals revealed their topmost business priority over the next 5 years, to be CX — more than product and pricing.
So then, what is a good customer experience? Is it the same as good customer service? A clean modern website? A super cool mobile app? A great in-store experience? Low prices? ..
It’s all about the treatment.
If you treat your customers better than your competitors, they’re more likely to stay with you, and even bring more customers to you. But how is that related to digital transformation? Why do the recent surveys reveal that customer experience is at the heart of enterprises’ digital transformation initiatives?
Let’s dig deeper with a relatable example.. Retail.
Meet Tom, the owner of a large retail store chain — The-Middleware-Emporium — that’s been in business for 20+ years.
Tom has had several thousands of loyal customers all these years, because of their high product quality, reasonable pricing, and great customer service. In the recent times of digital push, The-Middleware-Emporium even put up an online store (e-commerce website) and a mobile app, for selling remote.
A couple of weeks ago, Tom ran into an old friend Jerry, at Starbucks. Jerry is the CTO of a tech startup and also a loyal customer to The-Middleware-Emporium. Coincidentally, both were alone and not in a rush, so they were decided to spend some time catching up.
After initial pleasantries, the conversation moved to business.
Jerry: So Tom, how’s the pandemic treating your business?
Tom: Uh, we’re doing okay I guess. Could be better.
Tom (continues): You know we really took pride in the way we have treated our customers in store. Online is a challenge to keep them happy.
Jerry: Yes, it can be quite tough. I have to admit, I’ve been shopping at another store that came to me as a recommendation.
Tom: Wait, what!? You too? Is it The-Microservices-Boutique? They have been eating into our market share a lot.
Jerry: Yes, I don’t know about the market share, but they surely know what they’re doing, and it’s making me shift loyalties. I’m really sorry Tom.
Tom: Hmm.. what is it that makes them an expert in this business, considering they’ve been around for only a fraction of the time we have?
Jerry: Well, for one, they’re very modern and technology-ready, which gives them an edge in creating a good experience for the customers.
Tom: What do you mean? We’re in the business longer, we understand the customer better. As for the technology, we too have a professionally designed e-commerce website and mobile app.
Jerry: Yeah, but that’s not it, Tom. Are you able to take all your historic knowledge of the customers, and put it to good use? For example, based on past buying patterns, can you predict customer behaviors and guide them through their buying experience?
Tom: Hmm.. they do that? What else?
Jerry: Guided shopping based on tastes, physical attributes and past behaviors, virtual trial rooms, recommendations on similar products and accessories, and much more.
Tom: So if I add these features to my website, it should make a difference, right?
Jerry: Look Tom, as I understand, your business is riding on really old technology. It can certainly run the business as is, but it can’t scale for changing customer needs and preferences.
Tom: Why not!?
Jerry: To enable things that The-Microservices-Boutique is doing, you need a futuristic ecosystem. You need machine learning and AI to identify your customer, learn from their past behavior and guide them through the shopping journey. You also need a powerhouse to crunch all the data, and enable modern interactions such as facial recognition, etc. Furthermore, for speed and scale, you need to be on the cloud. With the legacy systems and physical infrastructure you have, all this is just not possible.
Tom: To tell you the truth, we’ve been sitting on the fence on the digital transformation initiative. It’s scary to continue on this losing journey. With so many alternatives out there, it’s been really hard to figure out a strategy that is right! One that can get us ahead in the game, and make us future-proof.
Jerry: Leap of faith is necessary, Tom. Imagine the customer experience you can derive when you combine your rich heritage in business with a set of modern machines that run at the speed of changing market demands!
To summarize the above conversation, only if businesses enhance their customer experiences, they will gain the competitive edge and get ahead of other players in the marketplace. But for doing so, businesses need the right toolsets to build the necessary modern touch points with the customer. Legacy technology — thick clients, mainframe, and monolithic middleware — cannot meet the desired customer experience.
Customers are at the core of the digital transformation.
Watch this space.. as we bring in some proven strategies we’ve employed for modernizing our customers’ legacy systems, in effect enhancing their customer experiences and bringing them ahead of their competition.