One could look back at our 2020 predictions column and conclude that we were right that “marketers will have their hands full in 2020”. Unfortunately, their hands were full with a deeper set of challenges than we thought probable. While no one of course could have predicted the scale of disruption, we were optimistic that ambitious marketers can successfully overcome their challenges, and did in fact hit the mark on the importance of a personalized customer experience – a trend that I believe in light of the events of this year is rapidly becoming even more prominent.
With the same spirit of optimism, I see better days ahead for the new calendar year. I think one of the main things 2020 taught us is to appreciate what is truly important, both in our personal relationships and in how we conduct business. For the latter, this means that building a relationship with a customer becomes even less about price or product than it does providing a meaningful experience. One in which value is not measured by a price tag, but rather by respect, empathy and understanding of an individual customer’s unique needs and wants.
Re-Examine the Value Proposition
A top prediction for 2021, and one that will resonate for any industry that interacts with customers, is that the need to deliver a meaningful experience will force businesses to re-examine their core value propositions. Successful brands will clearly articulate what they stand for and what they offer, because what a brand represents will become just as important, if not more so, to a customer than its products and services. I’m reminded of a line from “Hamilton” when Alexander Hamilton says to Aaron Burr, “If you stand for nothing, Burr, what’ll you fall for?” This is the time, in other words, for companies to clearly deliver experiences that are aligned with what they stand for – their value proposition.
Correctly identifying and going to market with a successful value proposition will largely depend on a company showing its customers that it shares the same values. Getting this right will require a keen understanding of what matters to a customer; how the customer defines and extracts meaning from the brands and companies it interacts with. My argument is that the need to establish an emotional connection with a customer is heightened.
With price and product largely commoditized and in the wake of a disrupted economy, customers are taking a deeper look at whether the companies they do business with share their values on a political, social or environmental basis. When these values align, customer relationships strengthen with an emotional connection.
Even though it may appear counter intuitive, developing such an emotional connection at scale requires marketers to abandon gut feelings or intuition about what’s meaningful for a customer, and avoid using guesswork to craft personalized customer experiences. A meaningful experience for one customer may not be meaningful for the next. By relying instead on data and analytics to compile a single customer view, marketers will be able to capitalize by infusing meaning, personalization and relevance into every customer interaction.
Customer Behaviors are Changing
Developing a keen understanding of an individual customer brings us to another challenge for businesses that will dominate 2021, which is the pressing need to pivot to changing customer circumstances. Preferences, attitudes and behaviors have been significantly upended. In healthcare, financial services, retail and other industries, there will be completely new ways of interacting with a particular customer, a patient or a member. Perhaps a dedicated in-store customer who used to keep a dressing room attendant busy is now buying online and simply using the store as a fulfillment center, to use one example.
A U.S. Department of Commerce study perfectly captures the sheer scale of disruption in the retail industry. In March and April of this year, ecommerce penetration as a percentage of retail sales climbed more than it had in the 10 years prior. From 2009 until the end of February, ecommerce penetration increased from 5.6 to 16 percent. By the end of April, it rose to 27 percent.
That is an unprecedented amount of change in such a condensed timeframe, and it has serious implications for brands that need to quickly adjust to meet new customer behaviors, while also delivering an emotional connection imbued with meaning. To make this a successful transformation, brands will invest in personalization, machine learning and automation underpinned by a data platform having the best most up to date view of the person to create differentiated customer experiences. It will be the only way to scale a personalized customer journey that honors each customer’s preferences and behaviors to deliver meaning and value with every interaction.
Brands that do not make this journey and embrace an all-out digital acceleration will be challenged to thrive and survive. This is why forming a sustained emotional connection based on trust tops the list of 2021 predictions and flows through the rest of the predictions in this column.
Fine Tune a CX Data Strategy
Once organizations grasp the importance of strengthening the emotional bond with customers, they will take a long, hard look at their customer data and some will come to the realization that they lack the proper foundation for a complete customer data strategy. To crystalize the prediction somewhat, I anticipate that half of digital transformations already in progress will stumble because their customer data is not in order.
It’s one thing to understand the importance of customer experience, and quite another to create differentiated, innovative experiences that ultimately drive revenue. The latter requires that all customer data be integrated – from every source and of every type – making it possible to know all tht is knowable about a person. Furthermore, there can be no barriers or data siloes between when data is collected, cleansed, prepared and made available to create hyper-personalized experiences at scale. Another CX data strategy roadblock will be incorporating precise decisions in real-time, because even with a complete data picture, the delivery of a personalized customer experience requires that a brand move in the cadence of the customer.
By delivering a perfectly timed action, offer or message in the right channel a brand demonstrates that it possesses a deep, ongoing understanding of an individual. It shows, in other words, that it cares. It cares about what’s important to the person at every point in the relationship journey. That capability derives from having a comprehensive CX data strategy which, given the new reality, will be a must-have for all consumer-facing companies. To develop innovative customer experiences that create and sustain an emotional connection, companies no longer have the luxury of treating customer data as an afterthought.
Let the Machines Take Over the Minute Details
When companies examine their readiness to transform digitally to infuse emotion and meaning into every customer interaction, they will recognize AI and machine learning – really, the entire set of advanced technologies including IoT, block chain, big data, etc. – as a powerful ally in creating a differentiated customer experience.
Another prediction for 2021 is there will be a deepening of the trend that advanced technologies will take over minute tasks, freeing marketers to focus on the more creative aspects of the job. Companies have been straddling the inflection point of viewing AI as the shiny new toy vs. a key cog for revenue-driving business use cases. 2021 will bring into focus the need to use advanced technologies to optimize data and analytics for building meaningful connections with customers.
We will start to see organizations using AI and other advanced technologies for the tasks that require attention to the fullest and smallest details, e.g. which exact message to send to a specific individual customer at a specific moment in time and through which touchpoint. This frees up marketers to deliver greater value for the customer, by identifying macro trends, crafting new content, defining segments and programs, etc. The trend is all part of the making the customer experience more closely aligned with individual customer needs and with the brands value proposition while making it simpler for the brand to achieve a meaningful connection.
By paying attention to a particularly detailed set of circumstances – who the person is, what they have done in the past, what they are likely to do in the future – makes each customer feel understood by the brand and eliminates the friction that so often derails a seamless CX. Deploying advanced technologies to bear responsibility for the entire context of a customer circumstance – down to the smallest minutia of data – will be at the core of delivering superior customer experience at scale.
A New Year, New Opportunity
In summary, I believe that there will be a reckoning of sorts come 2021. Unforeseen circumstances in 2020 exposed which side of the customer experience gap companies were on, and also made clear that closing the gap will require companies to reassess what really matters to their customers. Just as an indecisive Burr suffered from his indecision, empowered customers will punish a failure to act by taking their business elsewhere. Brand reputation will also suffer. Conversely, a brand that clearly demonstrates that it shares a customer’s values and treats that customer in accordance with a customer’s individual preferences will be rewarded.
Like any new year, 2021 will be filled with opportunities for a fresh start. Prior to the disruption of 2020, brands with their eyes closed to the importance of a superior customer experience may have gotten away with the status quo – at least for a little while. That luxury is gone. Using data and analytics to infuse a meaningful, emotional connection into every customer experience will be a make or break proposition in 2021.
