According to the World Economic Forum (WEF), business leaders across all industries are recognizing that digital technology can not only drive efficiency, but also power innovation, transform business sectors, and benefit society. Rapid technological developments have both altered customer expectations and given businesses the digital tools to cultivate powerful experiences that attract and retain customers.
The WEF reports that business-to-business (B2B) and business-to-consumer (B2C) customers expect the same quality of experience, determined by ease of use and convenience, across all the services and products they utilize. In addition to providing a highly-competitive customer experience, businesses must also meet the needs of digital natives, such as Millennials, who adopt technologies more rapidly and have higher expectations for new technologies.
The WEF’s Digital Transformation of Industries (DTI) project issued a report that identifies some of the top expectations among digital customers and outlines the three key areas that determine a company’s ability to satisfy consumers in the digital world. Based on the DTI report, here’s how companies can stay competitive as customer expectations evolve and disruption accelerates:
What do Digital Consumers Want?
Since the introduction of digital technology, customers increasingly expect more from the products and services they consume. Digital technology has particularly transformed customer expectations regarding the accessibility of products and services. While the Internet first introduced the concept of immediate access to information, customers now expect real-time access to actual services and products across a wide range of industries. The DTI report explains that industries like ecommerce and financial services have defined customers’ expectations and set standards for on-demand products and services.
Along with ease of access, digital customers want high-quality service and self-service options. A recent study found that poor service was the reason that more than 60 percent of consumers changed providers in one or more industries.
Although great service is key to retaining digital customers, the DTI also found that consumers are better prepared to manage their own brand, service, or product experience. For example, digital customers like having the option to personalize product features or resolve issues using company-provided information and tools.
In the digital world, transparency and peer reviews have also become more important to customers. Customers expect companies to provide transparent information about products and services that can help inform purchase decisions. During the buying process, customers are also relying more on peer reviews, rather than media coverage, and poor reviews from customers have more reach than positive reviews.
The Value of Customer Experience
All of the factors above contribute to the customer experience as a whole. Today, companies have to deliver a customer experience that’s in line with industry competitors and leading businesses in other sectors.
According to the DTI, more than 85 percent of business leaders now believe that customer experience is the top area of competition, even above the quality of their primary offering. A survey also found that the majority of companies are dealing with the effects of digital disruption by assessing how digital impacts the customer experience.
As the customer experience becomes more important, companies can focus on outcome-based services to transform the customer experience. Businesses can improve customers’ lives and increase customer satisfaction by using digital technologies to ascertain and deliver the outcomes that consumers want.
For example, digital technology has the power to significantly improve healthcare by facilitating individualized care rather than population-based care. Various technologies, from wearables to implantables, will help healthcare organizations provide more accurate, timely, and effective treatment.
On top of a remarkable customer experience, businesses can attract and retain digital customers with hyper-personalized products and services. The DTI report cites that more than 50 percent of all buyers crave more personalized offerings across every channel, while 70 percent want more personalized offerings across the brands they consume
With digital technology, companies can fulfill personalization expectations by giving customers the option to customize experiences and products. Advances in software intelligence and data analytics have also give companies the ability to offer more relevant products and services based on customer data.
To capitalize on the power of personalization, the DTI report states that companies can focus on incentivizing data sharing and identifying different customer segments to deliver appropriate personalization. Companies that establish trust with consumers will also have more success collecting data.
Despite a shared desire for personalization in various industries, customers do have a wide range of preferences on the forms and levels of personalization. A recent consumer survey identified examples of acceptable personalization in retail, which included automatic discounts on purchases with loyalty points or coupons.
Access-Oriented Business Models
Digital innovation has additionally ushered in a new business model that involves consumer sharing and on-demand access to a wide range of products and services, from cars to office space. By 2025, the global market for shared offerings in five major sectors is expected to reach $335 billion, and more than 110 million people in North America currently engage in the collaborative economy. Access-oriented business models have the ability to substantially impact traditional revenue paradigms, giving companies new ways to serve customers and reach different demographics.
The DTI report states that customers are most likely to shift from buying to sharing when there are convenience, price, and brand trust benefits. If companies want to compete in the collaborative economy, they need to offer these benefits in a way that makes sense in their industry.
Companies also have to identify which access-based model is the most fitting, whether that is a direct lending marketplace or a peer-to-peer platform. So far, startup companies and disruptors have primarily used peer-to-peer platforms, whereas traditional businesses have implemented direct lending models.