Digital Transformation and Customer Experience

The Critical Link Between Digital Transformation and Customer Experience

Digital transformation and customer experience may seem to be totally unrelated concepts.

However, anyone involved with technology understands that the two are directly linked.

Below, we’ll explore:

  • Why the customer experience is so critical
  • How digital technology enables better experiences
  • What companies should do to transform their technology and their customer experiences

Let’s start with some data that shows the link between experiences, technology, and ROI.

What Research Tells Us About Digital Transformation and Customer Experience

However, a quick dive into today’s research highlights the importance of the customer experience:

  • Adobe research found that digital technology dramatically improves the customer experience: for instance, 91% say automation led to KPI improvements on mobile
  • A Forrester report found that “becoming an experience business” can deliver 1.4X revenue growth, 1.7X customer retention rates, and 1.6X customer lifetime value
  • According to PwC, 54% of US consumers say the customer experience needs improvement
  • Nearly 1 out of 3 customers would leave a brand after a single bad experience … in Latin America, nearly 1 out of 2 say the same
  • 73% of people say that customer experiences are important factors when making purchase decisions, but only 49% provide good customer experiences today

Today, technology and data fuel the customer experience, which is why digital transformation and customer experience have taken center stage.

Benefits of digitally powered customer experiences include:

  • Deeper understanding of customers, through data and analytics
  • Experiences that deliver what customers really want – instead of what companies think they want
  • Personalized experiences, which are only possible with the right mixture of technology, strategy, and execution

To name just a few.

But how do you use technology to improve the customer experience?

Here are four strategies:

Understand Your Customer through Data

A good customer experience is customer-led.

That is, their needs should help companies define and design those experiences.

Technology offers an important window into the mind of the customer, through:

  • Data and Analytics
  • Feedback
  • Customer Service

Personalization is only possible, for example, with data. 

By combining data with customer feedback, companies can craft experiences that are relevant, useful, and profitable.

Remember that Technology Is the Enabler, Not the Final Answer

Despite the fact that technology powers today’s digital experiences, it is not the end-all be-all.

PwC’s report found that 75% of customers would prefer to interact with humans more often as technology improves.

Replacing humans is not the answer, in other words.

Instead, use technology to:

  • Make customer experiences more convenient and efficient
  • Facilitate human interactions where necessary
  • Align your priorities with your customers’
  • Improve communications with customers and gain insight into their needs

By taking this approach, companies can use technology to create human-centered experiences.

Such experiences will drive more revenue and profit over the lifetime of the relationship.

Rethink the Employee Experience

What does the employee experience have to do with the customer experience?

A lot.

Employees are the ones who:

  • Interact with customers
  • Run the organization
  • Operate the technology that fuel transformation
  • Innovate and drive change

Poor employee experiences will result in poor customer experiences, in other words.

To ensure that employees’ needs are met:

  • Train employees well. They will need skills to drive digitalization and create technology-enable customer experiences.
  • Support their goals. Longevity, loyalty, and productivity are directly tied to employee engagement. The more you support them, the  more they will support you.
  • Understand what matters to them. Find out what is important to employees, then give it to them. Create a culture that meets their needs and aligns with the organization.

From corporate culture to employee training, there are many ways to improve the employee experience.

And improvements in those areas will impact – directly or indirectly – the customer experience.

Focus on Efficiency, Convenience, and Customer Service

According to the PwC study mentioned above, nearly 80% of Americans say that these customer experience elements are the most important:

  • Speed
  • Convenience
  • Knowledgeable help
  • And customer service 

And another PwC survey stated that 40% of customers would pay extra for same-day delivery.

To address this issue:

  • Understand what your current customers what
  • Analyze your customer experiences across channels and touchpoints
  • Find out where those experiences fall short
  • Improve upon those experiences

Implementing these strategies is easier said than done, of course.

However, given the benefits of enhancing the customer experience – and the drawbacks of avoiding it – it will be well worth the investment.

Conclusion

Digital transformation and customer experience are two of today’s biggest business trends.

After all, customers have more choice and power than ever before.

The “battlefield” for the digital-first business, therefore, is the customer experience.

Every business should do whatever it can to win at this battle – from creating great products to improving customer service.

After all, great customer experiences translate into great bottom-line results.

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