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Digitalization and Customer Experience are Related: Not in Ways You Know

Businesses are investing as much as $1.3 trillion in their digital transformation initiatives to deliver value to their customers. However, around 70% of this amount has gone to waste. One of the fundamental causes of this failure is that companies move towards digital transformation with a flawed mindset and practices. And this only intensifies these flaws.

What companies need to understand is digitalization is not about technology or redesigning the IT infrastructure alone. People think that digitalization means hiring a digital marketing service agency. It goes beyond that. Brands need to understand that installing technology for technology’s sake is not what can drive your business today.

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Transforming the business to drive real value to customers is what they should focus on. Every digitalization effort should have the customer at the center.

  • You’re digitalizing your product, your customers should love it.
  • You’re digitalizing your process, your customers should have a better experience.

Whatever your digitalization initiative aims at, it should touch every point that forms a part of the customer journey. Be it the design, product development, product management, research, marketing, support, or any other touchpoint.

Defining Digitalization And Customer Experience

One word that has created the most buzz in 2020 is ‘Digital’. As business shut the physical doors, digital became the new normal. So, it wouldn’t be difficult for us to understand what Digitalization means.

Gartner's definition: “Digitalization is the use of digital technologies to change a business model and provide new revenue and value-producing opportunities; it is the process of moving to a digital business.”

In simple terms, digitalization is the move towards a more digital-first approach to business. However, many businesses feel that digitalization is just about adding efficiency to business operations or creating new monetization opportunities or gaining a competitive edge. But if you dig deeper and analyze digitalization to the core, you will realize that there’s one thing that digitalization efforts focus most on, and that is customer experience.

Digitalization revolves mostly around customer experience - changing in the way businesses interact with customers and provide a consistent experience.

Don’t believe us?

2020 Global Digital IQ survey reveals that nearly 50% of all organizations are aiming for digital transformation to improve their customer experience.

This brings us to our next definition - Customer Experience.

Gartner’s definition: Customer’s perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier’s employees, systems, channels, or products.

In simple terms, customer experience or CX is the experience that your customers have while interacting with your brand. This could be on your mobile application, your website, social media, review sites, emails, online advertising, support, or any other touchpoint in their buying journey.

According to Hubspot, “Remarkable customer experience is critical to the sustained growth of any business. A positive customer experience promotes loyalty, helps you retain customers, and encourages brand advocacy.”

In fact, a study even revealed that 65% of customers consider their experience on a website or app as a very important factor in their brand recommendation. A positive experience means they’d love to become your brand advocates and recommend it in their community.

We know that today’s customer is powerful. He has the power to take your business forward and create positive brand awareness. And they’ve got this power by being digitally conscious. So, it’s not just the customer experience that brands need to focus on. They need to move a step ahead to think and act in terms of digital customer experience.

What is Digital Customer Experience?

Digitalization is paving the way for a new, digitally-conscious customer. This customer is actively clicking, scrolling, and tapping on its mobile, yearning for a more personalized experience. And that’s exactly what they are getting!

Artificial Intelligence, Machine Learning, Automation, and other state-of-the-art technologies are spoiling the customers by serving them exactly what they are looking for. This has taken the bar of customer expectations to a new high. Hence, even the slightest glitch in a brand’s digital experience and the customer would perceive the brand in a negative light.

And it’s not just a conclusion we’ve come across ourselves. A study by PwC states that 32% of customers, i.e., one in every three customers, would walk away from a brand they love after a single bad experience.

As a brand, the onus is on you to please this new-age, modern, digitally-conscious customer.

You need to have a digital-first approach to how you interact with the customers, which could mean different things for different players.

So, customer experience is not just limited to the physical interaction your customer has with your brand through a salesperson or visiting your store. It is about the experience that you are providing them digitally. And that’s exactly how you can correlate customer experience with digitalization.

Relation Between Digitalization and Customer Experience

Now that we know that it is the digital customer experience that brands need to focus on, it is apparent that digitalization is the key to success.

The digitally-conscious customer demands special treatment. And this isn’t possible if a brand continues to move into the future with the traditional business model. Brands need to go digital or they’ll go obsolete.

The best example of a brand that has been able to live up to digitalization and customer experience at the same time is Nordstrom. With 380 stores and a loyal customer base, Nordstrom was a successful retail chain. However, seeing its customers rooting for online purchases, it took a fresh approach to customer experience and decided to undergo digital transformation. It has invested billions of dollars in reinventing its online presence to offer a seamless customer experience.

It has now bridged the gap between the physical in-store experience and the customers’ online experience. It’s digital transformation efforts are on-point with the powerful use of data and in-store experience.

Digitalization helps create a more responsive and agile model approach that can meet the expectations of today’s customers. Let’s quickly find out how it can help you.

Ways to Improve Customer Experience with Digitalization

Now that we have an idea about the relationship between customer experience and digitalization, it is time to reimagine your digital strategies to improve customer experience.

  • Taking Feedback From Customers
  • Using Digital Technologies such as observability platforms To Monitor Performance
  • Connecting Assets To Create A Unified Source Of Truth
  • Using Technology To Personalize Experience
  • Removing Any Hiccups From Multi-Channel Experience

There is no alternative or shortcut to the age-old feedback taking process. But digitalization is making things easier. You can directly ask your customers through digital means like a customer survey app or customer experience feedback software to ask them about their experience. This can help you calculate your NPS as well and improve as per the customer feedback analysis.

While it was very difficult to monitor the performance of your products, systems, processes, and operations, digital technologies have simplified it. Technologies like Artificial Intelligence, Data Mining, Machine Intelligence, etc., can help you monitor each process closely and create an analysis of any deviations. You can improve your process to remove bottlenecks and offer a seamless experience.

This is again related to your brand’s processes and operations. You can use state-of-the-art technologies to connect as touchpoints in your processes and have a unified source of truth to view their process. Technologies like IoT, visualization, data warehousing solutions, etc., can help with this. With this, your employees can manage the operations more efficiently and improve the customer experience subsequently.

One of the most crucial aspects of customer experience today is personalization. With a digital system in place, brands can collect data from the customers more effectively. Moreover, technologies like Machine Intelligence and Artificial Intelligence can help in analyzing the data stored in these systems to create a personalized customer experience through each touchpoint. You can know your customer behavior, buying patterns through their previous interactions and offer them the right content at the right stage to convert them into buyers.

Today’s digitally-conscious customers aren’t limited to a single channel when it comes to interacting with your brand. They might come across your brand on social media, research around it on their mobile browser, check out the product on the mobile app, and finally make a purchase on the desktop browser.

And there may be many other touchpoints from the point they come across to the final sale and even afterward. You must offer a seamless customer experience across all channels. And that’s where a digital experience platform can come to help.

Embracing the new digital landscape is the need of the hour for any business. As your customers are becoming more and more digitally conscious, taking the digitalization route is the only way to succeed. You might be in the thick of digitalization or just getting started or even planning for the same, keeping your customer in the center is imperative.

Don’t forget, investing in your customers will never go in vain!

Make sure your digitalization efforts are not for technology’s sake. They are providing some real value to your customers by creating a better customer experience.

Learn more about the Customer Experience 

Swati Sharma

Written by Swati Sharma

Oct 26, 2020

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