Digital Is Just One Facet Of A Great Customer Experience
New research from Accenture Strategy suggests that the vast majority of U.S. consumers actually prefer dealing with human beings over digital channels when getting advice or resolving customer services issues or complaints.
If I asked you, “Who are your most profitable customers?” how would you answer?
Many organizations assume their digital-only customers are their most profitable, largely due to a lower cost to serve. This belief has led them to overinvest in digital capabilities and channels so they can give customers (particularly millennials) more digital experiences they supposedly crave. However, the assumption is not entirely accurate, and it could cost U.S. organizations $1.6 trillion.
New research from Accenture Strategy suggests that the vast majority of U.S. consumers (83%) actually prefer dealing with human beings over digital channels when getting advice or resolving customer services issues or complaints. In banking, retail, and wireless industries, these multichannel “experimental” customers have shown to be the most profitable customers. They don’t want pure digital interactions; they want experiences that deliver the results they seek using unpredictable combinations of digital and traditional channels.
Our research also shows that in many situations, consumers still prefer to engage with companies through traditional channels as opposed to digital. And nearly half (48%) are comfortable crossing back and forth between multiple channels, even within a single interaction.
Organizations that have abandoned the human connection in customer services are now having to rebuild it. Those that don’t risk losing profitable customers–and not getting them back.
The Cost Of Assumption
Companies that rely on assumptions to define their customer services investment strategies fail to address the complexity and nuances of today’s consumers. While delivering services through digital channels can be more cost-effective, our research confirms that consumers with the highest rates of profitability use multiple channels. This trend holds true across many industries and geographies:
• In the global retail arena, customers that engage with companies through a variety of channels drive three times the volume of sales and more than twice the margin of store-only customers.
• Among U.K. banks, customers that interact via multiple channels buy one-and-a-half times more products than digital-only customers. And because the extra products they buy tend to be of a higher value, those purchases can significantly impact margin growth.
• Customers that engage with their providers via multiple channels are 15% more likely than digital-only customers to serve as advocates for those providers.
U-Turn On Digital?
The results by no means suggest that investing in digital capabilities is a mistake. Quite the opposite. The insights support the notion that digital is a vital component of a company’s go-to-market strategy. But it is just one component.
When companies overinvest in digital front-office capabilities or, conversely, underinvest in traditional capabilities, they fail to deliver the optimal channel mix that customers demand and deserve. Indeed, companies that lead in customer profitability do so by delivering multiple channel options that not only allow customers to achieve the outcomes they need, but also make it easy for customers to switch from one channel to another.
Transitioning to a more balanced approach will require traditional companies to:
• Apply new insights: Companies have access to more consumer data than ever before. Yet many aren’t able to make sense of it to enable more informed decision-making. By observing consumer behaviors within and across channels, and applying new analytical capabilities to examine the data trail they leave behind, companies can generate entirely new insights about who their customers are, the types of interactions customers want to have, and the economic impact to the company on not meeting their needs.
• Refocus investment strategies: Armed with insights about consumer behavior, companies will be better positioned to not only offer seamless, cross-channel experiences that drive profitable growth, but also eliminate the toxic experiences that push customers away. Addressing negative experiences head-on can have a significant impact on profitability. Companies should zero in on the experiences that have the greatest potential downside for customers by leveraging analytics to identify, isolate, and remediate the root causes of negative incidents.
• Build outcome-focused organizational capabilities: Companies need to ensure the customer is at the heart of everything they do, including how they are organized as a business. Doing so will make customer engagement exceptionally easier. Companies may need to change the way they are currently organized and structured in order to better drive end-to-end outcomes.
Organizations need to recognize that digital capabilities are just one facet of a great customer experience. Profitability is not bound by a particular channel. It resides in the digital/physical blur. Successful companies find a balance by optimizing their investments across channels, while simultaneously delivering the outcomes that their customers demand.