Customer experience has evolved from an exercise in teams listening to and sharing feedback, to a core component of strategy. Businesses recognize that to remain competitive, they need to deliver not only superior products but also exceptional customer experiences.
Customer experience transformation involves fundamentally altering the way customers interact with your company across the entire customer journey. From the sales process to product onboarding to long-term relationship management and beyond, such transformation drives improvements that help manage internal costs and/or better meet customer preferences.
Of course, customer channels for digital interaction vary depending on the role technology plays in a company. For customer experience transformation purposes, businesses typically fall into one of two paradigms:
- Technology as a Product: In industries where technology itself is the product — such as software companies or tech gadget manufacturers — customer experience transformation revolves around enhancing the product’s intuitiveness, functionality, and support. The technology must not only meet but also anticipate customer needs, providing a seamless, bug-free experience that integrates into daily life without friction.
- Technology Facilitating a Service: When technology acts not as product but as a facilitator for another service — such as in industries like banking or healthcare — the focus changes. Whether the transformation streamlines appointment setting, simplifies transactions, or provides more personalized service through data analytics, the goal is to make every customer interaction as efficient and pleasant as possible.
Customer Experience Transformation: Aligning Vision and Strategy
Customer experience transformation is no small undertaking — and companies can easily lose their way. To ensure you stay on track, incorporate the following signposts or pillars as guides for your efforts:
Pillar 1: Ground Your Efforts in Awareness
For a company to effectively transform its customer experience, its vision and strategy need to match customer expectations. This begins with empathy — truly understanding who your customers are and what they expect from interacting with your brand.
Tools like journey maps, service blueprints, and personas help sketch a detailed picture of customer interactions and expectations, providing an excellent baseline to start from.
Knowing your competition and industry standards is important, but it isn’t enough. For truly effective customer experience transformation, you’ll have to identify who is setting the bar for your customers — and it isn’t always a direct competitor.
For example, the ease of use customers experience with technology giants like Apple or Amazon sets expectations that all companies now strive to meet, regardless of industry.
Pillar 2: Seek Data Maturity
As you act, be sure you have a quantitative view on what you’re changing. We recommend three possible methods:
- Take advantage of measuring tools like Net Promoter Score (NPS), Customer Effort Score (CES), and Customer Satisfaction (CSAT) scores to represent organizational currency in customer experience. Be sure you know how to mine that data for signal vs. noise.
- Set a specific goal to increase one measurable aspect of the customer experience that also benefits your company’s bottom line.
- The team responsible for customer experience keeps a direct scorecard to track relevant metrics, such as the percentage of customers who call in regarding issues versus those who address their issues online.
To truly leverage data, organizations have to move beyond merely collecting information to acting upon the insights it provides. This involves a deep understanding of human behavior, acknowledging that consumer decisions are influenced by both rational and emotional factors.
Pillar 3: Understand Real Human Behavior
Even when organizations begin with awareness and empathy, it’s easy to drift from that foundation. Over time, teams may begin to design customer experiences for how they would act as the customer, rather than how customers actually behave.
For example, a common assumption in traditional business models is that customers act rationally, always making the best decisions based purely on logic and reason. But human behavior is far more complex. Emotional factors, past experiences, and subconscious biases affect human decision-making processes.
A deep understanding of behavioral economics and human psychology allows teams to turn data into evidence-based insights that reveal clear, strategic opportunities for customer experience transformation.
Pillar 4: Advocate for the Customer
Many organizations have some form of mechanism in place to capture customer feedback. In a truly customer-centric organization, however, those reports can’t languish in someone’s file folder.
If a customer submits negative NPS feedback, for instance, the business needs a process for escalating that insight to a person or department that can take relevant action to transform the customer experience. Insights only become actions if they reach those with the power and willingness to initiate change.
By understanding and acting on customer feedback, companies make informed decisions that enhance customer satisfaction and loyalty.
- Proactive Improvements: Rather than reacting to customer issues as they arise, data-mature organizations anticipate potential problems and address them proactively. This approach not only improves customer experience but also strengthens trust and loyalty.
- Customer-Centric Culture: Embedding a customer-centric culture within the org means that every team member understands the importance of customer feedback and is committed to delivering exceptional experiences.
Pillar 5: Adopt a Holistic Approach
Businesses often think through customer experiences at a channel or product level, but transformation can’t flourish when siloed in different departments.
For instance, imagine a bank considering customer experience transformation. The call center wants a certain experience for callers, and the digital team wants a certain experience for users. Each tries to optimize the customer experience within their own department.
Now consider: What if the best call center experience for the customer is never to make a call at all? A holistic view allows the company to recognize customer preferences across departments rather than within them — in this case, perhaps a preference to interact digitally rather than by phone.
Whether it’s digital interfaces, call centers, or in-person interactions, all the disparate channels contribute to a singular, overall customer experience. Consistency across channels, without friction when switching among them, is key in making customers feel known and valued.
Pillar 6: Pace Your Vision With Incremental Change
As companies begin to transform customer experiences, a subtle difficulty often creeps in to derail the efficacy of their efforts. Rather than comparing changes to the current state of affairs, they compare revisions to their ideal future vision.
That future vision may be perfect — lowering costs, eliminating friction, and delighting customers — but if it requires monumental change to achieve, it’s realistically several years away from realization. And the company will ned to gauge customer responses in increments along the way.
The pace each business takes to effect change will vary. Companies with frequent digital customer interaction, like Amazon and Netflix, have greater freedom to introduce gradual changes more frequently, leading to larger overall change in a shorter timeframe.
Other companies, however, have relatively infrequent digital customer interactions. For instance, customers likely only access auto or health insurance apps once or twice per year. If the interface changes dramatically every few months, the app will cause frustration every time the user logs in.
Developing an incremental roadmap for your customer experience transformation guides your business toward that glittering future vision while maintaining an empathetic customer perspective on change.
Customer Experience Transformation and AI
One of the most significant developments in customer experience transformation has been AI and its ability to handle unstructured data. Every day, customers generate massive amounts of data through conversations over the phone, interactions at a physical location, and activities online. AI technologies enable businesses to sponge up this information, analyze it, and turn it into useful insights.
For example, AI can examine customer behaviors during interactions with call center agents or while navigating a company’s website. By identifying patterns and anomalies in these interactions, AI helps businesses understand what aspects of the customer journey are working well and which need improvement.
AI-Driven Analytics Platforms
AI-driven analytics represent a game-changing advancement in customer experience. These platforms can monitor real-time customer interactions, pinpoint areas where customers frequently encounter issues, and potentially suggest immediate solutions.
For instance, if customers consistently get stuck at a particular step in an online application process, AI can flag this issue. It can then use generative AI to provide guidance based on the behaviors of customers who successfully navigate this interaction.
AI as Agents and Applications
The future of AI in customer experience looks even more promising, with generative AI expected to transition from mere applications to active agents. These agents could autonomously interact with customers, handle requests, and offer solutions without human intervention.
Currently, AI is used extensively to manage customer interactions through digital channels like chatbots and virtual assistants. These tools can handle a range of tasks, from answering FAQs to more complex queries; they already speed up response times and reduce workload on human employees.
AI and Personalization
AI technology allows businesses to gain an even deeper understanding of their customers by uncovering hidden patterns and trends in data. This enables companies to hyper-personalize online experiences — ecommerce stores offering tailored clothing recommendations, streaming services predicting the next show a user might enjoy.
However, the use of AI raises concerns about data privacy, especially as companies acquire data from platforms like Reddit. Businesses must be clear about how they use AI to maintain consumer trust.
AI and Customer Experience Transformation: Challenges and Considerations
Despite the remarkable capabilities of AI, there are challenges and considerations to address. The dependency on AI to analyze data and suggest changes requires a robust framework for governance and decision-making. Businesses have to determine who is responsible for acting on insights provided by AI, creating a clear process to ensure those insights lead to effective actions that are continuously monitored and refined.
There’s something to be said for finding your own unique balance between automated solutions and human judgment. While AI can crunch numbers and identify patterns, the human touch remains irreplaceable in services that require empathy, judgment, and complex decision-making.