In the post-pandemic world, good CX is your strongest business moat
Until the last decade, customer experience (CX) used to be an esoteric concept limited to the affluent customer base who frequented Disneyland or flew business class with Lufthansa. But with digital technology seeping into almost all aspects of our lives, CX has become a non-negotiable part of every business’ growth. Customers these days place a high value on CX no matter which domain you operate in. Whether you’re in the business of ride-hailing services or you run an e-commerce store-good CX is an absolute must today to acquire as well as retain customers for the long haul. Never has the importance of CX been so important more than now. The onslaught of the COVID-19 pandemic has radically accelerated the adoption of digitalization across all industries. Microsoft’s CEO Satya Nadella recently revealed in public that his company saw two years of digital transformation within just two months-all thanks to the spread of COVID-19 infection that crippled our access to the physical world. Coming from Microsoft, one of the world’s leading tech companies, this is a big testimony towards the digital future we all are headed towards. Welcome to the world of “experience economy.” No matter how good your product or distribution strategies are, you won’t be able to cut any ice without a good CX strategy. Market studies back this up too. According to a PWC finding , many of your customers need just one bad interaction to abandon your brand forever-often without warning. Across all industries, there are brands that offer more or less the same set of things-similar price range, lookalike features, and similar product quality. Today, you can’t bank on making your brand stand out based on the set of features you offer or your competitive price. Your brand differentiation depends on how well you face your customers, how fast you solve their queries, and how deeply you can build lasting relationships with them. All of which boils down to having a wholesome customer experience. A good CX is critical because it’s what differentiates a good brand from the mediocre ones. Good CX acts as your unique selling point (USP) to help customers favor your brand over the competition. It earns you the distinction of a purple cow that people will take notice of. Good CX also has a direct impact on all aspects of your business metrics-customer retention, brand loyalty, and customer lifetime value. At a time when the world is moving from the traditional brick-and-mortar business model into a largely phygital marketing model, it’s now imperative for your enterprise to reevaluate your online presence and service offering. Your business needs to move towards building an agile, integrated application platform with a digital-first approach-and with a strong focus on CX across all channels. Let’s look at a brand example to understand why this is important. How Sephora cracked the code of good CX Sephora is a global chain of personal care and beauty stores based out of France. If you’re familiar with Sephora, you must also be aware that beauty and skin care are some of the most cut-throat business environments that exist in the retail segment. But Sephora has carved its own niche despite being in such a hostile business environment-mostly because of its infallible omnichannel CX strategy. To say that Sephora is obsessed with its customers is putting it mildly. The brand unifies its offline in-store customer experience seamlessly with a range of digital services in a way that’s not quite evolved-if not entirely unheard of-in its domain. It’s because of its dogged determination towards building a world-class CX that won Sephora the #1 spot in the best Retail Personalization Index in 2018 and 2019. Sephora beat brands like Nordstrom and Nike to secure that top spot two years in a row. If you’re a Sephora customer, you’re in for a special treat the moment you step into one of their 2,300 stores spread across the globe. For example, Sephora employs an in-store technology called the Color IQ that digitally scans a customer’s skin to help her find the perfect lip gloss. Take its virtual makeover platform as yet another example, which allows customers to try Sephora’s products virtually through Snapchat- and Instagram-like photo filters. Its Foundation Finder does something similar-it offers interactive and rewarding experiences to its digital-native customers who want a try-before-you-buy assurance. There’s no doubt that Sephora knows that the future of commerce is mostly digital. That’s why it offers high-touch customer experiences and leverages all of its digital channels-emails, mobile, and in-app notifications-to offer a hyper-personalized customer experience Sephora also has an amazing loyalty program called the Rewards Bazaar that incentivizes its customers to stay loyal to the brand while offering a memorable customer experience. Unlike other brand’s loyalty programs, Sephora’s rewards program is a big hit among its customers because it lets them control how they want to spend their loyalty points. And the best part about Sephora’s example is that the brand pulled off all of these in the pre-pandemic era, which is the reason why Sephora is all set to bounce back in the game without much loss . How good is your CX strategy? While the pandemic continues to disrupt the traditional operational models, it’s the right time for you to recalibrate your growth strategies and quickly pivot to build powerfully connected digital platforms. The best way for you to start doing that is by integrating your digital storefront with your physical retail store, and your supply chain network with the entire backend operations. Of course, an added layer of data analytics would be a cherry on top since data is the competitive advantage for all businesses in today’s uber-connected, hyper-competitive economy. It’s time for you to speed up your digital transformation process and evolve as a savvy digital company as it paces towards the path to recovery.