As we enter a new year, it is time again to look at the current state of customer experience, recommendations for how businesses can deliver on their customer experience promises, and the impacts and trends happening within 2023.
Impacts to businesses in 2023
First let’s take a look at what will be impacting businesses throughout 2023 such as the changes brought about from the pandemic, the increased use of artificial intelligence and automation by businesses worldwide, and the economic threat brought on by inflation.
Companies are still feeling impacts from the Covid-19 pandemic. This includes supply chain shortages, difficulty in finding and holding on to quality employees, the shift of employees working from home, and the increase of customers purchasing from online. According to research from the Northridge Group, while customers in 2020 were understanding of these pandemic related issues, now the customer’s tolerance of these issues are diminishing and will affect CX scores as they continue to affect the customer’s experience.
Many workers continue to work from their homes and companies need to improve their tools and training for this new work paradigm. Customers expect the same high quality of service no matter where the employee is located or what issues they face while servicing the customer’s needs.
The pandemic drove many more consumers to shop online. Today the online transactions are still higher than pre-pandemic levels. Statista is reporting that the world-wide retail ecommerce sales for 2023 will exceed $6 trillion. Pair this with the rise of mobile commerce which Insider Intelligence predicts will reach over $728 billion in the US by 2025, and companies will find the need to ensure smooth customer experiences across multiple platforms and digital systems.
Artificial Intelligence and Automation
The deployment of AI and automation systems to streamline the processes and workflows used by businesses is a trend that will significantly grow in 2023 and beyond. In 2023 we will see the persistent increase in automation utilized by companies to lower costs, increase efficiencies, and hopefully, improve the customer experience. McDonald’s locations began testing automated drive-thru ordering in 2021, which then led to automated ordering kiosks inside many of their locations, and at the end of 2022 McDonald’s had opened its first automated restaurant.
What is likely to be the biggest impact to businesses in 2023 is the continuation of inflation. The economies of North America and Europe are seeing inflation around 10% and, in the US, economic growth slowed significantly in 2022. This trend is likely to continue if not worsen in 2023. According to the U.S. Chamber of Commerce, half of small businesses (50%) say inflation is the biggest challenge facing them right now.
Continued high inflation rates will cause consumers to look for lower cost products/services, reduce the quantity of their purchases or even delay or eliminate certain purchases. And these changes in consumer spending habits will cause a rippling impact to many B2B businesses for 2023.
Many companies will be looking to cut costs and as Ray Poynter points out that “One of the key challenges for managers and advisors below the age of 60 is that double-digit inflation has not been faced in developed economies for about forty years. This means that most people running businesses today have not had to operate during inflationary times” making even more difficult the decisions that businesses need to make to handle inflation for the short-term while preserving or improving customer experience for the long-term.
Customer experience trends for 2023
CX professionals will need to find ways to address several trends affecting customer experience in 2023, including flat or declining customer experience scores, customer’s increasing expectations for quality experiences, especially in the areas of customer support, the growing use of digital technologies, and in particular the increased use of artificial intelligence within the CX world.
Flat or Declining CX Scores
Data tracked by American Customer Satisfaction Index shows a decline from 77 in 2018 to 73.2 in Q3 of 2022, and Qualtrics XM Institute reports that NPS scores declined by an average of 4 points in 21 of 22 tracked industries in 2022. This is after a slight bounce back in 2021 from a 15 point drop in 2020 primarily due to the pandemic. In an upcoming blog we will discuss this trend including some of causes and look at what companies can do to not be a victim of this negative trend.
Research from Netomi revealed that 65% of customers stated they had higher customer service expectations now than they did 3-5 years ago and that customers are becoming more irritated by long hold times. While results from a study conducted by Hyken revealed that 59% of customers believe that customer service is worse today than it was before the pandemic.
The Northridge Group says that their survey responders state the importance of fast response times and that they find digital channels (online chat, text, and mobile apps) is helping to achieve faster response times. But this needs to be balanced as customers also point out that while the speed of response may be much higher with digital channels, the speed of issue resolution is still fastest by phone support.
The capabilities of digital technologies to help businesses support their customers and improve their customer experience will continue to grow in leaps and bounds in 2023 and beyond. Whether it is automating contact centers, expanding self-service options, or utilizing speech recognition and natural language processing. These technologies coupled with the various digital channels and touchpoints can provide powerful tools for both the business and customer, but if not implemented carefully can end up sacrificing the actual customer experience.
AI for CX Programs
AI systems can help organizations efficiently process their customer’s feedback, provide deeper insight to that feedback, to analyze customer behavior and sales data, and to enable companies in delivering personalized recommendations and support.
David Edelman and Mark Abraham write about how Brinks used AI to improve their call scheduling, help with cross-sell recommendations, and perform customer outreach. This use of AI resulted in decreasing the time waiting for results and assisting them in personalizing every customer touchpoint. During this time Brinks saw an overall 9.5% increase in revenue.
A May 2022 Salesforce report states that 73% of their respondents expect companies to understand their unique needs and expectations (up from 66% in 2020) and 88% say that the experience a company provides is as important as its products and services (up from 80% in 2020).
Consumers have become accustomed to having recommendations presented to them, whether its movies and shows to watch next, songs to listen to, a friendly email reminder of items left in the online cart, or personalized content based on a customer's language and other demographics.
Customers agree to the sharing of personal data in the belief that it will provide personalization that will make their experiences easier and more rewarding.
Recommendations for 2023
Here are some recommendations for improving customer experiences while confronting the various issues and trends that will be impacting your business in 2023.1. Eliminate the effects of the pandemic from your customer experiences – Find ways to minimize the impact your business may still be dealing with, from the experiences of your customers.
2. Make wise decisions around any cost costing – Remember that some cost cutting can negatively affect your customer experience may lead to long-term impact to your business.
3. Ensure that employees have the tools that they need – Provide them with high-speed and reliable connections to the office, have in place software and processes for them to collaborate with one another, and provide them with the training which will form a foundation for success in this new work paradigm.
4. Utilize AI and automation to improve your processes and systems – Deploy AI and automation that will not just reduce your business costs but will improve customer experiences.
5. Meet customers where they want to shop – Invest in where and how your customers want to shop, whether that is brick and mortar, online ecommerce, or mobile commerce.
6. Understand what is most important to your customers – When addressing your customer support needs, leverage technology wisely so that it will reduce both contact response time and issue resolution time.
7. Provide consistent and seamless experiences for your customers – Use your Journey Map and customer feedback to look at how your customers connect with you across all the various channels. Look closely at how your customers are handed off from one employee to another or what the experience is like when they move from one channel to another.
8. Create unique personalized experiences by utilizing customer information – Learn and understand what motivates and drives your customers. Use CX tools such as Personas and Journey Maps, then with the aid of AI tailor your messages and responses from their queries and searches.
What are your thoughts about the impacts to businesses and CX trends for 2023? What is your business strategy for navigating these impacts and trends while improving customer experience in 2023?
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