Customer Experience Priorities Move Online
In survey after survey, year after year, customer experience proves itself to be a major factor in retention and loyalty. But evidence now shows that this most compelling element of customer strategy is changing.
For one, it is moving online. A new report from U.K.-based analytics firm Foviance has found that the top publicly traded firms now put the online customer experience at a higher priority than the offline experience. The numbers were overwhelming: 71 percent versus 25 percent. What's more, 96 percent of the companies surveyed are planning to focus more and more on the online rather than the offline customer experience.
Not only is the priority of the online customer experience changing, so are the factors that customers need and value from it. New research shows that the customer priorities are moving away from simplicity and convenience toward more technology and experience enhancers. And a 2005 survey of 1,000 consumers from Internet experience analysts Keynote Systems found that a "lack of barriers" was the key to the online experience. Now a new study, this one from Internet consumer applications provider Molecular, tracked 25 consumers over three days. It found that several applications that are termed "rich media" were found to be more important than speed or convenience.
"We found that customers will incorporate more functionality into their online experience," says Molecular partner Kim Weller. "They are used to the drag-and-drop experience that they get with Quicken and other financial services applications. They don't want to wait for an HTML page to refresh. They may not know the definition of Flash technology, but they like it when they see it. In fact they're expecting it and we find they'll be more patient with it than in the past."
That new technology will enable higher customer retention rates and even more revenue per customer, according to Weller. A test with online retailers that included J.Jill, TJ Maxx, Yankee Candle, and Banana Republic showed that rich Internet applications (RIAs) like customizing products, auto-filling personal information and live chats can increase spending per customer by an average of 10 percent. In some cases the results were higher than 50 percent.
Additionally, for some demographics, online efficiency is now less important than accomplishing goals and becoming immersed in a topic or brand, according to Kelly Mooney, who publishes an online customer experience blog called Mooneythinks.com. "Clearly, Gen Y is interested in having more video, more immersive experiences, because that's what they're familiar with," Mooney says. "Look at the runaway success of YouTube.com -- consumers are creating, posting, sharing like never before."
But rich media alone isn't the answer. After all, if a customer has an easy time booking a flight online but has a horrible experience at the ticket counter, the entire relationship suffers. A balanced approach to meeting customers' needs through any channel is the way to go.