In the digital age, customer experience has become a key focus of corporate strategy. European companies need to remove their data silos.
The digital age is the age of the empowered customer: Never before have customers had such a high degree of transparency regarding products, prices, features and competitors. They can switch to a competitor with a mouse-click and instantly share their experience of a product or service with the rest of the world via social media. They can thus exert substantial influence on a company’s brand and revenue. Hence, the ability to provide a superior customer experience and innovative services via all touchpoints in a highly personalized manner is not only a key competitive factor, it is a necessity to survive in the digital age.
A holistic customer experience strategy, therefore, has to be an integral part of any successful digital strategy today. And indeed, in almost 70% of the European companies, customer experience is addressed as a key strategic topic at the top management level. This is a key result of the survey “Holistic Customer Experience in the Digital Age” that PAC conducted on behalf of Adobe. PAC surveyed 450 decision-makers of large companies in manufacturing, financial services as well as retail & wholesale in France, Germany and the UK.
However, cross-functional collaboration is insufficient in most companies
It is critical to understand, though, that customer experience is determined not only by frontend operations such as marketing or customer care. The survey results clearly reveal that customer experience is also strongly affected by backend functions such as billing & invoicing or product development and R&D. A great digital buying experience that is followed, e.g., by inflexible, old-style logistics, accounting or service processes will lead to highly frustrated customers.
However, half of all the companies PAC surveyed have no overarching customer experience strategy that goes beyond marketing and involves different business units such as billing, shipping and customer service.
Even worse: In most companies, frontend and backend departments don’t work hand in hand to provide an outstanding customer experience along the entire customer journey. 65% have not appointed a central function that oversees all customer touchpoints and integrates the work of the various departments from marketing and sales through the supply chain all the way to customer care and after-sales services.
There is a strong need for customer data integration in Europe
We also observe that effective cross-departmental collaboration to optimize the customer experience is severely limited by data silos. Access to valuable customer information, e.g. the contact history across touchpoints or individual customer preferences and individual profiles, is restricted to selected departments in most companies.
The majority of European firms have a zoo of different – and badly integrated — IT systems in place that collect and analyze customer data. This situation prevents them from gaining a 360° view of their customers and limits the potential to provide a superior customer experience across all touchpoints. While the analytics tools of individual marketing, CRM or customer service systems might help to optimize individual processes, they only provide an isolated (siloed) view on customer interaction and are not well suited for the development of an integrated and holistic customer experience strategy.
Half of all respondents therefore see a pressing need to implement one single IT system that integrates data from various sources along the entire customer journey.
Wake-up call for German companies
The study presents a particularly strong wake-up call for German companies: Even taking into account the fact that Germans tend to be somewhat self-critical, they are clearly lagging behind in their digital and customer experience abilities in almost all areas we surveyed. While German investment plans suggest there is some catching up going on, companies in Germany still have some way to go to reach their competitors in the UK and France. German companies need to act now if they do not want to lose ground in the increasingly competitive environment of the digital age.
Overall the results of the survey reveal that most European companies are not yet particularly well prepared for approaching customer experience in a holistic way – neither from a strategic or organizational nor from a technical perspective.
Organizations across Germany, the UK and France have to work towards implementing a dedicated organizational structure for coordinating all customer-related activities. They have to bring together all parts of the organization to jointly work on the optimization of the customer experience. And they have to remove their data silos!