Born-digital Enterprises and the CX Transformation

By Juan Manuel González, Research Director for Latin America, Information and Communication Technologies, Frost & Sullivan.

The CX and the New Normal

Born-digital enterprises lit the digital transformation fire, and the current pandemic made it burn even brighter. Customers, a key ember in this process, expect that organizations they engage with, whether digitally or face-to-face, deliver better, more secure and seamless interactions. They prioritize companies that are empathetic and that adapt to them and this new reality marked by the consolidation of digital and asynchronous channels. And lastly, they want to be able to choose how, where and when to interact with brands and demand that their experience be consistent over time and across all interactions.

For this to be possible, the context and history of each customer must accompany them throughout their various touch points with a brand. However, despite the fact that most companies engage with their customers through multiple contact channels, two-thirds (66.4%) still do not have a unified cross-channel contact management strategy . What’s more, only 26.4% have access to multi-channel data visualization and analytics tools that combine and unify data from across the company (and across channels) . Thus, making omni-channel strategy a reality is a crucial step in moving towards a new digital landscape.

On the other hand, it has become clear in recent times that the competitive dynamics of a large number of industries increasingly revolve around the customer experience (CX). In fact, it has become the main factor that impacts customer loyalty and the key differentiator that can decide the fate of a company.

Frost & Sullivan analysis shows that improving customer experience is already a key corporate objective at a global level. So, not surprisingly, many companies recognize that providing better customer service is a crucial part of doing business in a world where switching brands has never been easier.

Understanding that the customer must be at the center of a competitive strategy is an important step for any company. But that’s not all—changing the CX from its current state to an improved one is a multi-phase process that can profoundly impact a company’s organizational culture.

Instant access, self-service and mobility, the key drivers of born-digital companies

From their emergence to the present, born-digital companies have driven several changes in customer behavior. Instant access to products and services, the idea of “try and buy”, an appetite for self-service and the consumption of goods from cell phones all add to the boom of digital channels. Customers have progressively sought to communicate with companies through an ever-increasing number of contact media and different variations of those media, and born-digital companies have managed to respond appropriately. For example, while the ability of an agent to chat with a customer via a website has been around for more than a decade, the chat has expanded to mobile devices. In addition, the agent can be an Artificial Intelligence (AI)-driven chatbot or a textbot.

As the world changed around them in 2020, customers changed with it and adopted new habits that will endure over time. For example, nearly one-third of customers started buying from new brands during the pandemic, and 64% used new channels to do so .

While messaging applications were already very popular, particularly in Latin America and Asia, their use has increased. Unlike a live chat, messaging does not require customers to wait for a response and the conversation can continue at any time from where the customer left off. So, we are not surprised that of the 40% of companies that added a new channel during the pandemic, 53% opted for messaging (including WhatsApp) .

Today, context and urgency determine the customer’s channel of choice. On the one hand, automated channels are the number one choice for anyone born in this century, while social media is mutating from being a key medium for product promotion to an important tool in customer service. On the other hand, we can affirm that practically all readers of this blog already feel comfortable using digital channels to acquire what they need, reducing the amount of physical purchases they make monthly, and they may even have started to try contactless payments.

At the same time, born-digital companies have generated disruption in the CX Outsourcing services market. They demand and require their suppliers to be agile, fast and flexible. BPOs have had to update their culture, alter various internal processes and incorporate new capabilities and talents to deal with the dynamic requirements of digital companies.

The above is undoubtedly only the beginning. BPOs that do not want to miss the opportunities brought by digital natives and their booming growth trajectories should nurture their relationships with them through true long-term partnerships and invest urgently, not only in new digital methods of communication, but also in flexible business models based on results, enabling them to start small and then scale quickly, as needed, without losing quality and robustness in the various processes related to the customer experience.

Conclusion: 2021 and beyond

Customers today feel more vulnerable, insecure and with less control than before the pandemic. Many of them have experienced financial and health constraints in the last year and a half, and have become more thoughtful and selective in their decisions, giving preference to brands they trust, while rediscovering the value of family and friendship. Likewise, purchasing patterns have also changed, showing that customers have redirected their discretionary spending towards the essentials, and it is likely to remain this way until people rebuild their financial stability.

These distinctive behaviors have emerged around the world because of the way we’ve all had to adapt to life in lockdown, and they will endure for at least the next 12 months. Meanwhile, organizations will have to rethink their strategies and business models to adapt to the renewed priorities and expectations of customers. In addition, they will have to continue to focus on digital interactions, adding new channels and artificial intelligence (AI) to respond to customer needs. Engagement with them will continue to evolve from loose interactions across channels to seamless journeys that are proactive, asynchronous and persistent.

Beyond technology, optimized processes and innovation in products and services, the way agents and employees behave can give a company a boost in its relationship with its customers. This is the simple reason why the employee experience is as important as the customer experience. Without satisfied employees, it will be virtually impossible to achieve satisfactory results for customers.

On the other hand, although it is true that personalization offers substantial benefits for the customization and individualization of offers, it also generates doubt among users who are concerned about the increasing amount of information that organizations are collecting. Despite that concern, we have found that personalization is one of the strongest drivers for stimulating customer loyalty. Therefore, building trust and striking a balance between personalization and privacy must be a priority.

Without a doubt, the leaders of every organization must prepare themselves to compete in a high-intensity environment. Who knows what the next big disruption will be? In 2020 it was a virus, which no one expected or anticipated. So, future growth depends not only on technological advances and innovation, but also on smart and bold marketing and strategic decisions. A delay on any of these fronts could set a dangerous precedent that condemns them to failure.

We are certain that there will be winners and losers from this crisis. Are you ready to capitalize on the new opportunities that will arise? Your transforming path to future success starts now. There is no time to lose.

1. NTT, 2020 Global Customer Experience Benchmarking Report
2. NTT, 2020 Global Customer Experience Benchmarking Report
3. Zendesk Benchmark 2020
4. Zendesk Benchmark 2020


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