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The COVID-19 pandemic altered consumer behavior, possibly permanently, and shaped a world that’s now more reliant on technology than ever. In this new, more competitive environment, an organization’s ability to foster customer loyalty will determine its future.
As it turns out, businesses can win over prospects and customers in the digital world through differentiated customer experience (CX). Organizations can use CX to charm prospects, improve satisfaction scores, and retain existing customers by paying attention to the right details. When businesses focus on exceeding expectations at every journey step, they build loyalty.
That’s because customer experience drives over two-thirds of customer loyalty, outperforming price and brand combined, finds Gartner. The two are inextricably linked, and the tight relationship means CX is just as important as a company’s services or products.
Since the beginning of the pandemic, more than 75% of consumers in the US have changed their shopping behavior, and the majority are shopping through digital channels. They’re more focused on convenience, availability, and value, McKinsey reports. This shift means companies must consider every aspect of the customer experience, from the online shopping cart to curbside pickup and support options.
For businesses to be successful in a post-pandemic world, they need to adopt digital communication channels, reward customer loyalty, and align their marketing with consumers' values. Let’s take a deeper dive into each of these areas.
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Adapting to Digitalization
E-commerce sales have skyrocketed in the last three years. According to the US Census Bureau, consumers spent $211.5 billion online during the second quarter of 2020, a sharp increase from the first quarter of 31.8%. McKinsey says that E-commerce had the same growth in three months, which would have taken 10 years. This has caused unprecedented strains on many facets of business.
At the same time, consumer expectations for service changed. To meet safety concerns, businesses began offering no-contact pick-up or delivery. As a result, today’s customer journey is sharply different from what it was before the pandemic, as many of these service offerings have been maintained, and what was once seen as a benefit of buying from a small or local business is available at major retailers.
Since the switch to digital has happened swiftly, businesses and consumers are trying to catch up. For example, accessibility can be an obstacle for people with disabilities and older demographics. Fifteen percent of the world’s population is disabled, and a third of those 65 and older are not confident in their ability to navigate the web or use electronics. Businesses should make it a priority to adapt their digital services and ensure they’re accessible to all. In doing so, they’ll elevate the customer experience for a significant share of their audience.
Cybersecurity is also a concern. Protecting customer data and ensuring trust should also be at the forefront of the focus on building a better experience, regardless of whether you’re running a large or small business. Recent cyberattacks in Las Vegas show how crucial cybersecurity can be to a brand’s reputation and operations.
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Rewarding Customer Loyalty
Businesses can leverage the rapid increase in digital adoption to connect with and secure new loyal customers. Customers like to be valued by the brands they support; effective loyalty programs do just that, and the rewards don’t have to be extravagant. They should be representative of your membership.
Gina Fleck, Senior Director of Strategy, Insights, Promotion, and Loyalty Solutions at Merkle, Inc., says brands were pushed to “accelerate innovation in areas like technology, partnerships, and rewards, and that has led to brands connecting with customers in new ways.” Indeed, during the second quarter of 2020, enrollment in loyalty programs increased 7%.
Consumers are loyal to brands that are reliable and offer the products and services they’re seeking. But the COVID-19 landscape has created a type of free-for-all regarding customer loyalty. If a product or service is unavailable, the customer will seek it out elsewhere and perhaps favor the new business due to a better CX. By focusing on integrating CX and loyalty rewards, companies can hold on to customers, even when times are tough. For small businesses, this integration of the customer experience can make or break, as other companies may be able to offer the same product or service at a lower rate, but your CX keeps customers coming back.
Emphasizing Empathy in a Post-Pandemic World
Customers have experienced a collective trauma, with risks of exposure to a deadly virus, on top of everyday life affected by lockdowns and restrictions. Businesses can improve the customer experience by emphasizing care and empathy at every touchpoint.
Trust and safety are crucial. Brands that deliver tone-deaf messages through marketing aren’t likely to build strong or lasting relationships. According to Forbes, “Companies that provide an emotional connection with customers outperform the sales growth of their competitors by 85%.” Human connection has always been at the core of CX, and now it’s more important than ever. All messaging needs to reflect that.
Positive emotional experiences drive customers to make purchasing decisions and drive customer loyalty. Gerald Zaltman of Harvard Business School says, “Emotions make 95% of purchasing decisions.” Brands cannot afford to sit on the sidelines in silence during crises. Values matter to today’s consumers and play a significant role in CX and their buying decisions.
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Investments in enhancing customer experience, like seamlessly integrating digital and in-person touchpoints and striking the right tone in messaging, are vital for building customer loyalty. Businesses that put the customer front and center will win the new economy.
