Reports that our spending power is on the rise means that competition to capture a share of our hard earned cash will become incredibly fierce. However, a study from Cognizant and Oxford Economics has revealed that large numbers of businesses in Europe are not taking the necessary steps to unlock the value and opportunities provided by their customers’ digital experiences.

The survey of 300 senior executives in the US and Europe revealed that only 33% of business executives believe their customers’ digital experience could qualify as “high quality”, with just 3% believing that it is “excellent”. This is despite almost 60% of respondents saying that the analysis of digitally-derived customer data is key to their company’s innovation efforts and only 16% of respondents claiming to be effective at collecting and leveraging customer data from digital interactions.

As customers become more demanding and their consumption habits evolve, businesses should explore in more detail how technology can better support them. Disruptive digital technologies, such as social, mobile, analytics and cloud (SMAC), as well as sensors, are already becoming mainstream. Beacon technology is making ever more inroads, whether in retail with House of Fraser’s introduction of beacon-equipped mannequins to tailor the in-store retail experience to consumers and making it more convenient for them or on public transport in Tokyo to help people navigate the system.

This type of digital development is to be applauded as it could have a really positive impact on a business’ bottom line. By offering customers new ways to keep them engaged and encouraging purchasing loyalty, data will be generated that could lead to hugely valuable insights. However, many businesses are running the risk of being left behind by failing to react to the evolving market and its digitisation.

Crucially, the right digital analysis can reveal what customers are interested in, what products they like and even predict future preferences. Companies should turn to the digital information that surrounds each customer, organisation and device – what we call Code Halos – to identify patterns. By completely re-imagining how they interact with customers, using the possibilities spawned by next-generation digital technologies and associated business practices, companies such as Apple, Google, Facebook and Buzzfeed have ignited a revolution in serving and monetising their customers. These companies have tapped into and are putting to use the information that individuals generate through online buying, browsing, “liking,” swiping and commenting to understand and even anticipate their customers’ wants and needs with greater accuracy than has ever been possible before and make their customers’ purchasing process easy, enjoyable, fun and seductive.

Currently only 24% of business executives surveyed claim to be effective at collecting and using digital customer data, meaning many are missing out on a huge opportunity to refine their products and services in line with customer preferences. By accessing this data and analysing it, companies can understand their customers better, react faster when needed and anticipate new requirements to drive future growth strategies, both in-store and online.

Increased consumer confidence and the opportunity to drive profits through innovation are making 2015 an interesting and highly competitive year. Ensuring customers have a high quality digital experience will be central to unlocking new opportunities. Businesses must move quickly to adapt, or risk not only losing their customers to the competition but also their capability to succeed.

 

 

By Ben Pring, Co-Director of Cognizant’s Center for the Future of Work. 

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