Battered by Covid, worried about the economy and empowered by technology, consumers are already changing how they shop and what they want from retailers and brands – with the ‘E-formula’ of efficiency, expertise and emotion driving their choices.
The findings from ‘The Relationship Economy: Customer Engagement in the Digital era’ report from engagement platform Twilio suggest that consumers value ultra-personalised relationships with brands more than ever and expect those brands to translate this relationship into giving them the best value when they shop.
Talking to some 9000 consumers across Europe, Twilio finds that there is now an even split across the “three Es” in consumer minds. Despite economic woes, there remains a strong desire for efficient service, with 25% of respondents still citing this as their key priority.
The success of rapid delivery options and one-click shopping are testament to this pillar of convenience remaining front of mind, says the report. However, in order to truly prosper, speed should not be the sole focus for any business. Against the backdrop of a challenging economic climate, the data makes it clear that building lasting customer trust and ongoing loyalty is about more than mere speed.
Alongside the quarter craving efficiency, 24% and 25% respectively reported expertise and attitude – or emotional connection – as their main priorities. Brands must therefore go beyond just speed and invest in technology to support all three pillars.
This balancing act can be augmented through personalisation, whereby the options for getting in touch are tailored to the needs of the individual in a defined context. In the relationship economy, strong customer connections only blossom when efficiency of response is not merely a knee-jerk first response, and instead is supported by expertise and emotional connection.
Expertise and relationships
Information is easier than ever to access in the digital age, but consumers often have difficulty accessing the answers they need from businesses, which can create frustration and stress. The research supports this idea, revealing that knowledge-based tasks were consistently hardest to perform. Only 13% found it easy to find the logistics partner for a purchase, while still more struggled to uncover an organization’s diversity, equity and inclusion or sustainability credentials (12% and 11.5% respectively).
An engagement strategy that surfaces insights like these to consumers will help to free up the time of customer service agents, so they can concentrate on the more complex queries that do require a human touch.
“Recent economic challenges have brought to light how serious customer queries can be, and why businesses have a responsibility to respond thoughtfully as well as rapidly,” says Sam Richardson, Customer Engagement Consultant at Twilio. “Yet over-stretched customer service agents are often bogged down answering simple enquiries that could be better handled via other means. They are also frequently on the back foot because their systems don’t help them pass on the information or reassurance customers need. First-party data can help ease this burden – for instance, giving agents context on why someone is getting in touch, or how they prefer to give and receive information.”
Balancing the human and the digital
Slower and more emotionally-driven forms of engagement are crucial for businesses wanting to build longer lasting relationships, which will be sustained even when customers are facing pressures on discretionary spending. Organisations that thoughtfully engage with their customers on sensitive issues like finances will win their trust, which in turn will benefit their retention rates and profits.
Once more, personalisation is critical to this because it means the balance of human and digital can be tailored to suit individual needs.
Improved efficiency remains a useful benchmark in more transactional customer engagements, and ‘efficient service’ was a common reason to use a company again (39%) or recommend a brand to a friend (37%). But for more complex or long-term interactions like ‘connecting with a community’ or ‘asking for product or service support’, consumers express the desire for human empathy. When asked whether they preferred digital or human interactions for these activities, 74% and 69% respectively stated a desire for human connection. Similarly, respondents cited a friendly service as the most popular reason for repeat purchases (42%), and recommending a brand (37%). Supporting this mixture of engagement needs will help businesses hold onto customers even when they are facing growing economic pressures.
“Perhaps counterintuitively, the more digitally enabled businesses become, the more vital it is to adopt a human-centric approach in order to successfully acquire and retain customers,” says Andrew Stephen, Deputy Dean & L’Oréal Professor of Marketing at the Saïd Business School, University of Oxford. “Even in digital channels, ensuring that all interactions with customers are as “humanized” as possible is critical, particularly during turbulent times when people need to feel listened to. Personalisation using first-party data is the way to do this well, even with limited human resources – showing that you understand who someone is and where they’re coming from, in everything from marketing to customer service.”
UK consumers crave emotional connection
Compared to the other countries surveyed, UK consumers are the only ones to find brands are now harder to reach than before, with nearly two fifths (39%) agreeing that this is the case compared to 25% in Germany, and 27% in France and Spain.
In light of customer engagement challenges recently faced by the UK’s travel and energy industries, this hints at a broader perception issue for customer engagement in a post-pandemic environment.
However, data suggests that this could be exacerbated by businesses taking too long to provide a response, with over a quarter of UK consumers (27%) citing this for their negative view. Concurrently, UK respondents said ‘friendly service’ was the most common reason to use a company again (44%). The interplay of efficiency and emotion again comes to the fore here.
UK organisations looking to weather the coming economic tumult should be mindful that speed alone cannot improve perception.
“Analysing first-party data to understand what customers truly want and need, and using these insights to personalize service offerings, will help companies to balance efficiency, emotion and expertise,” adds Richardson. “Though improving speed through automation could be a ‘quick fix’, those who win in a relationship economy will be the ones who invest in nurturing customers longer-term, and expertise and emotional connection are critical parts of this puzzle.”