TheCustomer Quick-Take: 2/22/22

In the latest edition of TheCustomer Quick-Take: California targets loyalty, the cost of bad CX, consumers just want to be understood, and a couple billion reasons to take the Metaverse seriously.

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Loyalty in California’s Crosshairs

Quick-Take: California Attorney General Rob Bonta announced an investigative sweep of a number of businesses operating loyalty programs in California and sent notices alleging noncompliance with the California Consumer Privacy Act (CCPA). Under the CCPA, businesses that offer financial incentives, such as discounts, free items, or other rewards, in exchange for personal information must provide consumers with a notice of financial incentive. This notice must clearly describe the material terms of the financial incentive program to the consumer before they opt into the program.

 

Digital Habits are Changing

Quick-Take: More than 50 hours a week of screentime is the new normal: Across all countries surveyed, people are spending an average of 53 hours online per week participating in activities ranging from streaming video and music to virtual appointments and online dating. That’s more than two full days and nights in a seven day period.  Online gaming is reaching new levels: Second only to streaming video in terms of time spent online, Gen Z in the U.K. alone are spending 15 hours a week gaming. This captive and growing audience should be included in brand outreach strategies.

 

Bad Product is Forgiveable.  Bad CX Not So Much.

Quick-Take: Once consumers make that all-important first purchase, brands still have critical work to do in order to ensure they will buy from them again and become brand advocates. Good customer service following a purchase (such as short wait times and easy exchange/return processes), is most likely to lead to future purchases, according to 93% of Baby Boomers, 91% of Millennials, 89% of Gen X and 81% of Gen Z.

 

Bad CX, Part Deux

Quick-Take: Brands that fail to prioritize CX initiatives are putting brand loyalty — and revenue gains — at risk. This goes for brands in both the U.S. and the UK: A nearly identical number of consumers from each country (63 percent of U.S. consumers and 62 percent of UK consumers) said a poor customer experience is enough of a reason to leave a brand they were previously loyal to.

 

Stack Issues Still Creating Headaches

Quick-Take: Creating connected user experiences has become increasingly difficult: More than half (55%) of organizations said they find it difficult to integrate user experiences. This is up from 48% a year ago, showing there is increasing complexity for companies to meet their customers’ digital needs. The biggest challenges to digital transformation are integrating siloed apps and data (38%) and risk management and compliance (37%). 88% of respondents said integration challenges continue to slow digital transformation initiatives.

 

LiveCommerce Going Mainstream

Quick-Take: Case in point is live commerce, where retailers showcase products, qualify customers, and promote the brand. IDCanalysts predicted that by 2023, 40% of retailers will have integrated livestreaming capabilities to their commerce platforms, increasing e-commerce conversion rates by at least 10%.

 

My Chatbot Doesn’t Understand Me

Quick-Take: But many consumers find their relationships with chatbots “complicated.” Nearly one-third – 32 percent – say they rarely or never feel understood by a chatbot (only 28 percent say they always or often feel understood), and over 30 percent (30.5%) say a chatbot rarely or never fully answers their questions. Due to this failure to communicate, over 30 percent (30.8%) say they always or often abandon their efforts to resolve an issue when interacting with a chatbot.

 

My Loyalty Program Doesn’t Understand Me

Quick-Take: The survey found 64 percent of consumers would rather purchase a product from a brand that knows them, and 34 percent would spend more money on the product to do so. Furthermore, 49 percent of consumers said they were more likely to consider a purchase from a brand that does personalization well, and nearly one in three (32 percent) are willing to overlook a single bad customer experience if they feel like a company is trying to understand them as a customer.

 

The Other Data Problem

Quick-Take: 75% of respondents say staff fabricates data to tell the story they want decision makers to hear. 44% of respondents say they lose over 10% in annual revenue due to low-quality CRM data. 64% of respondents would consider quitting their jobs if additional resources aren’t allocated to a CRM data quality plan.

 

Peering into the Metaverse

Quick-Take: By 2026, 25% of people will spend at least one hour a day in the metaverse for work, shopping, education, social and/or entertainment, according to Gartner, Inc. “Enterprises will have the ability to expand and enhance their business models in unprecedented ways by moving from a digital business to a metaverse business,” said Resnick. “By 2026, 30% of the organizations in the world will have products and services ready for metaverse.”

Photo by Josh Hild on Unsplash.

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