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Immersive CX is the new way to win and keep customers

Zendesk has released the company’s latest global Customer Experience (CX) Trends Report, revealing immersive experiences are fast becoming a key differentiator for brands to stay competitive and help ensure customers remain loyal. According to the report, 70% of Australian customers feel it’s important that interactions feel more natural and conversational.

Immersive CX is evolving into the new standard, redefining how companies engage with their customers. This change stems from what people increasingly demand of brands today: that they meet them where they are, under their terms, through seamless and engaging interactions.

Over the last several years, leaders have recognised how this transformation has required an the expanded role of CX, prompting them to make significant investments to remain competitive and meet elevated customer expectations.

“Customers have high expectations, less patience and more options when it comes to who they do business with,” says Adrian McDermott, Chief Technology Officer at Zendesk. 

“This year, our CX Trends shows that this shift in behaviour has prompted leaders to invest in technology that creates an immersive, yet seamless experience. These new standards of customer service are critical to boosting customer acquisition and loyalty, as well as profitability.”

The 2023 Zendesk CX Trends Report consists of data from nearly 3,700 customers and over 4,700 customer service and experience leaders, agents, and technology buyers from 20 countries, as well as Zendesk Benchmark product usage data from nearly 100,000 Zendesk customers worldwide, ranging from small businesses to enterprises. This year's key findings highlight that Artificial Intelligence (AI), conversational experiences, personalisation, customer well-being and sentiment, and integrated teams are the critical components that businesses need to deliver immersive experiences which will shape the future of CX.

With the economic downturn and cost-of-living top of mind for Australians, 80% of leaders and managers agree that providing excellent customer service during an economic downturn becomes even more critical. 

82% of Aussie leaders and managers agree that strengthening business resilience through customer service becomes a top priority during an economic downturn.

With 80% of Australian leaders and managers feeling increased pressure from customers to deliver a great customer experience during economic downturns, 75% agree that their overall CX the budget would increase during such periods of uncertainty.

Increased investment in AI has not gone unnoticed, but customers are still unsatisfied with their interactions with AI compared to humans. 44% of Australian customers say they are repeatedly dissatisfied with their interactions with bots, with 66% saying they would prefer interacting with a human. More needs to be done. Only 30% agree that interactions with bots have become more natural and human-like over the past few years.

Even so, 71% of Australian leaders and managers expect AI/bots to replace some human agents over the next few years, with 70% believing they will drive significant cost savings. However, as businesses continue to focus on automated interactions with their customers to improve their bottom line, they must remember that the personalisation and emotional connection to a human operator remain essential. Indeed, 58% of Aussie customers wish bots could provide the same level of service as human agents.

"It is evident customers have a grasp of what the future of AI-driven customer service will look like, with their issues being resolved in ways that are nearly identical to human support," adds McDermott. 

“We know businesses are working to make it better, but there is a growing realisation that meeting customers’ expectations will require a more concerted effort. They are not willing to wait for companies to make gradual changes, a signal to businesses that change needs to happen fast."

Customers are driving the rise of conversational experiences. They want a fluid, friendly and natural interactions that put them in control and do not interrupt current tasks. For example, if a customer stops an interaction, they expect a new support representative to be able to pick up where the conversation last ended quickly. 

64% of Aussie customers spend more with brands that provide a seamless experience between all contact points. Similarly, 64% expect that anyone they are interacting with at a company should easily have access to past purchases, context from interactions, and other information provided.

While customer expectations could not be more precise, businesses are still playing catch-up. For example, 68% of Aussie leaders have committed to reimagining customer service, and 73% want (or are actively planning) to implement conversational customer service experiences.

According to the trends, 46% of customers in Australia want companies to use a large amount of data they have to provide truly personalised experiences that transcend typical marketing efforts, whether it is online or in-store.

Unfortunately, most companies hold a narrow view of what personalisation means and how to deliver it, which is at odds with over 50% of Australian customers who think businesses can do more. If companies deliver personalised experiences, they have the opportunity to reap the benefits of long-lasting customer relationships, 80% of Aussie business leaders agree that deeper personalisation leads to increased customer retention.

Businesses need to prepare when it comes to understanding customer emotions. Organisations have made efforts to improve customer well-being, but 66% of business leaders admit those efforts could be more focused and reactive. Australian companies have also been making strides in tracking emotional data more formally. 70% of Aussie leaders and managers say that customers' emotional responses are followed in order to personalise the experience a customer receives.

A negative experience with a company can cause real, lasting emotional damage and create  critics who spread the word. 71% of Australian customers will switch to a competitor after multiple bad experiences. This is up from last year, where 66% would do so, showing that Australian customers are becoming even less tolerant of bad CX. Almost half (41%) will head to the exit after one unsatisfactory interaction.

CX leaders have become increasingly aware of the benefits of creating immersive experiences and recognise that support functions can drive revenue. To that effect, 75% of Australian business leaders believe merging teams and responsibilities around CX will increase operational efficiencies, and 83% expect to increase their CX budget over the next 12 months.

"As we look ahead, providing excellent customer service will become even more important to build resilience and manage uncertainty,” says McDermott. 

“The brands that invest in technology to provide a seamless, immersive CX will see a boost in customer acquisition and loyalty, and ultimately profitability.”

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