Tag: CX / customer experience

The Promising Future of AI Translation in CXM | Blog

Driven by new technological innovations, Artificial Intelligence (AI) translation holds the promise to reshape the customer experience by transforming conversation channels, increasing agent efficiency, and reducing the need for language specialist talent. Read on to learn about the potential for the CXM industry as well as the obstacles that need to be overcome before AI platforms can eventually replace human agents.

While machine translation (MT) has been used for more than five decades, recent developments in AI and neural machine translation models have sparked new interest in AI translation to improve customer experience.

Today’s AI engines are being trained to translate 1000-plus human languages in real time and develop the ability to understand large volumes of text data. These innovations are revolutionizing the CXM industry by increasing agent efficiency and accuracy.

While the advances have just started and developing the ability to translate instantaneous voice conversations will take some time, AI translation’s potential is generating a lot of excitement. Let’s explore its promise further.

What is AI translation?

AI translation is a machine translation process using complex algorithms to understand the source data in its original language and translate it into a wide range of other languages.

Advanced AI/ML technology has improved machine translation accuracy, enabling it to better mimic the human brain’s ability to process spoken and written words and comprehend phrases, voice tones, complex sentence structures, and human sentiments.

Impact of AI translation technology on the traditional customer experience management (CXM) industry

With its people-heavy operating model, the traditional CXM industry has always struggled to attract and retain talent, which is especially difficult when language skills also are required.

Many service providers have invested heavily in building multilingual hubs in a broad spectrum of locations and recruiting agents from around the world or in training to improve language proficiency.

However, meeting the vast language and dialect diversification needs across the globe is nearly impossible and puts huge financial pressure on service providers to provide language capabilities in every spoken language a client may require.

This is why AI translation is a real game changer in CXM. It is already transforming conversation channels, increasing agent efficiency, reducing the demand for human language talent, and saving huge operational expenses – and additional opportunities still exist for further development.

Pros and cons of AI translations

Customer satisfaction and agent efficiency are major deciding criteria for companies in selecting a CXM service provider. Research has shown that customers feel more appreciated when they interact with an agent in their native language, positively influencing their buying decisions and increasing customer brand loyalty.

Using AI translation to respond to customers’ queries can offer numerous advantages, including the ability to offer services in many diversified languages and dialects through omnichannel conversation platforms such as chat, email, voice, and social media in the local language.

Other benefits include:

  • Increased agent efficiency and speed for agents who may be slower working in a second or third language
  • Reduced need for a multilingual talent pool
  • Faster time to proficiency of agents
  • Decreased need for sites in local countries

Currently, AI translations primarily are used for text data translation. With expanding data libraries and AI engine training, text data translation accuracy is improving rapidly. But to have broader application success, AI translation must:

  • Expand beyond simple, repetitive queries
  • Gain insight into human emotions and sentiments
  • Reduce contextualization errors to improve accuracy
  • Acquire a full understanding of local nuances, tone, formality, vernacular, slang, and colloquialism
  • Eliminate human supervision

Current AI translation technology can be inefficient and require human assistance to differentiate between normal conversation and exchanges involving humor or sarcasm. The inability to detect humor or sarcasm is less important in a customer service environment, as customers primarily want to resolve their issue. But it can create problems in content moderation where improper translations and misunderstanding the context of dialogues can lead to reputational losses for brands.

Use of AI translation engines in the CXM industry

To overcome these obstacles and benefit from advanced AI translation technology, many service providers leverage human linguists and digital translator tools to optimize resources.

Digital translator tools bring speed and efficiency, while human experts add accuracy and a personal touch. Combined, these solutions boost agent efficiency and performance by using AI for simple and standardized customer inquiries while transferring inquiries in hard-to-serve, low-volume languages to experts, simultaneously solving the problem of speed and accuracy.

Many service providers have partnered with technology providers to develop AI translation tools to serve their clients globally. For example, Concentrix Lingualab and Webhelp Polyglot combine best-in-class translation engines and machine learning tools with highly skilled language experts in centralized hubs to serve as multilingual service delivery centers. Another BPO provider, Majorel, with their Lingua, too combines machine translation, AI, and crowd-based human quality control.

What does the future hold?

Many technology providers are investing in building advanced translation tools to reduce machine translation engines’ dependence on human linguists.

Translation tools’ limitations will get resolved as AI engines build their content library with diverse languages, predictive replies, industry vocabulary, common phrases, knowledge articles, and vernacular, as well as its understanding of human emotions. The automated self-learnability of AI technology makes it possible to eventually replace humans completely.

Many technology giants also are now focusing on advanced speech translation engines. Meta Universal Speech Translator and Google AI language model are building translation engines that can translate more than 1000 languages.

Technology will also need to solve multiple issues to replace robotic voice delivery with the perfect human voice with flawless command over speech delivery speed, dialect, speaking styles, tone, and slang. And before AI agents fully replace humans, they will also need to understand human sentiments to appropriately reply to customers.

As voice translation tools evolve, they can revolutionize the BPO industry by completely replacing human agents with artificial intelligence platforms. But industry leaders estimate fully operational affordable real-time speech translation tools are still five to 10 years away. These advanced tools offer great potential to change CXM service delivery and transform the customer experience.

If you have questions or would like to discuss developments in this space, reach out to [email protected].

Learn about our Customer Experience Excellence Membership for deep customer experience research and strategy assistance.

And don’t miss our upcoming webinars, LinkedIn sessions, and events for more insight into what AI will bring and customer experience possibilities.

CXM Outsourcing Providers Can Thrive and Grow in the Upcoming Recession: Here’s How

The looming recession offers opportunities for forward-looking Customer Experience Management (CXM) outsourcing providers to emerge stronger. To learn five strategies that can help providers get ready for an economic downturn and win in the long term, read on.

With spiking interest rates across major economies, yield curve inversion in the US, and workforce layoffs by several tech giants, it is largely accepted that the next global recession is imminent (if not already here). A global slowdown may force enterprises to review new or large investments, expansions, or CXM sourcing decisions, directly impacting the CXM outsourcing industry.

While coping with the challenging environment is the immediate priority for third-party CXM providers, it also presents opportunities for proactive providers to emerge from these uncertain times stronger and chart a path for long-term success.

Here are some ways a recession could affect the industry: 

  • CXM outsourcing is expected to endure: Historical data suggests that the demand for Business Process Services (BPS) outsourcing remains resilient during an economic downturn as shown below:

Picture1 3

Source: Everest Group

In a global slowdown, enterprises look for short-term cost wins and quick and tangible benefits from their investments. The variability in cost structures outsourcing offers helps enterprises free their company’s resources, lowers fixed costs, and makes enterprises more flexible and eventually more competitive. This effect can be seen in quarterly releases where many leading CXM providers have raised their most recent like-for-like revenue growth guidance percentage 

  • Essential goods and service industries can act as a safe harbor: According to an Everest Group analysis of the historical correlation between an economic downturn and industry growth, the sectors of Fast-Growth Technology (FGT), travel and hospitality, manufacturing, and luxury retail typically have a higher risk of growth slowdown due to recessions. Healthcare, utilities, consumer packaged goods, and business and financial services (BFS) verticals are less risky and may offer a safety net 
  • Contract renewals may get tough: Enterprises, especially those impacted by the downturn, tend to focus on extracting maximum value at lower prices. To achieve cost efficiencies, enterprises may look for a no-frills approach to CXM outsourcing and remove non-essential components from deals, including value-added services and upsell/cross-sell services – resulting in a decline in the Total Contract Value (TCV)
  • An enhanced focus on digital CX can counteract the effects: During a global slowdown, focusing on superior CX and customer retention becomes imperative while also reducing or keeping operational expenditure stagnant. Third-party service providers with higher technical capabilities can sort customer queries and resolve simple queries with self-serve or other cost-effective channels, reducing voice volumes and operational overheads

Five strategies for CXM providers to navigate a potential recession

A recession can offer opportunities for well-prepared CXM providers to emerge stronger and triumphant. Service providers need to seize the moment and focus on developing strategies that will provide them with short- and long-term gains.

The following strategies can help providers mobilize for a recession:

  • Adopt a digital-first value proposition: Understand that cost reduction while maintaining CX quality is vital for enterprises during an economic downturn. Digital CXM solutions drive cost savings by reducing the cost of operations and service, and support through process optimization, automation, encouraging self-service, and enabling efficient workforce management. Service providers with the capability to manage simple queries leveraging digital technologies such as automation, agent-assist solutions, and conversational Artificial Intelligence (AI) can offer better pricing, helping their clients win new contracts, as well as more easily extend and renew existing ones
  • Demonstrate operational flexibility: In economic uncertainty, anticipating operational volumes over the coming months is extremely difficult for enterprises. Service providers should focus on adopting flexing staffing models to quickly ramp their operations up and down based on demand, helping enterprises reduce fixed costs and mitigate operational risk
  • Take a proactive customer approach: Capitalizing on every opportunity for additional revenue becomes even more important during unpredictable economic times. Enterprises should look to partner with third-party providers who actively monitor customer journeys, can identify customer pain points, and offer self-service solutions for addressing low-complexity queries, reducing inbound issues and support tickets. B2B enterprises should explore partnerships with service providers having defined roles, such as Customer Success Managers (CSMs) who are focused on identifying customer preferences and demand patterns to identify the best-fit opportunities to upsell or cross-sell to end-customers
  • Avoid being pressured into bad deals: As the economic cycle enters a downturn, competition over a potentially smaller pie will intensify and can lead to declining prices. Service providers must be financially prudent and avoid pursuing significantly margin dilutive deals. Further, they need to relook at their pricing models and optimize their strategy based on their risk appetite
  • Diversify into recession-proof industries: Service providers with a focus on high recession-prone sectors such as travel and hospitality, luxury retail, or debt-fueled start-ups should look to diversify their portfolio and target verticals where the demand for customer experience management is expected to pick up or at least have the lowest impact during the recession. For instance, payment collection in the utility vertical generally experiences increased demand during recessionary times. While entering new verticals is not an easy task, service providers should identify synergies between their current portfolio and targeted industries to develop their market-entry strategies accordingly

A recession in the next few months appears to be an inescapable reality. Regardless, service providers must be well prepared for continued economic uncertainty. While some providers may need to aggressively transform costs and offerings, others can diversify their portfolios and develop flexible offerings for the future. Providers who prepare now and take appropriate steps will not only navigate through difficult business conditions but also emerge stronger than the competition when conditions improve.

This is the second blog in our latest CXM blog series. To learn about CXM strategy, read the first blog, How a Robust CXM Outsourcing Strategy Can Help Enterprises Navigate the Economic Downturn.

To discuss CXM outsourcing opportunities, contact Shirley Hung, David RickardSharang Sharma, or Divya Baweja.

Customer Experience Management (CXM) in EMEA – Service Provider Landscape with PEAK Matrix® Assessment 2022

Top Customer Experience Management (CXM) Services in EMEA

The Customer Experience Management (CXM) market in Europe, the Middle East, and Africa (EMEA) grew at an unprecedented pace in 2021. Buyers showed a higher propensity to outsource and shifted their priorities with heightened awareness of the importance of personalized CX in driving customer acquisition and retention and creating market differentiation.

To provide an unparalleled personalized experience, organizations are pushing for digital customer experience management through a combination of digital tools, such as advanced analytics, intelligent automation, conversational AI, and omnichannel and agent-assist tools. The demand for transformation consulting services, such as customer journey mapping and design thinking, has also increased significantly among enterprises to accelerate their digital transformation initiatives and achieve business continuity, expanding the scope of existing CXM contracts.

To effectively serve these requirements, providers are developing capabilities through internal investments, their partnership ecosystems, and acquisitions. They are also setting up multilingual hubs across Europe to serve the diverse language needs of this region.

DOWNLOAD THE FULL REPORT Customer Experience Management (CXM) in EMEA – Service Provider Landscape with PEAK Matrix® Assessment 2022

What is in this PEAK Matrix® Report:

In this research, we analyze the CXM service provider landscape in EMEA and its impact on the EMEA CXM market. In particular, we focus on:

  • CXM Services in EMEA PEAK Matrix® Assessment 2022
  • Key insights into PEAK Matrix® dimensions
    Strengths and limitations of individual service providers
  • Sourcing considerations for buyers

In this research, we present detailed assessments of 25 CXM service providers in EMEA featured on Everest Group’s CXM Services PEAK Matrix® Assessment 2022. Each assessment provides a comprehensive picture of the service provider’s market success, vision and strategy, service focus and capabilities, digital and technological solutions, domain investments, and buyer feedback.

LEARN MORE ABOUT Customer Experience Management (CXM) in EMEA – Service Provider Landscape with PEAK Matrix® Assessment 2022

Our Thinking

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What is the PEAK Matrix®?

The PEAK Matrix® provides an objective, data-driven assessment of service and technology providers based on their overall capability and market impact across different global services markets, classifying them into three categories: Leaders, Major Contenders, and Aspirants.

LEARN MORE ABOUT Top Service Providers

Customer Data Platform – The Torchbearer of the Personalization at Scale Movement | Blog

Customer Data Platforms (CDPs) enable brand marketing teams to build hyper-personalized campaigns and retain high-value loyal customers. Seizing opportunities in this growing market can set brands apart. Learn how to achieve personalization at scale in the second blog in our series.  

In our previous blog, The Rising Role of Customer Data Platforms in Data-driven Personalization, we explored the factors driving CDP’s fast growth of 25 percent in 2022. Let’s now look at how to choose a CDP to gain profitable business outcomes.

The dire need for personalization at scale

True personalization is when Spotify surprises listeners with discovery playlists, when Netflix delivers differentiated experiences to each family member, and when Amazon recommends the exact gift a shopper urgently needs. Personalization at scale happens when companies can perform activities like these for millions of customers, in real-time, and at every relevant time in the customer journey.

Making every customer feel valued and loyal to the brand is the power of personalization. This only can be accomplished by knowing what customers want without being told and delivering it on the right channel and at the precise time.

With the surge in customer touchpoints leading to a massive flood of data from disparate sources and increasingly stringent privacy regulations, delivering tailor-made content for tangible and sustainable business outcomes is direly needed. Marketers today must realize that consumers have an overabundance of options, and demonstrating that they know their consumers better than others is the only way to gain a competitive advantage.

The Customer Data Platform – packaged software that ingests data from multiple sources, draws consumer insights through unique 360-degree profiling, and activates channels – plays a pivotal role in achieving true personalization at scale.

Personalization technology – the role of the customer data platform

Building marketing teams to keep up with the growing customer base is the biggest hurdle enterprises face to personalization at scale. The latest technology can enable marketers to take the long leap from merely collecting demographic data to using Artificial Intelligence (AI) and Machine Learning (ML) to harness huge amounts of data from disconnected sources.

That’s where the Customer Data Platform comes in.

A CDP’s core function is to create unique customer profiles by collecting data from multiple sources, such as Customer Relationship Management (CRM) systems, websites, and email campaigns. To achieve personalization at scale, enterprises need best-in-breed platforms that not only collect data but also orchestrate personalized experiences at scale by using smart segmentation, behavioral scores, AI, and ML models that constantly optimize experiences based on real-time interactions.

Choosing the right CDP

Since one size does not fit all, enterprises need to dedicate time and resources to select the right CDP provider that offers expertise aligned with their personalization goals and the use case they prioritize.

Our research finds more than 160 providers offer expertise in these delivery areas and include both enterprise-grade CDPs (such as Salesforce and Adobe) and pure-play CDPs (such as mParticle and Treasure Data).

According to the CDP Institute, four main service categories exist based on capabilities in data, analytics, campaigns, and delivery, as illustrated below:

Exhibit 1:  Customer data platforms categories based on capabilities

Exhibit 1:  Customer data platforms categories based on capabilities

Enterprises need to consider many factors when shortlisting CDP vendors, including marketing technology capabilities, vendor maturity, business use case alignment with the vendor’s core strengths, and pricing flexibility.

Evaluating technology features is extremely critical. The CDP Institute defines “shared features” as essential elements for a platform to qualify as a CDP and “distinguished features” as enhancements to the basic platform:

Exhibit 2: Features of customer data platforms 

Shared Features Distinguished features
Persistent Data Data Management
Unified Profiles Identity Management
Ingest and Retain Data Website Management
Manage PII (Personally Identifiable Information) Mobile App Data SDK
External access B2B specific use cases
Analytics
  Engagement

People and process recommendations

Selecting the right CDP only solves one piece of the entire personalization puzzle. Enterprises also need to further optimize their internal operating models and align their teams with their overall business objectives to ensure success.

Below are the key elements needed to optimize people and processes to achieve personalization at scale:

  • Setting goals – Marketers need to make sure the entire team is aligned with customer end goals before implementing any personalization technology.
  • Removing silos – True personalization only can be achieved if customers have consistent experiences across touchpoints. As enterprises scale and these touchpoints increase, the number of teams that own them rises. This can lead to varied unconnected customer experiences across channels, provoking scenarios where the marketing team promotes a certain offer and the customer care executive denies it to the customer. Brands need open communication across teams to ensure alignment in tone and messaging.
  • Hiring the right talent – In the talent war, enterprises find it extremely difficult to hire and retain the right type of data engineering and data science talent to achieve personalization at scale. Organizations need a talent strategy for their personalization efforts.

Although achieving sustainable personalization at scale can seem daunting, brands that gain the first-mover advantage will benefit by retaining loyal customers and increasing their lifetime value, reducing time to market, and improving workflow efficiency.

Consumers today expect sophisticated experiences that can predict their unspoken demands, and marketers must acknowledge this mindset paradigm shift to remain relevant. Brands that can personalize the customer experience at scale will differentiate themselves in the cut-throat marketing landscape.

To discuss Customer Data Platforms, contact Vaani Sharma at [email protected].

Learn more in our blog, How a Robust CXM Outsourcing Strategy Can Help Enterprises Navigate the Economic Downturn.

Healthcare Customer Experience Platforms PEAK Matrix® Assessment 2023

Top Healthcare Customer Experience Platforms

Rapid digitization of healthcare and evolving customer expectations are driving the need for personalized customer experiences across pre-care, care, and post-care interactions. To serve this need, healthcare enterprises are leveraging Customer Experience (CX) platforms to enhance patient and member experiences across multiple interaction touchpoints such as sales and marketing, services management, patient administration, care management, and billing and payments.

In this report, we assess 16 healthcare CX platform providers featured on the Healthcare Customer Experience Platforms PEAK Matrix®. The study will enable buyers to choose the best-fit provider based on their sourcing considerations, while providers will be able to benchmark their performance against each other.

DOWNLOAD THE FULL REPORT Healthcare Customer Experience Platforms PEAK Matrix® Assessment 2023

What is in this PEAK Matrix® Report

In this PEAK Matrix® assessment, we:

  • Assess the market trends for healthcare CX platforms
  • Examine enterprise sourcing considerations, along with the strengths and limitations of each provider

Scope:

  • Industry: healthcare
  • Geography: global
  • The assessment is based on Everest Group’s annual RFI process for the calendar year 2022, interactions with leading healthcare CX platform providers, client reference checks, and an ongoing analysis of the healthcare customer experience platforms market

LEARN MORE ABOUT Healthcare Customer Experience Platforms PEAK Matrix® Assessment 2023

Our Thinking

GettyImages 1367728606
Blog

The Promising Future of AI Translation in CXM

GettyImages 1305250081
Blog

CXM Outsourcing Providers Can Thrive and Grow in the Upcoming Recession: Here’s How

ADP Meeting of the minds big data data cloud
Blog

Customer Data Platform – The Torchbearer of the Personalization at Scale Movement

GettyImages 1372365545
Blog

The Sports Marketing Playbook is Being Rewritten! Are you Ready?

What is the PEAK Matrix®?

The PEAK Matrix® provides an objective, data-driven assessment of service and technology providers based on their overall capability and market impact across different global services markets, classifying them into three categories: Leaders, Major Contenders, and Aspirants.

LEARN MORE ABOUT Top Service Providers

The Sports Marketing Playbook is Being Rewritten! Are you Ready? | Blog

The FIFA World Cup 2022 was a global arena for marketers and brands to display revolutionary technologies that create immersive fan experiences based on Web 3.0. But to be game changers in the sports industry, organizations will need to digitally transform their fan engagement, media, partnerships, sponsorships, and content, effectively rewriting the sports marketing playbook. Read on to learn recommendations and winning examples to ensure you don’t drop the ball.   

With over a million fans having visited Qatar for the World Cup, the tournament is expected to have been one of the largest sporting events for brands in the digital world. A plethora of brands and tech companies competed to score points by creating unique fan experiences at stadiums and off-location.

What differentiated this World Cup from others is how brands harnessed the hype with a range of digital assets, virtual worlds, Augmented Reality/ Virtual Reality (AR/VR) tools, and other Web 3.0-based solutions. In this blog, we explore this further and share some innovative use cases.

Picture1 2

Digital technology is unlocking unprecedented opportunities in the global sports industry, valued at approximately $2.3 trillion. But to fully capitalize on this growth, sports organizations will have to go through a digital overhaul in four major areas.

Picture2 1

Fan engagement

Organizations are leveraging technology to move from reactive to proactive fan engagement in the following ways:

Elevating the fan experience: Seamless fan engagement, both off-venue and on-venue, has become critical in providing a great fan experience, especially post-pandemic. Today’s fans expect more personalized and customized experiences across multiple channels. Cloud-based solutions and technologies such as AR/VR are being deployed to deliver these experiences to fans.

picture3 1

Developing robust loyalty programs: Sports fans have an unwavering loyalty towards their favorite teams and players. These fans are a notch above traditional customers as the sport is linked to their sense of identity.

Sports organizations are investing in loyalty programs to reward fans for their commitment and passion for the sport. These programs are also using digital assets such as Non-fungible Tokens (NFT) to incentivize their most loyal fans. Additionally, they are leveraging these platforms to create year-round engagement with fans to establish loyalty that extends beyond the game season.

Media management

The rise of digital media, coupled with the pandemic, has had a transformational impact on sports broadcasting and media.

Increased adoption of digital streaming platforms: Overall linear TV viewership has been declining due to factors such as the rise of streaming platforms, changes in the media landscape, and consumer behavior. This is no different in sports. Major leagues are signing digital broadcasting deals with streaming platforms, leading to increased ad spend on these platforms.

Picture4

Leveraging influencer marketing: Sports has given rise to some of the world’s biggest celebrities, to say the least, and social media channels have turned them into influencers who are more accessible to their fans than ever before (Football star Cristiano Ronaldo recently became the first person in the world to surpass 500 million followers on Instagram, and these are not just followers, they are fans driven by passion!). Brands are leveraging platforms such as TikTok and Instagram to cultivate a personalized connection with fans through simpler technological innovations and highly engaging content.

Building digital infrastructure: A strong digital infrastructure in the form of websites, mobile apps, and Customer Data Platforms (CDP) is not only crucial to reach the target audience, but it is also a rich source of first-party data for sports organizations.

Picture5

Partnership/sponsor management

Partnerships and sponsor management in the sports industry is also evolving past its traditional confines:

Moving from sponsorships to partnerships: Organizations are putting skin in the game to improve fan experience and build awareness for their brand through more purposeful and riveting partnerships, instead of just sponsoring a sporting event or branding jerseys and venues.

Picture6

Evolving merchandising play: Sports merchandising includes sports-related equipment, clothing, and collectibles, among other things. E-commerce and social commerce are changing how fans purchase merchandise and with the advent of digital assets like NFT, the nature of the collectibles also is changing.

Picture7

Content management

When games change in a fraction of a second, delivering content that resonates with fans at the right time and place is imperative. Here’s how it is being done:

Data-driven content: Technologies such as (but not limited to) optical tracking and wearables have given organizations access to newer and richer data points. While this data can help with decision making and team strategies, marketers are widely leveraging it to create content that can give fans unique insights and a more nuanced understanding of the game.

Picture8

Dynamic and real-time content: Just like fast-moving sporting events, fans expect dynamic and real-time content. Organizations are relying on cloud-based solutions and AI-enabled tools to deliver the in-moment excitement and thrill associated with any sport.

A winner’s playbook to enable marketing in sports

To enable the new era of sports marketing, sports organizations need to build systems driven by intelligent automation, omnichannel experiences, and data, see the exhibit below.

Capture

Sports has always been and continues to be a force that brings people across demographics together. Digital advertisers and sponsors who manage to extend the passion, excitement, and loyalty fans have for their teams to their brands will see incredible results over time.

The stage is set, and the ball is now in the marketer’s court: will they become MVPs? Or have-beens? Only time will tell.

To discuss evolving marketing trends, contact Nishant Jeyanth and Mustafa Pitolwala.

Learn more in our webinar, How are Leading Organizations Delivering Exceptional Customer Experience?

How a Robust CXM Outsourcing Strategy Can Help Enterprises Navigate the Economic Downturn | Blog

Superior customer experience management (CXM) is even more vital in tough economic times when enterprises want to retrench. But through strategic CXM outsourcing, organizations can generate significant business value now and emerge stronger when conditions improve. 

Geopolitical tensions causing supply-side disruptions, the highest inflation numbers since the 1980s, and rising interest rates creating tremendous inflationary pressure on Gross Domestic Product (GDP) growth have put many of the world’s largest economies on the brink of recession.

A recession would significantly hinder investments by enterprises in many industries in CX initiatives. But by partnering with outsourcing providers, enterprises can navigate these difficult times and come out ahead of competitors. Let’s explore how.   

Importance of enterprises’ investments in CX during an economic downturn

During recessions, consumer sentiment and confidence drastically fall, making it even more crucial for enterprises to deliver superior customer experiences. Continuing to invest in CX can be worth it for these key reasons:

  • Customer retention is cheaper than customer acquisition: Failing to maintain good customer service during a crisis can reduce customer confidence, severely impacting brand trust. Superior customer experience is a must-have to retain customers and enhance their lifetime value. This becomes even more important during recessions when gaining new customers is more difficult. In uncertain times, people double down on brands they trust rather than risk spending on unknown products that may disappoint them
  • Experience management is necessary to understand customers’ changing needs during a crisis: Customer expectations change in a down economy. Understanding the effects of fast-eroding customer confidence and the impact of emotions on customer relationships is crucial to addressing changing customer wants and needs. This shift also represents an opportunity for enterprises to gain a competitive advantage by addressing changing customer requirements
  • Superior CX helps organizations avoid price wars: Consumers are even more price sensitive during recessions. By delivering superior CX, an organization can stand out without having to cut prices to compete

CXM outsourcing is a viable option during an economic downturn

In this challenging environment, enterprises’ immediate goals are to reduce costs, streamline operations, and achieve quick and tangible benefits from all their investments.

A strategic third-party service provider can help organizations achieve these objectives, enabling them to better manage the downturn and accelerate their recovery. Providers can deliver the following benefits:

  • Cost effectiveness: During recessionary times, demand for major enterprises’ goods and services takes a hit, affecting top lines, while fixed expenses remain stagnant. Through CXM outsourcing, organizations can convert these fixed expenses into more variable costs representing huge cost savingsfor many organizations. Selective outsourcing is one of the many effective strategies to control a company’s budget without compromising work quality
  • Flexibility in managing resources: A global slowdown can force enterprises to reduce hiring, freeze salaries, or reduce their workforce. CXM outsourcing offers the flexibility to ramp resources up and down depending on need without having to lay off employees and hurt overall organizational morale
  • Enhanced efficiency: Third-party CXM providers offer extensive pooled experiences, knowledge of existing and upcoming technologies, and awareness of best practices in the marketplace. These teams of experts can provide valuable insights to guide an organization’s CXM strategy and maximize efficiency
  • Providing the necessary digital push: Investing in internal digital initiatives in uncertain economic times becomes difficult – even when long-term benefits are clear. Leveraging a third-party provider to support digital CX initiatives in a strategic partnership-led model can allow enterprises to accelerate their digital road maps while avoiding upfront costs through innovative pricing models

To thrive with a looming recession and emerge on top when economic conditions improve, enterprises need to look at their business strategies now and evaluate the potential opportunities to outsource all or part of their customer experience management services.

Enterprises should begin by identifying key areas that could be outsourced, such as lead generation, payment collections, and technical support. As they achieve success, organizations can then expand contracts – striving to outsource their end-to-end CX services while strategically engaging with service providers to generate significant business value.

Read the second blog in this series for further insights on the CXM outsourcing market, CXM Outsourcing Providers Can Thrive and Grow in the Upcoming Recession: Here’s How.

To discuss CXM outsourcing opportunities, contact Shirley Hung, David Rickard, Sharang Sharma, and Divya Baweja.

Don’t miss our webinar, Key Issues for 2023: Rise Above Economic Uncertainty and Succeed, to hear major concerns, expectations, and key trends expected to amplify in 2023.

GSA Strategic Sourcing Symposium: Future of CX | Event

EVENT

GSA Strategic Sourcing Symposium: Future of CX

November 22, 2022

Everest Group Vice President, David Rickard, will lead a session at the Global Sourcing Association Symposium, exploring how inflation, technology, and cloud are having a major impact on negotiating and delivering customer service arrangements. The industry needs to adapt to address these changes. Join David’s session as he speaks about the future of customer experience management. 

The Global Sourcing Association’s Strategic Sourcing Symposium guides organisations to sustainable resilience through optimised use of technology and business services.

See the agenda

When

November 22, 2022

Where

160, Aldersgate, London

Presenters

David Rickard
Vice President, Everest Group

Request a briefing with our experts to discuss the 2022 key issues presented in our 12 days of insights.

Request a briefing with our experts to discuss our 2022 key issues

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