With each positive interaction a customer has with a brand, they expect similar or higher levels of service in the future. Unfortunately for brands there is no finish line, only continuous improvement to create better experiences.
Brands realize that putting the customer at the center of their business is a way to deliver consistent, personalized, and timely engagement across digital and physical channels and across marketing, sales, service, and support functions.
According to IDC’s September 2023 Future Enterprise Resilience and Spending (FERS) survey, respondents ranked delivering great customer experience as their top focus area to derive customer value. Brands have a clear mandate to augment personalized experiences and acquire and retain customers through customer experience (CX) technology investments.
To fulfill that mandate, customers should first prioritize continuous integration of dynamic data across touchpoints and deliver high-quality data using Customer Data Platforms (CDPs). IDC’s July 2024 Future of Customer Experience (FoCX) Survey identified that over the next 12 months, 77.8% of respondents plan to increase technology spending for CDPs.
Secondly, using AI and GenAI driven processes and tasks will help to better identify and segment audiences, uncover new levels of customer insights and create effective engagements. IDC’s April 2024 FERS survey shows that spending on GenAI–related infrastructure, models, applications, and services is expected to increase by an average of 64% across all companies. The survey also shows that companies that report an 80% success rate with their GenAI proof-of-concept efforts ranked “access to required high-quality data sets” as a top five success factor.
The final point is that acquiring customer data that fuels personalization and engagement is back in the news with Google’s latest planned announcement that it won’t be deprecating third-party cookies.
Google announced that it is introducing a new experience in Chrome that lets users make an informed choice across their browsing habits. While regulators decipher the plan and users decide on choices they face, organizations should continue to investigate what zero-, first- and second-party data they need to build segments and models with trust. Customers strongly prefer brands that are transparent and prioritize their data security and privacy, leading to a stronger, trust-based relationship.
Customer Data Platform to Enhance Customer Experience
According to IDC’s 2024 CX Path Survey, the top business outcome that organizations want to achieve from implementing CDPs is enabling customers to curate contextual experiences. CDPs provide high-quality data and analytics for this and other use cases involving growing revenue streams and delivering differentiated experiences with high value business outcomes. CDPs must include the following key components:
- Aggregation: Ingest, integrate, cleanse, resolve and consolidate individual-level customer data from multiple sources and formats and determine which attributes and dimensions to include in a profile or segment.
- Engagement: Activate segments for campaigns, advertising, and messaging across different channels and audience groups defined by multiple attributes and dimensions. Includes next best action, recommendations, etc. based on end-user choices and preferences synchronized across channels.
- Insights: Descriptive, diagnostic, and predictive analytics to understand the complexities of the customer journey, predict future behaviors and tailor marketing efforts. Augment it with GenAI to drive automation and improve productivity for users to engage with CDPs and improve self-service.
- Orchestration: Shared set of services will help to deliver a common orchestration layer for workflows, event management, scheduling, and rules. Having a solid framework for data governance and AI governance will help to balance personalization versus privacy, trust, and transparency.
GenAI and CDP to Drive Productivity and Personalization
While vendor roadmaps for AI are advancing, narrow down on which GenAI use cases you want to pursue and what does it take to implement the prioritized ones in context of CDPs. In parallel, define and develop the metrics and analysis required to justify investment in the selected use case or two. Organizations should use GenAI to improve productivity for CDP users and how it can deliver personalization to meet rising customer expectations in the following ways:
- Custom GenAI models trained on CDP data are used for generating personalized content like product descriptions, custom messaging, landing pages, email copy.
- Combine retrieval-augmented generation with GenAI models to provide grounded, trusted responses by extracting information within CDP and other knowledge repositories.
- Conversational AI assistants enable marketers to query and interact with data or describe the customer journeys they want to create using natural language, making it more intuitive and efficient for marketers.
- Dynamic segmentation allows for real-time adjustments to customer segments based on their behaviors and interactions analyzed by GenAI models with marketing campaigns.
- Synthetic data generation helps in augmenting datasets where actual data is sparse or limited, enhancing the robustness of AI models. This approach is particularly useful in scenarios where data privacy concerns limit the availability of real data.
Prepare for the Next Phase of Customer Experience
According to IDC FutureScape 2024 Predictions, Customer Data Platforms will deliver high-quality data for predictive AI and GenAI, activating 80% of real-time personalized customer interactions at scale for G2000 firms with four times engagement gains by 2026. Organizations need to identify primary use cases that highlight the growing importance of unified customer data beyond marketing and across sales, customer service, and field service.
They also need to quickly build a picture of full journey and behaviors exhibited by customers by accessing intent data, service and support data, and customer interactions captured in unstructured sources in a secure and trusted manner. Finally, understand what is practical today with GenAI and how it will automate CDP tasks and workflows to make marketers more productive and use it to build personalized content for activation in the best channel preferred by the customer.
Is your firm ready to take the next steps to meet rising customer experience expectations? Organizations need to prioritize investments in customer data platforms to deliver high-quality data for GenAI use case that will add to marketing productivity, enable CDP automation, and adopt trust- and governance-based marketing programs to drive personalization at scale and streamline customer experiences.
