Global execs say CX is crucial to success but most still struggle to optimize its performance
IN BRIEF
- ▪ 47% of global executives say customer experience is extremely important to business success, but only 17% say their company is extremely effective at optimizing its performance.
- ▪ 70% say they are confident that their own company’s leaders have a deep understanding of their customers’ needs, preferences and behaviors.
- ▪ 64% are confident in their company’s ability to derive strategic and actionable insights from customer data.
When it comes to the overall customer experience, global business leaders seem confident they’re getting it mostly right, but their responses also reveal areas for improvement, particularly around their company’s ability to optimize it effectively, according to the findings of Protiviti-Oxford’s Global Executive Outlook on the Customer Experience.
The survey of more than 250 global C-suite and board-level executives was conducted in March and April in collaboration with the University of Oxford.
Importance, optimization and an ‘opportunity gap’
Nearly half (47%) of global executives say the overall customer experience (CX) is extremely important to their business success, but only 17% say their company is extremely effective at optimizing its performance around CX. This 30-percentage-points gap represents a chasm between CX aspirations and reality and presents business leaders with a significant opportunity for improvement.
From a geographic perspective, the opportunity is even more stark. In Asia-Pacific, for instance, 57% say CX is extremely important for business success but only 14% say their company is extremely effective at optimizing its performance—a 43-percentage-point gap. In Europe, the gap is 35 percentage points—45% and 10%—respectively.
Meanwhile, in North America, it’s only a 13-percentage-point gap, where executives don’t think CX is quite as important for business success (38%), but nonetheless, they do think they are optimizing its performance effectively (25%).
Overcoming this optimization “opportunity gap” requires a multi-pronged approach across all facets of the customer experience lifecycle. Fortunately, the CX survey findings indicate global business leaders are well positioned to close the gap in the years ahead.
CX strengths and weaknesses
When we asked global executives to tell us where they excel the most in terms of their own customer experience strategies, Brand Promise and Personalization at Scale came in No. 1 and No. 2, respectively. And where do they fall short? Omni-Channel Experiences and Digital Touchpoints came in No. 1 and No. 2, respectively.
Interestingly, among North American executives, those top two strengths and weaknesses were flipped with Personalization being the top strength and Digital Touchpoints being the top weakness.
What are we to make of these results? Do business leaders have the awareness and the technology but, ultimately, fail in execution of strategies as digital execution gets difficult across the channels? Possibly. But overall, the survey shows business leaders are feeling good about where they are when it comes to their company’s CX efforts—some 70% say they are confident their own company’s leaders have a deep understanding of their customers’ needs, preferences and behaviors.
Customer data
When it comes to customer data, the lifeblood of CX, global executives are confident in how it is collected, managed, used, customized and segmented. Consider these data points:
64% are confident in their company’s ability to derive strategic and actionable insights from customer data
61% say their organization is effectively using customer data to inform the next-best marketing actions
70% of executives say their organization is prepared to comply with evolving regulations regarding the protection of privacy and personal data in the future
71% say their organization is effective in maintaining customer trust when it comes to data management
65% agree with the statement: "I feel that my company is transparent about how it collects and uses customer data.”
Resources and readiness
When it comes to staffing and spending, two-thirds of business leaders say they are confident or extremely confident their organization has the resources needed to effectively manage and improve the customer experience.
In terms of actual spending, more than two-thirds (69%) of global executives report an increase in investment in marketing resources over the last two to three years. Almost half (48%) say that the increase was between 1% and 10%, while 21% report an increase of more than 11%. But it’s not all great news: 30% say marketing spend has either stayed flat (23%) or decreased (7%) over the last two to three years. Over that same period, 73% say spending on tools and technologies designed to enhance the customer experience has increased. The majority (55%) report that increase was between 1% and 10% while 18% say the increase more more than 11%. Meanwhile, 24% said the spend remained the same, and 3% said it decreased.
When we asked business leaders to look out two or three years to predict future spending, they were a bit more optimistic. Almost a quarter (23%) said they expect increases of 11% or more, while 53% say increases will be between 1% and 10%. Only 2% expect a decrease.
When it comes to investment in tools and technologies, 85% expect increases; most (63%) expect an increase of 1%-10%, and 22% expect a significant increase.
AI and emerging technologies
Perhaps not surprisingly, 57% of business leaders report feeling confident or extremely confident AI will improve the efficiency of their company’s CX journey. Surprisingly, those over 50 years of age were more bullish (64%) on AI than those under the age of 50 (46%).
When it comes to AI’s impact on their organization’s overall customer experience strategies over the next two or three years, nearly a quarter of respondents are optimistic, saying AI will be impactful (40%) or extremely impactful (33%).
When we ask about the impacts of other emerging technologies, global business leaders ranked Data Management Technologies—software designed to help organizations collect, store, manage and utilize data efficiently and securely—No. 1. That was followed by AI and Machine Learning, The Internet of Things, Augmented and Virtual Reality, and Blockchain.
APAC out front; Europe lags behind
There are some geographic differences worth pointing out across the survey in general. Most notably, Asia-Pacific business leaders express far more optimism and confidence in their CX strategies and programs than their counterparts in Europe. Generally, North American executives fell somewhere in between Asia-Pacific’s optimism and Europe’s caution. Consider the following data points, all with at least 20-percentage-point gaps (click on the question to see all data):
It should be noted that Europe’s cybersecurity, data protection and privacy regulations are among the strictest in the world. Europe’s General Data Protection Regulation (GDPR) has been the law of the land since 2018, so it is entirely possible some of the responses were impacted by more stringent data privacy laws.
By contrast, the data privacy regulation landscape in Asia-Pacific is not consistent across the region. And culturally, consumers in the Asia-Pacific region generally are viewed as more accustomed to a more personalized and targeted approach in digital marketing.
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Dr. David Howard, Director of Studies, Sustainable Urban Development Program, University of Oxford and a Fellow of Kellogg College, Oxford. He is Director for the DPhil in Sustainable Urban Development and Director of Studies for the Sustainable Urban Development Program at the University of Oxford, which promotes lifelong learning for those with professional and personal interests in urban development. David is also Co-Director of the Global Centre on Healthcare and Urbanization at Kellogg College, which hosts public debates and promotes research on key urban issues.
Dr. Nigel Mehdi is Course Director in Sustainable Urban Development, University of Oxford. An urban economist by background, Mehdi is a chartered surveyor working at the intersection of information technology, the built environment and urban sustainability. Nigel gained his PhD in Real Estate Economics from the London School of Economics and he holds postgraduate qualifications in Politics, Development and Democratic Education, Digital Education and Software Engineering. He is a Fellow at Kellogg College.
Dr. Vlad Mykhnenko is an Associate Professor, Sustainable Urban Development, University of Oxford. He is an economic geographer, whose research agenda revolves around one key question: “What can economic geography contribute to our understanding of this or that problem?” Substantively, Mykhnenko’s academic research is devoted to geographical political economy – a trans-disciplinary study of the variegated landscape of capitalism. Since 2003, he has produced well over 100 research outputs, including books, journal articles, other documents, and digital artefacts.
