Engagement to empowerment

Merkle’s Chief Experience & Delivery Officer, Andrea Meredith, has money-making insights into how local businesses can win in the experience economy.

In today’s hyperconnected world, consumers are hyper-discerning. For marketers, that means
a key aim is to provide a holistic brand experience.

To do this well, it’s crucial that brands and marketers understand and tap into consumer preferences when looking to craft better user experiences.

To help gain a deeper understanding of consumer preferences leading into 2024, Merkle surveyed 2,100 consumers and 810 CX professionals from 18 countries across North America, Europe and Asia Pacific as part of this year’s CX Imperatives study, and found six crucial imperatives that are no less than money-making insights for marketers. What do they mean for businesses in Aotearoa, and how can we harness them to ensure we’re getting the right strategies in place in 2024?

Let’s delve a little deeper. 

The 3 Cs

For consumers, the language of shopping is ‘cost-efficient’, ‘convenient’ and ‘consistent’. In the current economic conditions, 57 percent of APAC consumers want their customer experiences to be more affordable or cost- effective and 54 percent want them to be convenient. Consistency is another major factor that keeps brand loyalty alive; 43 percent of APAC consumers want their customer experiences to be more reliable and consistent every time. 

With inflation and climate change ongoing issues, Kiwis are also increasingly mindful of quality and sustainability. Businesses that align with these preferences and implement suitable remedies are likely to thrive in this evolving landscape. The best way to do this is to ensure you’re harnessing data effectively. 

Data is key

With some essential digital changes over time and younger audiences growing, brands have been successful in gaining people’s trust – and their data. However, some consumers still feel less confident about brands using that data to improve the existing user experience cycle. Only half of people surveyed in APAC trust how companies are collecting and using their information.

To change this audience perception and build stronger brand trust, marketers can leverage this knowledge with
a hint of cutting-edge technology, providing seamless, precise customer experiences targeted to the tech-savvy youth.

We’re seeing this more and more in New Zealand. Local brands are increasingly using data-driven strategies
to enhance user experience and consumer trust. Below is a snapshot of what we’re seeing and how.

• Personalisation and recommendations. Brands such as Trade Me are starting to analyse user data to create tailored recommendations and content, suggesting products based on browsing and purchase history.

• Improved customer journeys. Within the airline industry, we’re enjoying the likes of Air New Zealand optimising touchpoints using data to enhance navigation and support and create a streamlined booking process and personalised in-flight experiences.

• Data-driven marketing. Leading local banks are executing targeted campaigns that use demographic and behavioural data to send personalised offers and content.

• Enhanced product development. Manufacturers such as Fisher & Paykel benefit from using feedback and usage data to improve products with enhanced design and features.

• Consumer trust and data privacy. Trust varies among consumers, so the government established the Consumer Data Right to give consumers and businesses greater rights over their data. Brands are now prioritising security, transparency and consent to build trust.

These are just some examples that stand out for their effective use of data to enhance the user experience cycle while maintaining consumer trust through transparency, data security measures and personalised offerings. There are many others, and the trend is rising. 

Building trust with ethical AI

Technology has been one of the biggest contributing factors in turning consumer data into valuable insights worldwide, with generative AI being used to curate highly personalised product recommendations. Practising ethical AI eliminates the risk of losing valuable customers and allows customers to be transparent with their data security concerns. 

Local consumers’ trust in AI is influenced by factors such as transparency, reliability and the ethical use of data. Many consumers appreciate AI-powered features that simplify tasks, improve efficiency and provide personalised experiences, but concerns about data privacy and bias in algorithms can lead to skepticism among others. 

There are some great examples of New Zealand brands that are leveraging AI well. Three highlights among them
for me are: 

• Xero, who are using AI to automate financial processes, such as invoicing and expense management, providing small businesses with real-time insights and streamlining their operations. 

• Orion Health, who are developing AI-powered healthcare solutions that optimise patient care through the use of predictive analytics, personalised treatment plans and remote monitoring. 

• Air New Zealand, which employs AI algorithms for route optimisation, pricing strategies and customer service interactions, ensuring seamless travel experiences and efficient operations for passengers. 

Overall, although Kiwi consumers may have varying levels of trust in AI, businesses and brands effectively implementing AI technologies have demonstrated tangible benefits in improving customer experiences and driving innovation across industries.

But we still need humans

Sometimes, replacing every problem with a digital solution can leave consumers in a complex situation. To provide the best-of-both-worlds solution, marketers should focus on catering to consumer requirements – easy digital payments combined with live human interaction. 

More than 20 percent of consumers surveyed in the CX Imperatives study prefer human support across industries like media, automotive and financial services, and more than 40 percent in retail, healthcare and travel. An amalgamation of technology and human support enhances interactions and helps in analysing post purchase behaviour to amplify the customer journey.

Let’s talk post-purchase

Through the power of word of mouth, consumers hold the maximum potential to influence the post-purchase stage. In many sectors, people believe maintenance is the prime issue in the customer’s journey. To curb this problem, brands that provide loyalty programmes to offer lifetime value help customers feel that the brand experience isn’t limited to conversion.

From the awareness to the purchase stage, it’s important that marketers follow a consistent process to keep the customer journey hassle-free. Several New Zealand businesses and brands excel in utilising technology to enhance this experience and foster greater loyalty. Outside of the brands we’ve already discussed, The Warehouse Group is a great example of a company that’s using technology to enhance the post-purchase experience for its customers, and this extends to their brands Warehouse Stationery and Noel Leeming too. Their digital initiatives include personalised recommendations, click-and-collect services and loyalty rewards programmes, all of which drive greater customer engagement. 

Kiwi brands that are focused on this stage in the marketing life cycle are also those that have successfully built long-term relationships with their target audiences. 

Technology to consumer is a bit different

Everyday consumers perceive technology differently to how brands and marketers see it. According to the Merkle CX Imperatives study, consumers bifurcated technology into two segments:

1. Low-impact tech, such as self-service checkout systems and personalised messages, emails or chatbots. 
2. High-impact tech, which includes smart devices, voice commerce, natural language processing (NLP) platforms and augmented reality, along with mobile apps, loyalty programmes and personalised product recommendations. 

In the age of the experience economy, the biggest competitive advantage exists in foreseeing the possible shift in consumer preferences to stay in step with the trends. The customer journey is more than simply delivering the product or service.

To continually strengthen the bond with consumers, marketers have to continuously refine their strategies based on consumer feedback and changing tastes. Building lasting customer relationships will only help you to thrive in this competitive landscape, so if you’re working in our local marketing industry and looking at your customer experience strategy for the year ahead, these are the top five actions you need to be taking:

1. Ensuring convenience and consistent experiences. Monitor quality while focusing on providing seamless and reliable service to customers.
2. Acknowledging that data and data security are key. Prioritise data collection and security measures as fundamental elements. Safeguard customer data while utilising it effectively to enhance experiences and inform decision-making processes.
3. Building trust with ethical AI. Ensure transparency and accountability in AI-driven processes to maintain consumer confidence and loyalty.
4. Optimising post-purchase experience and loyalty. Extend the customer journey beyond the point of purchase to enhance loyalty. Invest in post-purchase support and engagement initiatives to foster lasting relationships and encourage repeat business.
5. Remembering that humans are important. Acknowledge the importance of human touchpoints in customer experiences. Although technology plays a crucial role, it’s important to recognise the value of human interaction in addressing complex issues, and to deliver personalised service when necessary.

By aligning their strategies with these themes, businesses can effectively address key considerations and prioritise actions to enhance their customer experiences and drive their success in the New Zealand market.

To learn more about consumer preferences based on brand experiences, you can download the 2024 Merkle CX Imperatives study at merkle.com. 

This was first published in our March/April 2024 issue.