Organizations Misfiring With Digital Consumers: Survey
A Credit Union Times article
Note: This article was originally published on CreditUnionTimes.com on July 19, 2019. Please note that Kony is now a part of Temenos.
Only 19% of consumers reported any significant improvement in experience across four vertical industries—banking, retail, utilities, and healthcare—despite nearly $5 trillion in global investment on digital transformation.
Austin, Texas-based Kony, which provides cloud-based digital application and low-code platform solutions, unveiled the results of “The Kony Digital Experience Survey 2019,” which gauged the efficacy of global investment in digital transformation. The study benchmarked business investments and customer experiences.
“Everyone is talking about digital transformation, but the dominant conversations are about the businesses embarking on it and the technology that is driving it. Where are the customers amid all this organizational change, cultural pivots and digital renovations?” asked the study, which found that misalignment is not only driven by businesses out of sync with consumers, but that it travels in both directions.
The report concluded consumers do not believe businesses are investing in digital initiatives resulting in meaningful outcomes. In every market and every vertical, consumers underestimated the number of businesses investing heavily in every customer experience outcome by at least 50%. Consumers also are not giving businesses credit for the level of investments they are making.
Conversely, businesses are not listening to—or understanding—the evolving needs of their consumers. According to the study, only 28% of enterprise digital transformation initiatives begin specifically with customer needs as the priority.
“Improvements in costs and efficiencies are always welcomed and clearly important to project funding, but the real returns and real impact of digital starts and stops with its impact on the customer experience,” Thomas E. Hogan, president of Kony said. “‘The Kony Digital Experience Index’ highlights a chasm between consumer expectations and business spending.” Hogan also noted because only one in five consumer respondents felt any significant improvement demonstrated the enormous opportunity that remains for businesses to leverage digital for customer loyalty, service levels, convenience, and commerce.
The study also ranked businesses efforts on the Kony Digital Experience Index based on how the business delivers on several digital experience outcomes, such as improving web experiences to make it easier to navigate, more engaging and intuitive to use; providing comprehensive online and mobile capabilities so users can do everything online or on their mobile device, quickly and easily; and offering cutting-edge digital experiences such as artificial intelligence, chat bots and augmented reality.
The consistent theme for KDXi Laggards is an internal focus (improving workflow productivity, cost reduction, better internal collaboration) while KDXi Leaders have an external focus (meeting customers’ changing expectations, agility, risk management—such as cybersecurity). Hogan explained, “Laggards are simply trying to keep pace and improve internal efficiencies. The customer experience is not the main focus, and that is painfully obvious to the customer. Businesses must listen to and understand customer needs such as data security, digital support and improving mobile experiences, which are especially high in the U.S. and North America.”
The Kony Digital Experience Survey 2019 involved 1,600 respondents sourced from specialist global research panels; 800 were major contributors or leaders of digital transformation initiatives in enterprise businesses with 500-plus employees.
Some key findings:
- Retail leads the way in integrated digital transformation initiatives, favoring a single, strategically-led and funded approach. Banking and financial services are least likely to have a fully integrated program.
- Banking is the most successful vertical with 25% more banking customers reporting a significant improvement in the customer experiences offered in the industry than the market overall. Utilities are struggling despite the longest history of digital transformation investment and the largest annual budgets of any vertical.
- Banking and financial services’ customers are more focused on investment to protect their data than customers of other verticals, and retail customers are most likely to under-invest in emerging technologies and customer experiences like IoT, chatbot or augmented reality initiatives.
- Banking consumers are the most likely to state that they will spend or invest more with financial institutions that offer excellent digital experiences; 70% said they spend more, and 71% claimed they are more likely to be loyal, if their digital transactions feel effortless.
- Retail is at most risk as they have higher levels of competition than other sectors and lower switching barriers than healthcare, banking or utilities.
The report identified six key steps for driving improved return on investment from future digital investment.
Step 1: Embrace innovative thinking, ambition and a commitment to improvement—they matter more than a desire to please customers.
Step 2: Prioritize investment in digital outcomes, not digital initiatives. “Ask yourself, what would my customers and prospect do if they were in my shoes? Better still, ask them directly.”
Step 3: Consumers will always focus on the here-and-now. “You have to get your foundations right before you have permission to evolve and innovate.”
Step 4: Build for now, but invest in a roadmap to the future.
Step 5: Say “no” to silos and “yes” to integrated digital strategy.
Step 6: Set a customer-centered digital transformation agenda.
In June 2018, Kony officially launched Kony DBX, the banking and financial services arm of Kony, which includes pre-built native and web apps along with a digital banking platform to help credit unions cost-effectively accelerate digital strategies.
To access the full report visit: The Kony Digital Experience Survey 2019