Feature
The Gist
- DCX as a top priority: 81% of businesses consider digital customer experience extremely or very important, recognizing its critical role in overall business success.
- Cross-departmental collaboration is key: Limited collaboration between departments remains the top challenge, emphasizing the need for structured strategies to enhance DCX efforts.
- Growing investment in advanced DCX solutions: There's a noticeable shift toward investing in sophisticated tools like DXPs and CDPs.
2024 and digital customer experience. Where are we going? Where have we been?
We probably can no longer say this is the year of generative AI experimentation. That was 2023. OpenAI debuted ChatGPT in November of 2022, setting the table for a year of generative AI infusion into our digital customer experiences. We came. We saw. We conquered. And, yeah, we saw some weird stuff with ChatGPT and our other generative AI friends.
It was a year of experimentation, for sure, and not all digital customer experience leaders were convinced, it turned out.
Fast forward 14 months post-ChatGPT's debut, and, generative AI implementations or not, we've still got to create the best digital customer experiences for prospects or customers or risk falling behind competitors. It's that simple. Customers drop you because of poor experiences — and quickly.
State of Digital Customer Experience: Generative AI Meets DCX
The "CMSWire State of Digital Customer Experience 2024" report covers the intersection of generative AI and digital customer experience among a host of converging consumer and business trends in the experience arena.
Its respondents tell us the journey toward fully realizing the potential of generative AI in digital customer experience (DCX) is still in its nascent stages. We are at a juncture characterized by a blend of early successes and some inevitable setbacks. A significant challenge remains in breaking down the barriers of siloed teams, systems and data to achieve effective delivery.
Despite these hurdles, the overwhelming majority of DCX teams are eager to deepen their understanding of their customers. The ninth annual State of Digital Customer Experience Report, analyzing responses from over 1,100 DCX executives, serves as a resource for strategizing, sparking internal discussions or simply as a catalyst for new ideas.
As Simpler Media Group CEO Brice Dunwoodie aptly puts it, "The next DCX chapter is going to be bold, exciting and involve some unexpected twists. But I’m confident we have an amazing opportunity to move forward with more savvy teams, increasingly intelligent solutions and ultimately smarter experiences for our customers."
Here are some key findings from the State of Digital Customer Experience report, part of CMSWire's CX Research Library.
DCX as a Top Priority
Here's the good news right off the bat: Practitioners still recognize the importance of digital customer experience. The report highlights that 81% of respondents consider DCX to be extremely or very important. This emphasizes the growing recognition of DCX's impact on business success.
DCX remains a major priority for digital marketing teams. More than four organizations out of five view DCX as either being “extremely important” (40%) or “very important” (41%), proportions which have remained largely static for the past three years.
Additionally, 71% report having tools that work well or are satisfactory, indicating a strong foundation for many organizations in their DCX initiatives. Through the survey there is no evidence that DCX is being deprioritized by organizations, according to report authors.
Related Article: The State of Digital Customer Experience: Where We're Headed
Cross-Department Collaboration Challenges
The biggest challenge for DCX teams is limited cross-department collaboration and alignment. In most organizations with multiple teams working on DCX, collaboration is often informal and lacks set processes. This challenge points to a need for more structured collaboration strategies to optimize DCX efforts.
Why can't DCX teams collaborate with other departments as effectively as they wish? This has been the No. 1 challenge in the last three reports. What needs to change? We don't have the answer, it seems.
Learning Opportunities
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AI: The Essential Vitamin for a Healthy CX
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Investment in Advanced DCX Solutions
Organizations with more effective DCX toolsets are likely to use advanced solutions, including Digital Experience Platforms (DXP), Customer Data Platforms (CDP), and journey orchestration software. This finding suggests that investing in sophisticated tools can significantly enhance the effectiveness of DCX strategies.
Over the past six years, there's been a noticeable shift in perceptions, with an increasing belief that these tools are more effective. Presently, a significant 71% of DCX teams consider their tools to be "working well" or "satisfactory." This is a marked increase from 2018, when only 54% felt this way and 46% thought their tools required improvement, a figure that has decreased to 29% today.
This trend likely mirrors the enhanced sophistication and accessibility of DCX tools, as well as the expanded capabilities of DXP and Content Management Systems (CMS). Is it the vendors getting better or the practitioners getting better at using vendor software?
Yet, there's room for improvement: There's a 4% increase since last year in those who think their tools need work, representing over a quarter of teams who see potential for enhancing tool effectiveness.
Related Article: Emerging Trends Shaping the Future of Digital Experience Platforms (DXPs)
Rise in DCX Investment
There is a rise in overall DCX investment. Teams are increasingly shopping for smarter digital customer experience solutions, with customer journey analysis and optimization being top priorities. “Customer journey analysis and optimization” saw 44% of respondents indicating they are looking to invest — a significant year-on-year rise of 9%. “Analytics, insights and dashboarding” is also up 4% to 34%; 53% of those with tools that “need work” want to invest in customer journey analysis and optimization, compared to 40% of those with tools “working well."
Additionally, there's a 15% increase (to 40%) in plans to spend on AI and machine learning, reflecting the growing role of advanced technology in DCX and the highest leap over the past 12 months.
Generative AI Interest
There is massive interest in the use of generative AI, with 77% of respondents actively exploring how it can deliver opportunities for their business. This reflects the rapidly growing interest in AI's potential to revolutionize various aspects of business, including customer experience. The percentage of those with "extensive" or "middling" use of AI in their CX tools has increased from 32% to 39%.
Concurrently, those with no AI usage for digital customer experience (DCX) decreased from 25% to 17%, while the number of organizations just beginning to use AI rose from 18% to 24%.
There's a heightened awareness of AI's potential influence on DCX in the next 2-5 years. Those anticipating a "transformative" or "significant" impact of AI and Machine Learning (ML) have grown from 60% to 73%. Meanwhile, the proportion of respondents expecting a "modest" or "minor" impact is declining, with only 1% believing there will be no impact.
Related Article: Generative AI in Marketing: Smoothing Creative Operations
Conclusion: Navigating the Evolving Landscape of Digital Customer Experience in 2024
As we move deeper into 2024, the digital customer experience landscape is evolving rapidly, driven by generative AI and advanced technology. The CMSWire State of Digital Customer Experience 2024 report underscores this evolution, highlighting the ongoing importance of DCX in business success, the challenges in cross-departmental collaboration and the increasing investment in advanced DCX solutions.
With generative AI gaining traction and organizations recognizing the need for more effective tools, the future of DCX promises to be innovative, customer-centric, and increasingly influenced by AI and machine learning.
Dig deeper into these and other findings from our State of Digital Customer Experience report!
