Recessions and times of economic hardship tend to make businesses take a step back, re-evaluate priorities and look for potential savings while riding out the storm. And it is very much a time of economic downturn, according to the World Bank’s latest Global Economic Prospects report. It says the global economy is entering a protracted period of weak growth and elevated inflation, raising the risk of stagflation.
Global growth is expected to fall from 5.7% in 2021 to 2.9% in 2022, and the world’s biggest tech companies are showing signs of being nervous about the world economy. An economic downturn naturally makes consumers nervous and less inclined to spend money on big purchases. So, if you’re a business owner, it’s time to tighten your belt, isn’t it?
Not necessarily. Orange Business recently hosted a webinar in which industry experts discussed the issue of what companies should do about CX and EX during an economic downturn. The conclusion was that while it might be a difficult time, you should invest in CX and EX nonetheless if you want to emerge from the storm in good shape.
Why invest in CX?
Morris Pentel, CX analyst, consultant, and chair of The Customer Experience Foundation, outlined his recent experiences of company reaction to the economic situation. “Things change really quickly. For example, in the past month, with the hike in European gas prices, UK utility companies have received double the phone calls. Call volumes have gone up in a very short space of time. How do you manage that when companies still always need to do more with less?”
Companies who invest in CX during an economic downturn can emerge strongest. According to Pentel, organizations that thrived during recent financial crises displayed one common behavior pattern: they focused on investment to reduce wasted opportunity. They invested in winning more often, even if there were less customers to be had and less opportunity that would result in lower margins or losses in the short term.
Research by Harvard Business Review found companies like Facebook, Apple, Amazon, Netflix, Nvidia, Google, Microsoft and Samsung, all of whom had invested in CX during a recession, were those that came out of it best. “I’ve found that companies that have done well lately have one common thing – their attitude is fight, not flight. They focus on improving more outcomes. They invest in winning and focus on being operational ready for when the market turns,” said Pentel.
It’s an approach also endorsed by Bain & Company in its The New Recession Playbook 2022: companies make more dramatic and sustainable gains and losses during a downturn than during stable periods. Those that make the bolder move and invest can reap potentially bigger rewards on the back end.
The importance of EX
Improving the employee experience (EX) is a key part of investing in CX. You cannot expect to deliver great CX without having empowered, happy, productive employees. The Orange webinar considered what makes a good EX. From a contact center customer handling perspective, factors cited included empowered agents who know what they are talking about and having easy-to-use digital channels in place.
As Pentel commented, “When there are siloes and systems everywhere, it puts additional stress on agents. It’s hard to keep a customer engaged while you’re surfing lots of different systems, trying to make sense of what you as an employee see in front of you. It’s important to deliver a happy customer to the agent, to make self-service easy, and to make it easy to switch channels. And remember that things like this that just work well, often the customers don’t notice!”
Ozgur Cay, Orange Head of Customer Experience Consultancy, Europe, underlined the importance of a single view of CX to empower employees further. “We’re seeing our customers use more channels, so we’re trying to bring all those channels together under a single view, to give customers seamless omnichannel experiences. Because it shouldn’t matter what the channel, they should get a great experience.”
That means a single view to give agents the tools to empower them as much as possible. It makes them more efficient, makes them happier as employees, and makes customers happy as a result. Empowering agents is one of the biggest areas that can contribute to saving costs and making end customers happy in challenging times.
Key areas for investment
Other investment priorities in CX and EX during an economic downturn include automation for both processes and applications like bots, along with interaction analysis, omnichannel SLAs, agent well-being and behavioral analysis. But according to Pentel, the most important investment in tough times is a 360-degree view. “The 360-degree view is the most important investment for many. To be able to manage all your CX in a whole, seamless way is key.”
Watch the replay of the webinar: Investing in EX and CX during an economic downturn.
I’ve been writing about technology for around 15 years and today focus mainly on all things telecoms - next generation networks, mobile, cloud computing and plenty more. For Futurity Media I am based in the Asia-Pacific region and keep a close eye on all things tech happening in that exciting part of the world.