Customer Experience Software Seen to Get Higher IT Budgets as Businesses Face Disruptions and Recession

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The IDC’s FutureScape 2023 report has identified customer experience as one of the segments that will receive a higher portion of the enterprise IT budget in the next two to three years. 

In particular, the report predicts that tech-centric organizations will focus on the As-a-Service model to enhance customer experience. As-a-Service (AAS) customer experience software often includes tools for social listening, behavioral analytics, helpdesk software, and omnichannel capabilities. 

Companies had traditionally viewed customer experience (CX) as a cost to the business. That made it challenging for managers to get C-suite buy-in for relevant tools and strategies that support the customer experience. But this view has changed since more companies report revenue growth because of improvements in their CX.

For example, one research found that 84% of companies that improved customer experience saw increased revenues. Another 79% reported cost savings, while 92% reported increased customer loyalty. 

Why Improving Customer Experience is Essential in a Recession

In recession news this week, the CEOs of Goldman Sachs and JP Morgan have spoken about the likelihood of the United States entering a recession. Strictly looking at the definition of a recession (two consecutive quarters of negative growth), the economy is already there. That’s because the gross domestic product (GDP) shrank by 1.6% in the first quarter and 0.6% in the second quarter of this year.

However, some experts are pointing to factors that indicate otherwise. For example, there’s still low unemployment and strong job growth. Household savings also remain elevated. But these indicators don’t mean that a recession is not possible. In one survey, 91% of CEOs in the US expect a recession to happen in the next 12 months.

Interestingly, the same survey revealed the commitment of business leaders to their organization’s digital investments. Despite a looming recession, 78% of respondents said they have an aggressive digital investment strategy, while 75% said continuing to drive digital transformation at a rapid pace is critical in their competition for customers and talent.

These sentiments are consistent with the predictions of the IDC report when it comes to enterprise spending. Customer experience trends indicate that digital tools for enhanced CX will continue to evolve as a priority. That’s because good CX increases customer satisfaction, which leads to repeat and long-term customers. Based on a study on customer expectations and behavior, 91% of customers who had a positive customer service experience are more likely to make additional purchases.

Moreover, happy customers are more likely to recommend a business. This positive word-of-mouth marketing helps boost brand awareness and creates more opportunities to acquire new customers. All these aspects of CX can ultimately drive continuous revenue—something crucial for a business to survive a recession.

Ways Customer Experience Software Improves CX

Businesses are now more aware of the benefits of a good CX and are leveraging technology to find ways on how to improve customer experience. Social media listening features in customer experience software, for example, help businesses monitor what people are saying—or not saying—about their brand. This enables customer service staff or marketing managers to address issues promptly before they become damaging to the brand.  

There are also tools to efficiently gather customer feedback, from web forms to SMS surveys, live chat, and interactive voice response (IVR) technology. Feedback is useful for improving CX since businesses can know what’s working and what’s not directly from their customers.

Customer experience software also makes it easier to make sense of all the data businesses are able to collect from customers. Using omnichannel capabilities of the software, brands can review emails, tweets, posts, a third-party website, or a customer support call in a single application. This means data is centralized, gets real-time updates, and is easy to share with colleagues or teams in case the issue needs further action.

Moreover, since data is centralized, customer experience software becomes a repository of interactions and experiences for each customer. This allows businesses to review where they got customer service right or wrong. How did the support team or managers handle the interaction? How did the customers react? Being able to look back at these points can help businesses make adjustments that will improve customer experience and make them stand out among competitors.