Recessions have unique impacts across industries and teams, and each team has their own responsibility to help their organization get through the economic instability. Interestingly, research shows that the quality of a company’s customer experience (CX) is a major factor in determining how well an organization can successfully make it through a recession. This is especially true in retail, an industry dependent on the whims and spending habits of customers – and one especially vulnerable to reputational blows when customers have a bad experience.
By exploring how past recessions have impacted the retail industry and call centers, customer experience and marketing teams can prepare for the next one. There are many strategies and tools they can adopt to ensure their customer experience is as stable as possible in future recessions. Here are some of the most common impacts call centers see and which technology or strategies can be used to address these challenges.
Consumer Spending Slows Down
Recessions typically cause customers to reduce their spending, and they’re likely to be more careful about where they’ll even consider spending their money. One major deterrent for consumers is experiencing a negative customer support interaction. The potential of scaring customers off through these poor experiences is already palpable in normal economic times, and a recession only makes it worse.
The inverse is also true, though: good customer support experiences will help organizations drive customer loyalty and confidence. Customer loyalty is an invaluable resource for CX teams to nurture during a recession. When people can resolve an issue with an agent quickly and efficiently, they’re less likely to cancel orders or abandon the brand. The Harvard Business Review states that during a recession, “marketing isn’t optional — it’s a ‘good cost,’ essential to bringing in revenues from these key customers and others.”
Subject matter experts from Interactions stress that the last thing businesses want to do during a recession is to lose loyalty and lose business. Still, many companies look to CX when they need to cut costs or lay off staff. An alternative to this plan is to keep customer relationships a priority to earn loyalty and gain a competitive advantage over companies who choose to pull resources from CX.
One key way to keep the customer relationship a priority is by investing in intelligent, conversational AI, for example. Customers get quick, easy answers to their simple requests, and call center agents have more time to put into customers’ more complicated issues – ultimately increasing customer satisfaction.
Making Further CX Investments Will Be a Hard Sell
Companies must reconsider their spending habits and investments during recessions. This may include laying off employees or cutting budgets. Innovation and technology investments may be on the chopping block as the organization tries to focus on weathering the current storm and focusing on day-to-day operations. CX leaders need to be able to argue for the resources and innovations they need to keep customers satisfied and loyal at call centers and other customer-company touchpoints.
According to Interactions experts, mapping the customer journey is a key step to prepare for this aspect of a recession. Companies can map this journey at any time, ideally when things are going well and the CX team has the resources and money to put into mapping. This helps identify areas where the contact center needs improvement, where costs are too high and where more investments need to be made. Knowing the customer journey from this zoomed-out view helps companies prepare for uncertain events in the future – letting them know which areas can operate with fewer resources and what cannot be reduced further. Another key benefit of customer journey mapping is that companies can learn what type of technology they can adopt to support a reduced budget, in preparation for times of economic uncertainty.
Customer Segments Will Look Different
Many customers make purchases for different reasons during a recession than during healthy economic times. A customer may exhibit one type of purchasing behavior when they're feeling confident about the future and thinking more about lifestyle than survival. But a recession brings out the more careful side of many customers. Emotions about the poor economic state will drive different buying decisions, according to the Harvard Business Review. They’re more likely to forgo purchases such as travel, dining, cars, entertainment, consumer electronics, and more – choosing to focus on the essentials instead.
What this means for marketers is that a positive CX is especially important when a customer reaches out for support. They’re already feeling more hesitant about buying items – especially non-essential purchases – and that one bad experience can totally turn them off from your brand.
According to Interactions subject matter experts, proper technology can help here. With simple requests, customers can go through an AI-enabled virtual agent and get their problem fixed quickly and seamlessly. When agents have more time to focus on higher-value conversations with customers, they can help them through complex or emotionally challenging issues and make them feel good about their purchase and overall experience with the company.
Start Preparing for the Next Recession
Recessions come and go, and by developing a game plan early on, your CX team can ensure that customer experience is as positive as possible in uncertain economic times. Making smart technology investments before the market turns can help your organization stay healthy and keep customers coming back even as they rethink their buying habits. For example, technology like Interactions conversational-AI-enabled Intelligent Virtual Assistant uses AI and human understanding to create a positive CX and to allow human agents to focus on more complex customer service issues. Don’t fall behind. Start preparing for the next economic downturn now, and your organization will be well-situated to weather the storm.
Learn more about Interactions AI technology solutions at interactions.com.