5 Challenges Facing Your Customers and Brands, and What They Mean for Your CX Program
A great deal of customers and the brands that serve them are facing unprecedented uncertainties; understanding them is key to organizational success, delivering Experience Improvement (XI), and ensuring that your customer experience (CX) program is operating optimally. All of these obstacles affect both customers and brands to some extent. Because half the Experience Improvement process is knowing what these challenges are, today’s conversation addresses five of the most prominent ones that I’ve observed in my work as an experience program designer:
- Price Increases
- Efficiencies
- Off-Price/Discounts
- Shrinkflation
- Skimpflation
Challenge #1: Price Increases
A plethora of international events, crises, and phenomena has produced steep inflation throughout much of the world, and no part of the supply chain has been spared these upticking costs. Brands have had to pay more to produce, transport, and store their wares, which means passing that cost burden onto their customers. I’m sure you can guess how that’s affecting customer experiences the world over.
Challenge #2: Efficiencies
This is another customer experience woe that affects both parties in CX interactions. Many companies have struggled to stay fully staffed amid the job market churn often called The Great Resignation, which translates directly to everything from longer customer wait times to reduced item availability. For brands, this has become an employee experience (EX) challenge that is formidable, but not insurmountable.
Challenge #3: Off-Price/Discounts
The events of the last few years (and their lingering effects) have resulted in a consumer demand collapse for many goods and services. This is an especially adverse problem for the brands that sell these goods, as they now have to offload them at a significant discount. For example, I discussed in a prior article how reduced demand for patio furniture left these goods gummed up in the supply chain. About a year on, a combination of sluggish demand and eventual delivery has resulted in a deluge of patio furniture that brands, frankly, have no room for. Steep discounts can benefit customers, of course, but on this scale they leave a brand’s bottom line weakened.
Challenge #4: Shrinkflation
You’ve probably seen this word plastered all over your local news recently; if not, it’s the media’s new favorite term for paying the same price for a good that is reduced in size or amount. Multiple brands have taken this approach to their customer experiences as a means of attempting to prevent cost increases, but as you can imagine, most customers aren’t thrilled that the same amount they paid yesterday yields less for them today.
Challenge #5: Skimpflation
This one is similar to both shrinkflation and the staffing woes I mentioned earlier. In essence, even when brands manage to keep employee churn low, they must still contend with the possibility that the service their retained employees provide has lost some of its quality. This results in an underwhelming customer experience much like the amount reductions discussed with shrinkflation.
The Path Forward for Customers and Brands
It’s helpful to understand the territory your brand operates in, and these challenges constitute just that for many organizations in these strange times. However, there is more to the story: what are customers doing to cope with these and other challenges, and just as pertinently, what can brands do to respond in a meaningful way? How can they ensure that they’re displaying that empathy mentioned at the beginning of this discussion?
Click here to read my full-length point of view article on customer coping strategies and what your organization can do to address them. I’ve spent a great deal of time researching both of these CX elements over the last few years and am confident that those learnings can help you on your own Experience Improvement journey.
