The current coronavirus crisis has resulted in several “firsts”: the extent of the business slowdown, the closure of shops, schools and cultural facilities, and the restriction on free movement. Simultaneously, this crisis resembles others that we have experienced or will experience: economic difficulties exist, unevenly impacting different market sectors; and there are vulnerable groups, whose fragile finances will be hit hard. Like any crisis, this one results in winners and losers. It will cause or accelerate decline among some players, but also unleash untapped potential and new opportunities.
From research KPMG carried out in late May and early June 2020 (into companies’ response to the COVID-19 crisis, by Ipsos for KPMG, Czech Republic, N = 570 respondents), it emerged that approximately 16 per cent of small and medium-sized enterprises are responding to the crisis through investing in customer experience. For some of them, it is about survival (for example, building new distribution channels). For others, it means a chance to maintain renewed interest from customers or, in some cases, a way to occupy a market position vacated by competition killed off by the crisis.
One of the findings of the international CEE (Customer Experience Excellence) research is that customer experience indicates that some companies have taken advantage of the crisis for future development, while others (at best) are merely surviving. This study is primarily based on the CEE research.
In the Czech Republic, customer experience has improved since 2019, continuing the trend of previous years. Two thirds of brands saw their scores increase. The NPS (Net Promoter Score), i.e. an indicator of how recommendable a brand is, also went up. Recording the most improvements were the Restaurants and Fast Food, Non-Grocery Retail and Logistics sectors. The only sector witnessing a decline is Travel and Hotels. In the wake of the coronavirus crisis, this is to be expected.
In the new “COVID-19 response” parameter, customers especially appreciated the sectors meeting their basic needs during the crisis: Grocery Retail, Logistics and, under the Non-Grocery retail category, pharmacies. Telecommunications operators enjoyed decent scores, too, but one might have expected better results, given the fact that it was thanks to these companies that people could work, study, “meet” loved ones and do their shopping.
The weakest result in this parameter was recorded on the one hand by segments with a worse overall evaluation (Utilities and Telecommunications, already mentioned above) and on the other hand by segments hardest hit by the crisis (especially Travel and Hotels).
Financial Services institutions also performed poorly in this metric, which is reflected in the significant gap between the evaluation of their overall customer experience and these companies’ responses to COVID-19. The least satisfied were the customers of institutions which did not allow mortgage or other loan repayment deferrals. Widespread media coverage of this issue led customers to expect their loan providers to show appropriate understanding. Insufficient willingness and flexibility in meeting such expectations have strongly impacted how customers perceived building societies but also some banks.
In what specific ways has the coronavirus crisis affected customer experience? We have identified four main areas:
1. Using digital channels
This aspect chiefly concerns banks and financial services institutions (e.g. the development of online banking, including mobile apps and cashless payments). Likewise, it applies to online shopping, online entertainment and online communication, both business and private. Besides boosting standard online tools, the crisis has facilitated more experimental formats, such as virtual tours of a chateau. Additionally, people have discovered new services and brands, e.g. ordering directly from producers (farmers).
A digital channel in itself did not automatically guarantee success. Services built digitally from scratch could also be severely affected if the final service involved interaction posing a health risk, as some taxi firms illustrated.
Some establishments could not fully manage the enormous surge in interest in their services, resulting in website outages, in some cases causing logistics issues.
2. Fostering customer loyalty and being socially responsible
Many corporations have used the crisis to strengthen their relationships with customers. For instance, some banks contacted them remotely through personal bankers and proposed more flexibility in loan repayments. In sectors which weren’t hit hard (e.g. Utilities), companies supported communities where these businesses operate, for example through directly assisting vulnerable groups or providing meals to emergency services. Any establishment wishing to do so had an excellent opportunity to present itself in a good light and build a socially responsible image.
3. Being helpful when services are restricted
Being unable to provide services (or only to a limited extent) has principally affected the Travel and Hotels and Entertainment and Leisure sectors. In the first COVID-19 wave, companies faced an enormous administrative burden as clients sought refunds of admissions/fares, or were required to reschedule, cancel, etc. The resulting customer experience in these sectors strongly depended on the flexibility and willingness such corporations show to their clients. We can expect that the helpfulness factor will remain important in the future and that customers will be more demanding in this regard.
4. A new way of bricks and mortar shopping
Not all shopping has moved online. Bricks and mortar shops have continued doing business, but their operations have changed. Masks, distancing, disinfectant, gloves, shopping hours for senior citizens only, serving hatches and plexiglass on restaurant tables have all affected customer experience.
Greater digitalization will continue where it makes sense. Some organizations will be able to capture a positive moment in the perception of a brand’s reputation and transform it into a longer-term impression. Services that could not be provided during the pandemic will return, although not all establishments providing these services pre-COVID will be back. After some time, we will be able to breathe at each other’s necks in queues in bricks and mortar shops again. However, we may be quite happy to keep some conveniences contactless, such as serving hatches or contactless delivery by courier.
And what about customer experience? Thanks to the active approach of some firms, the overall impact could be positive. The adverse effects of the crisis will subside as the economy restarts, and the positive new practices that companies have adopted will remain.