Bug or Butter: With Data, Where’s CX Going Next?

It is the Charles de Gaulle Airport. As you run towards your boarding gate, you dash by the flight information screen hanging in a corner. You pull out your boarding pass and suddenly squint your eyes. It can’t be real. The screen flashes ‘just your’ flight name, gate change update and boarding sequence. Coupled with the exact directions to make you reach your gate without confusion. But everyone around you is as surprised and delighted as you are. The same screen but different – for each passenger.

You walk into a retail store. And – as if by magic- the aisles rearrange themselves to display an assortment of items you usually buy. As if they just read your mind. It’s a fuzzy world. The food apps know what you are craving for. The cab app takes you where you want to go without even asking. And the hotel room is smelling of just the flowers you were thinking about.

We already have streaming sleuths like Netflix serving us ‘almost exactly’ the kind of movie we would have preferred to watch next. Less of a recommendation and more of a preternatural intuition.

It’s not in the future tense. It’s happening. Right this minute.

De Mieux En Mieux

Customer experience is no longer the forte of a few. Gone are the days when only fancy hotels or high-end personal care services would worry about this marketing term. Today, even products are becoming highly serviced. Every product - be it a car, a cornflake box, a burger, or an OTT subscription- has been boiled in the pot of customer experience and distilled into a service. And every service, of course – be it a flight, a hotel stay, a cab ride or a haircut- is trying its very best to understand, guess, serve, delight, and ‘wow’ its customers at a very deep level.

Recently at a conference Dr. Satya Ramaswamy, Chief Digital & Technology Officer, Air India shared how AI-vision is in progress- and soon advanced and real-time vision capabilities can automate a lot of things with just a vision-capture of the boarding pass.

Personalization is everywhere in this Customer Experience renaissance. From Netflix – which uses ‘signals’ in an algorithm to gauge how long a user watches a show, where s/he rewinds or opts for fast-forward to Sephora’s Color IQ (Which now provides personalized makeup recommendations using the scan of a customer’s skin tone) – everyone is trying to ‘suss’ the customer out – proactively.

At CareAsOne, we recognize the transformative impact of data on customer experience.

Paras Chaudhary, Co-founder and CTO, CareAsOne

We already have personal finance assistants like Cleo that can target Gen Z with memes, imagery and slang that ‘gets’ them. For instance- it does not offer plain, common denominator-type suggestions but a ‘hype’ or ‘roast’ — positive or negative feedback on their spending. There is Hinge Health, which gives tailored therapy and gamified ways to motivate patients.

Even traditional companies like American Express are now sponsoring teams like the Brooklyn Nets and venues like the Barclays Center – to give fans enhanced game-day experiences, exclusive ticket access and fast-lane entries.

A good example here is that of a care-giving service enterprise. “One of the significant trends is using data to encourage caregivers to be proactive in their job search. By leveraging AI and data analytics, we remind caregivers to complete their profiles, apply for jobs, and attend interviews.

This proactive engagement ensures agencies have a robust pool of qualified caregivers, streamlining their hiring process. Utilizing behavioral data, we send personalized reminders and notifications to caregivers based on their activity on the platform.” Shares Paras Chaudhary, Co-founder and CTO, CareAsOne.

AI is also in the marketer’s team now- making it easy for brands to know more, know fast and know minutely. “The role of AI in enhancing customer experiences has never been more crucial, as it empowers companies to meet these demands with precision and efficiency.

AI enables businesses to automate tasks, personalize interactions, and provide intelligent recommendations at every touchpoint, allowing them to deliver faster and more efficient service while also gaining a deeper understanding of customer needs.” Shares Deepak Pargaonkar, Vice President of Solution Engineering at Salesforce.

With a commitment to building trust in AI, we emphasize the importance of responsible technology use. 

Deepak Pargaonkar, Vice President of Solution Engineering at Salesforce

As Ravi Putrevu, Co-Founder & CEO, Natfirst chimes in, "The latest buzz in customer experience (CX) technology for retail insights in India centers around AI-driven analytics and real-time data integration. These advancements are transforming how retailers understand and engage with consumers. Generative AI (GenAI) is particularly exciting, offering enhanced predictive analytics and automating personalized interactions. This means retailers can make smarter decisions, tailor their offerings, and create seamless, customized experiences for shoppers.”

The tip of the iceberg has already been scratched. Now more is coming in and at a faster pace than ever.

“By expanding our use of behavioral analytics, we can create even more personalized and effective engagement strategies. This might involve more sophisticated nudging techniques or predictive models that anticipate caregiver needs and actions, thereby improving their job search experience.” Chaudhary lets on.

Yes, studies have shown how Digital Experience Platforms or DXPs helped companies with a 25 percent increase in customer engagement. Also, businesses have reported a 20 percent jump in sales after implementing personalized experiences via DXPs – as shown by Gartner.

And by 2025, AI-driven personalization strategies could spur retail business profitability by up to 15 percent. There are expectations that the use of AI in understanding customer preferences could chop away marketing costs by 20 percent through automated, targeted campaigns (as seen in a McKinsey report — AI in Personalization)

In a 2022 survey, Salesforce also reported that 73 percent of people expect companies to understand their unique needs and expectations. In fact, over half also hinted that companies should go as far as ‘anticipating’ them.

The twist in the story is that it’s not just marketers that are tapping user data for personalization but users, themselves – in some emerging cases.

Yes. Now customers can also use their data for monetization opportunities- instead of it being exploited by second-party or third-party data marketplaces. Take the case of Datacy which compensates individuals for their online browsing behavior or Caden which doles out monetary incentives for detailed information about a person’s streaming/traveling/buying behavior.

Clearly- we are fast-moving in a world where brands listen and whisper to us at a very intimate level. Intimacy can be extraordinarily caring. Or creepy, depending on who is handling it, for whom, and how.

De Pire En Pire?

Remember the Target backlash? How the retail major suffered when a predictive analytics system spotted a teenager’s pregnancy before her family was cognizant of it. It is a good cue for marketers to remember that not every personalization move in CX is right or desired by the customer/prospect.

Target has a company here- interestingly, from Disney. Disney gives attendants personalized wristbands using their information to log entry into different points in the park. At the Haunted Mansion, the attraction took that technology and used customer names and even home states during a final animation sequence. This was combined and etched onto holographic tombstones. Of course, some loved it. But some found this ‘mention’ more scary than the Mansion.

PII is now front and center across your CRM/CDPs- and how you protect it, no matter where the data is stored becomes vital. 

Anshu Sharma, Co- Founder and CEO of Skyflow

And you cannot be rude or intrusive when you know too many details about your customer. Netflix has been under the spotlight whenever it would reveal tidbits about its own user data for other purposes. Like, once during the 2017 Holidays, when the streaming giant tweeted out, “To the 53 people who’ve watched ‘A Christmas Prince’ every day for the past 18 days: Who hurt you?”

As to ‘anticipatory selling’ – it can, too, slide into a dangerous zone before you know it. Recall how baby products wholesaler Mother’s Lounge thought it would be clever to tap data to reach future customers but ended up pushing away new shoppers. It tried to target women based on their age and location to indicate a higher probability of pregnancy – with what looked like handwritten ‘Congratulations!’ notes bundled with gift cards to their stores. Well, a vast majority of the women were, as is not hard to guess, not pregnant. And imagine the reaction of one woman who received the note on the first anniversary of her miscarriage!

No one wants a nosy-parker for a brand – for sure. Privacy – both in terms of customer expectations/awareness as well as regulations- has emerged firmly in the recent past. And the biggest challenge in CX today- is not ‘how’ ingeniously you can use customer data but ‘should’ you use it.

Croyez Moi

So what’s the safe spot between ‘knowing too much’ and ‘knowing too little’?

The tricky part is that while data can lubricate personalization-enriched CX in fast and deep ways, it can also turn into something nasty and smarmy. The grease is good as long as it moves the wheels and does not spill into someone’s hands.

To begin with, the next generation of CRMs need to evolve from storing customer data to storing user data. Example: Ola Cabs or Uber, reasons Anshu Sharma, Co- Founder and CEO of Skyflow. “Their customer relationships are primarily the users of its applications both on the driver side and the passenger side. Whatever approach they choose to manage this new type of user data is what the world of CRMs will evolve to. The old school way of just thinking about your customer base in terms of leads, contacts and accounts is now outdated.”

Handling sensitive information requires stringent data privacy and security measures, Chaudhary seconds that concern. “We have implemented robust protocols to protect caregiver and agency data, ensuring compliance with all relevant regulations and building trust among our users.” 

Caution will not be a bonus but a staple in the next era of Customer Experience design. “The future of CRMs (Customer Relationship Management) will require robust access control mechanisms to manage who can view specific fields and in what context. Encryption of sensitive fields will likely become standard practice.” Sharma stresses.

Data will stop being just data. Especially if it’s PII (Personally Identifiable Information) that you are harnessing in some way. In Sharma’s reckoning, the next generation of CRMs and CDPs (Customer Data Platforms) must prioritize PII protection, adopting advanced access controls and encryption methods to comply with new regulations and protect user data.

Especially- with the recent enactment of the DPDP law that has set stringent standards for data protection. It has begun making compliance essential for companies to avoid severe legal and financial penalties of up to INR 250 crores ($30M) per violation.

“Many organizations utilize data warehouse solutions like Snowflake or BigQuery to gain a comprehensive view of their customers. With new regulations, protecting PII within these systems or excluding it altogether is crucial. For instance, should your marketing team have access to specific customer details, such as Ayesha's email and purchase history, to send targeted offers? The solution lies in running workflows, including analytics, pseudo-anonymously. This means your marketing team would see data on ‘customer 123’ instead of identifiable information. Whether this anonymisation happens before data is loaded into the data warehouse or is managed within the system, it ensures compliance with new privacy regulations while still enabling effective marketing strategies.” Sharma explains.

CX is going to be not tough but tricky as we move ahead. The difficult part of the puzzle will not be technology but the choice of using it.

Imagine. You are running towards your boarding gate. You stop to look at the screen. And it shows you which hotel you are coming from, what you watched last night, what you ate, which Doctor you go to and even the school your kid goes to. Would that be delightful? For some, it may be the WoW-laden intuitive personalization that they had always wanted. For some it may be a trespassing nightmare. You know the answer best. And the brand has to guess that too.

Before you do. And before you reach your gate.