Digital customer experience: Everything to know in 2024

What is digital customer experience?

Digital customer experience refers to the sum of all the interactions between a business and its customer (or user, client, lead, etc.) through the course of their digital journey.

This digital experience encompasses everything from browsing a website to engaging with a brand on social media to using a company’s mobile app. The digital customer experience spans the gamut from initial product discovery to after-sales support and ongoing customer engagement.

The essence of successful digital experience management lies in meticulously tooling up for, carefully planning, and continuously maintaining every online experience to ensure it is seamless, engaging, and resonant with customer needs.

Digital customer experience vs. customer experience

The distinction between digital customer experience (DCX) and customer experience (CX) lies in the scope, medium, and methods of interaction and measurement between a brand and its customers. Digital customer experience specifically refers to the aspect of customer experience that is facilitated through digital channels—such as websites, mobile apps, and social media. It focuses on how a brand uses technology to engage with customers online, aiming to optimize the ease, efficiency, and personalization of those digital interactions.

Customer experience, on the other hand, is a broader concept that encompasses every touchpoint a customer has with a brand, regardless of channel or medium. This includes both digital and physical interactions, such as in-store services, phone support, and face-to-face communication, in addition to digital engagement. The goal of customer experience is to build a holistic and positive perception of the brand, fostering loyalty and satisfaction across all points of contact.

The key differences can be summarized in the following table:

Note that there can be an overlap between the measurement of the success of digital customer experience vs. customer experience. For example, surveys can be administered both digitally and in person. However, a survey administered digitally can be more easily created, disseminated, tracked, and analyzed.

Now that we know the difference between a digital customer experience and a traditional customer experience, let's talk about why a digital customer experience is so critical to business success!

The importance of crafting a top-notch digital customer experience

Here’s what makes the digital customer experience so significant in the modern business landscape.

Deliver on increased customer expectations

According to Raviteja Dodda, co-founder and CEO at the customer engagement company MoEngage, “Consumers today expect to receive a connected experience from brands.”

Modern consumers are shifting their needs from companies and looking for more than just products or services. In their digital experience, modern consumers desire a sense of connection and partnership. Businesses with apps must develop modern, digitally-native customer engagement strategies (such as loyalty programs), retention tactics, and customer support pathways to offer consistent interaction and guidance for users.

Digital customer experiences that can pull personalized customer data, no matter where a user is in their journey, will deliver on the evolving need for continuous, companion-like interactions that build deeper relationships.

Brand differentiation

In a digital marketplace, products and services are quickly commoditized. At that point, there’s little more than price to set them apart — and this is not where you want to compete.

In a world in which customers are increasingly digital-first, businesses that excel in providing an outstanding digital experience will set themselves apart in the most crowded market.

Better data-driven insights gained from a digital experience

By their very nature, digital interactions generate vast amounts of data. Turning all of this information into insights offers businesses an unprecedented understanding of actual customer behaviors and preferences — and how those evolve with the introduction of new features, competitors, and digital customer experience trends.

Boosted user loyalty and retention from a top-quality digital experience

Think about the last time you genuinely enjoyed a warm mug of hot chocolate - didn’t you want to tell your friends about it?

When people genuinely like a product or service, they want to come back — and let their friends know!

The same is true with the apps people interact with every day.

By focusing on providing a smooth, positive digital experience for your app users, you will inevitably start building loyalty. And by keeping up with what users want over time, you’ll eventually be able to build repeat purchases or subscriptions — aka, retention.

Now we know why a digital customer experience is critical to business success. So, how can you implement a winning digital customer experience strategy?

Steps and tooling for crafting a digital customer experience strategy

Developing a successful DCX strategy requires a multi-step approach:

1. Get to know target customer needs

The most important step in your digital customer experience strategy is to build detailed customer personas. These should outline demographic, psychographic, technographic, and behavioral information about the core groups of customers using your app and interacting across the rest of your digital experience.

You should know what they’re looking for based on this insight, but you can go even deeper by actually connecting with real app users. Ask them what they love about your app, what they wish it had, where they’re experiencing pain across their user journey with your brand, and so on.

Tooling: This can be a time-consuming and daunting task, especially if you’ve never had to create personas before. Look for customer persona-building tools and templates that facilitate the process.

2. Outline core digital customer journeys

Now, you can map out the customer journey of core user groups to understand the various touchpoints and interactions customers have with your brand.

Combine this with the personal insight you were able to gather in the previous step to make sure you have a clear picture of all the omnichannel ways users are experiencing your brand.

You may uncover some surprises but have a lot of conversion and retention power once you optimize them.

3. Map out new digital touchpoint integrations

Where along those digital journeys that you just mapped out can you integrate more modern, helpful, or exciting touchpoints?

Touchpoints are key areas of contact during the customer journey. When they’re used well, touchpoints can inspire the customer to continue on to your desired goal. Depending on the channel, you may want a touchpoint to help a user complete a transaction, share your brand with a friend, click through to your website from an email, click on a mobile notification to open your app, etc.

Tooling: There are a few platforms that are helpful in mapping out — and finding improvement points along — the customer journey:

• User testing software can visualize how users behave inside your app, as well as across all the digital channels they interact with on their way to achieving their goal. Different platforms will facilitate feedback in different ways. You may be able to see a layout of the path(s) users take, a video recording of their actual flow, eye-tracking data, or a heat map that shows areas of engagement.

• Mobile app analytics, or a similar type of product analytics platform, will show you clicks, bounces, scrolls, and other behaviors in your app so you can see how people are truly using it.

4. Leverage feedback to continuously improve the digital experience

As we’ll touch on when discussing digital customer experience optimization, iteration is everything. It’s the best way to ensure your brand and app will keep converting and retaining as the digital world continues to spin.

Tooling: How do you gather the information you need for continual refinement? Here are some options:

• Robust in-app chat messaging creates a natural-feeling channel for gathering real-time user thoughts and ideas.

• In-app feedback forms that are deployed at critical touchpoints in your app (or website!) can ask users what they think is done well and what could be done better.
  

• Surveys may be sent via email during/after customer support actions to gather insight.
  

• Social listening tools offer a completely unfiltered view of public opinion around your brand experience.

• An AI chatbot may proactively ask for feedback at critical stages along the customer journey.

4 best practices for digital customer experience management

Once you’ve got your systems and platforms in place for amazing digital customer experience management, here are a few things to check on to make sure you’re making the most of it.

1. Data-driven, omnichannel personalization is the name of the game

Recognize that, today, customers view most digital channels as equally important. Each serves a different, specific need.

That means you should ensure that each interaction is as effective as the next, catering to customer needs on their preferred channels. Lean on data to inform the level of personalization you’ll need to meet these varied requirements and enhance the overall customer experience. Here’s why omnichannel experiences are critical to your success.

2. If you have to prioritize, think mobile for your digital experience

Yes, we just said you should ultimately be serving most digital channels most of the time.

But if you need an area to focus your budget on or are ramping up digital customer experience efforts and looking for the right place to start — make it mobile.

Mobile traffic accounts for the majority of all web traffic. In addition, many consumer markets around the world are mobile-first or mobile-only.

No matter if you’re in the B2C or B2B space, smartphones are where consumers are shopping, assessing how your company measures up against competitors, and even making big purchase decisions. If your mobile app fails to meet their expectations and fit into how they interact with the rest of the digital world, they’ll be on to the next vendor before you even know it.

3. Implement closed-loop feedback when necessary

Let’s talk about closed-loop feedback. This is when you make an effort to follow up directly with a user who’s expressed specific feedback — especially when it’s negative.

Focusing on addressing this feedback can turn around soured relationships, leading to retention if not brand evangelism.

Pro tip: If you don’t have the bandwidth to close every feedback loop (and few businesses do!), the first step is to build a scoring system that helps you objectively prioritize customers and pieces of feedback. Then, use a customer support ticketing platform to document feedback you want to follow up on, attach scoring to that feedback, assign an agent, and then track its resolution to make sure the loop gets closed.

4. Get buy-in based on ongoing, iterative commitment

Digitizing customer experiences requires a significant, ongoing commitment. After all, if you’re aiming to enhance customer lifetime value, you have to engage throughout that entire lifetime (not stop the moment they download your app).

This means that results won’t be immediate, and the scale — as well as the budget needed to support the scale — will forever be changing.

Success in this area demands strong leadership support and maybe even a cultural shift within your organization. It’s a dynamic digital world, so it only makes sense that digital customer experience optimization is built on a framework of continuous improvement.

Pro tip: Iteration can be operationalized using A/B testing software. With this kind of platform, you’re regularly comparing old vs. new or making sure you’re moving in the right direction when it comes to optimizing digital experience services.

7 most important digital customer experience trends to know in 2024

Many trends in the digital customer experience have AI as their foundation. Where might you be able to take advantage of AI to elevate your DCX? Here’s where we’re seeing AI bring the most assistance to the digital customer experience journey.

1. AI chatbots and virtual assistants

Chatbots and virtual assistants can leverage advanced AI technologies like natural language processing (NLP), machine learning (ML), and deep learning to better comprehend customer inquiries and deliver help in natural, conversational language.

AI-powered bots and assistants empower customers to help themselves throughout their digital journey, so they can convert at your key touchpoints more quickly.

Digital customer experience examples

Here are a few examples of a great digital customer experience in action.

HDFC Bank’s EVA (Electronic Virtual Assistant)

EVA is deployed across various customer interaction points, including HDFC Bank's website and mobile app. It's designed to provide instant, 24/7 assistance to customers, handling a wide range of queries from account information and transaction details to product and service inquiries. EVA uses natural language processing to understand customer queries in a conversational manner, making digital banking more accessible and intuitive.

EVA stands out for its ability to handle millions of customer interactions with high accuracy, significantly reducing response time and improving customer satisfaction. The chatbot can efficiently manage a vast array of queries, which reduces the need for customers to wait for live agent assistance for basic banking inquiries. This level of automation and self-service enhances the overall digital banking experience, making it more seamless and convenient.

Based on AI and machine learning, EVA evolves with every interaction, which improves its accuracy and effectiveness in handling customer queries. This capability ensures that the chatbot remains up-to-date with the latest banking policies, procedures, and customer service practices. Furthermore, EVA's integration with HDFC Bank's backend systems allows it to provide personalized banking information securely, respecting customer privacy and data protection standards.

AllAthlete’s AI chatbot

AllAthlete, a sports recruitment app, used an AI chatbot to revolutionize sports recruiting at the high school and college level in just 3 weeks.

AllAthlete's journey began with a commitment to provide opportunities for young athletes and simplify the recruitment process. Communication between athletes, recruiters, and coaches was critical to the mission. Encouraging athletes to update their profiles and stay active on the platform was a challenge. So AllAthlete built chat in their app, and then used an AI chatbot for recruitment to prompt and guide these desired user behaviors.

Three distinct recruitment chatbots were built by AllAthlete using Sendbird’s capabilities powered by OpenAI's ChatGPT to do the following:

1. Proactively guide the users on how to best use the platform

2. Assist in athletic development

3. Bridge the communication gap between athletes and coaches

By transforming their digital customer experience with AI chatbots, AllAthlete was able to save 100+ hours of time with a more reliable system and saw a 25% increase in user retention. Read the full success story.

Navigating challenges and opportunities in digital experience

While the digital realm offers immense opportunities for customer engagement, it also presents several challenges that can hinder the effectiveness of these interactions.

Maintaining consumer privacy

Privacy is of paramount importance in the digital age. Customers are increasingly aware of how their data is being used and demand greater control over their personal information.

The solution is, first and foremost, to be transparent about data usage. More than half of people already believe data sharing is necessary to get a personalized experience — they would just like to be asked first!

Additionally, for legal purposes, you also need to become familiar with any privacy and security regulations that exist in your country — for example, General Data Protection Regulation (GDPR) is a common one — and make sure you’re compliant with those requirements. There are also data privacy management platforms that can help with this job.

Ensuring data security

With the rise in digital transactions, the threat of data breaches and cyber-attacks has become more pronounced. A security breach can result in financial loss for you and for your customers. It may also irreparably damage your reputation.

To tackle this, businesses need to invest in the best IT personnel and cybersecurity measures they can for websites and apps. Regular security audits, educating employees about security best practices, multi-factor authentication, and secure payment gateways are other crucial steps businesses can take to keep data safe.

Handling technical setbacks

Technical issues such as website downtime, app glitches, or slow loading times can significantly degrade the digital experience.

Unfortunately for many businesses, these problems can become more prominent as they grow their audience and traffic. In that way, success is a double-edged sword.

This is a huge reason why we’re proponents of the buy then build approach when it comes to underlying business software.

Instead of building out every single platform you use to make your business run, look for easy-to-integrate and flexible options that you can quickly deploy into your tech stack. Because the vendor maintains tools like this, you can always keep up with scale, avoid worrying about maintenance or updates, and go to market much faster than you would have if you were to create a complex product from scratch.

Enabling accessibility for all users

1.3 billion people — that’s one out of every six — experience disability. Accessibility is about making digital content and experiences reachable for all users, including those with hearing, visual, and mobility impairments and beyond.

To ensure the digital interactions you’re putting out there are safe and easy for everyone to use, look to the Web Content Accessibility Guidelines (WCAG) from the World Wide Web Consortium (W3C) for globally recognized standards on making web content more accessible for diverse audiences. If you don’t feel comfortable that you can fully enact their guidelines, you can also find agencies and individuals who offer web accessibility audits.

Now that we understand the basics of the digital customer experience and how to manage it, let’s talk about measurement! After all, how will you know if your digital customer experience strategy is bearing fruit?

Metrics for digital experience success

How will you measure your efforts to optimize the digital customer experience? Let’s cover some helpful metrics you can rely on to benchmark and guide your success.

• Touchpoint “conversion” rate: You can monitor the effectiveness of different digital experiences by how often a user converts, or takes the next action you want them to at a touchpoint. Conversions may include a signup, a click, a chat started, a content download, a purchase, etc.

• Customer satisfaction score (CSAT): CSAT helps quantify customer satisfaction. It's typically obtained through a survey and is considered an indicator of customer approval.
  

• Net promoter score (NPS): This metric gauges the strength of a company's customer relationships and is correlated with loyalty and business growth.

• Customer lifetime value (CLV): CLV reflects the financial value of each customer, helping you track increases and make decisions about how much to invest in acquisition.

• Retention rate: A high/increasing retention rate indicates that your experience is successfully keeping customers engaged, contributing to sustained revenue.

• Churn rate: High churn points to turnover due to customer dissatisfaction. Lowering this metric via an improved experience is crucial for maintaining a solid customer base.
  

• Referral rate: You want to see your referral rate grow, as it suggests satisfaction and is one of the best paths to growing user numbers, and by extension, revenue.