Firms struggle with digital change

04 June 2012

NEW YORK: Many brand owners believe they have not yet adapted their customer communications to match the opportunities and risks of the digital age, new research has revealed.

Genesys, the software provider, and the Economist Intelligence Unit, the insights group, surveyed 244 executives, finding that 47% thought new media would help their company reach a wider audience.

Another 42% pointed to an enhanced ability to track consumer sentiment, 39% saw possibilities for more targeted sales and marketing, and 33% hoped to gather feedback and improve products.

"It's now much easier to stay in touch with the customer and form an ongoing dialogue," Richard Binhammer, director of social media and community at Dell, the IT group, said. "These closer relationships will increase customer loyalty, the likelihood of purchase and the average spend."

The primary problems included the rapid spread of unfavourable buzz on 40%, knowing which mediums to prioritise on 37%, issues in controlling brand image on 34% and working across channels on 29%.

"Consumers now own the brand," said Frank Eliason, SVP, social media at Citi, the financial services giant. "They tell each other what they are thinking, and what they are thinking is often negative."

While 59% of firms described their response to the rise of new customer communications channels in the last two years as "good", only 8% rated it as "excellent", versus 21% stating it had been "poor".

More specifically, 55% of participants regarded their initial response as "slow", 38% viewed their current model as "outdated" and 31% were still struggling to secure management buy-in to support change.

A further 26% of organisations reported that a "disconnect" existed between their social media and mobile teams and functions like call centres and email marketing.

One example of the delayed reaction to changes in the media environment is that 43% of companies started using social media in the last year. But just 11% have done so for three years.

A 60% share of the panel think the "main purpose" of new communications channels is for marketing and PR, with customer service on 6% and sales on just 4%.

But Mark Barnes, Volkswagen of America's head, customer experience, argued that firms must take an integrated approach.

"Different people within the company used to deal with different phases of the customer experience," he said. "There was no standard message coming out."

Data sourced from Economist Intelligence Unit; additional content by Warc staff