Managing the CX demands of 5 generations
INTRODUCTION
Baby Boomers, once the largest generational cohort, were followed by Generation X, the smallest age demographic. Gen X was followed by the Millennials, who outnumbered Baby Boomers, and now Generation Z is hot on their tails as the youngest, and largest, generation to date.
Born into a world brimming with technology, smartphones, social media, Gen Z’ers didn’t have to adapt to technology; it was always there. They are likely to be our first fully-digitized generation. However, unless your business is aimed at a specific age (e.g., pre-school parents or over-55 housing), focusing on one generation to the exclusion of others is not always a good strategy. Pew Research Center (a nonpartisan fact tank) published this chart as part of "Defining generations: Where Millennials end and Generation Z begins."
Bookended by the Silent generation, sometimes referred to as Traditionalists, and Gen Z, the continuum of ages in the chart comprises your customer base. Because of differences in comfort with technology, a one-size-fits-all approach to Customer Experience (CX) would leave many of them dissatisfied. A hybrid physical/digital strategy, though, that enables each generation to find their comfort level will ensure all customers are satisfied.
DIGITAL OR PHYSICAL - DON'T MAKE THEM CHOOSE
Forrester Research studied the best way to satisfy customers and published their findings in a report called, Customers Prefer Hybrid Digital/Physical Experiences. They concluded that consumers prefer a hybrid approach to CX over one that is purely digital or physical. One reason for this is that during the customer journey interactions take many different forms. Forrester opined that "...companies may find that expensive physical experiences are most worth the cost near the conclusion of customer journeys since according to the peak-end rule, customers judge an experience based on how they felt at its best moment and its end."
Deloitte also explored a hybrid approach in their post, Accelerating digital transformation in banking. They surveyed 17,000 respondents defined as Traditionalists (28%), Online Embracers (43%), and Digital Adventurers (28%). Not surprisingly, Millennials comprised the highest share of adventurers compared to the other segments.
Across this spectrum, Deloitte learned that "Many consumers still prefer traditional channels over digital channels for complex or advisory services [however].
Of the respondents who filed a complaint with their bank, 42 percent used contact centers, 26 percent used branches, and only 30 percent used digital channels (online or mobile). The trend is also true for applying for new products, especially loans that require multiple verification and documentation steps."
5 GENERATIONS AND THEIR CX EXPECTATIONS
The political landscape, economics, and social movements of a place in time bind generational cohorts together. The name, the Silent Generation, is attributed (in part) to the fact that they grew up during the McCarthy era, a period when it could be dangerous to air unpopular opinions. Millennials came of age during a recession, which made entering the workforce more difficult than it was for Boomers. Regardless of the generation in which they were born, all customers want the same thing – a great customer experience. The shared experiences which are unique to each generation shape their expectations for what makes a successful customer experience.
What follows are thumbnail sketches of each generation to remind you how their customer journeys may be shaped.
SILENT GENERATION (Traditionalists)
The Silent Generation are retired and very loyal. Today, this generation expects communications to be respectful and even formal. They prefer a phone call or even better, face-to-face interaction, over electronic communications.
Deloitte found that "Nearly one-quarter of traditionalists have never used online banking to access their primary bank. Their reluctance to use mobile apps is even higher—44 percent have never used mobile apps to access their primary bank.” They value individualized attention, high-touch CX, and personalized phone experiences.
BABY BOOMERS
Baby Boomers want an available, solution-oriented, polite, and authentic customer experience. They will hit zero ten times on the phone to speak to a human
being who will resolve their issue in one call. They still appreciate face-to-face meetings and telephone conversations, and although they do text, their digital
channel of choice is email.
According to Facebook research, Baby Boomers often begin their retail customer journeys in-store but are increasingly shopping online (over 30%), and on mobile devices (just under 20%).
Boomers are also less likely to use apps. They didn't grow up snapping and tweeting, but they still desire a seamless customer experience.
GENERATION X
Generation X is in the prime of their income-generating years, and they’re heavily influenced by their Gen Z kids. They are older, but not yet in their Golden Years, and they still value a streamlined process, with a wide range of communication channels. Statistically, Gen X has the highest rate of brand loyalty—as long as their experiences are positive. They are part of the 86% who will switch to a competitor because of a poor customer experience.
Slightly more than 80% of Gen X consumers own smartphones.5 Gen Xers who do use mobile payments like the opportunity to earn rewards, and appreciate the
convenience of being able to pay quickly and receive an electronic receipt.
When it comes to social media, Gen X uses Facebook and YouTube regularly; however, they tend to keep social media for personal use only and don’t often use it to communicate with businesses.
MILLENNIALS
From a global perspective, Millennials are, for now, the economic powerhouse. They will soon be the largest adult population, and they not only hold the purse strings, but they are moving into leadership roles in their careers. Millennials expect a fast, tech-savvy solution tailored to their preferences.
Ninety percent of Millennials own smartphones, and 50 percent have used their mobile device to make a purchase.Millennials are also more likely than Gen X or Baby Boomers to use mobile wallets, and branded mobile payment apps (like those offered by Starbucks and Dunkin Donuts) that reward them for loyalty.
A recent Bankrate survey revealed that Millennials tend to be wary of credit because of their firsthand experiences with the financial aftermath created by the Great Recession. As a result, their mobile or digital purchases are likely to be linked directly to a bank account or debit card, rather than a credit card.
Nine in 10 people ages 18 to 34 said they will take action after having a bad online customer experience, such as telling friends, stopping purchasing from the company, and posting reviews on a review site or social media.
GENERATION Z
Generation Z, the largest cohort, is still young, between the ages of four and 24, but they have an incredible influence on their parents’ spending habits. For them, technology is a way of life. Their cellphones wake them up; they turn their third-grade homework in via a tablet. They’ve been interconnected with their peers and their world for as long as they can remember.
Gen Z is growing up in an on-demand economy, defined as “...the economic activity created by technology companies that fulfill consumer demand via the immediate provision of goods and services.” This has cultivated a demanding customer who expects little or no wait time, and even more than Millennials, Gen Z expects (and will expect) an efficient, simple and fast customer experience—because they don’t know anything else.
As the most self-educated generation in history, Gen Z consumers are incredibly self-sufficient. They value seamless experiences that aren’t broken up by requiring assistance or having to deal with frontline staff. Instead, they prefer to handle things themselves. Providing readily accessible information to Gen Z consumers means they’re less likely to get frustrated and decide not to do business with a brand.
Gen Z consumers favor personalization with a view to individualization. These one-to-one “micro-experiences” are the basis for building brand loyalty and an emotional connection with customers, especially the true digital natives who make up Gen Z.
According to Fast Company, Gen Z is also highly comfortable using technology for financial transactions — including the use of mobile payment apps, and those that allow them to transfer funds instantly on their mobile device. This demographic also makes up the largest user group of mobile payments users, followed closely by Millennials, according to The Pew Charitable Trust findings.
While Gen Z prefers to shop online, this group gives priority to retailers that offer brick-and- mortar stores as well as an e-commerce option, compared to brands with an online presence only.
THE CUSTOMER JOURNEY
It’s critical to remember that the Customer Journey starts the first time a consumer clicks on a link, fills in a form, or calls to request information. They search the web, read reviews, and ask for quotes. They use their tablet, smartphone, and laptop, and they talk to friends and acquaintances about their experiences. Older generations are not the only ones who want to speak to a live person, and younger ones are not the only ones using smartphones.
When discussing the customer journey and its impact on CX, Annette Franz, founder, and CEO, CX Journey, said, “For CX, we want to map journeys that occur within each [lifecycle] stage. We need to map at a [more] detailed level to identify what’s going right and what’s going wrong with the experience. If you stay at too high a level, you’ll never know what the customer truly experiences.” A hybrid approach to support the customer experience will allow each generation to find their comfort level, and ensure that all customers are satisfied.
ONE SIZE DOESN'T FIT ALL
While trends provide marketers with a valuable, amalgamated view into the changing needs of demographic groups over time, insights gleaned from “generational marketing” research are precisely that – trends. While this research provides feedback on the preferences of overall groups, it is crucial to study outliers that exist to the data, and how representative those outliers are in your customer base and prospect lists.
For example, data may show that Baby Boomers prefer to receive physical communications and digital communications. However, this will not be true of ALL customers in this segment. Conversely, you will no doubt find Millennial and Gen Z consumers that prefer to receive physical communications rather than communicate via mobile or digital channels. If these outliers represent a significant portion of your customer base, generational marketing may be misleading to your overall strategy.
Providing an industry-leading customer experience requires marketers to focus on the individual and provide a truly personalized experience, regardless of the channel being used to communicate. While generational research gives an indication of what groups might desire from organizations when it comes to customer experience, and therefore help inform your overall approach, building systems of interaction based on this data will not provide the granularity required to craft deep connections with your customers.
Therefore, it is vital to put into place a flexible communication platform that leverages the data and content your organization has gathered to provide a truly individualized experience for every customer and prospect.
THE ROLE OF CCM
Modern customer communications management (CCM) technology helps companies create an agile, effective, and unified customer communications infrastructure to improve the customer experience. CCM puts you in control of every communication you send to your customers, regardless of the channel. It connects your business owners, designers, developers, and compliance personnel, and enables collaboration across all channels.
With a modern CCM platform, you leverage existing data and templates to create personalized omnichannel communications so you can accommodate the range of customers’ needs with a single tool and ensure excellent CX for all. By unifying your customer communications infrastructure, every communication project becomes accountable to your enterprise CX strategy at the highest level.
CONCLUSION
Each generation has its defining characteristics, but they also impact the expectations of others; Gen X’s children are Generation Z’s, and Baby Boomers’ children are Millennials. While Millennials were the first to demand a seamless, omnichannel experience, their Baby Boomer parents also now expect it.
A modern CCM Platform facilitates a hybrid approach to customer experience by enabling you to:
- Get the right messages to your customers, faster, on the channel of their choice
- Deliver interactive and device-friendly statements and reports
- Position, upsell, and cross-sell promotions tailored to the unique needs of your clients
- Create digital onboarding processes that include data pre-populated from your core systems
- Provide choice for communications channels
And create customer communications that are:
- Personalized
- Ready for delivery via any channel
- Guided by customer journey mapping
- Compliant with regulations
- Managed by your business users
- Governed by approval processes
Even as your company embraces modernization and undergoes a digital transformation to attract the younger end of the spectrum, you mustn’t neglect the Silent generation and the Boomers. Instead, use a hybrid approach to the customer experience and ensure that the message, branding, and presentation of your communications are the same, no matter what channel is used, and keep all your customers happy