Trends in customer experience & commerce [The S&P Global Report]

In 2024 (and even beyond), several key trends will shape how businesses connect with their customers and deliver exceptional experiences. But these trends are not just dry information. It’s concrete insights on how to improve customer engagement and operations at a company. 

That’s what the 2024 Trends in Customer Experience & Commerce report from S&P Global offers us. 

Let’s explore the top ten trends and see how they can impact your strategy for the time ahead.

Trend #1: Customer experience will be the top priority for GenAI use cases

An increased focus on leveraging GenAI to enhance CX while reducing operational costs is expected in 2024 and beyond. According to recent research, 57% of organizations planning to increase IT budgets this year will invest in GenAI. Notably, 87% of organizations currently utilizing GenAI expect to continue to do so.

Source: The S&P Global’s 2024 report

Currently, GenAI is used by organizations in customer-facing departments, including marketing (53%) and sales (45%), as well as customer service and support (42%). 

GenAI’s capabilities, such as automating service through chatbots or agent assistance, are revolutionizing how businesses interact. Its ability to craft personalized responses, solve complex queries, and anticipate needs can elevate the overall experience and make customers feel understood and valued.

Thus, businesses must prioritize this trend because investing in GenAI can significantly reduce human workload while improving the customer journey. However, to stay ahead, they should look into integrating GenAI not only for customer service but across all touchpoints. 

The best practice is to start small, then scale, and continuously monitor customer feedback to ensure GenAI is meeting the intended goals.

Trend #2: Advertising and marketing technology vendors’ advancements in Generative AI will be swift

The advertising and marketing landscape is seeing rapid change with the integration of GenAI tools. From predictive analytics to personalized content generation, AI enhances many areas – for example, how companies manage marketing campaigns. 54% of consumer-facing businesses plan to increase investment in technologies designed for running these campaigns. Further, 94% of marketers agree that they expect their company to increase spending on digital ads.

Source: The S&P Global’s 2024 report

Why is this trend significant? Because GenAI is a real help for improving accuracy and efficiency:

• Marketers can use AI to build predictive models that anticipate customer behavior and lead to more effective ads and promotions. 
• With economic uncertainty on the rise, the ability to cut costs while delivering high-quality, data-driven campaigns is invaluable.
• The AI-driven approach offers real-time campaign optimization – it can reduce wasted ad spend and enhance ROI. 
• Nowadays, marketers can no longer afford to rely solely on traditional methods. Here, GenAI offers them a competitive edge by making data actionable at unprecedented speeds.

Tip for your business: Regular training and AI-driven insights can also keep your team up to speed on the latest advancements.

Trend #3: Digital experiences will lead to the growth of embedded commerce across different shoppable touchpoints

There was an increase in embedded purchasing opportunities in 2023 for major media businesses. Now, embedded commerce, or the ability to make purchases directly within platforms like social media, TV, or live streams, is expected to grow. Companies like NBCUniversal, Hulu, and TikTok have already launched shoppable features on their platforms, which have given users a seamless buying experience. 

This trend will continue to explode. 

Why? Because consumers want convenience. 

According to the Voice of the Connected User Landscape (VoCUL): Connected Customer, Quantifying the Consumer Experience 2023 survey, 43% of consumers are less likely to interact with a brand/retailer in the future if they encounter too many steps during checkout. 

Moreover, 41% of respondents say that, in the past six months, they have already decided not to purchase if there are too many steps required to find the product or service or to complete the transaction.

Source: The S&P Global’s 2024 report

So, simplifying the buying process through embedded shopping experiences minimizes these barriers, encourages higher conversion rates, and results in fewer abandoned carts. Brands need to meet customers where they are. Without complicating the buying process.

Additionally, the personalization opportunities in these embedded experiences create a direct path to increase customer engagement and loyalty. Personalized recommendations, loyalty program access, and one-click checkouts can make all the difference.

Trend #4: Content supply chains will become more valuable with integrated feedback loops

An increasing number of content types, formats, and channels raises the need for well-orchestrated content supply chains. These chains span ideation to measurement and ensure content is not only created but optimized and reused based on real-time data insights. 

Source: The S&P Global’s 2024 report

Why is this trend important? 

In a world where consumers demand more dynamic and engaging content, having an integrated feedback loop lets you stay relevant. With this loop, you can track content performance and act quickly if something isn’t working. 

For example, a brand could release a digital ad campaign, receive immediate feedback from consumers, and optimize the messaging or visuals in real-time for better engagement.

Content that is contextually relevant and personalized wins consumer trust. Thus, managing content supply chains efficiently can both maximize brands’ investment in content creation and ensure they are delivering the right message to the right audience at the right time.

Plus, as user-generated content rises in popularity, companies need feedback loops to act quickly on content performance and adjust strategies. And to improve authenticity, 72% of businesses expect to increase spending on curating and syndicating user-generated content over 2024.

To leverage this trend, you can:

• Develop a comprehensive content strategy that includes a feedback mechanism to optimize content across platforms continuously. 
• Use AI-driven analytics to measure how each piece of content resonates with your audience and make data-driven adjustments on the fly.

Trend #5: Customer experience and product-led innovation will push new data-driven platform demands

Customer experience is a critical factor in differentiating businesses in a crowded marketplace. But improving it demands a focus on understanding your customers at a granular level. That’s where data-driven platforms come in. 

With the rise of customer data, companies need platforms that offer more than just storage – they need tools that provide a 360-degree view of the customer and can pull in data from various touchpoints to form a comprehensive profile.

According to 75% of respondents, customer experience can be improved by better alignment and collaboration with product design and engineering teams. Without this, companies risk losing valuable insights that can shape their offerings. 

Fortunately, with the right data-driven platform, businesses can gather real-time feedback on how customers interact with their products, identify pain points, and make necessary improvements. As a result, they can create better products, refine services, and guarantee the entire customer journey is seamless.

Source: The S&P Global’s 2024 report

Trend #6: Composability, not headless, will drive architectural shifts in digital experience

While headless allows for immense flexibility, it can also add complexity, especially for non-technical users. This has led many organizations to seek out composable architectures instead, which offer the best of both worlds: flexibility for IT teams and usability for front-end users. 

According to the data, only 14% of businesses prefer headless tools. The others prefer a templated approach or an architecture that provides composability for future flexibility.

Source: The S&P Global’s 2024 report

Composability enables businesses to add or modify any component of their digital experience without needing to overhaul the entire system. For companies focused on agility, it’s a necessity. Instead of ripping out an entire system, you can plug in new features or integrations as needed. 

So, composability allows businesses to iterate quickly, scale efficiently, and adapt to market changes in real-time.

Action point: Before committing to headless architecture, assess whether your business really needs that level of flexibility. For many organizations, a composable approach that offers ease of use alongside IT agility may be more suitable.

Trend #7: Embedded communications and conversational AI will displace contact center as a service

The way businesses communicate with customers is – of course – changing so fast. And embedded communications are at the forefront of this shift. 

Traditional contact centers, while still valuable, are being replaced by more dynamic solutions like embedded communications and conversational AI. These tools enable real-time, interactive customer experiences across various channels, from mobile apps to social media platforms.

Gone are the days when a phone call or email was enough.

Customers now engage with brands across multiple touchpoints, often simultaneously, and businesses need to keep up. Embedded communications allow companies to integrate real-time chat, video, and voice interactions directly into their apps and platforms. They just provide a more fluid and intuitive customer experience.

Conversational AI, which powers chatbots and virtual assistants, is vital in this transformation. By automating routine tasks, businesses can reduce the burden on human agents and free them up for more complex interactions. Moreover, conversational AI can provide customers with instant responses, reduce wait times, and improve satisfaction.

As we are into 2024 and get closer to 2025, we expect to see more companies adopting these technologies, particularly in customer service. 

You can integrate conversational AI into your customer service strategy. Start by automating simple tasks, like answering FAQs, and gradually expand its role in your customer interactions. As a result, your business can scale its customer service efforts without sacrificing quality.

Trend #8: ABM will move beyond marketing and sales into customer success

Account-based marketing (ABM) has long been a cornerstone of B2B marketing strategies. Until recently, it focused primarily on the early stages of the buyer’s journey – to increase awareness and consideration. But as companies evolve, ABM must also evolve. 

In 2024 and beyond, we will see ABM move above its traditional role and expand into customer success. This shift is driven by the need to maintain and develop post-purchase relationships with customers.

In the VotE: Customer Experience & Commerce, Budgets & Organizational Dynamics 2023 study, B2B respondents, when asked if they expected to hire more customer success managers or salespeople, were 3.5 times more likely to select managers. 

Hence, the conclusion is that the ABM metamorphosis will not stop at the sales department.

No longer confined to just generating leads, ABM will now focus on the entire customer lifecycle. This includes, for example, nurturing relationships after the initial sale, ensuring customer satisfaction, and identifying opportunities for upselling or cross-selling.

For businesses, this shift offers huge advantages:

1. By integrating customer success into their ABM strategies, companies can build stronger client relationships, reduce churn, and increase customer lifetime value. 
2. Moreover, with the rise of subscription-based models, retaining customers has become just as important – if not more so – than acquiring new ones.

Trend #9: The future of revenue intelligence will be powered by the new middle office

As digital transformation accelerates, a new market is emerging in the B2B space: the middle office. This group, responsible for managing the complex processes that keep both front-office (customer-facing) and back-office (operations-focused) functions running smoothly, will become an important player in revenue generation.

As part of this trend, revenue analytics is expected to be a major differentiator. 

B2B respondents in VotE: Customer Experience & Commerce, Budgets & Organizational Dynamics 2023 survey said they expect sales analytics and analytics tools to receive the third highest level of investment among sales technologies – after customer engagement tools and customer data integration/intelligence platforms. 

Source: The S&P Global’s 2024 report

Unlike traditional sales analytics, which necessarily look backward, revenue analytics offers a forward-looking view. It uses predictive analytics to anticipate customer behavior. These predictions will increasingly encompass every aspect of the sales process, from early qualification to complex negotiations.

Revenue intelligence tools provide sales teams with real-time insights and help them make data-driven decisions throughout the sales process. Moreover, revenue intelligence can identify which existing customers are most likely to be interested in additional products or services and help businesses maximize customer lifetime value as well.

Trend #10: Deep sector fintech vs. financial institutions — banks will focus on digital experiences

Fintech has transformed the financial services industry, and the competition between traditional banks and fintech providers is heating up. 

• Banks still hold a significant portion of the market and are widely trusted financial service providers.
• Fintech companies are gaining ground by offering superior digital experiences. 

For consumers, this means more choice, convenience, and personalized financial services.

As consumers become more accustomed to digital-first interactions, they expect the same level of service from their financial institutions. This has pushed banks to rethink their approach to customer experience and focus on digital platforms that offer real-time, data-driven services. Fintech providers, on the other hand, are targeting the gaps left by traditional banks, such as accessibility and usability, and are quickly becoming trusted sources.

For banks, the challenge lies in competing on both fronts: offering competitive products and delivering exceptional digital experiences. As more consumers turn to fintech for their financial needs, banks will need to invest in digital transformation to stay relevant.

Source: The S&P Global’s 2024 report

Bonus: Customer attitudes towards online shopping in Germany

German consumers display unique shopping behaviors that reflect their reliance on research, reviews, and convenience. 

According to Statista, 56% of German respondents prefer to conduct thorough online research before making a major purchase. So, we can say that German customers value being well-informed, take the time to compare options, and gather information before committing.

Following this, 49% of respondents find customer reviews to be an integral part of their decision-making process. For them, reviews offer trust and reassurance.

Convenience also plays a key role, with 35% of respondents preferring to purchase goods from various sellers in one online location. Platforms like Amazon or Allegro, that consolidate multiple sellers and provide a seamless shopping experience are clearly favored. 

Furthermore, due to convenience, 34% of respondents manage recurrent or habitual orders directly via their smartphones or tablets.

Interestingly, despite the shift towards online shopping, 24% of German consumers still prefer to see and touch an item before purchasing. This showcases a desire for a tactile connection with products, particularly in sectors like fashion or home goods.

These are the five most important factors for German buyers. The others are:

Source

Interestingly, many customers are in favor of augmented reality and virtual reality, so this provides further opportunities for companies. 

By adding express shipping or even same-day delivery, you get closer to offering the best experience.

Conclusion

As highlighted in the S&P Global report, the trends shaping customer experience and commerce in 2024 are driven by technological advancements, shifting consumer preferences, and market dynamics. 

Adapt accordingly, and you will take advantage of these changes. Otherwise, you may miss a lot of chances. 

And if you’re looking for more advice on e-commerce, the market, or customers themselves, you’ll find lots of useful information in our newsletter.