Customer experience centricity is the top capability needed to succeed Enhanced digital engagement is the key trend
Hong Kong, 14 December 2020 – Hong Kong-based consumers have named grocery brands as top performers for customer experience excellence (CEE), according to an online KPMG survey of over 1,000 consumers in the city. Other sectors surveyed included Retail, Financial Services, Logistics, Travel and Hotels.
The survey, titled Customer Experience in the New Reality: Hong Kong S.A.R. Edition, asked the participants to evaluate over 60 local and international brands, with companies rated on KPMG’s Six Pillars of Customer Excellence – Personalisation, Integrity, Expectations, Resolution, Time and Effort, and Empathy. The analysis shows that overall customer experience score across all sectors remained at a similar level to last year (2020: 6.8/10; 2019: 6.9/10). ‘Expectations’ and ‘Personalisation’ were the key drivers for overall customer experience and the crucial motivators for enhancing brand loyalty, while ‘Integrity’ was the most important for driving customer advocacy in Hong Kong.
Grocery is the top performing sector which scored 7.01/10 this year (2019: 6.87/10). The survey shows that the sector came top in all Six Pillars across the sectors and achieved the highest enhancement in ‘Expectation’. Under the COVID-19 pandemic, grocery’s specific challenge is the meeting of sudden surge in demand for certain items, including food and household goods. The survey shows that not only were the grocers able to deliver and meet customer needs, but they were also able to provide a more frictionless experience for customers and reduce their time and effort to purchase, differentiating this sector from the other industries. Human touch is integral for all pillars. Customers expressed their satisfaction in the variety of goods found in store and the helpful staff. Customers are more cautious when purchasing a product under the pandemic. Feedback from customers who shopped at the top scoring grocery retailers praised the quality of products: namely freshness and cleanliness. Grocery retailers who can provide trusted information regarding their products will gain loyalty customers.
Alice Yip, Partner, Head of Consumer and Industrial Markets, Hong Kong, KPMG China: “Traceability and transparency will gain loyalty from customers who are more cautious about the origin of their grocery purchase. Digitalisation will enable this and businesses need to invest in it.”
2020 was a particularly challenging for the Retail sector in Hong Kong, where retailers had to find ways to reach customers amid social disruption and the pandemic, which have been catalysts for the digitalisation of retail in Hong Kong. The Retail sector outperformed other sectors in the ‘Personalisation’ and ‘Time and Effort’ pillars this year, with its overall customer experience score remaining at a similar level to last year (2020: at 6.91/10; 2019: 6.95/10). In addition, with customers being cautious about what they spend their money on, especially with non-essential items, retailers have to demonstrate a clear purpose and show empathy. During the pandemic, some luxury perfume and cosmetic brands converted their usual production to make sanitizers; while some apparel retailers with manufacturing capacity produced protective clothing for medical workers. This agility and flexibility in demonstrating solidarity has also given those brands a clear differentiating edge in terms of brand integrity.
Anson Bailey, Partner, Head of Consumer and Retail, ASPAC, KPMG China, says: “We are going to see an explosion of young Gen Z customers who are digitally savvy along with a strong sense of purpose as they look at the origin and manner of production across everything related to retail in the future. Data will be the key and businesses will need to communicate their values in a clear transparent manner to develop consumer trust.”
The Financial Services sector, the laggard sector back in 2019, achieved an improved overall score of 6.91/10 in 2020, compared to 6.78/10 last year. However, the study shows the sector still performed below average in all Six Pillars, with ‘Expectations’ being the worst in comparison with other sectors. The pandemic and the launch of virtual banks has accelerated the use of digital banking channels. As a result, banking customers’ expectations for a great digital experience have significantly increased. According to the survey, although banks have been able to meet customers’ basic expectations, customers still expect better experiences across digital channels and enhanced personalisation and self-service options through the use of mobile banking Apps.
Isabel Zisselsberger, Partner, Head of Strategy & Performance for Financial Services, Hong Kong, KPMG China, says: “Not surprisingly, enhanced digital engagement and experiences are critical success factors for banks looking to surpass client expectations in the age of COVID-19. Notwithstanding all the investment already made, consumer feedback shows that there is still much space to improve.”
As for insurers, major insurers in Hong Kong have recognised the stress of the pandemic on customers, with many offering free COVID-19 protection during the crisis, as well as other benefits and additional claims support. While it is clear insurance requires the human interaction, the industry as a whole has recognised the need for remote engagement. Hong Kong insurers are now enabling virtual and remote sales to customers. Customers are also having a greater expectation on the ability to purchase simple insurance online, and to digitally self-serve, for example to review their portfolios.
Darren Pigg, Partner, Insurance, Customer and Analytics, KPMG China, says: “Now is the moment all insurers have to invest more in digital as there is no other option. COVID-19 has just highlighted how much the industry depends on face-to-face selling and wet signatures, so organisations must now accelerate their efforts to remain relevant in the new normal. But then, alongside, there it is a great opportunity for insurers to demonstrate their value to the customer.”
Other sectors covered in this survey include Logistics, last year’s highest rated sector for customer experience excellence, which saw its score dropped from 7.08/10 in 2019 to 6.88/10 this year, while the laggard sector in 2020 is the Travel and Hotels sector, which score decreased from 7.06/10 in the previous year to 6.55/10.
Zisselsberger concludes: “Customer experience centricity is an absolutely critical capability to succeed in the new reality. In Hong Kong, we have studied customer expectations at multiple points during this year to understand which of the pandemic’s influences are lasting in consumer preferences. It is clear that we observe an increased expectation for organisations to enhance their capabilities to offer seamless experiences across channels. Customers of all ages value organisations which can deliver high levels of innovation and greater digital access whilst operating in a manner that is aligned with their own social values.”
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