AWS for Industries
Seven Ways to Improve the Customer Path to Purchase Journey
Customer journeys have become a hot topic in recent years as retailers and brands try to better understand and enhance customer experiences. While this topic has been at the forefront of business-to-consumer (B2C) companies for many years, it’s becoming more and more important for traditional business-to-business (B2B) companies, like CPG brands—especially since many CPGs are adding a direct-to-consumer (DTC) channel to their distribution mix. In this blog, we’ll explore the concept of customer journeys, how it applies to CPG companies, and what technology strategies you should consider to enhance your customers’ journey.
Customer Journey: A Definition
Before we get too deep into the topic of customer journeys and how they impact CPGs, I’ll share a definition to make sure we’re on the same page. According to questionpro.com, “A customer journey is an entire experience a customer has while communicating with a brand. It considers the complete interaction roadmap from brand discovery to purchasing and beyond. The focus isn’t on transactions, but rather how the customer feels after interactions with the brand.” In other words, it’s about understanding customer behaviors holistically—end to end—including actions, preferences, and sentiment before, during, and after the sale.
The Complex CPG Customer Journey
As a level set, in this blog, we’re talking about consumers, as opposed to retailers and other traditional B2B customers of CPG companies. A key point to keep in mind, as technologies become entrenched in our culture, is that consumers have come to expect top-notch service—product information available on Google and overnight delivery. In fact, impeccable service has become the norm, and anything less can be detrimental for brands.
Here are a few stats to paint the picture of high customer expectations and preferences:
- 67% of consumers check the return policy before purchasing a brand’s product.
- 36% of consumers will go somewhere else if they have a bad post-purchase experience either online or with a retailer, and 20% never come back.
- 40% of millennials will go public with their experience.
- 59% will walk away from a brand after a few bad experiences.
- 17% will walk away from a brand they love after only one bad experience.
- Two-thirds of millennials shop in stores weekly because they like the experience.
- Most consumers follow brands on at least one social platform.
What’s interesting is the emergence of the post-purchase experience—the return process or service after the sale. It’s made CPG customer journeys much more complex. The re-emergence of retail stores after COVID-19 lockdowns and restrictions have also added complexity to CPG customer journeys, especially when CPG brands don’t necessarily have control over the retail experience. All of this means that CPG brands are no longer solving for channels; the customer is the channel, and engagement means from demand to delivery.
Why Customer Journeys Matter to CPGs
Customer journeys are not linear. They stop, start, retrace their steps, and can last extended periods of time. One stage along the journey doesn’t necessarily lead to the next stage, the way it does with some products and services and before the proliferation of CPG channels. With that said, one good experience almost always earns another experience.
Given the power of customer reviews these days, the story of a CPG brand is often formed by moments of truth that consumers are more than willing to share in reviews. And brand perceptions/value can fluctuate as each customer’s journey unfolds because loyalty is earned or lost with each engagement. For CPG brands to maximize their differentiation, CPGs must effectively manage the customer journey in collaboration with retail partners.
Customer Journey Opportunities for CPGs
Enhancing the customer journey means eliminating friction and making it as easy as possible for consumers to discover, engage, purchase, return products, or get service after the sale, especially as CPGs implement a DTC channel.
Here are some interesting stats to help you pinpoint opportunities to enhance your CPG customer journey:
- 63% of consumers expect personalization as a standard element of engagement, and 74% are frustrated when it’s not offered.
- 78% of consumers will leave a brand’s website if fast, free shipping isn’t offered.
- Customers check the status of shipments an average of eight times during a typical shipment and expect new updates with each status check.
- 60% of consumers are unhappy with the return process and often do not attempt to return a product.
With that said, when brands create a positive customer journey, before, during, and after the purchase, customers are:
- Willing to pay a 7% premium for a product.
- 8% less likely to switch to a competitive brand.
- Two times as likely to spontaneously recommend a brand to others.
Recommendations to Improve CPG Customer Journeys
What can CPGs do to enhance the customer journey and create loyal customers? Here are my seven recommendations to engage with customers more effectively and reduce friction at every point of interaction:
- Eliminate technical debt: CPGs need modern, agile cloud-based technology infrastructure to quickly adapt to changing market conditions, customer preferences, and emerging trends.
- Create a holistic view of the consumer: Consolidate siloed data and create a consistent pool of data to drive forecasts, marketing, personalized recommendations, and integrations with shipping and retail partners.
- Deploy a DTC ecommerce platform: Many CPGs are adding this new channel to engage more closely with consumers. If you already have a DTC website or you’re planning to implement one, Three Steps for Modernizing Your DTC Ecommerce Website by my colleague, Danny Yin, offers helpful strategies to modernize an existing ecommerce platform or implement a cloud-based, serverless platform from the beginning.
- Implement AI and ML: These technologies will be game changers for CPG customer journeys. Using tactics like automated, data-driven marketing campaigns, product recommendations, and post-sale follow-up interactions, brands can more closely connect with consumers.
- Expand shipping options: With modern, agile, flexible cloud-based systems that provide a real-time view of inventory across locations, CPGs can offer more options like faster or free shipping.
- Streamline last-mile delivery processes: Tightly integrate technology systems with third-party carriers to ensure a seamless flow of up-to-date tracking data, so customers always know the status of their deliveries.
- Simplify the return process: Be sure your back-office financial and operations systems are seamlessly integrated so you can provide returns as quickly as possible. Work with retail partners to improve system integrations for returns, too.
If you’re ready to enhance your customers’ journey, AWS is here to help you with global, flexible, pay-as-you-go cloud capabilities that can be deployed quickly. Contact your account team today to get started.