Andrea Lennon
Aug 11, 2016

The challenge in Asia: fragmentation

Want to create a great customer experience in APAC? First, understand the perils of pitfalls of its fragmentation.

Andrea Lennon
Andrea Lennon

Everyone wants to make inroads in the pan-Asia market, but regional marketers face many hurdles—especially where customer experience is concerned. Fragmentation and variability from region to region can capsize even the most insightful global or regional CX strategy. Here are some of the culprits:

  • Varying adoption rates and behaviours of digital and social media
  • Pervasiveness of local mom-and-pop sales environments
  • Variation in web/mobile usage
  • Market-specific prevalence of ecommerce
  • Socioeconomic factors.

Overcoming these challenges is no small task, but they’re by no means insurmountable. By better understanding how fragmentation and variability manifest from region to region, marketers can start to fine-tune solutions. So let’s take a closer look a few of the main difficulties endemic to Asia.

The ecommerce conundrum

Asian consumers are twice as likely to buy online as any other group in the world and purchase from a wider range of categories. Why?—an emerging middle class with growing access to digital devices, products and services. Also, the sheer scale of transactions is mindblowing: revenues in some markets are two to three times those in the US or Europe. It’s a recipe for an increasing demand for personal, best-in-class digital customer experiences.

But if you’re keen to deliver on that demand, don’t expect it to be uniformly easy. In Indonesia, for example, ecommerce is expected to grow by 18 percent annually with “fashion” as the market’s largest segment. But experience barriers related to connectivity, last-mile logistics and inventory availability will continue to pose obstacles to a good customer experience.  Moreover, data science is a relatively underdeveloped discipline; tracking the full customer lifecycle and lifetime value is the exception, not the norm.

Bank on fragmented preferences

China has some of the least loyal banking customers in Asia. Fewer than half will remain loyal to their bank in the face of more attractive competitive pricing. In contrast, 70 percent of consumers in emerging Asia tend to develop brand affinity for their bank (as well as their banker relationship).

Among my agency’s financial-services clients in Asia, we see premium customers express the same interest in self-service banking options as their global counterparts. Where they pull away in customer experience is the value they place on 1:1 relationships with their account managers, the types of products and services they purchase, and their fundamental investment philosophies. Finally, finance regulations fluctuate significantly from one country to the next, making a one-size-fits-all solution impossible.

Bank on fragmented channels, too

In Malaysia and Singapore, consumers demonstrate a preference for in-store service and shopping over digital channels—the opposite of Hong Kong and India, where online and mobile experiences reign supreme. Even customer-service channel preferences are highly variable by market, with as much as 91 percent in China, 87 percent in India, and 84 percent in Singapore preferring different channels to meet their needs.

The absence of a truly omnichannel, single view of the customer has never been more dearly felt than in the pan-Asia region. Again, banks are a prime example: there’s little connectivity among mobile, call centre, desktop, account manager, and physical branches. New products and services from existing banks (and brands) provide little to no incremental benefit. Outside of banking, however, Apple is a notable exception. It sees a seamless customer experience as a powerful core differentiator. Angela Ahrendts’s first order of business as the SVP of retail and online was to integrate the retail and online sales functions, which were previously run separately.

Solutions: Where to start?

1) Know your customers: First, talk to your customers in each of the markets you’re focused on. And do it frequently. In a recent customer journey exercise we were working on, we had some pretty significant gaps. Five customer interviews in each of three markets helped yield about 80 percent of the information we needed.

2) Champion the customer: Next, talk to your colleagues about your customers. And yes, do it frequently. If you lack the sophisticated tracking and analytics that you can leverage within an organisation, becoming the champion of the customer voice can be a way to build internal consensus on organisational priorities.  

3) Adapt to evolve: And always, recognise that there is no silver bullet. Be prepared to think differently about your business, and be prepared to fail faster, too. Size things up objectively—industry disruptors aren’t necessarily your nearest competitors or easy to spot. Above all, adapt to the environments your customers are already in, and don’t expect to construct entirely new branded ecosystems.

Andrea Lennon is SVP and general manager, APAC, with Critical Mass


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