97% of Indian companies say CX innovation is required to protect businesses from competitors: Zendesk study

According to new research released today by Zendesk, Inc (NYSE: ZEN) in partnership with Enterprise Strategy Group (ESG), companies in Asia Pacific (APAC) that have continued to invest in their customer experience (CX) over the past year are 10.3 times more likely to have maximised their resiliency during the pandemic and five times more likely to have grown their customer base in the past six months. Organisations in India stood out against their APAC counterparts, displaying a keener interest in taking the CX route to business growth. Most Indian organisations (88%) accelerated their CX projects over the past 12 months compared to their counterparts in South Korea (67%), Australia (65%), Singapore (62%), and Japan (37%).

“In today’s digital-first economy, improving one’s customer experience is critical. In fact, our research with ESG confirms that the customer service function has evolved from a cost centre to become a revenue driver for businesses. Indian organisations who realised this have made great strides in maturing their customer experience capabilities, and are seeing the results. It’s important that all businesses - regardless of industry, size and life cycle - continue to invest and innovate in CX for long term success and growth,” said KT Prasad, MD & RVP, India & SAARC, Zendesk.

The 2021 State of CX Maturity Report surveyed more than 3,400 CX decision makers globally - of which 921 were from APAC including India, Australia, Japan, Singapore, and South Korea - to understand the characteristics and benefits of customer experience leadership. ESG built a CX maturity scale to identify common patterns and behaviors that separate high-maturity CX organisations - what ESG calls the “Champions” - from three levels of less-mature ones: “Starters”, “Emerging”, and “Risers”. The report outlines what businesses need to do to move up the maturity scale.

The research found that the number of Champions within midsized and enterprise companies in Asia Pacific has increased from 6% to 8% since 2020, with India (16%) and Australia (12%) having the highest proportion of Champions. The greatest gains in the region were tied between India, Australia and Singapore, which all saw a 6 percentage point increase from 2020.

“The findings indicate that the shift to digital and remote work during the pandemic served as a trigger for companies to accelerate their adoption of new technologies, policies and processes to benefit from a higher CX Maturity,” added Adam DeMattia, Director of Custom Research at ESG. “Across Asia Pacific, Champions recognise that service excellence can be a differentiator, and are actually accelerating investment in CX projects.”

CX-led innovation is a competitive differentiator, particularly in India.

The vast majority of respondents in APAC (90%) agree that CX innovation is required to protect their business from competitors. And in India, 97% of midsize and enterprise-sized Indian organisations agree with this sentiment. In fact, three quarters of them recognise the strategic imperative of CX innovation, significantly more so than their counterparts in South Korea (49%), Japan (45%), Singapore (42%) and Australia (41%).

They also see the value of data to help focus this innovation - 100% of Indian organisations say they use support data to expand sales opportunities and business growth, the highest globally. And they’re reaping the results - an overwhelming majority (94%) report a significant impact on business growth, higher than any other country surveyed.

Among the four levels of CX maturity, Champions in APAC are taking the lead in driving continuous innovation in their CX and using customer service data.

  • APAC Champions are 7.4 times more likely than Starters to be using service data extensively.
  • When used, that data is delivering results - APAC Champions are 17.3 times more likely to identify the impact on sales success as “game changing”, oustripping counterparts in North America (12.7 times) and Europe (9.4 times).
  • APAC Champions are also 2.8 times more likely than Starters to have accelerated major CX projects over the past year.
CX maturity and innovation linked to business resilience and revenue growth

There also continues to be a clear correlation between improved CX maturity and the benefits of increased customer satisfaction (CSAT), faster response times, and effective customer service. Notably, the study also calls out the connection between CX maturity and greater business growth and revenue.
  • This connection is most pronounced in Asia Pacific, with midsized and enterprise Champions from the region 4.7 times more likely than Starters to have grown their customer base over the past six months, and 10 times more likely to have increased per-customer spend significantly over the same time period.
  • Champions are also changing how the customer service function is viewed across their organisation. With digital interaction being the main connection point with many customers, Champions in Asia Pacific are three times more likely than Starters to operate profitable service teams, where direct revenue exceeds the cost of customer service.
  • APAC Champions are also better positioned to adapt and thrive in the face of change, taking roughly half the time to grow their team by 50% and onboard new hires (22 days versus 43 days for Starters) and add a new channel (21 days versus 45 days for Starters).
Investment in CX leads to better agent retention and productivity

Agent turnover, technology, flexibility and wellbeing all emerged as areas of investment and focus for teams over the course of the past 18 months. This led APAC Champions, in particular, to move quickly to implement tools to support overwhelmed service teams.
  • Investments and process changes made by APAC Champions in the early stages of the pandemic include increased utilisation of public cloud services (66%); more flexible remote work policies (64%); expanded mental health/wellbeing initiatives (64%); more flexible working hours (60%); and the adoption of new collaboration tools (60%).
  • Larger APAC businesses have also increased customer visibility in the past year, with 43% saying they have achieved a “single source of truth” when it comes to customer profiles compared to 25% a year ago. A closer look at APAC Champions found that they are 6 times and 9.4 times more likely to deliver excellent customer visibility and cross-channel visibility, respectively, to agents than Starters. In fact, over three quarters of larger Indian organisations (77%) achieved greater cross-channel visibility, a significantly higher percentage than their counterparts in Australia (36%), Singapore (29%), South Korea (23%), and Japan (17%) .
  • As a result, APAC Champions are 4.3 times more likely to have excellent agent retention and 72% higher agent productivity than Starters. That said, staffing turnover continues to be a challenge for more than one in three APAC organisations, up from 23% in 2020. This figure rises to 76% among midsize and enterprise-scale businesses in India.
  • Between accelerating CX investments and adapting service policy changes earlier in the pandemic, Champions in APAC are 10.3 times more likely to believe they made the right investment and policy decisions during the pandemic to maximise their resiliency. Indian organisations stand out against their APAC counterparts as close to two thirds (64%) feel they made the right CX investments to increase their business resiliency in the future versus 11% in Japan, 21% in Singapore, and 28% in Australia and South Korea.
  • APAC Champions also expect a 25% increase in the number of remote agents, even after the COVID-19 pandemic is no longer an issue.
Conversational experience for stronger customer relationships

Globally, Champions are three times more likely to prioritise delivering conversational customer experiences that can build deeper customer relationships. And in APAC, Champions unanimously agree that pivoting to a more conversational experience with customers is a key goal for their teams - signalling the shift away from transactional service focused purely on resolving tickets.
  • Organisations in APAC have increased the number of service channels year-over-year from an average of 7 to an average of 7.8.
  • Many anticipate that preferences and changes will continue to shift as well: 73% of APAC organisations predict that chat and social channels will be most used by customers in the future, up from 54% who say this is the case today.
  • Meanwhile, Indian organisations lead globally in their enthusiasm for a conversational future, with 79% of them agreeing that chat and social channels are most used by customers today and 100% predicting this will remain the case in the future.
  • Zendesk’s customers in India include ITC Foods, Ola, 1MG, DevFactory, Dream11, Slice, Magicbricks.com, etc.

- For more information, download the report, The State of CX Maturity, here

- Read the blog content series on how businesses can achieve CX maturity here

- Check out the virtual event, “CX Discoveries: Decoding Customer Service” here


In the second quarter of 2021, ESG conducted a double-blind survey of 3,450 line-of-business decision makers - of which 921 where from Australia (N=203), India (N=200), Japan (N=208), Singapore (N=197) and South Korea (N=113) - who were responsible for ensuring and enhancing the customer service at their organisation. Organisations spanned all market segments, from small businesses to large enterprises, and multiple industry verticals like retail, consumer and corporate services, financial services, healthcare, education, and technology companies, among others.

About Zendesk

Zendesk started the customer experience revolution in 2007 by enabling any business around the world to take their customer service online. Today, Zendesk is the champion of great service everywhere for everyone, and powers billions of conversations, connecting more than 100,000 brands with hundreds of millions of customers over telephony, chat, email, messaging, social channels, communities, review sites and help centers. Zendesk products are built with love to be loved. The company was conceived in Copenhagen, Denmark, built and grown in California, taken public in New York City, and today employs more than 5,000 people across the world. Learn more at www.zendesk.com.

About ESG

Enterprise Strategy Group is an integrated technology analysis, research, and strategy firm providing market intelligence, actionable insight, and go-to-market content services to the global technology community. Learn more at www.esg-global.com.


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