According to a 2022 global study of over 23,000 consumers, 80% believe businesses need to improve their customer experience (CX). The same report warns that 9.5% of the revenue might be at risk due to bad CX. In the current digitised world, there are no two ways about the fact that businesses that truly stand out from their competitors are those that provide top-notch, delightful customer experiences.
To be precise, CX is king! That’s resolved. But can we afford a king with unlimited powers? The answer is a thunderous NO.
Are brands crossing the line?
Understanding customers and strategizing products as per their needs enhances CX and accelerates the company’s revenue growth. However, on the flip side, we are on the verge of a sustainability crisis. To offer better CX to consumers, brands are crossing a line – the red line.
To begin with, let me take you through a simple example. To target lower-income customers, single servings of foodstuff like soup and sauces are sold at low rates in tiny, multilayered packaging. Flexible packaging material is made with layers of different types of plastic that provide different qualities each. It becomes challenging to separate these different layers, and the components have little or no commercial value. Hence, most plastic sachets cannot be recycled, forming a huge chunk of our non-biodegradable waste.
With the advancement of technologies like AI, companies are chasing customers aggressively. This calls for a balance between customer experience and environmental choices. So, what is the way out?
Need to move towards responsible CX
Today, businesses worldwide are experimenting with artificial intelligence, machine learning, and advanced analytics to boost CX. However, many of these added advantages have a flip side that needs to be explored.
First, the population of Gen Y is constantly on the rise, and so is the demand for digitisation. However, the race towards extensive digitisation is hurting energy efficiency. A clear illustration of the potential effects of digitisation on efficiency and demand may be seen in video-streaming services.
Although it takes significantly lesser energy to download a video than it does to create, market, and buy a DVD, the accessibility and convenience make it easy to download and watch different content every night. The availability of digitalised services can unquestionably increase utilisation and the resultant energy demand.
Second comes AI, Natural Language Processing (NLP), to be specific, is a darling of the retail sector, especially when it comes to automating customer engagement 24×7 throughout the year. Researchers from the University of Massachusetts recently conducted a study to evaluate the life cycle of training various well-known large NLP models in Amherst. To their surprise, the process can produce more than 626,000 pounds of Co2 equivalent, almost five times the lifetime emissions of the average American car (including the manufacture of the car itself).
Additionally, personalisation engines let marketers decide what kind of experience is best for each customer or prospect based on their previous interactions, the current context, and their anticipated purpose. These engines assist marketers in identifying, selecting, customising, and delivering communications such as content, offers, and other interactions across customer touchpoints. As a result, we are moving towards promoting too much consumerism. The need to create things rises along with the demand for them. This causes more pollution emissions, increased land use, deforestation, and finally, climate change.
The way ahead
With the adoption of ML models across industries, the need to gather and analyse enormous volumes of data, and thereby the demand to have larger data centres has boomed. There is a need to set boundaries. An aggressive and careless approach to enhance customer experience may be beneficial in the shorter run, but disastrous in the long run.
According to a survey by The Economist, consumers feel that companies and governments have equal responsibility to bring about beneficial environmental change. Online searches for sustainable products have increased by more than 70% on a global scale. The way that consumers interact with sustainable businesses has changed. This pattern is not exclusive to first-world nations. Concerns about global warming are also linked to consumer satisfaction in emerging and developing nations. Now, it is for businesses to open their eyes wide open and move away from irresponsible CX to responsible CX.
