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The Digital Customer: Balancing Personalisation and Privacy

The fifth edition of the State of the Connected Customer Report, produced by our partners at Salesforce, provides insights into the new customer engagement landscape. Based on responses from nearly 17,000 consumers and business buyers, the report highlights how the events of recent years, including the global pandemic and the supply-chain crisis, have influenced the way in which customers interact with brands. Trends such as digital-first experiences, personalisation at scale, data privacy legislation, and the rise of asynchronous channels have all contributed to this shift. 

The Salesforce report is segmented into four chapters, and we here at redk are summarising the highlights from each chapter over four blog posts. This week we’ll cover chapter two: 

 ‘Digital Acceleration Sparks Demand for Personalisation at Scale.’ 

Digitalisation: The Generation Gap 

In 2020, the global pandemic accelerated an existing trend – digital transactions rose by an impressive 36% between 2019 and 2021. Even after the return of in-person sales, this trend continues, with only 43% of customers preferring non-digital channels.  

 Salesforce predicts that ‘if younger customers’ preferences are a weathervane for the future, digital footprints will expand.’ 

There’s a clear generational shift in attitudes to digitalisation, with millennials – the generation born between 1981 and 1996 – showing the highest preference for digital engagement: 65% prefer digital channels and 63% prefer to purchase online rather than in-store. And the youngest customers, Generation Z (those born between 1997 and 2003) are 1.6 times more likely than baby boomers to prefer digital channels.  

Customer Expectations: The Personal Touch

Customers are increasingly recognising that it’s possible for companies to deliver a personalised service across digital systems. 56% of customers now expect offers to always be personalised and the percentage of customers who expect companies to understand their unique needs and expectations has risen from 66% in 2020 to 73% in 2022. 

Salesforce found that 88% of customers say the experience a company provides is as important as its products or services – up from 80% in 2020 

These results suggest that investment in digital transformation is paying off. Exposure to positive digital experiences seems to raise expectations further, placing increased pressure on companies to deliver.  

Data Privacy in the Spotlight

Personalisation relies on the collection and use of personal data. Here too, there has been a shift towards greater trust: an earlier Salesforce report on ‘the connected shopper’ revealed that 67% of customers would share their birthday, and 42% their lifestyle preferences, with a company in exchange for tailored rewards. 

 74% of customers still say companies collect more personal information than is necessary – Salesforce 

Although consumers now feel that companies take online privacy seriously, many feel that businesses are not open enough about their use of personal data. That’s why it’s essential to have a data-driven strategy to ensure that customer data is accurately and consistently stored and to implement identity and privacy tools. 

AI and Customer Trust: Friend or Foe?

Artificial intelligence (AI) is a vital component of data-driven digital transformation. But as customer awareness of the benefits of AI – such as voice assistants – increases, so does awareness of the risks. 72% of customers express concern about the unethical use of AI, and 62% are worried about bias in AI. 

On the whole, customer trust in the use of AI is increasing: 69% of customers say they’re open to the use of AI to improve their experiences. Provision of personal data is increasingly viewed as a fair exchange for the level of personalised service generated by AI – as long as that data is used ethically. 

Digital Transformation: Increasing Customer Satisfaction and Trust

As we’ve seen, customer engagement is increasingly digital-first, a trend that is likely to continue. But as engagement with digital channels grows, so do expectations – and this is why you need the tools, training, and organisational buy-in to ensure excellence in all your customer interactions. 

At redk, we have over 15 years of experience in digital transformation, providing the expertise and digital capabilities to implement the technical solutions that offer the best value for you and your clients. Talk to us to find out how we can help to support your customer engagement strategy. 

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Hideki Hashimura

Lead Consultant
CRM Transformation Practice at redk

Hideki applies over 15 years of experience in the field of CRM and Customer Experience to overcome business challenges in the customer cycle.

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