Amid a rapidly-changing landscape, businesses face mounting challenges in understanding customer needs and shopping habits and in staying ahead of any shifting consumer trends. However, tapping into reliable market research data and conducting thorough, nuanced analyses of evolving consumer behavior can provide businesses with the key to resolving these challenges. This approach will not only strengthen competitiveness but also open the door to remarkable breakthroughs.

In today’s difficult economic climate, Vietnamese consumers are making notable adjustments to their spending habits, cutting back on non-essential purchases, limiting shopping, and adapting their choices to accommodate tighter budgets. These shifts create both challenges and opportunities, compelling businesses to rethink their strategies and better engage consumers with tailored solutions that drive satisfaction and loyalty.

Reshaping the customer experience

With 7.4 per cent GDP growth posted in the third quarter of 2024, Vietnam’s economy is on a strong recovery trajectory. Despite the positive trends, however, consumers remain cautious and have clear plans for their spending. Personal financial improvement is also now a top priority for many Vietnamese consumers. Data from NielsenIQ highlights that enhancing financial health ranks second among personal goals for 2024.

Specifically, 26 per cent of consumers aim to cut unnecessary expenses, while 13 per cent are focused on saving more. In search of the best deals, 72 per cent of consumers now prefer shopping online. According to NielsenIQ’s 2024 Shopper Trends report, consumers are spending an average of 8.2 hours each week browsing e-commerce sites, with 11.2 hours dedicated to watching livestream shopping events.

AI is increasingly integrated into daily life, with consumers becoming more open to using AI tools. NielsenIQ’s report shows that 40 per cent of global consumers receive product recommendations from virtual assistants, 40 per cent leverage AI for quick and easy shopping decisions, and 35 per cent are willing to let smart devices automatically place orders. Additionally, 34 per cent are ready to make purchases after experiencing products through augmented reality.

In Vietnam, 33 per cent of consumers are already familiar with and using AI, with 41 per cent believing it will positively impact society and 65 per cent feeling it will improve their personal life.

These shifts in consumer behavior are reshaping the customer experience.

Rising demand for convenience: The digital revolution has made life more convenient than ever, enabling customers to readily access information and shop with just a few taps. This has led to a surge in customer expectations, with growing demand for instant satisfaction and the most convenient shopping experiences possible.

Personalization becomes the new standard: With a wealth of customer data at their disposal, businesses can now understand their customers more deeply, allowing them to create personalized shopping experiences tailored to individual preferences. Personalization has evolved from a trend into a new standard that helps businesses cultivate stronger, long-term relationships with their customers.

Seamless omnichannel experiences: The rise of e-commerce has dramatically altered consumer shopping habits. Customers now enjoy the flexibility to shop anywhere, anytime, across multiple channels. This shift requires that businesses continually improve the customer journey, ensuring a cohesive and unified experience that seamlessly connects both online and offline touchpoints.

Leveraging technology

As the customer experience revolution unfolds, businesses are constantly innovating to meet the growing expectations of consumers. A prime example is Marriott International, one of the world’s top hotel brands, which has been elevating the customer experience by using technology to offer personalized services.

By collecting customer data from previous bookings, individual preferences, and post-stay feedback through its Marriot Bonvoy loyalty program, Marriott gains valuable insights into its guests. This enables it to ensure that returning guests feel welcomed, with personalized offerings such as tailored room selections, custom welcome messages, and amenities that match their preferences. Furthermore, Marriott has implemented contactless services like online check-in and check-out, providing greater convenience and safety and ultimately enhancing the overall stay.

Meanwhile, Netflix has transformed the viewing experience with the help of AI. AI not only helps it understand individual user preferences but also enables the platform to suggest movies that match personal tastes. A standout feature is Netflix’s ability to adjust visual recommendations. For instance, if a user has watched several films with a particular actor, AI ensures that the actor’s image is prominently featured in related suggestions, making it easier for users to find and choose their favorite films.

Amazon, the e-commerce giant, has also embraced technology to create a personalized and seamless shopping experience. With its “Collaborative filtering” technology, it offers customized product recommendations to each customer on its website. Amazon also serves not only as a shopping platform but as an online community, where customers can explore products, research alternatives, share opinions and reviews, and engage in real-time chats with sellers and experts.

People - The key factor

While technology has revolutionized the customer experience, the human element is still an essential and irreplaceable factor. Figures show that 49 per cent of consumers are willing to wait longer for direct human support and prefer avoiding AI interactions, especially in personal or sensitive situations where empathy and human understanding are needed.

To truly stand out in the market, building a customer-centric company culture is crucial. When employees genuinely embrace the core values of the company, they can confidently create memorable customer experiences, blending the warmth of human interaction with the convenience of technology.

A great example of this is Zappos, a clothing brand known for its unique and exceptional company culture. Rather than focusing purely on metrics, Zappos prioritizes creating outstanding customer experiences, believing that every interaction is an opportunity to delight the customer. To achieve this, Zappos has designed a distinctive recruitment and training process.

In the first five weeks, employees engage directly with customers over the phone. This helps them refine their communication skills and gain a deeper understanding of customer expectations and needs. If, after this period, an employee feels they are not a good fit for the Zappos environment, they are financially supported to explore other career opportunities.

By cultivating a strong company culture, Zappos has built a team of employees who are not only effective but also enthusiastic brand ambassadors. This approach has significantly contributed to revenue growth and customer loyalty through outstanding customer experiences.

Path forward

To provide truly exceptional customer experiences, consultants the Temkin Group have conducted thorough research into the nature of human interaction. Their Human Conversational Model highlights the key elements that help businesses not only improve direct interaction but also optimize online communications, creating an emotional connection and a cohesive experience for customers.

Understanding consumer intent involves exploring their expected goals, such as casual conversation, sharing knowledge, or building connections, based on the context, content, and shared history. Recognizing consumer characteristics, like appearance, age, gender, style, and interaction history, allows businesses to adjust conversations accordingly. Empathy is also essential, as businesses use verbal and non-verbal cues to infer the consumer’s emotional state and adjust their behavior to maintain positive interaction. Additionally, providing supportive feedback shows customers they are being listened to and understood through both verbal and non-verbal signals, such as nodding or asking relevant questions.

In today’s digital age, where customers have countless options, the experience they perceive becomes the defining factor in a business’s success. To leave a lasting impression, businesses must go beyond offering high-quality products and services; they must deliver truly exceptional experiences. The integration of modern technology with the human touch allows businesses to create personalized interactions that cater to each customer’s needs and desires, fostering positive experiences and building lasting relationships and loyalty.

^(*)Ms. Dang Thuy Ha is Director of Research, Consumer Insights, at NielsenIQ Vietnam