Personalisation and end-to-end digital services will be the drivers of growth for the information technology services sector in the coming year, said analysts. Despite the overall slowdown in the economy, the companies have been reporting new deals, so the analysts do not see the sector slowing.
The companies have also invested heavily in digital marketing and improving consumer experience.
In the second quarter (Q2) of 2019-20 (FY20), Infosys reported 31 per cent year-on-year (YoY) growth, led by cloud, data and analytics. TCS reported 25 per cent YoY growth in digital, with a strong emphasis on longer duration and large-ticket size deals contributing to a third of revenue. The management said this growth was lower than earlier because of a strong revenue base.
While customer experience and overall digital experience are segments of the “new” and “digital” business segments that IT companies do not yet disclose revenue numbers for, it is certainly a fast-growing segment as seen from incremental numbers.
The game is to figure out where and how the software clients engage with their B2C customers and use that to drive the rest of their engagement with the business.
“Transformation-led growth will be key for many IT services organisation and a significant portion of the revenue will come from this. Slowdown in economy may, however, impact some of this growth but in the current situation it appears to be promising,” said D D Mishra, senior director, Gartner. Mishra also said enterprises are also shifting investment from traditional run part of the business, which continues to shrink, to transform and grow a part of the business and hence investments are going to be there for now.
TCS CEO Rajesh Gopinathan said how some of the company’s innovative product solutions are improving customer experience journey for their clients as a part of what they call “mass personalization”. “We worked with a leading American electronics retailer who were worried about customers using their expertise/reviews to buy products from ecommerce platforms.
We helped them create a model to monetise this expertise itself as a personalized service through an app. It has turned around their customer base as they became a preferred digital advisor to them and the company captured a huge market share again,” said Gopinathan. TCS also recently announced the renewal of their decade old partnership to use analytics and Artificial Intelligence (AI) to further improve VIL’s customer acquisition and work on bringing integration synergies in Vodafone’s and Idea’s systems.
Recent research from Accenture found while only one-sixth (17 per cent) of nearly 1,000 CMOs surveyed know how to transform their operating models to deliver hyper-relevant customer experiences at a global scale, organisations that do deliver such experiences generate shareholder returns 11 per cent higher than those of their industry peers.
Accenture has opened its largest experience activation centre in Mumbai. The solutions here will focus on data analytics and insights, target segmentation and content creation along with customisation apart from programmatic delivery and measuring the performance of campaigns on a daily basis.
The company has a large employee base in India to handle the same.
Recently, Mumbai based Tech Mahindra also announced a collaboration with marketing cloud firm InMobi to enable advertisers to develop and distribute innovative and engaging video advertisements on mobile phones.
“This more embedded, connected, and adaptive IT approach will gain momentum in 2020 — particularly as firms address the opportunity and challenges of emerging technologies” noted a new Forrester report on predictions for 2020. Forrester noted that firms already have multiple robotic process automation (RPA) tools, conversational intelligence platforms, and machine-learning projects. To address this, firms will set up automation strike teams that sit between traditional IT and domain experts and have unique roles such as robot architects and automation jump-starters.
Even a minor improvement to a brand's CX quality can add crores of rupees of incremental revenue by reducing customer churn and increasing share of wallet. Additionally, superior CX leads to reduced service costs and lowers the cost of customer acquisition through word of mouth.