SA consumers shun ChatGPT for brand engagement
South African consumers lag global counterparts in regards to the use of large language models (LLMs), such as ChatGPT, to engage with local brands.
This is one of the biggest takeaways from the 2023 South African Customer Experience Report, released on Friday.
Now in its fifth year, the 26-question survey was served to the ovatoyou base of over 30 000 online South Africans and 2 000 completed it. The report was co-authored by Charlie Stewart, Rogerwilco CEO; Amanda Reekie, founder of research tool ovatoyou; and Julia Ahlfeldt, founder of Julia Ahlfeldt CX Consulting.
According to the report, online engagement has grown significantly over the years, as more consumers chose digital options to buy groceries, medication and clothing, among other items.
It notes this was fast-tracked by the pandemic, but now that the COVID hangover is almost over, consumers’ behaviour has changed.
“We no longer have the same level of empathy for brands and instead have developed a striking state of apathy, disempowerment and disappointment for brands that fail to meet our expectations,” the authors say.
The report notes local firms understandably want to cut costs and are increasingly using tech to improve systems, but it is clear from the research that consumers still want to talk to a human instead of a bot for first contact resolution, but are happy to self-serve if they can.
“It is little wonder then that e-mail (24%) remains the most popular form of contact, alongside call centres (18%),” the report says.
“Website chat is used by only 10% (versus 17% last year) while people’s willingness to consult FAQs [frequently asked questions] is down to 4% from 8%. Interestingly, while just 8% would go into a store or branch to resolve an issue, it proved to be the most effective channel for first time resolution.”
Keeping in touch
According to the study, this may change thanks to the latest innovation sweeping the globe – LLMs.
“However, there is a caveat: when businesses lean towards digitising engagement, it can cause dehumanisation and a loss of empathy. Those who use LLMs must consider how to retain high-touch with their customers amidst a high-tech world.”
Among these new LLMs, the frontrunner is OpenAI’s ChatGPT, says the report. “As South Africans, we lag behind the international uptake of the tech, as only 15% of our customer panel had tried it, while just under half (49%) had never heard of it.”
Nearly a third (31%) believed it would become a part of their lives in the near future. In contrast, in the US, 47% of consumers have used it, and globally, 68% of ChatGPT users consistently choose it over a search engine.
“When we asked our local businesses their opinions, 46% of organisations are considering using ChatGPT, or other LLMs, to enhance customer experience and service delivery, but just 30% think it will be effective.”
Ahlfeldt cautions, however, that “ChatGPT should not be underestimated as a game-changing tool in the hands of consumers and businesses alike”.
Stewart says local consumers need to hold more brands to account – and there is a powerful way to do that: reviews and recommendations.
He points out that among the most common actions performed online, 67% of consumers either post reviews and recommendations or read those of others. According to the report, these online reviews and recommendations can cost businesses as much as R40.2 billion in a year.
“Travellers, for instance, can view a property’s popularity on Booking.com before confirming their stay, or refer to social media to get a sense of what others’ experiences were. This is empowering, as it gives consumers the tools with which to call brands out if they are not living up to their promises,” says Reekie.
The study shows this trend applies to most sectors. From groceries and non-grocery retail, to restaurants and fast food, domestic travel, communication such as cellular and fibre connectivity, and automotive, collectively these categories account for a significant R2 trillion in on- and offline sales, representing 43% of GDP, it says.
By extrapolating consumers’ typical online activity during the purchase journey, the study found online product research (reviews, recommendations, browsing) impacts R516 billion of purchase decisions within the total R2 trillion retail pie. This highlights the strength of actively driving positive reviews, something that 64% of respondents said they did by posting on social media.
Grievances grow online
Conversely, the report adds, if customers have a negative experience, 59% said they tell their friends and family, and are more likely to air their grievances in public, with 50% confirming they would post on social media or a review site. This is up from 43% in 2022.
This trend must not be overlooked by brands, as the more consumers trust reviews, the more impact these will have on securing or losing sales, say the authors.
They note that another critical area for businesses to consider is the acquisition of consumer data. It is estimated that companies collect somewhere in the region of 2.5 quintillion bytes of data every day – but simply are not capable of processing or utilising all that they capture.
A meagre 14% of businesses surveyed said they always use their data, yet 69% of consumers strongly believe the brands they deal with are using their data to enhance their customer experience.
“There is a growing disconnectbetween what businesses do with the data and feedback they collect and whatconsumers think they do with it,” says Reekie.
“The reality is businesses have access to an avalanche of data and customer feedback, but few can use all of it. This creates a sense of false belief among consumers that they are giving their data away, often for free, but getting little in return.
“It is evident that if companies don’t start acting on the feedback they’re given and use the data they have access to, to improve delivery, at some stage consumers will stop providing it.”