The Future is Phygital

India is one of the fastest-growing economies today, well on the path to becoming a USD1-trillion digital economy by 2025. Driven by digital acceleration, new technologies, and increased Internet penetration, India’s growing consumer market has expanded rapidly over the last few years. Research firm International Data Corporation (IDC) forecasts India’s ICT Spending to reach USD111 billion by 2024.

The last couple of years have also seen the concept of hybrid work grow exponentially.  Remote working has shifted the attention towards digital or online platforms, where companies have been forced to grow their digital presence to meet consumer demands. Thus, retailers and marketers are now creating a “phygital” world, which is the blending of physical and digital in the customer experience strategy to create the ideal integrated experience for the consumer.

What is a Phygital Strategy?

In the Digital-first environment, an integrated approach is used where physical and digital are interdependent. This includes a centralized repository for both digital and physical transactions and a platform that integrates inventory, sales, and customer profiles, among other things. For emerging economies, the full potential of marketing and financial inclusion can be realized through the seamless and comprehensive route of Phygital. The Phygital model combines physical and digital experiences emphasizing aspects such as ease of use, convenience, speed, and support. Phygital is mutually beneficial for both the producer and the end-user when it comes to promoting the aspects of accessibility and personalization. It enables producers to save on a variety of variable expenditures while also reaching a larger audience. Customers, on the other hand, can make purchases from the comfort of their own homes. In addition, as customers want to connect with a brand on a personal level, companies are formulating tactics to reward them with unique experiences and perks such as membership cards, loyalty points, special events, and festival discounts. Brands can do the same online while maintaining the traditional purchasing experience through the phygital model.

A few companies have already started to implement the phygital model. For instance, Bausch+Lomb, a leading eye-care brand, has put a lot of emphasis on their online shopping platform by introducing features like virtual trials to ensure customers make a more informed purchase. Similarly, BPCL, a leader in the Gas and Petroleum space, is driving customer campaigns that provide personalized engagement based on customer lifecycles. Under their digital marketing pilot under Project Anubhav, BPCL is focussing on customer experience and provide insight and intelligence that has stemmed from the AI powering Oracle’s CX cloud.

TATA Teleservice, a telecom giant, is yet another example of Phygital adopters. This provider is embracing automation and data analytics and integrating the Phygital business component to increase customer engagement, improve marketing strategies, and maximize business performance.

Creating a phygital experience in the financial services industry is important as customers need to experience a technologically advanced space that is simple, safe, and efficient for financial transactions yet has some semblance of in-person, physical services. Companies such as HDFC Ergo and Federal Bank have been early adopters of the Phygital model, leveraging their technology-based customer interactions to make them more human. Under the Phygital model adopted, the entire process right from filing an application to making the payment is executed digitally thus minimizing the possibilities of human error and other delays while offering customer service on a real-time basis.

As the world evolves and the difference between digital and physical experiences becomes “phygital,” brands and companies need to embrace this change proactively and start thinking about the strategy that will work best for their business. The future is phygital and the blending of physical and digital in the customer experience strategy is certainly here to stay.

The author is Senior Sales Director - Oracle Applications