While most organisations claim to want to compete on customer experience, our research shows that most organisations are unable to use analytics to predict customer needs.
In the Age of Now, where consumers have more choices than ever and their expectations of brands are higher than ever, customer experience and being obsessed with customers is your only opportunity for competitive advantage.
Remaining relevant in the experience economy
Over the last few years we’ve moved from a product and price-based economy to an experience-based economy and the experiences that organisations deliver to customers are what drives loyalty and ensures they continue to do business with you. With consumers easily able to compare products and prices in seconds, continuing to compete in this area alone is a race to the bottom.
To avoid this, organisations need to focus more efforts on customer experience and that starts with understanding as much as we can about your customers; what they want, what they need, what their preferences are, how they feel.
Avoiding the race to the bottom
Much of this data already exists and is available to organisations today. Every day, across millions of interactions, your customers are sharing valuable insights with you.
Digital channels provide a huge opportunity to capture the digital breadcrumbs or footprints that customers leave with every digital visit. In fact, technology has advanced far beyond capturing page and content level clicks, to being able to capture granular behavioural and experiential data at individual visitor level, including everything a customer does and everything a customer sees.
Contact Centre channels provide opportunities for organisations to capture each conversation and analyse it for content and context, sentiment and mood.
Verbatim interactions such as email, letters, chatbot conversations, surveys and the like offer similar opportunities for text analysis to drive additional insights at an individual customer level.
Advances in technology and analytics means that it’s easier than ever for organisations to harness this data and derive valuable insights. And what’s more, customers are becoming savvier in this area too. They expect you to know them and deliver relevant and consistent experiences, regardless of the channel they choose to interact with you.
Peering into the past
While many organisations are turning to analytics to better understand customer trends and preferences, the mismatch between perception and reality when it comes to how well they can do this is hampering their ability to deliver on customer expectations.
In our research, more than 90 per cent of businesses are unable to use analytics to accurately predict what individual customers will want in future. Yet over half of businesses believe that they are ‘best-in-class’ or even ‘transformational’ when it comes to using customer intelligence to shape their marketing campaigns.
The truth is that most organisations are using customer data and analytics to report on the past. Many of the analytics solutions they rely on are designed to deliver insights as reports, using descriptive and diagnostic analytics. Descriptive analytics “describes” or summarize raw data into neat reports to tell us what happened – e.g. how many visitors abandoned their basket on our web site last week. Diagnostic analytics try to understand why something happened – why did we see a higher abandoned basket rate?
Both descriptive and diagnostic analytics are very useful - they tell us what happened and why, which allows us to learn from past behaviours. But the information produced in such reports is not actionable. The past has already happened, the customer has already abandoned the website and it’s too late to impact that customer’s experience in a positive way.
Using customer analytics to report on the past is bit like driving a car while only looking in the rear- view mirror. You can see where you’ve been, but you can’t see the road ahead and therefore you’re unable to properly work out your next move.
Closing the gap with predictive analytics
Organisations must become more mature in their use of analytics if they are to compete on customer experience. Customer data needs to comes to life by using predictive analytics to anticipate our customers’ next move and behaviours, and provide guided experiences that exceed customer expectations.
Predictive analytics identifies patterns in your existing customer data set and extrapolates them to predict what is most likely to happen next. It can be used to quickly and easily drill down to the individual customer level and gives the business the ability to design a tailor-made experience for that customer with the best likelihood of producing the desired outcome – be that sales, loyalty, or resolution of a complaint.
Apply that ability across every individual in your customer base and you can see how predictive analytics can close the customer experience gap.
Take Shop Direct, which is driving ground-breaking personalisation using predictive analytics to tailor individual shopping experiences. By analysing customer data to predict what customers are looking for they automatically show the right products at the right time to capture each customer’s attention.
In an age where customer experience is your only competitive advantage, the winners will be those who are able to take actions using data faster to deliver superior customer experiences.