What is Customer Analytics?
Customer analytics is the process that companies use to gather and analyze the data of their customers to make better and wise decisions. Customer analytics help companies with actionable insights into the behaviors of their end-users. These insights empower businesses to improve their marketing, sales, and product development efforts. Additionally, such data can be used to build solid predictive models to determine potential customers. Research shows that companies that focus on customer data analysis are more profitable than ones that do not utilize such services. Therefore, it can be safely assumed that the lack of accurate customer data skews customer profile. It, consequently, leads to lost opportunities, lost customers, poor use of analytic solutions, and unnecessary costs for business, affecting the outcome.
Precisely predicting future buying behavior of customers is not an easy task for businesses. Channel optimization and targeted marketing may hold the key to success. Get in touch to know more about the benefits of our customer analytics solutions.
Why do Companies Use Customer Analytics?
Companies can break big problems into manageable answers by leveraging customer experience analytics solutions. Furthermore, customer analytics has the potential to help businesses gain insights into customer behavior. Customer analytics also unveils their actions and make them easier to understand for business leaders. This helps companies to make wiser and better decisions on pricing, promotion, and management.
Companies that use customer analytics systematically outpace their rivals in terms of profits almost twice as often as companies that do not.
A good consumer analytics platform can help companies improve:
- Customer retention
- User engagement
- In-app purchases
Today, companies have realized the potential of analytics and have started relying on it more than ever before. It helps them keep pace with customers who are increasingly sophisticated. 85% of the customers today expect a seamless experience and faster responses. Analytics is the key for the companies to provide desired customer satisfaction and enhance customer experience.
With customer analytics, companies can:
- Improve customer loyalty, response rates, and, ultimately, ROI by targeting the right customers with highly relevant messages and offers at the right time.
- Minimize the costs of campaigns by targeting those customers most likely to respond.
- Reduce attrition by accurately predicting customers most likely to leave
- Deliver the right message by segmenting customers more effectively and the better understanding of target populations.
How to Implement Customer Analytics?
In the competitive landscape, companies are benefiting from customer journey analytics significantly across all channels. This is because results are immediate, real, and have a lasting effect. Customer analytics encompasses a completely new approach to analytics, which requires business leaders to become more customer-obsessed. Following are a few steps to implement customer analytics that you must follow in order to obtain the maximum result:
Steps to Implement Customer Analytics
Step #1: Define the scope of the project
Start a customer analytics project by specifying its scale and scope. While defining the scope of the project to implement customer analytics, you need to consider basic parameters like size, complexity, function, and goals. Additionally, it is important to note the quantitative goals like customer retention, churn, acquisition, upsell, cross-sell, the rate of renewable and purchase.
Step #2: Determine Goals
Since customer analytics involves multiple stakeholders, it is crucial to set goals and define what success will look like. One of the most important benefits of using customer analytics is that it connects individual customer behavior to important KPIs and quantitative metrics that you and your business are measured by. Therefore, the key lies in selecting the appropriate KPIs and metrics to monitor and improve, based on the insights generated by your customer analytics platform. You need to choose a mix of customer, financial, and operational metrics.
- Net Promoter Score (NPS)
- Customer Satisfaction Score (CSAT)
- Customer Effort Score (CES)
- Growth of revenue
- Upsell and Cross-sell Revenue Growth
- Churn Rate
- First Call Resolution (FCR)
Step #3: Create a plan for data integration
Data integration is the spine on which a successful customer analytics initiative rests. Before preparing the plan for a successful data integration, it is important to understand the basics behind it. Whether you are working with a consulting agency, firm, agency or the customer success team of the vendor for implementation, it is important to understand and identify the customer data sources that you want to integrate into the customer analytics platform in order to obtain the required insights.
Step #4: Identify key use cases
It is important to identify a use case that addresses the most important pain points being faced by your business. At the same time, you should also be careful that you are addressing the issues being faced by all the stakeholders involved in the customer analytics project.
How to pick your use cases?
Here is a framework that can help you pick the best use cases for your initial implementation of customer analytics. This framework describes six types of customer analytics use cases in the order of growing complexity. Most business problems would fit in one of these six types.
- A-B Testing
- Optimization of conversion rate
- Impact analysis
- Behavioral segmentation
- Goal optimization
- Journey discovery
Step #5: Make your organization ready for customer analytics
Customer analytics deserves the time, effort and resources you invest in it. But to derive the best outcome and truly reap its benefits, you need to integrate it seamlessly in your organization. This integration goes far beyond technology and data. You can do this by:
Multiple teams and departments might get affected by the results of customer analytics, so it is important that they understand the whole initiative. This is where the support and influence of the stakeholders prove beneficial.
Training of employees is an important part to ensure that your organization is ready to successfully implement customer analytics. To ensure usage and adoption of your new customer analytics platform, you need to make sure that the users are properly trained.
Large organizations have a central governance team in place. This team is responsible for fostering communications, setting project quality standards, and sharing best practices. The governance board is responsible for improving the success rate of customer analytics projects undertaken by the company, while at the same time takes into account the risks involved.
We understand the challenges companies face in identifying and curating high-value customers to develop marketing strategies and initiatives to maximize profitability. Our analytics solutions provide best-in-class frameworks to identify factors for customer churn and develop effective strategies that will increase customer retention. Request a free demo below for more insights.
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