While analytics can be developed and leveraged across the business, midmarket companies have seen greatest success when focusing on the customer
Three key areas to focus resources
Midsized organizations today face a complex set of issues in the marketplace. Customer expectations keep climbing, data sources and customer engagement points continue to multiply and internal demands to drive revenue while reducing costs adds to the complexity. These dynamics mean organizations have to squeeze the most out of every dollar to develop a competitive edge in the marketplace. The best way for these organizations to achieve and sustain such an edge is to make decisions derived by analytical insight. While analytical insight can be developed and leveraged from operations to strategy to forecasting, midmarket companies have seen great success when focusing on the customer. Companies looking to make the most of each customer interaction need focus in three key areas:
- Understanding the customer. The most important aspect to understand is customer behavior. Gathering, organizing and storing data on the actions a customer takes is imperative to having successful future interactions. This data enables the company to develop a comprehensive view of each individual & their interests while at the same time getting an aggregate view of the entire customer base.
- Developing actionable insights. Having a comprehensive view of historic customer behavior enables companies to optimize future interactions. Insights derived from customer data can range from identifying products the customer may be interested in to revealing problems encountered in the website checkout process.
- Putting those insights to work. Developing analytical insight is of little benefit until they are used to drive change in customer interactions. Marketing can send more impactful promotions to customers, product managers can determine the best features and functions to include in future iterations, engineering can determine where to spend funds on improving the mobile application experience.
Visualizing and Exploring of Customer Data
If you don’t know your customers, it is impossible to develop insight or take action on it. The best way to know your customers is to explore the data you collect about them. Any data is useful, and it should all be considered.
Once your customer data is in a manageable form visualization can help you actually see what the data is telling you. Data visualization empowers organizations. Marketers, for example, can use it to look for hotspots or unique customer segments. Visualizing sales data may reveal certain regions have low penetration and require specially targeted campaigns to improve sales.
Marketers also often struggle to get current campaign performance data. By the time it arrives, the campaign is often over. Data visualization can enable real-time dashboards so marketers can quickly adapt ongoing campaigns while ensuring the next campaigns take advantage of lessons learned.
As digital engagement points continue to expand, the importance of understanding how customers interact across channels rises, too. Data visualization enables organizations to understand which paths on a website are working and how customers convert through the checkout process (and how they don’t).
Having a rich, detailed understanding of your customer is a foundational step in becoming analytically driven. This foundational knowledge can be used to develop actionable insights.
Tactical vs. Strategic Insights
Insights are information that can make decisions more focused and precise. It can be developed at both the strategic level and the customer level.
Strategic insights are high level and enhance long term plans by providing a roadmap for achieving goals over specific time periods.
Tactical insights are used to make decisions that will have a more immediate impact. Tactical insights can do things like provide a deeper understanding of customer segments and how they are differentiated across the customer life cycle for important marketing metrics (value, growth potential, loyalty and attrition risk). These insights also enable personalization of the customer experience. Both strategic and tactical insights are needed to help companies achieve their corporate goals and objectives.
For example, a strategic insight might reveal that a product is forecasted to perform poorly in coming months. As a result, the sales & marketing teams may decide to increase spending on direct outreach & search engine marketing to drive traffic to the website. This type of insight is often developed using special tools tuned for forecasting so that an organization can adjust their plans to create the best outcomes.
Tactical insights enable marketers to know how to engage with specific customer segments or even specific individuals. Should a midmarket retailer send out a 25-percent-off coupon to every customer in their database, or only those that won’t make a purchase without it? The answer is obvious, but many retailers end up doing the former. Predictive models, developed with data mining software, can help marketers understand which customers will to make a purchase without a coupon and which won’t.
Developing both strategic and tactical insights enable organizations to see a visible impact, but only if they deploy them. This means putting those insights to use.
Taking Action on Insights
Strategic insights inform the customer marketing plan and provide focus so the team can establishing priorities and facilitate marketing mix decisions.
Marketing attribution is a great example of strategic insight, it helps marketers understand which campaign touch points account for conversions. Marketing attribution helps organizations make budget allocation decisions that may affect every campaign.
Predictive models are a great example of tactical insight. These models can be embedded into the customer experience using campaign management software to automatically select and deliver the best offer. Campaigns using analytically selected offers results in increased revenue decreased cost per interaction.
Real-time decision software can use the same models to enable marketers responsible for interactive channels to implement real-time analytically driven decisions where context and timing are critical. For example, whether or not to attempt to retain a customer trying to cancel their account and the level of investment to make to retain that customer.
Developing both strategic and tactical insights is the foundation of an analytically driven organization, but an analytically mature organization uses data derived insights to improve all aspects of the customer experience.
Ready to get started? Check out Customer Analytics: Taking the first step