Why knowing your customer starts with analytics and a well articulated next-best action strategy
In a world of increasingly high consumer expectations, customers want to be known as individuals with distinct preferences, not just a member of a segment. The digital world is challenging marketers to consistently understand and enhance the customer experience across all channels, making mastering the art and science of next-best action (NBA) a worthwhile endeavor.
Next best action is a customer-centric marketing technique that considers the alternative actions during a customer interaction and recommends the best one. Determining what the next best action is leverages an organization’s competitive assets—the data and analytical insights used to understand a customer in the moment of engagement—and serves that customer in a relevant and contextual manner whether it’s marketing- or service-related.
That competitive asset is an organization’s opportunity to be truly useful to its customers. It’s an opportunity to help, thrill and delight them from a state of apathy to a state of enthusiasm. But that competitive asset only truly becomes a differentiator if an organization is able to bridge the agility gaps between its data, its insight and its ability to put those into action at the moment of engagement with the customer.
Unfortunately, many organizations are falling short of achieving a true NBA strategy because they are missing key ingredients in the NBA recipe.
Data: This seems simple, but is actually quite challenging when you consider all the possible sources. Your data strategy must include not just your customer information, but also the data that tells you who they are at their core. For retailers, this could be transactional data, online behavior data (not just click stream) and new technologies like social media and beaconing. For banks and insurers, it’s all of the above, plus data awareness of risk and fraud profiles. For telecommunication companies, it’s incorporating the network data into new opportunities to proactively service their customers.
Analytics: Take the data you have and determine if it’s merely interesting or if it’s significant enough to act upon it. Use that data to make analytical inferences or predictions to support hyper-personalized experiences.
Action: All the data and analytics in the world won’t deliver an impactful experience without the ability to put it into action with your customer in the moment of execution (proactive outbound) or in the moment of interaction (anticipated inbound).
In addition to embracing the three key pillars above, organizations must quickly:
Determine relevance: What is relevant right now for my customers? What are they eligible for?
Understand context: What is happening right now with this customer? What has been his or her recent experience?
Be agile: What can I anticipate and predict about this customer? How do I respond in the moment while I have his or her captive attention?
This sets the stage for a customer-centric next-best action strategy. But how do organizations actually achieve it?
Recognize and acknowledge the reality of your organization. Is your organization truly ready to be customer-centric? Can your culture adapt from a product-centred approach to a truly customer-centric approach? This is a shift in mindset from “I have an offer, what customers are eligible for it?” to “I have a customer, what’s right for them?” Organizations should be cognizant that this shift has downstream impacts on employee compensation packages and how departments are measured. For example, call centre agents are often rewarded based on AHT (average handling time), which can lead to a culture of serving up the easiest offer as opposed to what’s right for the customer or a profitable offer for the organization. Conversely, many financial organizations hold a lead-based metric as the gospel for success.
Understand what the data and technology landscape looks like realistically within your organization. Is real-time data a reality or a pipe dream? Do you have a number of disparate supporting technologies, like a campaign tool, an email tool, a decision or rules engine? Are there silos that exist that need to be addressed in order to move forward with a customer-centric strategy? In working with many organizations, the most common question is where to start. You start with the hindsight of the answers to the above questions, but you also need a vision of what capabilities or experience you’d like to enable. For each, weigh the possible value each could drive for the organization against the level of disruption enabling those capabilities would entail. For example, if you’re thinking of starting an NBA journey in the call centre, are there cultural considerations? Is there re-training needed? Do compensation packages have to be adjusted? Does the Call Center operational system have to be updated or adapted?
What is your customer’s perspective? What are their most common complaints and requests? What’s the competitive landscape in your industry? Are you looking for first-mover advantage, to keep pace or be on the bleeding edge? This is not a one-time exercise. It must be considered an operationalized, continuous improvement loop. For many organizations, incorporating “listening” into their process manifests itself in survey and net-promoter scores. However, the maturation of “listening” feeds this information into the decisioning process and advanced test-and-learn strategies.
Have a vision, make a plan
The old adage of “fail to plan, plan to fail” is accurate. A plan without a long-term vision is just a plan without the motivation or inspiration to maintain the momentum needed to endure. NBA is a long-distance race that will be fraught with hurdles, challenges, twists in the road and some steep hills to climb. Organizations must rally key stakeholders across marketing, IT, customer experience, channels and customer service around a central vision that sets everyone facing forward in the same direction. Stakeholders must understand what the end game is and be the internal change agents to maintain momentum and lead. NBA does not happen overnight. There’s a right way and a wrong way to approach a true NBA strategy. The wrong way is a “big bang, boil the ocean” approach. For most organizations it’s too much organizational change at once. It works sequentially toward a far out “go-live” date that jeopardizes momentum and allocated budget, and places tremendous pressure on the individuals involved. The right way is an iterative, value-based approach with innovation waves across the work streams. This delivers incremental value to the organization and to the customer with each wave and further advances the capabilities and maturity without unnecessary pressure or crippling organizational change.
Leveraging a thoughtful, realistic NBA strategy can yield millions of dollars in additional revenue, drive up customer satisfaction and drive down unnecessary operational costs. But with most organizations pursuing NBA, marketing has become a game of inches. The number of inches you get over the competition is up to you. Building and maximizing your competitive assets combined with a solid strategy is the means of differentiation.
Marketer turned marketing technologist and ‘customer fanatic,’ Monique Duquette has spent the last 18 years immersed in all things marketing. As national practice lead for SAS Customer Intelligence, Monique works with marketing and customer experience leaders across Canada to deliver analytically driven strategies and best practices that drive value and superior customer experience.