STRATEGIES AND SOLUTIONS FOR CUSTOMER ANALYTICS
Marketing departments have often functioned on gut feelings, intuition and qualitative information-gathering in the form of anecdotal reports from customer-facing employees. Visibility into customers' transactional purchases behavior is provided through operational reports, while Web, store and call center interactions provide behavioral information. Triple pressures such as the need to: grow revenue, optimize budgets and resources, and to identify and invest in one's most profitable customers have driven organizations to seek a better balance between "art plus science."
Across all industries and company size, growing revenue is a top priority for organizations. This holds true for all business models—business to business (B2B), business to consumer (B2C), not-for-profit and those that perform the "marketing two-step" (B2B2C). Moreover, top-line growth is not the only pressure faced; marketers also seek to do more with less. They are pressured to identify and invest in their most valuable or profitable customers while optimizing both budgets and resources applied.
Marketers must find ways to communicate, interact and provide service to customers based on value metrics. Ideally, highly profitable customers would receive more attention, service and resources than less profitable ones. Customer retention and acquisition rates among preferred segments or profiles would increase, as well as marketshare among most valuable customers. Moreover, within highly commoditized industries, marketers plan to proactively address a customer's propensity to migrate based on analytical models to reduce customer churn rates.
Marketers are faced with multiple pressures. Those pressures include the need to contribute to top-line growth and to increase share of customer as well as marketshare. Moreover, marketers also seek to do more with less; they are pressured to identify and invest in their most valuable or profitable customers while optimizing both budgets and resources applied. In order to address those pressures, marketers seek strategies and solutions that will provide the required level of decision support. Enterprises participating in three recent Aberdeen Group benchmark studies cited business intelligence/analytics applications and tools among the top prioritized investments for the next 12 to 24 months.
Aberdeen Group surveyed and interviewed more than 400 companies to gain an understanding of the selection criteria and approaches used by top-performing organizations in deployment of customer analytics strategies and solutions. That research demonstrates that effective use of customer analytics leads to improved customer retention rates, higher revenues from up-sell/ cross-sell campaigns and enhanced levels of customer satisfaction.
Leveraging customer analytics in support of profitable growth has been shown to deliver triple value for organizations. Aberdeen research confirms selective investment in high-value customers empowers companies to boost revenues, reduce operational costs and increase customer retention rates. All respondents confirmed they are addressing challenges from a technology, process, performance and organizational perspective.
Top performers' planned investments include greater utilization (63 percent) of marketing services providers—an acknowledgement of expertise to be gained through selective engagement and sharing of "best practices." Leader-planned investments underscore the value they place in leveraging technology such as predictive analytics (66 percent) and multichannel marketing automation tools (66 percent) in providing a seamless experience for customers at each touch point or interaction channel. Interestingly, as inbound interactions have become a new competitive battleground for customer retention and share of wallet, a significant number of top performers intend to further invest marketing resources in their call center.
In high demand will be vendors and service providers who can offer solutions that are financially attractive as well as easy to use for line-of-business employees in marketing, sales/business development or call center. Overwhelmingly, survey respondents cited cost and ease of use as top criteria for selection of customer analytics tools and services. Numerous tools, applications, solutions, systems and/or third-party services may be engaged in support of customer analytic strategies,