With the onset of data consolidation, there is tremendous potential for personalization in contact centers and the ability to better serve customers through cross-selling and partnership marketing.
If you follow any technology or marketing publications and blogs, you’ve likely read about Big Data. Some even say it should be the word of the year. After the most recent presidential election, the nation learned that President Obama’s campaign group used Big Data to help it win the election. It enabled journalist Nate Silver to predict the election. We are reading more about Big Data in 2013, and chief marketing officers are working out what to do with it and how to make the most of it. Its value to companies who can harness Big Data and use it properly should not be understated.
According to the recent Forbes article “Making Sense of Online Personalization and Privacy,” “… companies like eBay process up to 50 petabytes of data a day, a seemingly impossible task for most organizations.” The value of Big Data is not just in the processing of data from a single source; it’s the correlation of data from multiple sites and multiple events that delivers the consumer insights that makes it indispensible. The crux of it is a common corporate mantra: Know your customer.
Personalization technology requires the correlation of customer data from multiple sources and along the customer’s historic timeline.
“We should look to Big Data for inspiration—and combine it with our ability to distill those revelations into testable customer experiences,” wrote Scott Brinker in the recent article “Why Big Testing Will Be Bigger Than Big Data” on SearchEngineLand.com. A vital aspect of the Big Data movement is that it provides real opportunity to gain insights from customer interactions and drive organizations to actionable improvements in their systems and processes.
With more available data about customers and purchasing patterns, it’s no wonder personalization technology that enables companies to target customer interests more precisely is becoming increasingly popular—and possible. Personalization technology requires the correlation of customer data from multiple sources and along the customer’s historic timeline. From a retailer’s perspective, effective use of Big Data can positively impact the customer experience and engender loyalty because it allows the sellers to personalize offers, treatment and responses.
The study conducted by the Social Science Research Network called “The Contribution of Personalization to Customers’ Loyalty Across the Bank Industry in Sweden” found personalization increased customer loyalty among bank customers in Sweden. Researchers reported a high level of personalization increased the customers’ satisfaction and commitment, as well as positive significant relationships between customers’ satisfaction, commitment and customers’ loyalty. Consequently, as customers’ satisfaction and commitment is enhanced, the level of customers’ loyalty also increases.
Getting It Right
As many companies have learned, there is a fine line between what is perceived as on-target and off-target when it comes to the use of customer data to support marketing outreach. The question to always ask is: Who does it serve? More specifically, does it serve the customer’s interest and add value to the customer experience? Is there mutual benefit for you and your customer? Or does it solely serve your interest? Consumers will make their own determination and reward you with their loyalty if your offer is perceived as value added.
Personalized advertising based on data is pervasive among online retailers and other online advertising companies. Google practically wrote the book on it. In a Wired editorial titled “The End of Theory: The Data Deluge Makes the Scientific Method Obsolete,” Editor-in-Chief Chris Anderson asked, “There's no reason to cling to our old ways. It's time to ask: What can science learn from Google?”
Contact center agents have the ability to offer highly targeted and relevant products and services to customers based on information exchanged in a phone call.
On the flip side, it is also the company most often accused of crossing the line into invasive. In the 2010 article titled “Google CEO: ‘The Laws Are Written by Lobbyists,’” Eric Schmidt, then CEO of Google, described the company’s policy as getting “right up to the creepy line and not cross it.” That line is subjective.
Still, shoppers with eBay.com, Amazon.com and so on are being tracked and mapped. Website visits, navigation patterns, purchases by subjects, patterns, timetables, etc., are being used to deduce consumer preferences and habits and target relevant sales, offers, products and partner offers. The end game is mutually beneficial: value-added personalized service for the customer and increased sales opportunities for the marketer. Companies are trying to get it right and understand what their customers are doing and how to earn more sales out of it. In the process, they win greater customer loyalty by providing what people need when they need it.
Off the internet, retail stores and medical practitioners are just a couple more of the industries following in the footsteps of the online companies and major retailers. For some, such as Target, there is the added element of tying together in-store and online shopping. It’s more difficult to track purchasing patterns for consumers that visit retail stores and don’t have a credit card from that store, so those customers have to be viewed differently.
Another important avenue for personalization technology is contact centers. They are a strategic customer engagement channel for companies and serve as important customer touch points.
Effective use of data is not a new concept for this channel—contact centers have historically utilized disparate data from across multiple channels and sources to intelligently route callers, determine contact history across channels, determine best offers, expose performance issues, lower costs and predict outcomes based on analytics.
With the onset of data consolidation in the cloud from multiple data sources and channels, there is tremendous potential for personalization in contact centers. The opportunities here can be quite different and more dynamic than with online purchasing, because they rely on personal, one-to-one interaction.
Contact center agents have the ability to offer highly targeted and relevant products and services to customers based on information exchanged in a phone call. If a new dad calls the cable company to add a package because he knows he’s going to be spending a lot more time at home for the next few years, the agent talking with him can infer that that same dad may also be interested in a security system to keep his new family safe. It’s relevant and complementary.
Many consumer purchases are based on trigger events: major or minor events in a consumer’s life that “trigger” the purchase of multiple services and products. For example, a new baby joining a family, a new home purchase or retirement all precipitate the need for a wide variety of relevant and related products and services. This concept is becoming increasingly important, particularly in the contact center sales world.
As a personalized approach on par with those used in online advertising, contact center personalization is focused on presenting products and services relevant to the consumer’s immediate needs and interest. A contact center agent can be automatically guided or prompted on next best actions based on factors such as engagement and purchase history, preferences and other events. Contact center personalization can get as specific as targeting by demographics, geography, contact history, purchase history, life-based events and preferences.
Companies that take a broader approach can better serve customer needs and engender loyalty by offering relevant products and services from partners through partnership marketing, as in the cable company and home security example above. Personalization done in this manner benefits the customer experience. It creates an environment of value-added services driven by the company knowing and understanding the customer. In turn, customers feel more loyal to a company that is looking out for and serving their needs.
The customer insights we gain from a single, holistic view of the customer are based on real and personalized data.
Big Data = Big Value
There is big value in Big Data. The customer insights we gain from a single, holistic view of the customer are based on real and personalized data. However, it does not come without new challenges. Companies must integrate systems with which they can capture and correlate data across multiple consumer touch points, channels and timelines, piecing it together from disparate sources to create a big picture.
In the December 2012 article “The Dark Side of Cross-Selling” in Harvard Business Review, Denish Shah and V. Kumar summarized their analysis of the customer data sets of five Fortune 1,000 companies during periods ranging from four to seven years. The companies included a B2B financial services firm, a B2B IT services firm, a retail bank, a catalog retailer and a fashion retailer. They focused their research on personalization programs through cross-selling among company departments.
Shah and Kumar’s research confirmed that “the average profit from customers who cross-buy is higher than that from customers who don’t.” However, they “discovered that one in five cross-buying customers is unprofitable.” We can infer from their findings that consumers respond to offers relevant to their immediate need. They are perceived as a value-added service and build loyalty, but personalization may need to be broadened outside of the company’s realm of products.
Clearly, the advantages of Big Data are great. With the cloud-based data repositories available today, consolidation from multiple sources is now possible. Companies can see the good and the bad interactions and then apply insights into which actions, offers and responses make sense as next steps for their customer.