4 Steps to Creating Data Analytics Driven Customer Experience Management Strategies

November 6, 2014 | Posted by April Rios

Customer_Experience_Management_StrategiesHow much do you know about your customers? There is a good possibility that you do not know them as well as you think. Despite having collected a lot of data on past and potential customers, you might not be able use the data in any type of meaningful manner. You may know that "Jane" always buys "Brand X" cat food, that "John" is 25 years old or that "Joe" makes purchases at all hours of the day and night, but how does this information help you create a personalized experience for them? Unless you just happen to sell products for cat care, these tidbits of information are relatively useless for most businesses. In other words, collecting data is easy -- connecting it is the challenging part.

Companies that neglect to establish a relationship with their customers are not going to thrive as well as those that work to build lifetime customer loyalty. The economic environment is too competitive. Furthermore, consumers know that there is a lot of competition for their business, so they feel a sense of empowerment. To complicate matters, today's consumers have access to the Internet, allowing them to research a company or its products thoroughly, discuss merits with other consumers and post about their experiences in numerous blogs and forums.

Given the current environment in which businesses must operate, it makes sense to leverage every tool at your disposal. While conducting your business, you have collected a great deal of data about customers. It is now time to analyze what you have collected and apply it to your customer experience management strategies.

 

1. Create Customer Experience Programs to Suit the Lifecycle Stage

If you are not familiar with Sitecore's Customer Experience Maturity Model, you should be. The CEMM is based on the assumption that you would like to develop lifetime customers -- a reasonable assumption, since it is less expensive to retain a customer than to attract a new one.

There are three phases in the CEMM -- attract, convert and advocate -- that cover seven steps in the customer lifecycle. The first step is the initial approach, and the final step is to secure a lifetime customer. You need to determine in which stage your company falls. Are you still trying to align your digital initiatives, or have you already reached the nurturing or engaging steps? Once you know where you currently stand, you can plan an engagement strategy that will span all phases and steps.

 

2. Create Customer Personas

Customer personas are fictional portraits of your typical customer groups. You may only have one or two customer groups, but you might have 10 or 12, depending on your line of business. Personas can be just as detailed or brief as you prefer. However, your personas must be based on analytical data, not your perceptions, guesses or intuition.

To give you an idea of what a customer persona is, consider the following two examples.

 

  1. Jill is 33 years old, has children under the age of 10 and her address indicates that she lives in an upper middle-class neighborhood. Most of her shopping occurs between 10 am and 2 pm. She routinely uses discount coupons. Her purchase history indicates a large number of "green" products as well as many items that were on clearance.
  • Based on her persona, you can identify Jill (and the other members of this group) as having concerns about the environment. You can also identify her as someone who likes to save money and who "bargain-hunts" regularly. Armed with this information, you can tailor a marketing campaign that will appeal to both her thriftiness and her environmental consciousness.
  1. Customer group X consists of males between the ages of 25 and 40. No one in this group has ever redeemed a coupon or code to receive a discount. Their purchases consist primarily of name brand (but not designer) jeans, sweat suits and tee shirts, whether they shop online or in the store. They also purchase a great deal of camping gear, sports equipment and video games. When making an in-store purchase, members of this group spend an average of 16 minutes in the store.
  • Based on this persona, group X members are not extremely interested in fashion fads. They have disposable income that they can spend on recreational activities. They rarely bargain hunt; they arrive at the store with a good idea of what they want, and they find, pay for it and leave without doing much browsing. If you want members of this group to make impulse purchases, you need to position displays near the entrance or at the register. They are not likely to redeem discount coupons or respond to campaigns that focus on the latest fashion trends. However, a demo of an upcoming video game or a course on backwoods first aid might draw them in.

 

As you can see, personas help you identify the techniques you can use to give each group of customers what appeals to them the most, thus engaging them and enhancing their experience. In the first example, the persona was given a name, but it is important to remember that the name represents an entire group, not an individual customer.

 

3. Understand Customer Expectations

Your goal should always be to exceed your customers' expectations. At minimum, you want to ensure that you meet those expectations. However, you cannot meet or exceed expectations if you do not know what your customer expects from you.

Making assumptions about customers can be dangerous. For a real-world example, you need look no further than the disastrous rebranding of JC Penney's. The new CEO decided that customers must be tired of the store's use of coupons as a marketing strategy and its private-label brands. He eliminated both, and within months, the company's sales had collapsed. Only in hindsight did the CEO understand that a large percentage of customers loved coupons and trusted the private-label brands. A careful analysis of historical data, such as the percentage of customers who used coupons or the ratio of sales of private-label brands versus comparable name-brand products, could have helped avoid the debacle.

 

Sources of more trustworthy data include:

  • In-store surveys
  • Number and nature of returns
  • Customer responses to follow-up emails asking whether they are satisfied with a recent purchase or visit
  • One-question surveys that pop up on your website
  • Repeat purchases

 

Once you have a grasp of what customers expect, you can formulate a strategy to ensure that you always meet or exceed expectations. Accumulating historical and analytical data allows you to predict how your customers will react if you fail to at least meet their expectations -- and how they will respond if you exceed their expectations.

 

4. Use Contextual Engagement

 

If you want to enhance your customer engagement, you need to do two things:

 

  • Be where they are
  • Engage them in context

 

Contextual engagement means different things to different businesses. For an electronics retailer, for example, it might mean offering a reduced price on an extended warranty for a product the customer is in the process of purchasing. For an e-commerce site, it might mean establishing a community forum where visitors can get recommendations from other customers on the best product to suit their needs.

If you know that many of your customers are active on social media sites, you can engage them there. You can publish updates about interesting new products, offer advice on selecting an appropriate product or create a fun, easy quiz.

It is important to remember that for a contextual engagement strategy to work, your message must be appropriate for both the location and the customer's actions. In other words, a teenager buying a rap CD is not likely to be interested in learning how to color her gray hair at home. An 80-year-old on Facebook probably does not need your promotional video on how to install a new roof as a DIY project.

 

Experience + Persona + Expectations + Context = An Engaged Customer

Focusing all your efforts on a single customer engagement strategy is unwise. There are elements in each that contribute to establishing a loyal, lifetime customer. It will be up to you to incorporate the key elements from each strategy to create an effective plan for your particular business.

Topics: User Experience, User Experience Design

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