Customer Analytics: It’s all about Knowing Your Customer

From the moment you offer a service, you are in a relationship. It is this relationship that will power the continuance of your service offering in a mutually acceptable and beneficial manner. This will depend on how you handle it, on what you learn from it, and what you can grow it be. Its something like having a big lump of clay. You can mould it, you can learn from it, you can benefit from it.

More in a business perspective, it will make for business benefits by way of improving your products and services, for effective target marketing, efficient forecasting and brand management.

Learning how to understand what your customer has already told you, or will tell you, or what you can get them to tell you in addition to knowing who they are, will go a long way in helping you further your business.

It’s all about knowing your customer.

You need to find new customers, you need to retain the ones you have, and you need to turn the ones you already have into your advocates recommending your products and services to others.

There is an ocean of data that can be collected from your customers. You will need an infrastructure that allows you to gather data, process it, analyze it and learn from it. The learning is what you will use in furthering your relationship and your business.

Demographics is the study of the behaviors and other characteristics of groups of human beings in terms of statistics and can include objective characteristics such as age, income, education, sex and occupation.

Psychographics is the study of how people live, what interests them, what they like, in short studying them based on their activities, interests and opinions. This would involve dividing the market into segments on the basis of consumer life styles. Lifestyle would refer to the collective choice of hobbies, recreational pursuits, entertainment, vacations, and other non-work time pursuits
Belief and value systems would include religious, political, nationalistic, and cultural beliefs and values.

You can look at your customer both as an individual and as part of a collective. When you look at a customer individually, it is important to get an integrated view of the customer. You need to know who they are, their details, the services they have subscribed to, the products they have bought from you, their usage patterns, their browsing patterns, propensities, banner response, etc. This will give you a complete view of the customer and help in determining their value to you. A customer lifetime value can be determined based on various factors.

When you look at the customer as part of a collective, it is the collective or the segment that is the focus of your marketing and sales efforts. Customers can be segmented based on various criteria. These demographics can be used for analysis and in your marketing and sales campaigns. You can analyze their shopping patterns, how many are actually buying, how many are abandoning their carts, at what stage are they dropping off, questions such as these will help in refining your service offering.

In a nutshell, analytics would help in Marketing in Customer Segmentation, Target marketing, campaign management. Analytics in Sales would help in Customer Profitability analysis, new product introduction, cross-selling and up-selling, Market Basket analysis, product affinity. Analytics in Customer Services could be used for Customer Satisfaction analysis, Customer Loyalty analysis.

Customers are a very dynamic lot, with lots of attitude, with a mind of their own. They can be demanding. They are open to interaction. They are forthcoming and forthright and do not believe in accepting just anything that may come their way. It is this attitude that makes them valuable. They have insights. They have ideas. And they definitely have something to tell you.

It would be difficult to find a team that would test your services and products as thoroughly and as completely as your customers. They are in an ideal position to be part of your quality team. They have competition to compare with. They have experience to benchmark against. They are your virtual team. And they come for free. The least you can do is listen to them when they contact you with feedback, suggestions and insights.

Only about 10% of your customers will take the trouble of talking to you – remember it involves an effort on their part to get in touch with you – and they are making that effort. They will reach you in many different ways – email, the phone, word-of-mouth through friends and colleagues, fax.

Collecting this information and organizing it so that you can process it effectively is a process by itself. Assume that this is done, and you have in front of you all this collective information. You have feedback that is valuable, that can be used to improve and enhance your service, and ideas for further product development. They become part of your virtual design team.

So how do you go about getting all this information? What are the possible interaction points? Its important to remember that you don’t always need to go to them, there are many instances when they will find their way to you. They are there - your extended sales force, your beta testers, your most valuable partners – you better listen to them. For the insights they will give you will probe you to delve deep into your psyche and question the very existence of your being… ok it may not always be as earth shaking as that, but you get my drift. So how do you make sure that these rivers of wisdom wind their way to you.

You can have a structured or an unstructured means of obtaining information. You can have an email ID listed where people write in. This is free format email where the inputs will be highly unstructured, may be incomplete and may not always be relevant. On the other hand, it can be far richer in content and insight than the structured format. This is the greatest advantage. The downside is the much larger amount of processing and manual effort that is involved in processing this input.

A structured format would be a web-based form, which very precisely asks for specific information (often in the form of drop-down lists) which would restrict the user from saying whats really on the mind. The greatest benefit of this approach is the processing of such mails can be automated to a large extent. Of course, you may miss out on some gems of insight. Also, you may miss out on the insight itself, as customers may be put-off or intimidated at the prospect of filling in a form and may choose to avoid making the effort.

Other methods of collecting Customer feedback can be Survey forms, Feedback links to email, Telephone, Form based mail, Snail mail, Fax, and social communication.

Your solution Framework would finally enable you to gather data, process it, analyze it and gain insights and predict customer behavior. It would enable you to feedback into your system valuable information that could be used to enhance your services and your product offerings.

It is, like we said in the beginning, all about knowing your customers.