What Big Data Means for Customer Loyalty
There’s no question that Big Data analytics represents the next big wave of innovation in customer experience and advocacy. These collective technologies give companies powerful new tools to enrich human dialogue and make it more effective in earning customers’ loyalty. Big Data analytics have the ability to track customer episodes, predict certain customer behaviors and perceptions, and prescribe how a company should engage with those behaviors to deliver more value to customers as described below:
It serves as the foundation for creating a better customer experience. This instrumentation can cover ﬁne-grained usage patterns and expressed sentiment in human interactions.
Big Data analytics can predict the likelihood of that customer becoming a detractor; the customer might reduce purchases, stop visiting a website, or even defect to a competitor. A company also can effectively conduct sentiment analysis of contact center calls in order to make predictions without having to directly survey customers.
This helps companies to determine the most effective steps after one or more interactions. With so much digital data, most companies should know in real time when problems occur and be able to respond proactively.
Big Data does not replace areas where human judgment and empathy come into play, but it amplifies the value by applying the lessons across a very broad base of customers. These digital technologies can allow employees to have much higher-quality and often lower-cost interactions with customers in those areas, in which case, it is impertinent for companies to create real value from advanced customer analytics and keep in mind the following points:
Get the basics of the experience right
Companies who interact with their customers through chats, personalized recommendation, mailers, information about new launch based on their past orders, etc. increase customers’ loyalty and lifetime value to the ﬁrm.
Act upon the data
The data will only be useful if you tie it into customer feedback loops that lead directly to improvements in the relevant experience. The fact that software companies are swimming in experience data but do not use the data to make the relevant improvements is not a good thing.
Data itself does not create a customer-centered culture
Many companies have intensely instrumented their experience without truly incorporating the customer’s perspective. The ethos of providing a great end-user experience has not permeated that industry despite the reams of data it collects.
The most effective companies use Big Data analytics to scale up their abilities to serve, tailor and enhance the experience for their customers, encouraging loyalty.