The ultimate guide to customer intelligence
CX Best Practices
In today's digital world, companies have access to extensive troves of customer information. Every time a user clicks on a website link, makes an in-app purchase or engages in a customer service chat or social media interaction, they're providing organizations with invaluable information about their interests, needs, demographic details, preferences and more.
For companies, this data is critical for improving sales and creating an experience that is more responsive to consumers, but privacy and security best practices must remain top of mind in order to gain the full benefits of customer intelligence (CI).
What is customer intelligence?
Customer intelligence is the collection and analysis of customer data by an organization, usually with the help of technology. The goal of customer intelligence is to better understand a customers' wants and needs, their preferred methods of interaction and ways to improve their customer experience (CX).
Overall, it can set your business up for long-term success by influencing how consumers perceive your brand, along with how much they're willing to engage with it. The better you understand your customers, the more equipped you'll be to provide a CX that's personalized to their needs.
Benefits of customer intelligence
The benefits of customer intelligence range from positive word-of-mouth marketing to improved sales efficiencies, and everything in between. When you use customer intelligence to create a better CX, and you build your strategy with a strong foundation in privacy and security, this leads to increased satisfaction, loyalty and retention.
- Satisfaction: Personalization and customer satisfaction go hand in hand. A survey conducted by The Harris Poll on behalf of TELUS International found that 42% of Americans are likely to switch brands if a company doesn't provide them with a personalized experience. The survey also found that when a brand provides a more personalized customer experience, 76% of Americans are more likely to complete a purchase and 53% are more likely to pay a bit more for products and services. Delivering on these data points can lead to higher customer satisfaction ratings and has the potential to boost your Net Promoter Score (NPS).
- Loyalty and retention: Naturally, increased satisfaction also leads to increased loyalty and retention. The same survey results show that when a company provides a CI-informed personalized experience, 70% of Americans are more likely to choose that brand over others. And Ad Age — a global media brand that publishes news, analysis and data on marketing and media — recently reported that 60% of consumers are likely to become repeat buyers after a personalized experience.
However, it appears there is some dissonance between what businesses are offering and what customers think they're receiving when it comes to personalization. Ad Age noted that 85% of respondents believed they were offering a personalized experience — but only 60% of customers agreed.
That may be because today's customers have extremely high expectations. They're accustomed to seeing entertainment suggestions, product recommendations, email newsletters and other forms of digital content customized to their tastes. When it comes time to interact with your brand, they'll be looking for that same level of customization.
Armed with customer intelligence data, you can provide the customization they're looking for.
Customer intelligence examples
What does customer intelligence look like in action?
In the eCommerce industry, leading brands are using customer data to make more accurate suggestions for future purchases. Aside from Amazon and eBay, which are known for relying heavily on customer insights when making product recommendations, brands like Walmart are also going all-in with customer data. According to CourseKey, in 2019, every hour, Walmart collected 2.5 petabytes of unstructured data from 1 million customers. Not only is this data used to personalize the shopping experience for customers, but the retail giant is also using it to make its pharmacies more efficient, improve store checkout, manage its supply chain and optimize product assortment.
In the travel and hospitality sector, Canada's two largest airlines, WestJet and Air Canada, are using customer data to provide personalized offers with the goal of making the flight booking process more efficient. A streamlined list of flights are presented based on a user's interests and price preference, reducing the need for customers to spend time sifting through an arduous list of flight options.
Meanwhile, Delta Airlines Inc. utilizes software to help monitor basic customer information during their travels. Flight attendants input real-time data into the tool to help the airline deliver a customized experience. For example, an apology email could be sent to each customer impacted by a flight delay, or a thank you email to a loyal customer for collecting a milestone number of frequent flyer miles.
Customer intelligence best practices
While utilizing customer intelligence has proved to be beneficial for brands, there are a number of steps between data collection and actionability that are intrinsic to developing a strong customer intelligence strategy. Keep these customer intelligence best practices in mind:
- Prioritize privacy and security. If customers have high standards when it comes to personalization, they have even higher expectations when it comes to the privacy of their data. Government regulations — such as Europe's General Data Protection Regulation (GDPR), Japan's Act on the Protection of Personal Information and California's Consumer Privacy Act — give consumers more control over the personal data they provide organizations. The mishandling of data can have lasting negative impacts on your brand, so being transparent with how customer data will be used and ensuring safe-guards are in place to secure the data is key to protecting your reputation and building trust with your customers.
- Choose the right technology to analyze the data. What good is data if you can't tap into it for actionable insights? Choose an analysis solution that's reliable and robust.
- Create a strategy. Use data to build customer profiles that can inform both your sales and customer service departments and act on the data you collect. Consider personalizing emails and text messages, making in-app suggestions and recommendations based on your customers' preferences, as well as equipping your customer care agents with the right tools to create better customer experiences.
- Measure success. Customer intelligence isn't meant to be a quick fix, but rather a long-term commitment. Update your strategies on a regular basis based on your results to better meet your customers' evolving needs.
- Partner with an expert. You're not alone in this. Partner with a leading digital experience and CX solutions provider that has a 360-degree view of the customer experience.
As consumers' expectations continue to rise, customer intelligence will become indispensable to businesses regardless of industry. Establishing a winning approach now can prepare you for ongoing success.