Here are some customer retention statistics as of 2020.
- 33% of Americans say they’ll consider switching companies after just a single instance of poor service. (American Express)
- 63% of U.S. consumers say they’d share more personal information with a company that offers a great experience. (PWC)
- 9 out of 10 consumers value when a business knows their account history and current activities with that company (Genesys)
Customer Experience is the Key to Customer Retention
Statistics prove that personalized customer experience is the key to revenue, growth and brand loyalty. It’s obvious that technology is driving the need for personalization and efficient processes to give the consumer a seamless experience in achieving their desired goals. Consumers want businesses to know them, understand their preferences and deliver them an experience that caters to their expectations.
In our years of working with 4,500 businesses worldwide, we have observed two types of business situations when it comes to CX initiatives:
- Businesses that are in denial of customers’ expectations or are slower than their competitors in delivering this experience are struggling with customer attrition.
- Businesses that are making efficient use of their data and implementing data-driven customer experiences are achieving growth revenues 1.4X than other companies.
Data is the source that drives all CX initiatives, but very few companies realize the direct connection between data and effective customer experience. When customers make inquiries via websites, when they submit tickets, when they make calls, when they consent to data use, they are expecting the company to deliver them a personalized experience.
Unfortunately, most organizations aren’t aware of the steps they can take to improve their data. They use data to get more leads, more traffic, more customers, but they do little to use that data to build customer experience or increase customer retention.
Let’s explore this more.
What Does Data Have to Do With Customer Retention?
Global brands like Coca-Cola, Amazon and Netflix, Sephora and many others use data to deliver tailor-made experiences, thus triggering brand loyalty.
Netflix recommending relevant shows. Sephora providing a virtual makeover app. Coca-Cola creating social initiatives. These efforts were made possible with the use of big data analysis.
For most businesses though, this level of personalization may seem impossible to achieve because of the demands that go along with it. High-level IT infrastructure, big teams of analysts and data experts, investment in R&D are difficult for a mid-level organization to afford.
So how can businesses improve their customer experience without spending big? How can they achieve customer retention especially in a niche market where it’s difficult to retain customers?
No secret here. It’s all about the efficient use of data.
Data is the key to creating, delivering and measuring customer experience whereas meaningful data is the key to brand success.
How to Get Meaningful Data?
Every line of business within an organization – marketing, customer service, sales, product, finance, has its own data platform that gives them a partial view of the customer. This data is stored in different silos and is rarely centralized. The customer’s entire journey and relationship with the company are never measured nor analyzed.
Eventually, when company executives want to use reports and analytics to get valuable insights, they fail to get a complete view of the customer. Data on its own, siloed away is never meaningful nor useful.
Things get more challenging when companies have to migrate to newer systems or implement automated CRMs to manage their customer expectations. It is only at this time that organizations realize they have held on to poor data for all this time. More importantly, they understand that a partial view of the customer has prevented them from obtaining any valuable insight.
Thus, begins the journey to data quality, data management, and data governance. Central to delivering CX is the ability to unlock the value from data, get a holistic view of the customer in real-time and enable dynamic decision making. This is not easy to achieve but is a necessity for companies and enterprises across all industries to maintain customer retention while reducing customer attrition.
Single Customer View & its Role in Customer Retention
A single view of truth refers to the solidarity of your data within the organization. In practical terms, it means you have a centralized data system where information from multiple data sources are unified to give you complete information about the customer.
A single customer view (also called 360 or unified customer view) therefore, refers to all the data you’ve gathered about your customers and merges it into a single record.
This could mean billing info from finance, behavioral info from social media, tickets, and complaints from service could be merged to give you a powerful overview of every action they performed. A customer interacts with the organization at different spots and it makes sense to have access to their entire journey and understand where best to help them with improved experiences.
Without a comprehensive view of the customer, it’s almost impossible to give them a personalized experience. For example, you might want to know how many of your customers are working mothers between the age of 20 – 34, own a flagship phone and may be interested in testing a new parenting app. To deliver this level of a personalized experience, you need to know the customer at a much deeper level. You could get contact information from sales, but you will need behavioral data from marketing to run a marketing campaign. You will need a complete map of your customer to know where exactly they should be seeing your ads and will be interacting with your organization.
How to Achieve Single Customer View?
Start with achieving data quality.
Raw data is inherently bad data. This means, the data streaming into your database may be having problems with:
- Duplicated entries because of multiple departments recording different versions of the same customer
- Human-input errors such as typos, nicknames, variation in spellings due to cultural associations and missed details
- Data that does not follow a structure such as phone numbers with missing city codes, or addresses with missing zip code
If these issues are not sorted, it would be hard to derive value from your data. You may be tempted to go ahead with unifying systems and migrating data and all that fancy digital transformation ideas – but the fact remains that if you don’t clean your data first, you can’t achieve a single customer view.
The actual process involved in this would include:
- Data Cleansing: Where you will set about identifying and fixing issues such as duplicates, typos, incomplete and invalid information.
- Data Standardization: Implementing a uniform standard across your database. For example, all names must have the first letter in upper case, all phone numbers must have city codes, all addresses must have zip codes, etc.
- Data Matching: Where you will identify duplicates between data sources and data sets to weed out unnecessary or duplicated entries. Matching will also help you find missing information from other data sets that you can add to an existing data set to get a complete overview of your customer.
- Record Linkage: Where you will link records from multiple sources and unify them into one source. You can achieve all of this with the use of a powerful data quality solution that will let you sort through TBs of data within a short time period. You do not require any additional team or data experts to implement data quality.
A single customer view is the means to an end. It will help you create customer experience initiatives and prevent the negative impact of data isolation. More importantly, it becomes a centralized repository of information that can be accessible by authorized users within the organization. The single customer view holds the essence of your data.
As Daniel Newman puts it, ‘Clearly, data can help dramatically improve the customer journey, but only for companies who are willing to be led where the data tells them to go.”
For the right solution to unify your customer experience data, get in touch with us to know more.