If you’re reading this blog, then you likely understand the importance of collecting customer data in order to streamline organization-wide processes and operations, as well as to improve customer relations.
It’s why your sales manager, for instance, analyzes your company’s transactional data in order to craft more personalized promotions. It’s why you have (hopefully) invested in a contact center software solution that enables you to automatically flag desktop and call recordings based on specific identifiers, like a code entered by an agent or a key word said by a customer during an interaction.
Collecting data like this—whether it’s transactional, customer-specific or historical—is important, but it’s not the ultimate solution. Rather, this is only Part 1 of a two-step process. The second, and perhaps more important, step involves using this data in making strategic and actionable changes within your organization.
It’s easy enough to collect data; however, for many businesses, parsing through the mountains of data they collect for use can be a daunting and grueling process. To this end, not many companies can truly use the data they collect successfully. In fact, new research from the Aberdeen Group found that an overwhelming 96 percent of surveyed companies are not satisfied with their use of customer data.
The consequences of being unable to effectively use customer data are nothing short of negative. The Aberdeen Group found that fragmented views of customer data cost U.S. companies $1.45 million each year. This can be due to a lack of visibility into customer purchasing patterns and preferences, which could lead to increased revenue from more customized offerings. Or, perhaps this figure stems from costs associated with customer churn due to poor service—that is, dissatisfied customers taking their business elsewhere.
On the other hand, the results of effectively using customer data are more than clear. Best-in-class companies—companies that effectively use their data—are 61 percent more likely to use real-time reporting and alerting tools to enhance service and operations. What’s more, in being able to effectively use their customer data, these companies are 208 percent more likely to have a formal program in place in order to nurture and promote customer advocacy.
Overall, 74 percent of best-in-class companies say they’re satisfied with the quality of their customer data, verses only 28 percent of other companies. In other words, these companies are most positively positioned for success.
At the end of the day this problem is not rooted in the amount of customer data that is available. As the Aberdeen Group explains, companies today are in no shortage. Rather, the problem can be traced to the fact that data collected within an organization is essentially useless until it’s strategically applied. Even if the data is used, that doesn’t mean it will yield valuable results.
This then begs the question: How can businesses properly use the customer data that they collect? This is a topic we will be discussing in Part 2, so stay tuned!