Creating a Great Customer Experience – Why Data-Driven Decisions are the Best Decisions

Peter Walker's picture
 By | July 13, 2015
in Big Data, Business Analytics, Business Intelligence
July 13, 2015

One of the easiest ways to improve the customer experience, and loyalty, is by giving them access to their own information.

The customer is at the heart of most decisions made by business leaders today – but how to please that tricky 21st Century consumer? This has never been more important for the retail industry, which has seen its landscape altered permanently by ecommerce.

Data is essential for retailers if they want to make informed decisions about customer behaviour, with analytics helping to improve existing products, and in turn, helping with knowing where to focus marketing spend and improve a website to better engage with customers. Using analytics at the preliminary stages of buying are of course important – more than three-fifths of global internet users research products online before buying – so this is great time to use prior knowledge gleaned from data to pique their interest. But now marketers are looking at other ways in which big data can add business value in the retail world.

In 2013, approximately 50% of retailers were using big data and analytics, but many retailers were still a bit hesitant about how they could monetise that data and turn it into profit. Now, there is no doubt in anyone’s mind that big data is ‘enterprise ready’. Retailers have seen their operating margins increase by more than 60% with the help of data analytics services to make the most of all that is available. Not only within the business, but this data-centric approach could have a national impact – if all data within retail and manufacturing is used to its full potential, GDP could be increased by $325 billion in the US alone (source: McKinsey). That is a figure to be reckoned with. 

While new customers are important and indubitably an attractive prospect to retailers, they shouldn’t be the only customers that a business cares about. It costs six times more to attract a new customer than it does to keep an old one, yet many enterprises are so focused on reeling in new customers that the ones they already have feel rather neglected and quietly slip away to a competitor. And keeping customers is (unsurprisingly) very good for business, as improving customer retention by 5% can boost profitability by up to 75%!

So, how can data help keep those customers happy? The best way for a business to start making data-driven decisions is to make sure this data is accessible to the right people. From there, retailers can use data to learn more about customer behaviour and what is working, monitoring it to check that it is always up-to-date. Ultimately, personalised experiences created by gathering the right data (often in real-time) can make a customer feel valued, which is an important factor in retention and drives loyalty.

Overall, businesses need to look beyond the big data buzzword to realise the true potential of fully understanding data. Data can be mined in the right way to drive customer satisfaction and a better customer experience. 

See our infographic below to visualize how analytics can help with customer retention, acquisition, revenue generation and transparency.