Ever since Clive Humby described data as “the new oil” in 2006, organisations have been racing to either confirm or refute the comparison. The main comparison has been in its value to industry – much as oil powered industrial and transport revolutions in the 19th and 20th centuries, so data is powering the information age. There is also the question of volume – while once oil reserves were believed to be practically infinite, data truly is – and its creation is entirely within our control. According to IDC, the world will produce over five times the data by 2025 than it did in 2018.
However, most comparisons to data as oil are too one-sided. Too many organisations see data as something that can fuel the business itself – guiding it to new opportunities by giving greater insight into customers and the market. Yet this approach is as limited as seeing oil purely as a fuel. Just as oil has a multitude of uses, from paints to plastics to pharmaceuticals, so data can be refined to serve any number of functions.
Fuelling the customer conversation
For instance, take the way in which organisations communicate with their customers. Most businesses will say that they use their precious customer data to identify customers’ interests, and to ensure that they are presenting offers and services that will be of maximum appeal. But is this enough? Consumers are becoming increasingly powerful – not only do modern communications give them innumerable ways to share their displeasure widely if they are unhappy with a business. There are more alternative options than ever if they are dissatisfied, meaning companies cannot ever be complacent about customers switching to the competition. Increasingly, consumers expect more than simple communication – they demand a conversation.
The difference engine
The difference between communication and conversation is simple – it can flow and evolve in both directions. For instance, customer communications such as updating customers on a predicted loss of service – as Lloyds bank experienced earlier this year – are themselves welcome, and the simple act of informing customers can have a profound effect on their experience and loyalty. But what happens if the customer wants more information? Or, as happened with the wave of recent banking glitches, the planned service outage turns into something much more calamitous and long-term?
In this case, the organisation needs to be prepared both to answer customer queries – over whichever channel the customer chooses – and to maintain a steady flow of updates to keep customers informed: even if the update is essentially that there have been no updates. Just as our modern conversations with friends and acquaintances will flow across multiple channels, from the phone to email to instant messages to other platforms, so the customer conversation will have to flow across channels to ensure customers are always receiving the right message at the right time from the right place. Otherwise, to go back to the Lloyds example, customers’ only interaction with the business will be getting increasingly frustrated as banking services fail to work.
Bringing data into the picture
Data is critical to allowing this conversation. After all, how can the business speak with its customers if it doesn’t understand them? At its most basic, customer data is critical to understanding which channels to use to contact which customers, and when. If the business knows that Mr. Smith never responds to email, but frequently interacts over Twitter, then choosing how to inform him of a planned outage should be simple. Similarly, if Mrs. Brown tends to favour posted communications, but needs to be updated urgently, then perhaps her second favourite channel should be brought into play.
The more businesses understand their customers, the more they can personalise their conversations and so the more relevant they can make them. Mr. Smith and Mrs. Brown might both be worried by a loss of online banking, but Mrs. Brown’s pattern of behaviour might show that she needs to be told exactly when she will be able to manually move funds again – or what other options there are for her to do this. Conversely, Mr. Smith might only need to be reassured that his regular standing orders will still go ahead. However, without the right, historic customer data, that can be accessed wherever it is needed across the business, this won’t be possible.
Timing is everything
Currently, many organisations – and even some consumers – are wary of how much they can use customer data thanks to last year’s introduction of the GDPR. Certainly, regulations like this may limit some implementations of customer data – particularly those that are unscrupulous, or that take data out of the ultimate control of the customer themselves. However, any use of data to truly improve the customer conversation and ultimately the customer experience should be perfectly permissible under GDPR – assuming the organisation is meticulous in how it handles information, and always gives customers ultimate control.
In the broad picture, improving the customer conversation is only one of a multitude of uses for data. However, just like credit cards or contact lenses, it’s one that once introduced, organisations won’t be able to imagine living without.
Mike Davies, Vice President Business Partners, Quadient