Requests for data and data sharing are now commonplace in consumer interactions with retailers and brands. Virtually every interaction consumers have with a brand requires some degree of data exchange and businesses must embrace the insight consumer data provides and use it to enhance their overall customer experience (CX). It is important to note that today’s consumers are more empowered than ever to choose how, where and when they purchase so the relationship they hold with a brand can provide a key driver in their decision-making process.
There is no doubt that data collection and analysis provide valuable opportunity for businesses to gain insight and deep understanding into customer preferences. This insight can be used to transform the experience a customer has with a brand by enabling a truly personalised service placing the customer at the centre of each interaction. It is now widely accepted that CX has the power to drive loyalty over and above other factors including price. The 2017 Gartner Customer Experience in Marketing Survey revealed that 81 per cent of those businesses surveyed, said they expect to be competing mostly or completely based on CX in two years’ time. It is no surprise that businesses are scrambling to ensure their CX is able to compete.
In the battle for CX enhancement, the value of data cannot be underestimated. Applied effectively it can provide businesses with rich insight into the personal characteristics that make up the human behind a data point. Data is a precious asset and when used correctly, businesses can develop detailed profiles of their audience and use it to foster more personal (and profitable) connections.
Building personal connections through data
Customer segmentation is a popular and well-established method of ensuring relevance between consumer and brand interactions. Building strong customer profiles enables businesses to identify who their customers are, what they are interested in and how best to interact with them. This insight enables businesses to market to consumers in a way in which they find relevant. Carefully analysed data allows businesses to not only base customer communication on past and previous interactions but also builds a predictive picture of likely future behaviours and buying preferences.
The reason this method works is that communicating with consumers in a meaningful way is only possible when a personal connection is made between the brand and the individual. Despite technological advances, emotional connections remain a powerful driver for consumers when choosing a brand - people like to interact with companies they feel understand and care about them. A Customer Thermometer survey conducted across 1000 people in the United States found that 65 per cent of people felt more connected to brands they felt cared about them.
For this reason, brands must look beyond transactional data when profiling customers and instead develop an understanding of the people behind the profile. The use of data to analyse customers should provide a three-dimensional view which identifies buyer preferences, motivations and needs while mapping how the brand can truly satisfy the customer with every interaction. Producing a clear representation of consumer activity provides businesses with valuable insight into individual behaviour and key drivers. By drilling down into customer behaviour in this way, brands can create more valuable interactions that drive trust and customer loyalty enabling businesses to reach out to customers on an emotional level.
Getting it right
The mistake many retailers make is deciding what type of customer they would like to attract and trying to make their product or service suit the desired group. When profiling customers businesses need to firstly ascertain who is buying the product not who the brand would like to sell it to – this should clearly identify a number of profiles which can be targeted in different ways.
High end supermarket Waitrose provides an example of a retailer that has successfully identified its customer profile and uses this data to interact with its known customer base in a considered way. Waitrose doesn’t try to compete with other supermarkets on price and instead focuses on the quality and shopping experience it knows its customers want. The MyWaitrose loyalty program offers members the opportunity to save up to 20 per cent on their most frequently purchased items offering customers discount on items most often purchased and providing a scheme that is tailored to individual customers and is based entirely on their specific preferences. The approach not only delivers a loyalty program which is different from the others but is very specific to individuals preferences driving a very personalised service.
A matter of trust
The emotional connection an individual holds with a brand is reliant on consistency, service and trust. The introduction of the General Data Protection Regulation (GDPR) on 25th May this year along with numerous news stories surrounding data sharing and data breaches in the NHS, Facebook and most recently British Airways, has highlighted the power of data, bringing it to the forefront of consumer minds. There is now a much greater degree of awareness amongst the general population about personal data use and misuse. According to a report released in February by the DMA, the clear majority of consumers (78 per cent) believe that businesses benefit disproportionately from data exchange in the UK. Businesses have a responsibility to treat consumer data with respect by protecting the rights of the individual. Using data ethically and only in considered ways that enhance the individual’s experience ensures trust is front and centre in the company-consumer relationship. Trust in an organisation remains the dominant prerequisite when engaging consumers within the data economy. In fact, 54 per cent of respondents to a recent DMA survey ranked this option in their top three considerations for data exchange with a brand.
The GDPR applies much greater scrutiny to businesses that collect, hold and use personal information and consumers are much more likely to question motives for requesting their personal details.
Data collection provides valuable insight for businesses which can greatly enhance the customer experience with a brand however the most important factor is how that data is used. To fully unlock the potential of consumer data, businesses must use it to create a detailed three-dimensional view of the customer.
By combining transactional data along with individual consumer behaviours, businesses build the ability to fully understand the people behind the data. This level of detail allows businesses to use the information to deliver a personalised service while cultivating more valuable relationships with customers, driving better service and generating great results for the business.
Stuart Robb, founder and CEO, Equiniti Data
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