By Amber Anderson, Strategist, & Product Manager, Founder, Kayson
The term customer analytics may sound complicated, but the concept is rather simple. Customer analytics is a process where a business uses data it has collected about its customers and potential customers to service them better and drive key business decisions. Customer marketing analytics supports the needs of the marketing team or the marketing process.
Learning more about your customers and then using the information you’ve gathered to provide a better experience isn’t new. In fact, you may already be doing it.
What is new, however, is the technology available. With so many solutions on the market, it can be overwhelming. That’s why it helps to get an understanding of what your business needs in a customer marketing analytics solution.
Getting Started: What Does Your Business Need?
Before you begin searching for new customer marketing analytics solutions, it helps to identify the systems you're currently using, validate their use and then identify gaps.
Consider conducting a business process review. Walk through your business process diagrams and customer journey maps, jotting down the systems you’re using. If you do not have business process diagrams or a customer journey map, you may want to create one or hire a business or process analyst who can create one for you.
After you have identified your existing systems, take a moment and write down your requirements — that is, what you want to capture. For example, are you trying to learn more about your customers or figure out who your target customers are so you can allocate your marketing spend more strategically? Trying to increase customer satisfaction or improve customer retention by offering a more personalized experience?
Once you’ve captured your why, you can document the features/capabilities you want in a new solution.
Making Sense of Customer Marketing Analytics Technology
A number of software solutions are available for your customer marketing analytics needs. You can find customer marketing analytics and customer satisfaction analytics capabilities in three broad categories: functional systems, cross-functional systems and analytics systems.
Functional systems are designed to solve the use cases for a particular function. For example, email marketing software, such as MailChimp and Constant Contact, can provide insights into how your email marketing campaigns are connecting with your customers. If email marketing is part of your business strategy, this is data that your marketing team may want to understand. If the majority of your current business needs are within one area of your business, a functional system might satisfy your needs.
If you are looking for more, take a look at cross-functional systems. Cross-functional systems, such as customer relationship management (CRM) tools, are designed to capture data and provide insights on your customers as they navigate through various functions within your business. The data collected in cross-functional systems can lead to insights that can help inform your retargeting strategy, personal the customer's experience or address customer satisfaction concerns.
Although they are not traditionally called out as customer analytics solutions, functional and cross-functional tools can offer valuable insights into your business that can help you make more informed business decisions. So if you are not ready to invest in a full-blown analytics solution, a simpler functional or cross-functional solution may be a good place to start.
Alternatively, if your business case involves analyzing customer data across multiple channels or performing more detailed analytics tasks like creating models or developing predictive analytics, a customer analytics tool may be better for you.
Customer analytics tools aggregate your data from multiple sources and then offer insights that can help influence business decisions. For example, by analyzing buyer data from years past, a customer analytics solution may provide you with insights into how the holiday season will look (or how to price your products) months, even years, before the season begins.
These tools may also be able to provide your marketing team with more details on your target customer. For example, you might discover your most valuable customer is a woman, between the ages of 35 and 40 with two children, with a $100,000 household income and a credit score of above 650. Customer analytics software is designed specifically to provide you with more targeted data about your customers. These solutions can be purchased “off the shelf," or if you can't find one that meets your needs, you can hire a technical team to create one for you.
The cost of these tools varies. When considering price, think about the cost of not only the software (as a Software as a Service offering, these tend to be monthly, per-user costs), but also the implementation itself, professional service support and training for your staff.
Looking Beyond the Tech
New technology usually comes with a learning curve. When considering new customer analytics solutions (customer marketing analytics and/or customer satisfaction), consider keeping your team and implementation time in mind.
Determine who will be the owner of the new solution and their skill set. Depending on the level of analytics you plan on implementing, your current team members may be able to process the new insights—or you may want to consider hiring an analyst who has experience analyzing and acting on the data.
Either way, remember that customer analytics is a business process. It can't replace people. It's a tool that can provide you with valuable information. How you act on it is up to you.