ROLE OF DATA ANALYTICS IN UNDERSTANDING CUSTOMER BEHAVIOR

ROLE OF DATA ANALYTICS IN UNDERSTANDING CUSTOMER BEHAVIOR

“Companies that focus on customer experience are three times more likely to exceed their business goals, than the rest.” says a report by Adobe.

Forrester also predicted in 2020 that if organizations don’t learn to leverage customer insights and quantify the business impact of customer experience initiatives, they will find themselves in a vulnerable position. The positive customer experience (CX) is a competitive advantage in every industry, be it FMCG, consumer durables, finance, healthcare, or retail. Understanding customer behaviour plays a key role in improving customer experience. If an organization knows the preferences, needs, and emotional patterns of its customers, it can use the same to create better experiences for them, which in turn directly leads to an increase in sales and revenue.

BIG DATA AND CUSTOMER BEHAVIOR ANALYTICS

Understanding customer behaviour has always been a challenge for organizations. “Small data” in the form of sales reports, web analytics, and social media dashboards, has been accessible for many years now. However, an in-depth analysis of every present and prospective customer is only possible by connecting these transactional insights with the emotional behaviour of customers. When channels such as mobile app usage, chatbot interactions, social media feeds, search histories, transaction histories, chats, email conversations, location, check-ins, and in-store interactions are combined together, they capture tons of data giving valuable insights into how customers like to engage with brands. ?This helps in understanding customer behaviour and improving customer experience.

Here are some of the ways data analytics can help in understanding customer behaviour:

·??????UNDERSTANDING CUSTOMER PERSONA

Data analytics helps us understand specific parameters that characterize customers’ individual behaviour. These parameters are crucial to understanding the needs, likes, dislikes, interests, goals, and desires of customers. Identifying such direct and indirect parameters can help in creating a complete customer persona.

·??????Direct: Evident demographics such as age, marital status, parental status, income level, and employment mode.

·??????Indirect: Non-evident parameters such as interests, lifestyle, preferences, personal objectives, spending patterns, influences, etc.

Analysing such a wide range of data on customers can help in creating the right customer persona and in designing marketing and sales strategies around the same.

·??????CREATING A PERSONALIZED EXPERIENCE FOR EVERY CUSTOMER

According to a Salesforce report, 80% of customers feel that an experience that a company provides to them is as important as its products or services. Data analytics can provide valuable insights into customer behaviour and deliver personalized experience through customized recommendations, offers, and listings, to drive more purchases by the customer. Such customized offers create an emotional connect with the customers and lead to quicker conversion.

·??????UNDERSTANDING CUSTOMER JOURNEY

With the help of data analytics, organizations can gain complete visibility into the buyer journey by analysing, browsing time, transaction data, and purchase histories. This gives insights into which factors triggered a certain purchase. Companies thus can create specific customer segments and target each group with precision. Optimizing customer interactions become easier by serving personalized content and communication at every point of interaction. Further, data analytics helps in mapping what customers say, to what they actually do, and analyses satisfied, neutral, and dissatisfied customers to identify what factors form a good or bad experience. This helps in gaining a complete understanding of their behaviour and decision-making journey.

Using such insightful data helps in catering to crucial metrics related to consumer behaviour such as:

·??????Customer acquisition costs

·??????Customer retention costs

·??????Customer satisfaction percentage

·??????Average purchases

·??????Brand value and recall

CUSTOMER INSIGHTS THROUGH DATA ANALYTICS SET THE PATH TO SUCCESS

Technology is redefining the relationship between brands and consumers. Data-driven customer experience is no longer an exclusive privilege for well-funded giants or start-ups. Many companies have now realized that investment in smart data analysis tools is imperative to create positive customer interactions leading to successful conversions.

Need to gain an understanding of your consumer behaviour? We at PBI analytics, provide end-to-end data consulting to help you with your business’ success journey.