How To Improve Customer Experience With Data

Your customers expect you to understand what they want. Not only this, they expect you to know when they want and how they want it.

Today, the modern company has no reason for not being able to deliver on these demands. The reason? Data.

Data is everywhere, and businesses are well placed to utilize this to improve the customer experience and smash their KPIs. Over 40% of marketers plan to expand their data-driven budgets, and that’s why it’s essential to adopt a data-driven strategy.

Data is the most critical part of any attempt to improve customer experience. But, it can be challenging to move from a strategy that under-utilizes data to one that places it front and center.

In this article, you will find how to improve customer experience using data.

Types of Data

Before we dive in, let’s take a look at the different types of data.

First-party data

First-party data is data that you have collected from your customer or your audience, including:

  • Data that is already inside your CRM
  • Behavioral data generated from customer or audience interaction (website, app, shops, location)
  • Data around customer subscriptions
  • Social data such as likes, interactions, and following data

Second-party data

Second-party data is somebody else’s first-party dataset. The reason that this term exists is that third-party data sets can be inaccurate, or may have crossed hands several times.

Third-party data

Third-party data is usually purchased from outside sources where the seller is not the direct owner of the data.

This data can be useful as it is usually available en mass, but issues with accuracy and validity can harm the customer experience.

How to Use Data to Improve Your Customer Experience

#1 Using Data to Segment Your Current Customers

Data helps paint a picture of how your audience behaves. Segmentation is a concept that has existed in the marketer’s toolkit for a while. But today, much better data is available to understand how your customer interacts with your business.

Segmenting your audience based on this is a fantastic way to improve the experience and drive personalization.

For example, based on the pages your customers have visited,  you can segment your email list and restructure your newsletter content in a way that they are more likely to enjoy.

Segmentation can also help you improve your conversions and ensure that your strategy is engaging when customers interact with your business. This helps you to create a better experience and helps you to generate more revenue per customer.

#2 Data as a Tool for Getting Personal

The benefits of personalization are clear – it’s a fundamental part of any attempt to improve customer experience.

Apart from offering a great product, customers want brands to recognize their interests and remember their preferences.

Now that’s not just an easy task, but data can be of great help.

Take a look at how some of the world’s largest companies are using personalization to improve the customer experience. For example, Amazon provides highly personalized recommendations while Netflix uses data to display what you want to watch next, usually before you do.

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Without data analytics, this would not be possible.

Every interaction should be an opportunity to leverage data to optimize customer experience.  There are many sources for this data, from site visits to email opens and app engagement. Both online and offline data can be used to help improve the customer experience across the customer journey.

#3 Using Data to Understand What is Working with Customer Experience

Adopting a data-driven strategy will provide you with more insights and give a better understanding of your customers and their behaviors.

This naturally leads to making better marketing and broader business decisions. Your newfound love for data will help you improve your customer experience.

For example, the insight you receive from personalization and segmentation can help you understand which audience is best to market to, what kind of content or incentive is best suited to your audience, and what you should be doing to maximize positive experience within your product or content.

These can help understand broader trends in your industry. Combining data with strategy helps you become predictive, engage with customers, maximize the experience, and drive new business with the right message via the proper channels.

#4 Data can Help You Optimize Experience Across All Channels of Communication

Your customers will experience a lot of content throughout their day, across many different channels. Data can help your content stand out from the rest.

Using content to engage customers is a common tactic to boost customer experience. But by adding data to the mix, you can target this by utilizing key insights to inform what your users want and when they want it.  For example, you can use app analytics data to display dynamic content and provide users with the content they want and improve the customer experience.

This works across other channels too, from email to chat and even paid advertising. Using datasets to optimize these channels will allow you to boost the customer experience and drive engagement across the lifecycle of your customers.

Conclusion

Data is a powerful tool for any business. By adopting a data-centric approach, companies can dramatically improve customer experience. Data helps companies become predictive by segmenting their users and personalizing the way they communicate across channels. By creating a personalized, data-driven strategy,  your business will lead the way in customer experience.