| By Pam Baker
Measure The Right Metrics For The Fastest Payback
When Customer Relationship Management software debuted as a set of technologies, business prospered because it provided more information about customers than business had before. But that information, as grand and scalable and automated as it was, soon reached its limit in terms of understanding and usability. The need for more and faster information had to be balanced with the tools to interpret, flex and act upon the information. Enter customer analytics, the one big hope to mine and tweak customer information and thus pour pure gold into company coffers. But even analytics are tricky because sometimes they tell you what you already know, or worse, the wrong information altogether.
In this day and age when the economy is teetering upward, competition is stiff and customers are cynical, using the right analytics is absolutely critical for improved decision making. "CRM analytics needs to be improved upon over time with a shift from more of an 'Art' to more of a 'Science,'" says L. N. Balaji, president of US Operations for ITC Infotech.
To that end, here are five of the best CRM analytics in use today.
Direct customer feedback is still at the top, but it is now available via direct and indirect means; e.g. mined data from communities and social channels. "This avoids the distortion of surveys, which are often answered mainly by those with an axe to grind, or call center call reasoning, which is often subject to human interpretation or limited choice of classification," explains Mitch Lieberman, Sword Ciboodles Product Strategist. "It should be clear that while these are the most useful, these sources take the most energy and work to interpret correctly."
Comprehensive view of the customer is essential, and necessary to provide consistent customer response regardless of who in the company is communicating, or understanding customer behaviors for improved marketing campaigns, loyalty programs or actions from enrollment to referrals to impact on repeat business. Additionally, CRM systems should capture customer data from within and without the company to include social media, store visits, partner visits, company blog comments, and online buying patterns. CRM analytics can then generate demographic, behavioral and psychographic insights so that you are aware of the customer's satisfaction with service, price changes, response to marketing offers, etc. Ultimately, this complete albeit complex view "should reveal the customer's ecosystem and sphere of influence," says Balaji. "Do I know my customers family and office members? Are they my customers as well? Is social media playing a role in influencing my customers' behaviors? Can I measure the advocacy influence of my loyal customers?"
Measure engagement levels so that you know how active your programs are, how popular your offers and your partners are, and how well all of this action, or lack thereof, translates into increased customer share and incremental revenues.
Measure and track escalation response efficiencies such as FCR (first call resolution) be that via online chat, email or phone channels. Customer satisfaction primarily boils down to two things: customer satisfaction with the purchase and customer satisfaction with problem resolution. Your analytics need to measure how often problems arise with a specific product or service so you can fix the problem in manufacturing, the supply chain or in service delivery and thereby extinguish the problem at the source and end such complaints permanently. But it also needs to alert you to problems beyond the technical scope. "If a customer goes online to self serve, then calls the call center, this is clearly and escalation point and indicates a failure on the web which must be addressed—or a customer behavior that must be accepted or modified through social engineering, rather than technical means," says Lieberman. You need business analytics to tell you which situation exists so that proper steps can be taken to ensure better conversion rates and increased customer retention.
Measure and track customer value (Life Time Value or LTV) so that you know the actual value of a customer relationship. If you look only at the sales record for a customer, you can incorrectly assume profitability of the relationship. A high-dollar client that is expensive to serve and manage may actually be unprofitable when all is said and tallied. Conversely, a customer that spends less with you but is profitable to serve can often be enticed to spend more without sacrificing your profit margin. Thus, a customer's past buying record does not tell you everything you need to know in determining overall profitability of the customer. Make sure you have an accurate calculation of actual customer value.
In all probability, you'll need CRM analytics beyond these five. "CRM Analytics at their most useful are the ones that reflect KPI (key performance indicators) — if you own a bakery, your KPI could be how much product volume you move, or how many times your best accounts buy from you a month, but that is in stark contrast to what your KPI should be if you were a law firm or a dental office," says Adrian Sanders, CEO and Chief Value Migration Architect of VM Associates, a cloud-based business development consulting firm.
Categories: CRM Analytics
Tags: business intelligence, BI
Author: Pam Baker
Share This Article
Customer satisfaction boils down to two things: customer satisfaction with the purchase and customer satisfaction with problem resolution. Your CRM analytics need to measure how often problems arise with a specific product or service so you can fix the problem in manufacturing, the supply chain or in service delivery and thereby extinguish the problem at the source and end such complaints permanently.
More Articles By Pam