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 companies 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 CRM analytics are tricky because sometimes they tell you what you already know. Other times they deliver just meaningless information.
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 - or types of analytics - to improve customer experiences and company profits.
Segmented Customer Feedback
Direct customer feedback is still at the top, but it is now available via direct and indirect means; such as 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."
A 360 Customer View
A comprehensive view of the customer is essential, and necessary to provide consistent customer response regardless of who in the company is communicating. It's also essential for 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. Is social media playing a role in influencing my customers' behaviors? Can I measure the advocacy influence of my loyal customers?"
Customer Engagement Measures
Customer engagement directly correlates with customer relationships. Measure engagement levels so that you know how active your programs are, how your messaging is resonating, how popular your offers are, and how well all of this action, or lack thereof, translates into increased customer share and incremental revenues.
Track Root Cause Analysis Measures
Measure and track escalation response efficiencies such as FCR (first call resolution) be it 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 prevent such complaints from repeating.
Customer Lifetime Value
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 will short change the true value.
When looking at the lifetime value you may also find that a high-dollar client is expensive to serve and manage and 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.
More Analytics Needed
In all probability, you'll need CRM analytics beyond these five and analytics focused on your industry. "CRM Analytics at their most useful are the ones that reflect your business outcomes. 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.