A (Truly) Data-Driven Customer Experience

Businesses spend billions of dollars each year on surveys, customer service staff, and customer rewards programs to attract, understand, and retain customers.

In today’s digital world, improving the customer experience is an ever-increasingly data-driven process that’s generating real results for brands, big and small.

Customer Experience Analytics: What It Is and How It Works

Customer experience analytics, also known as CX analytics, involves collecting and analyzing customer data to understand how users interact with your product or service. While most companies using data to improve the customer experience tend toward the digital, these practices are also used in brick-and-mortar locations to monitor how people order, how long they spend in-store, and other variables that ultimately impact metrics like average order value or customer retention.

How to Use Data Analytics to Improve Customer Experience

Successfully leveraging data to provide users a better experience is all about input. After all, your analysis is only as good as the information you have to work with – and that depends on understanding the two types of feedback data sources you have to work with.

Direct feedback customer data is solicited from the customer via survey; the customer knows they’re providing the feedback, and their responses are shaped by the questions asked.

Examples of direct customer feedback include:

• Customer surveys – Also known as qualitative market research, these are questionnaires completed by customers during or after a product is purchased or a service is performed.
• Customer effort scores – One-question survey delivered post-interaction to evaluate how hard it was to purchase a product, reach customer support, or find a resource they were looking for.
• Voice of Customer programs – Ongoing analysis of customer reviews, social media posts, product reviews, and other feedback distilled into timed-based reports. These are increasingly popular among large ecommerce companies.

Indirect feedback data is based on customer interactions and relies on more objective metrics, many of which are primary goals for ecommerce marketers.

Some examples of indirect customer feedback include:

• Customer lifetime value (CLV)
• Average spend, or average order value
• Customer churn rate
• Average handle time (AHT), or the amount of time it takes to complete a customer service interaction

Both direct and indirect feedback data reflect successful customer interactions and illustrate new opportunities to improve the customer experience.

Companies often claim they care about customer experience, but few invest the resources to monitor customer satisfaction. Even when they do, some fail to act on the results of those surveys to accurately and consistently make adequate changes.

Putting Data to Work

Implementing your findings usually starts with a round (or two, or three) of internal discussions to determine how to address customer pain points. Include project managers, product developers, the sales team, and other stakeholders to categorize findings into a few buckets, such as:

• What we can fix now
• What we can fix later
• What we can fix in the next redesign
• What we cannot fix

It’s obviously important to address as many issues as possible to keep customers happy, but there are limits. Certain requests or feedback, particularly around pricing, may not be possible. Additionally, there may be technical limitations or risks associated with resolving certain customer requests.

For example, feedback might call for implementing a feature that’s copyrighted by a competitor; copying or “borrowing” too much from that feature might expose your organization to legal trouble.

The 3 Main Benefits of Customer Experience Analytics

It’s hard to overstate the importance of data in customer experience initiatives. These efforts provide marketers and businesses with information that guides everything from future product development to highlighting simple but impactful changes that ultimately drive growth.

Take dark mode on your favorite apps (besides Candy Crush); developers add dark mode because it leads most users to spend more time in the app compared to lighter default settings.

Data and customer experience analytics give brands big opportunities to learn and improve in three ways:

1. You find out what your users want.

It’s that simple. Direct feedback raises obvious answers (“I wish your product were cheaper”) and not-so-obvious answers (“It would be easier if the lid opened the other way”), but it’s feedback that you may never have received without directly asking your customers.

2. You see what users actually do.

Customer behavior is different from customer feedback. Satisfied customers may never return, while angry or vocal customers might be your most valuable user base. Accurately tracking customer behavior through indirect feedback identifies important patterns that reveal the most efficient customer journey or sales channels.

3. You can improve how your business operates.

No one likes to wait. Companies use data to reduce wait times across industries, from healthcare providers to call center support. Thanks to customer experience analytics tools and research, companies can determine how long customers are willing to wait, average that time, and adjust or invest in resources to meet those benchmarks.

For example, take a bank call center. Customer surveys (direct feedback) and average handle times (indirect feedback) show how long a satisfied customer waits to speak with a representative; let’s call it four minutes. The bank now has the data and needs to support investment to reach that goal more consistently, whether by investing in more support staff, offering more self-service kiosks, or creating an AI chatbot to handle more straightforward questions.  

Of course, similar practices can increase average order value, increase online conversions, or keep users on your website or app longer. Once you understand how data can improve customer experience, it’s simply a matter of acting on the information to meet your broader business goals.

Make Data-Driven a Part of Your Customer Experience

 Data doesn’t lie, but it fibs if your sources aren’t accurate. Oneupweb has helped businesses make smart decisions with clean data and reliable market research for nearly 30 years. Give your customers a delightful experience; get in touch or call (231) 922-9977 to get started.