Data is increasingly transforming the way small businesses innovate and manage their customer relationships.
At its core, data is the collection of records of human behaviour. It is a by-product of the customer journey and their interactions with a company.
However, traditionally, much of a company’s data was held in “silos” – often within individual product, marketing, purchasing, technology or strategy teams – with each business unit making decisions using their limited pools of data.
As a result, this led to difficulties in sharing data insights across departments and a lack of cohesion within an organisation.
Customer relationship management (CRM) platforms were the starting point for both small and large businesses to centrally organise the customer information they collected. However, this information is inherently limited as it represents only a small proportion of the actions (online or offline) that a customer would take across his or her entire life.
But today, organisations can enrich CRM data by integrating and overlaying it with external data.
Here are four benefits of using data to improve your CRM:
- Offer real-time customer experiences
A company that has customers’ location data (say, through the provision of an app) can integrate it with historical transactional data to offer proximity-based offers.
This ensures that promotions are relevant and reaches the customer at the time when they are most likely to take action.
- Increase knowledge about customer sentiment and preferences
Organisations usually collect customer sentiment by directly surveying customers or using third-party services provider to do so.
One example of such a measurement is the Net Promoter Score (NPS), a tool that acts as a proxy for gauging a customer’s overall satisfaction or their brand loyalty.
Whilst commonly used, this method is subjected to limited participation (ie. responses only from very upset or very happy customers) and an over-reliance on a customer’s own representation of their feelings.
Another source of customer data is social-media listening, which offers organisations the ability to analyse public customer posts.
The efficacy of these collection methods lies in companies going to where the customer is instead of vice versa, thus feedback collected may be more honest and more useful.
- Be used to predict future customer behaviour
Companies now have the ability to combine CRM data, website analytics, social media insights, location information, customer service records and email data to build more detailed profiles of their buyers.
These profiles can then be used to predict the likelihood of future conversions. For example, knowing whether pushing a certain message at a certain stage of the customer journey will increase or decrease the likelihood of conversion can greatly influence strategic marketing decisions.
- Deliver high-quality customer service
Here, “customer service” extends beyond simply the problem-solving interactions a company has with the consumer. By using historical customer data to enrich CRM records, companies can personalise the customer’s experience at every touchpoint with the brand.
This can go a long way towards improving retention rates. It can also inform more relevant benchmarks and provide enhanced reliability indicators for support teams.
Managing data and risks is key
Companies that are serious about using data optimally can use a data management platform (DMP) to collect and structure data. Further, it is of utmost importance that companies are aware of privacy regulations that determine how the data can be used.
Stringent data protection policies and strong methods of data encryption must also be implemented to minimise the risk of data breaches or leakage.
Through the use of data exchanges to enrich CRM data and DMPs to make insight generation more efficient, companies can start to communicate with their customers in more personalised ways to revolutionise the way in which these relationships are developed and maintained.
Adora Goh, Marketing Manager, Data Republic