E-commerce is on the rise. For the first time in history, online retail sales amounted to approximately $5.2 trillion worldwide in 2021, and they’re forecast to grow by over 50% over the next few years. However, with this continued growth comes higher consumer expectations – so it’s never been more important to get your digital customer experience right. Serving up effective but complex digital customer experiences requires data-driven insights that work in real-time to convert customers and build loyalty. The key to unlocking all of this is the use of a customer data platform (CDP).
The importance of digital-first customer experiences
Every digital interaction can make or break your customer experience. When everything works as it should, trust and loyalty in your brand will grow. But if there are blockages, such as a broken link or a three-hour wait for a live chat response, you may lose customers for good.
To illustrate this point, a recent survey found that 60% of people in the UK and US would stop using a company after just one poor customer service experience. By that same token, according to a study from Harvard Business Review, happy customers stay with a company for five years longer and spend an average of 140% more than customers who describe themselves as dissatisfied.
What’s clear is that customer satisfaction creates real, tangible results. By providing a responsive, personalised and streamlined digital-first experience across all customer touchpoints, you’ll benefit from higher conversion rates, increased profitability and improved brand loyalty. The best way to achieve this is through a good customer data platform.
Why you should use a customer data platform
If you plan to deliver a seamless, personalised, digital experience for your customers, you must first understand who your customers are. Investing in good customer database software will provide you with a holistic view of the characteristics, behaviours and needs of your target market.
According to recent findings, companies that successfully use data analytics outperform their peers by up to 20%. What’s more, a study by Capgemini found that 45% of marketers have access to a CDP, giving them a significant competitive edge, along with a whole host of other benefits, including:
No more silos: Because all data is collected on one platform from multiple sources, CDPs remove data silos, blockages and redundancies between departments
Single Customer Views (SCV): CDPs store all the data gathered from individual customers as a single profile. These profiles contain their purchase history, touchpoints, behaviours, and interests, enabling marketers to better understand their customers’ needs
Enhanced privacy and compliance: By creating a single, comprehensive, up-to-date customer profile, CDPs can help you keep your customers’ data secure
Better customer experiences: CDPs use actionable customer insights to dynamically create personalised experiences that match a customer’s needs and behaviours
Increase revenue: By using CDPs, companies can increase customer engagement and brand loyalty, leading to higher conversion rates and increased revenue. In fact, McKinsey reports that effective personalisation can increase revenue by 5–15%.
Using data to deliver a streamlined customer experience
A good data platform makes it easier to adapt to new and emerging trends, as well as to the changing behaviours of your target customers. By using data to tailor the customer experience, you’ll be able to make your customer journey more effective and inclusive, while quickly identifying points of friction.
However, there are a few things to consider when choosing or implementing a CDP. There are many different platforms on the market, with different strengths and weaknesses, and it’s important to select one that will enable you to work towards delivering the perfect customer experience and managing customer data.
In order to choose the right platform for your business, you also need to place the needs and wants of your customers front and centre, and take into account the business problems you want to solve.
The way you manage customer data is equally as important as the CDP itself – if not more so. Getting this wrong can lead to incorrect analysis, poor decision-making, a substandard customer experience and even non-compliance with data regulations –all of which can negatively impact your business.
Research by Gartner found that organisations believe poor data quality to be responsible for an average of $15 million per year in losses, while a report by KPMG shows that 84% of CEOs are concerned about the quality of the data they’re using to make decisions.
Despite the many clear advantages of CDPs, Gartner recently reported that most customer experience programs are not delivering on their promised competitive advantage. The same article claimed that companies that link customer satisfaction with growth margins or profits are more likely to report CX success.
How a digital transformation partner can help
Customer data platforms are no longer ‘nice to have’ – they’re now non-negotiable for any business that wants to prioritise the customer experience. But many companies either don’t know where to start or they’re overwhelmed by their options when it comes to collecting, segmenting and analysing data. There are also complex regulatory requirements to consider, such as GDPR.
At MMT, we understand the importance of data-centric customer experiences, and we have the expertise to help you create them. For example, when Vodafone released the first ever end-to-end chatbot-driven sales journey for a telecoms company, we were on hand to help make the rollout a success.
By providing ongoing support, we can also help you maximise the benefits of your CDP and unlock the value of your data. Book a discovery call to find out how we can help you take a data-centric approach to your customer experience, boosting profitability, increasing brand loyalty and gaining a competitive edge, both now and in the future.