Raj Sivasubramanian - Director of Customer Experience Services
3 minute read
By Raj Sivasubramanian - Director of Customer Experience Services
Posted in Customer Engagement
In my last post, I said listening to customers and capturing feedback across all channels is a crucial step to delivering great customer experiences in today’s omnichannel world.
I’ve noticed a growing school of thought in the digital world that merely observing and analyzing customer behavior can provide equal or better insights than feedback from customers.
Driving this is the explosion of customer data and rise in behavioral and web analytics that have made it seemingly easier to predict purchasing intent or possible churn based on past behavior. There is also the argument that customer feedback doesn’t always influence purchasing behavior. A senior executive at a former employer of mine once commented when asked about low survey scores: “I don’t care what our customers say; I care about what they do.”
However, there are two important reasons why listening to customers can provide greater insight than just analyzing behavior.
Customer purchases are often driven by emotional factors that behavioral data does not capture
While behavioral analytics tools are impressive, they cannot understand the emotions that drive customer behavior. Analyzing actions without truly understanding the “why” behind them can, in many cases, lead to an incomplete or even inaccurate view of customers’ needs and desires.
Consider a sports example, known for highly emotional fan behavior. My wife is a huge Atlanta Falcons fan, so the Super Bowl was tough for her as the Falcons blew a 25 point lead and lost to the New England Patriots in one of the more stunning collapses in sports history. The next morning as she was trying to forget about the game, she was greeted with an email from an online retailer asking her to “Join the Patriots Celebration and Shop the Largest Selection of Super Bowl Champs Gear.”
Why did she get this email? Her only purchases from this retailer have been Golden State Warriors apparel for our 4-year-old daughter and, ironically, Atlanta Falcons gear a few weeks earlier. Clearly this retailer’s analytics fell short in matching up potential shoppers with their teams of interest—the campaign only further infuriated my wife, who has decided never to buy from them again.
This might be an extreme example from the emotional world of sports, but customer decisions are often emotional—engaging with them is the only way to add data points that provide emotional context. If this retailer had done something as simple as asking my wife what teams she liked after her last purchase, they not only could have avoided sending her the Patriots ad that cost them her business—they also could have sent her better targeted ads for the teams she does like that may have led to additional purchases.
Customer feedback provides insights on “trapped” customers who will not be trapped forever
Relying solely on behavioral data also fails to capture the perception of “trapped” customers—those who are unhappy but purchase reluctantly for many reasons. Maybe they don’t have other good options, maybe the switching costs are too high, or maybe they are trapped by a rewards program. But whatever the reason, their purchasing behavior doesn’t truly reflect their satisfaction with the company.
Market dynamics are constantly changing and circumstances that “trap” customers could disappear overnight. A new competitor could enter the market. A new promotion could reduce switching costs. Or in the case of certain airlines that have made recent headlines, one bad PR incident could make customers re-evaluate the true importance of the factors that are trapping them.
Some customers of the airlines in question might be very satisfied with their overall customer experience, so the recent incidents might have no effect on their loyalty. However, other customers with the same behavioral characteristics could see an event as the final straw in a string of poor experiences that offset the benefits of their status and decide to find a new airline. Analytics that include customer feedback would allow these airlines to understand who their churn risks are and act accordingly.
Newly "un-trapped" customers are an immediate risk for defection—companies that don’t capture customer feedback will not be aware of how much of a churn risk these customers are until it is too late.
Ultimately, what customers “say” and what they “do” are both important to understand—fortunately, you don’t have to pick just one. If you have an omnichannel approach to customer feedback and can analyze both customer thoughts and actions, you will know your customers on a much deeper level—and potentially drive increased share of wallet, less churn and a better overall experience.
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