Marketers have a new focus - customer experience. It brings together the full suite of their activities - brand, pricing, proposition, analytics, creative - across every channel and, possibly for the first time, links them directly with revenue-driving outcomes. According to research carried out on behalf of SAS, 50% of CMOs and other CxOs believe real-time customer engagement could increase revenue by as much as 10% and one in five believe it could be 20% to 40%.
Getting that gain involves pain, however, The same study found that only one in six are currently able to adjust their marketing communications in real-time, while half say their attempts at real-time Cx are constrained by budget, data security, legislation changes and GDPR.
As Charles Senabulya, vice president, SAS UK and Ireland, said at the analytics vendor’s recent Cx Summit: “With the investments made into niche analytics over the last decade for social, mobile and digital, as well as data management platforms, there are a lot of disconnected silos. So marketers are struggling to deliver consistent customer experiences, even though consumers expect to be known throughout the customer journey. The opportunity is to bridge the gaps in those silos.”
Three examples of organisations who are working towards this kind of consistent Cx show what can be achieved, what still needs to be done and where value is realised along the way. Ireland’s Permanent TSB is a challenger bank to Bank of Ireland and Allied Irish Banks which is focusng on growing its customer base and brand. It has a customer value management team which ties together insight, analytics, customer base management and reporting and is targeted with identifying gaps and managing the base to bring value to customers and the bank.
Orla Fiztpatrick, head of customer analytics, value management and reporting at PTSB, explained to DataIQ that, “we have a higher volume of calls than other banks and the highest net promoter score. We are very strong digitally - we launched an updated mobile app and an upgraded web site with new functionality for business customers. We also have end-to-end online personal finance application and 25% of personal loans now come through digital channels.”
"We have a value-driven culture focused on identifying the return on investment in everything."
That already reveals the complexities which the bank faces in understanding its customer journeys and architecting a positive customer experience. Recently profitable again, it has undergone significant changes in its C-suite that have helped to bring a new approach. “The commercial department has 76 people under a new director who recently joined from Virgin Ireland and UPC. He has a very different perspective and has brought a value-driven culture focused on identifying the return on investment in everything and to be customer-focused in how we operate,” said Fitzpatrick.
Using SAS Enterprise Miner, the CVM team has been developing customer segments and building propensity models which have been deployed into marketing campaigns. “It has been surprisingly successful in terms of outcomes with twice as many customers likely to apply in the next six months compared to a control group,” she said.
While discussions about Cx are often focused on digital channels, Fitzpatrick noted that, “our call centre handles high volume activity, with 77 branches more focused on selling complex products, like mortgages. The next step is to apply it in a multi-channel environment including outbound telemarketing and direct mail as well as SMS.” PTSB is planning to introduce next best action and real-time decisioning into end-to-end processes next.
Fitzpatrick describes the culture of PTSB as being relatively traditional, despite being a challenger brand and even within the analytics team, which can make recruitment in Dublin’s overheated data and analytics market challenging. For organisations looking to develop their Cx capability and tie marketing activities to analytical insights, having the right people on board is crticial.
At Allied Irish Banks, Peter Swan, head of customer data and propensity modelling, told DataIQ that, “the mindset here is changing. We are pretty good at recruitment and are building a reputation among the community of analysts as a good place to work.”
"Our CEO understands the value of analytics.”
That shift includes dressing down, rather than wearing suits and ties, and a more relaxed, digital-style working space, as well as appealling tasks. “A lot of them don’t want to work for a bank, so we try not to look like a bank. We try to give them interesting work so they are always challenged. We use agile working methods which fits well with analytics projects. We are also in the middle of designing career paths for our analysts, with continuous training and development,” he said.
The bank started its turnaround from the financial crisis eight years ago and sold a 25% stake via an over-subscribed IPO this year, raising €3 billion to add to the €6.8 billion it has so far repaid from a €20.8 billion government bailout. According to Swan, it has other advantages: “We are in a very positive position from an analytics point of view. Our CEO understands the value of analytics.”
Robert Mulhall, managing director of retail and commercial banking banking, Ireland, is another example. He started as an IT analyst, became head of BI and head of CRM, before heading up the strategy and insight team, then moving into direct channels. A spell at Accenture in New York preceded his current position. As Swan said: ““Analytics is embedded into our DNA. That is not the norm in banking.”
“The strategy is to drive customer-first behaviours, with connected customer journeys, customer engagement and voice of the customer, all driven by analytics. Lines of business and product development now engage with our analysts before they develop new services,” he explained.
“We are moving towards a place where we drive every decision with data and analytics and have started to operationalise that. We implemented next best action a couple of years ago. We have the technology, now we are trying to embed it in the business - it is my job to drive adoption, for example by branch manages who have a pop-up on their screens about what to offer customers.”
Sky has been on a well-known journey to develop its customer base which has seen it combine traditional direct marketing channels with call centres and digital. Its use of data and analytics may be mature, but the more recent focus on Cx creates challenges because of the way it crosses internal silos.
"The last [step] is the most significant part of the customer journey, not the clever stuff we do around algorithms."
“Customer service is looking to reduce its cost-to-serve, but the service channel is also a sales channel because the reason why a subscriber is calling can reveal a sales opportunity,” said Daragh Kelly, data strategy and innovation director, at the SAS Cx event. “There is a trade-off between the sales target for the quarter and long-term goals which we are pursuing which means there are decisions that have to be made.”
Those trade-offs are arbitrated centrally, although decisions are made by “multiple brains” within functions as part of decisioning ecosystem. Kelly explained why this makes the analytical task challenging: “Customer experience has to be relevant and consistent, but also contextual. If you promote a product regardless of which channel a person arrives by, that goes against relevance. If a TV subscriber is calling the call centre about a service issue, they don’t want to talk about broadband.”
Similarly, the company has invested to make it possible to personalise the customer journey at every touchpoint. “Do we want to do that every time and in every touchpoint? No. That last bit is the most significant part of the customer journey, not the clever stuff we do around algorithms,” he said.
Sky’s analytics function has developed a wide range of models to support end-to-end decisioning which has been rolled out one channel at a time, starting with dynamic content on the web site and agent support in the call centre. When somebody logs in, they get a modelled recommendation, their action flows back to their profile which updates in 60 seconds with their next best action. According to Kelly, this has delivered a 110% uplift in click-through rates and 240% uplift in sales (because the models are focused on sales uplift, not CTR).
To reach this level of capability in Cx, Sky created a “war room” with representatives of technology, finance, analytics, and marketing all round a big table which allowed it to set targets and budgets. “We had channel personalisation ready in six weeks, but it took six to eight months to enable it in all channels,” said Kelly.
That underlines why Cx is so challenging, even though it is a game-changer. And not just for brands - SAS sees it as a major opportunity to reinforce its position as an analytics leader and has focused its product development onto omni-channel customer experience, digital leadership, digital planning and ecosystem enablement. As the level of interest and investment in Cx grows, it seems both sides are taking the same journey together.