From a strategy standpoint, data holds the key to business transformation says Shikhar Vaibhav, engagement manager at analytics firm Mu Sigma.
Much has been said about the demise of traditional media with the new kids on the online block successfully attracting a growing and loyal audience.
Digital media has taken the market by storm, gathered unprecedented fan-following over the years with no signs of taking a breather yet. With so much happening within such a short span of time, the question that looms large in the minds of digital marketers is how to enhance their customers’ digital experience so that they keep coming back for more.
Consumers are increasingly ditching traditional sources of information such as newspapers and magazines in favour of news aggregator sites such as Google News, peer recommended niche sites and blogs. The spurt in multi-device ownership such as smart phones, tablets and phablets in addition to the choice of personal programming using disc players, recording devices, gaming boxes, streaming services, cable pay-per-view, etc. has resulted in consumers being perpetually online.
But all is not rosy for digital media companies. In order to stay competent and competitive in the ‘Information Age’, they have to battle a number of problems ranging from well-informed customers who are spoilt for choice to competitors who vie for the attention of customers. An online buyer will invariably browse through all possible online platforms and evaluate his/her options in terms of pricing, quality and range of products, thoroughness of service, peer reviews and competitor offerings before arriving at a decision. Customers today are on the look-out for deals that work best for them. They favour the medium that provides them the most viable, personalized brand experience. They don’t shy away from voicing their opinions on a range of platforms such as social media, blog sites and consumer forums, leaving digital footprints all over the Internet. To overcome these challenges, digital marketers are focusing on certain key areas to provide customers with the ultimate brand experience.
Customer retention is the key
Digital media companies need to prioritize customer retention keeping in mind the high cost of acquisition and impact of attrition on revenue. Organizations need to be attuned to key drivers that impact customer behavior and formulate strategies that are proactive in nature rather than resorting to reactive measures. They need to be equally cognizant of Customer Lifetime Value and their propensity to churn, in order to excel at customer relations. With more and more start-ups joining the digital media bandwagon, it is crucial for organizations to garner the right talent, tools and richness of data in order to gain a 360-degree understanding of customers not just in terms of their behavior, needs and priority areas but more importantly, of drivers of “delight”.
One size doesn’t fit all
Since customers are people with different needs, preferences, income types, mindsets, personas and demographics, the “one size fits all” maxim does not hold good for everyone. Customers are far more likely to opt for a platform that caters to their specific needs and remain loyal to the brand if they are treated as individuals. In order to provide a personalized experience, digital media companies need to identify key drivers that impact customers’ churn behavior. Companies such as Netflix are experimenting with more efficient recommendation lists and improving their algorithms to obtain better insights into viewer preferences and interests instead of just offering suggestions based on genre or actor. The company recently introduced ‘Max’, a recommendation assistant that singles out movies for its users after they answer a few questions.
Deep-diving into the customer life cycle
The relationship between customers and service providers needs to be more than just a one-time transaction or a pre-defined process. A customer goes through a typical life cycle starting from pre-sales engagement and going through sales, fulfillment, consultation and renewal, underpinned by exceptional customer service support. The needs of customers differ at various touch-points.
Big data analytics to the rescue
Smarter customers and a hyper-competitive landscape have resulted in innovative approaches towards satisfying, acquiring and retaining customers in the digital marketing sphere. Armed with the right tools, platforms and talent, digital media companies can leverage this ever-burgeoning, plethora of structured and unstructured data – popularly known as ‘Big data’ – to derive valuable customer insights needed to boost their business.
Big data helps marketers see their customers as individuals and cater to them uniquely. From the strategy standpoint, big data holds the key to business transformation. Digital marketers need to see the writing on the wall and create a strategic roadmap to monetize big data opportunities and internalize data driven decision making. To stay ahead of the race, companies need to actively listen, analyze and respond to the onslaught of customer data, incessantly pouring in from all forms of online and on-ground channels. They can delve into their customers’ historic data by leveraging multiple data sources such as surveys, customers’ reviews and comments, interactions with customer service personnel to understand their level of satisfaction and willingness to recommend the services to their peers. Additionally, it is crucial to keep pace with real-time feeds of customer click-streams, social posts, call center interactions, geospatial coordinates, and other behavioral data that change by the second.
Multiple analytical solutions and processes can be developed to achieve viable interactions throughout the customer life cycle. Discrete choice regression models can be developed to identify drivers of satisfaction and predict their propensity to churn. This information can be used by companies to identify which customers need to be targeted. Furthermore, predictive modeling techniques can be used to decipher what kind of personalization needs to be delivered during renewal. In the digital space, click rate, traffic, bounce rate, etc. could be some of the aspects that need to be monitored throughout a customer’s lifecycle in order to evaluate the overall ROI and also the propensity to churn or stay loyal. Exception analytics should be set up to monitor the way customer service interactions are conducted and also to identify which outliers need attention. Text analytics solutions can be applied to identify customer sentiments. Omni channel strategies can show the preferred path taken by consumers that result in a sale.
In addition to the tried and tested methods of data analytics, digital marketers can be benefited tremendously by the cross-pollination of ideas, learnings and best practices from other industries. For instance, telecoms, media, online ads companies can learn customer affinity bucketing from the banking and credit cards sector by analyzing customer loyalty gaps, prevalent switching patterns, etc. They can implement best practices of price optimization by studying customer price elasticity techniques from the travel and hospitality industry. Survival modeling can be improved by focusing on uncertain lifetime of entities, patterns of behavior differences by age and sudden losses as seen in the biological sciences industry. By finding adjacencies in other industries, digital media enterprises can find new solutions to old problems, thereby innovating as they grow.