APAC ADDENDUM
CUSTOMER EXPERIENCE
OPTIMISATION REPORT 2015
As a follow-up to the report, Ensighten analysed data from the Asia Pacific surveys specifically and compared them to the overall results to determine if there was an APAC regional difference. After analysing the data, we concluded that there were subtle differences in a few key areas:
1. OUR FIRST CONCLUSIONwas that although digital marketers from APAC directionally have similar challenges and opinions to global marketers, there are subtle differences about the importance of customer experience optimisation. For example:
a. Globally, 41% of respondents claim that customer experience optimisation is critical, i.e. a high priority for the organization compared to only 24% of respondents in APAC.
b. Additionally, 72% of APAC respondents indicated that customer experience optimisation is somewhat important but many other initiatives take priority compared to 52% of the global responses.
2. OUR SECOND CONCLUSION was although digital marketers globally struggle with collecting, analysing and modelling non website customer data, the APAC region in particular is lagging. For example:
a. 75% of APAC respondents indicated No Capability or Don’t Know when asked about collecting data about mobile app
b. 33% of APAC respondents indicated No Capability or Don’t Know when asked about analysing user data from different systems compared to only 16% of the global respondents. c. 67% of APAC respondents indicated No Capability or Don’t Know when asked about modelling data from different systems compared to 40% of the global responses.
3. OUR THIRD CONCLUSION is that although the majority of global digital marketers have started programs to integrate data for the purposes of customer experience optimisation, the APAC region is behind the rest of the world from a program adoption perspective. For example:
a. 32% of APAC respondents indicated they are 1. Either considering doing this but don’t know where to start, 2. Have already tried and failed or 3. Have no plans to integrate data across channels, technologies and databases. This compares to only 17% of the global digital marketers.
It is clear that directionally digital marketers across the globe are facing similar challenges with respect to customer experience optimisation and are addressing those challenges to a certain degree. What is clear is that the APAC region is slightly behind the rest of the world in terms of the importance of customer experience optimisation relative to other marketing priorities and the level of maturity of their omni-channel data collection and
Econsultancy partnered with Ensighten to publish the Customer Experience Optimisation Report
based on a survey to more than 600 global digital marketers and ecommerce professionals. The
report delivered valuable insights on how brands are addressing their customers’ experience and
impacting their customer journey.
Market Data
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Event Presentations / User Experience
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Customer Experience
Optimization Report
Customer
Experience
Optimization
Report
Econsultancy London
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Econsultancy New York
350 7th Avenue, Suite 307 New York, NY 10001 United States Telephone: All rights reserved. No part of this publication may be
reproduced or transmitted in any form or by any means, Published March 2015
Contents
1.
Executive Summary ... 4
1.1.
Methodology ... 6
1.2.
About Econsultancy ... 6
2.
Foreword by Ensighten ... 7
2.1.
About Ensighten ... 8
2.2.
About Pelin Thorogood ... 8
3.
The Importance and Benefits of Customer Experience
Optimization ... 9
4.
How Are Organizations Optimizing CX?... 11
5.
Activating the Single Customer Profile ... 15
6.
Data Collection and Analysis Capabilities ... 19
7.
Modeling the Customer Journey ... 22
8.
Integration Needs to Become a Priority… Now... 25
9.
The Customer Data Challenge ... 28
10.
Appendix ... 31
10.1.
Additional data ... 31
10.2.
Data cross-tabulated by company size ... 37
10.3.
Respondent profiles ... 41
10.3.1.
Business focus ... 41
10.3.2.
Business sector ... 42
10.3.3.
Geography ... 42
10.3.4.
Job role ... 43
10.3.5.
Revenue ... 43
1.
Executive Summary
This Customer Experience Optimization Report, published by Econsultancy in partnership with Ensighten, is based on a survey of more than 600 digital marketers and ecommerce professionals.
Customer experience optimization is critical for higher engagement
and conversion rates
Catering to the needs of the customer has become a defining feature in this new era of marketing when consumers have more power than ever in their relationship with brands. This research shows that businesses need to sharpen their focus on delivering outstanding customer experiences as a key requirement for achieving business success.
More than two in five companies (41%) claim that customer experience optimization is
critical, i.e. a high priority for the organization. A further 55% describe the practice of optimizing customer experiences somewhat important, with other initiatives taking priority.
According to responding companies, customer experience optimization leads to higher conversion rates and greater loyalty. Almost all (94%) companies see higher engagement and conversion rates as benefits of a commitment to customer experience, compared to two-thirds (66%) who cite better brand perception as part of the resulting upside.
Businesses are still at the start of the customer experience journey
Most organizations are just starting to use the tools, processes and techniques required to facilitate a real-time, personalized customer experience at scale. Despite the acknowledgement of its importance, this has not yet manifested in development of the necessary capabilities, as organizations struggle to get to grips with what is required for success.
Less than a fifth of organizations are using a single customer profile (SCP) for ‘most’ of their marketing applications. In comparison, 37% of companies are using an SCP for a fraction of their MarTech applications and 45% are not making use of a single customer profile at all.
Just 3% of businesses claimed they have a strong capability when it comes to using cross-channel or cross-device data for either real-time website or mobile apppersonalization. No more than one in six respondents even claimed that their capabilities here were ‘average’ (16% and 12% respectively).
Volume of data has become ‘overwhelming’ for many organizations
Part of the reason behind organizations struggling with their customer experience efforts is their inability to manage or maximize their data. However, this is with most companies collecting data from only a handful of first-party data sources. There is a clear gap in resourcesthat organizations must address if they wish to enhance their ability to deliver seamless experiences.
More than half of responding companies (51%) cite insufficient resources (including budget and staff)as a significant barrier to optimizing customer experiences. The second most common obstacle to customer experience optimization was data quality, with 44% of companies raising this as an issue.
While data can be incredibly valuable, for most this is not the reality, as 85% of businesses admitted they are not able to extract the full value from the data sources they have access to. Just over a quarter (27%) are able to turn all data into useful information and act on it.
Brands are slow to ‘join the dots’ and to tackle integration issues
Optimizing and personalizing customer experience requires a technological infrastructure that joins up different applications and automates processes. As is often the case with new technology, legacy systems and antiquated business practices are a significant hindrance when it comes to implementing change. However, integration is a requirement that businesses cannot afford to ignore if they want to optimize effectively.
One in ten businesses have tied together customer data from multiple channels, technologies and databases. In comparison, 70% are only just starting the process of integration and admitted they have a long way to go in this area.
Although a third (34%) claim to have become more effective at integrating user data from different systems into one profile store, just 9% claim this as a ‘strong’ capability. In comparison, 45% rated this capability as ‘weak’ and 23% do not have this capability at all.
Privacy concerns are impacting how companies optimize customer
experiences
As the appetite for joining up different types of customer-related data increases, so do the concerns regarding its management, implementation and its potential for controversy. The apprehension surrounding privacy issues is shaping the overall customer experience and the ability to optimize it, for better and for worse.
The vast majority of company respondents (89%) are ensuring complete customer privacy as part of their customer experience optimization activities, second only to monitoring website performance (96%).
Around two in every five organizations (41%) believe that their concerns regarding privacy are significant enough to prevent them from personalizing customer experiences. This is likely a factor contributing to companies being 19 percentage points less likely to ‘thoroughly’ use customer data to predict future customer needs and behavior than for the purposes of better understanding current customer needs and behavior.
1.1.
Methodology
The Customer Experience Optimization Report is published by Econsultancy in association
with Ensighten.
There were 613 respondents to our research request, which took the form of an online survey in November and December 2014. Respondents included both companies or in-house marketers (55%) and supply-side respondents, including agencies, consultants and vendors (45%). Information about the survey, including the link, was emailed to Econsultancy’s user base, advertised on our website and promoted on Twitter. The incentive for taking part was access to a complimentary copy of this report just before its publication.
Detailed breakdowns of the respondent profiles are included in the Appendix.
If you have any questions about the research, please email Econsultancy’s Research Director, Linus Gregoriadis ([email protected]).
1.2.
About Econsultancy
Econsultancy’s mission is to help its customers achieve excellence in digital business, marketing and ecommerce through research, training and events.
Founded in 1999, Econsultancy has offices in New York, London and Singapore.
Econsultancy is used by over 600,000 professionals every month. Subscribers get access to research, market data, best practice guides, case studies and elearning – all focused on helping individuals and enterprises get better at digital.
The subscription is supported by digital transformation services including digital capability programs, training courses, skills assessments and audits. We train and develop thousands of professionals each year as well as running events and networking that bring the Econsultancy community together around the world.
Subscribe to Econsultancy today to accelerate your journey to digital excellence. Call us to find out more:
New York: +1 212 971 0630
London: +44 207 269 1450
2.
Foreword by Ensighten
We live and do business in a time when data offers the power to optimize the customer experience across every platform and channel for vastly improved marketing ROI. That’s the promise of 1:1 marketing now within reach of brands worldwide. Yet marketing organizations face stiff
challenges. Marketing data is typically isolated in dozens of siloes and standalone systems. Many marketing organizations struggle to simply retrieve data from behind vendor firewalls. The volume of data has become overwhelming to many marketers. And once collected, digital data must be integrated with other sources and analyzed for action in real time, because data without actionability has little value.
To support marketing organizations, Ensighten partnered with Econsultancy, the premier digital research and consulting firm, to explore these opportunities and challenges in a survey of
marketing leaders and service providers. Marketing technology and data management are clearly ‘table stakes’ for optimizing the customer experience. Yet, many of our respondents reported they have substantial obstacles standing in their way of optimizing the customer experience across the complex, omnichannel landscaping. Here are snapshots from the study’s results:
There is near unanimity among leaders surveyed in our study about the value of optimizing the customer experience. Ninety-six percent of companies cited it as ‘important’, with more than two in five companies (41%) ranking it as ‘high priority’.
Clearly these leaders see customer experience optimization as vital to achieving key business goals. Ninety-four percent say it supports higher engagement and conversion rates, while two-thirds also cite better brand perception.
Yet gaining insights from omnichannel data to support personalized, 1:1 marketing – at the heart of optimizing the customer experience – remains elusive. Nearly two-thirds (62%) of respondents report feeling overwhelmed by the volume of incoming data. A staggering 85% are unable to extract the full value from the data sources to which they have access. And only 3% of these leaders say they have a strong capability for using cross-channel or cross-device data for real-time website or mobile app personalization.
Tracking and responding to consumers as they traverse multiple platforms, channels and devices require an integrated technology and data management capability that defies easy solution. Collecting and integrating data across channels, technologies and databases are essential. Yet 70% of our respondents say they are just starting this process and have a long way to go. About one-third (34%) say they have effectively integrated data into a single profile store, but only 9% claim this as a ‘strong capability’.
Privacy concerns continue to surface as user-level data and its use in the marketing suite expands. Eighty-nine percent of respondents say they are ensuring complete customer privacy as part of their customer experience optimization activities, second only to monitoring
website performance (96%).
How does the marketing organization extract the full value of data to optimize the customer experience while balancing these competing factors? Learn more here from these 600+ marketing leaders and service providers about how they are responding. Explore what this study’s insights mean to you, your business goals and marketing organization.
Pelin Thorogood
2.1.
About Ensighten
Ensighten, the global leader in omnichannel data and tag management, is changing the face of digital marketing by transforming the way enterprises collect, own and act on their customer data across all marketing channels and devices. The Ensighten Open Marketing Platform enables enterprises to achieve true one-to-one personalization, accelerate the execution and optimization of their marketing initiatives and deliver superior user experiences.
Ensighten, with its unique hybrid-tagging technology, powers companies generating over $1.9 trillion in revenue in over 150 countries. The world’s leading brands (Microsoft, Capital One, United Airlines and T-Mobile) achieve marketing agility by implementing Ensighten’s single line of code.
Ensighten is headquartered in San Jose, with offices in San Diego, London and Sydney. To learn more visit www.ensighten.com, and join the conversation on LinkedIn and Twitter.
2.2.
About Pelin Thorogood
Pelin Thorogood, a MarTech innovator and analytics executive, is Chief Strategy Officer (CSO) of Ensighten, the global leader in omnichannel data and tag
management. She also continues to serve as CEO of
Anametrix, an Ensighten company. Pelin’s career highlights include leading the go-to-market strategy as Chief
Marketing Officer (CMO) of WebSideStory (acquired by Omniture/Adobe), and extending Peregrine Systems’ enterprise software business (acquired by HP) into web-based applications as head of product marketing.
She was named one of the “20 Women to Watch” in sales lead management in 2011 and 2012. Pelin holds a B.S. in Operations Research, Masters in Engineering and MBA degrees, all from Cornell University, where she also serves as Executive-in-Residence for the Johnson Graduate School of Management. Follow Pelin on Twitter @PelinT.
3.
The Importance and Benefits of
Customer Experience Optimization
The last few years have seen a significant shift in the attention given to customer experience (CX), and rightly so. Customers have assumed the position of power in their relationship with brands, as technology has given them unprecedented information and choice regarding any product or service they wish to purchase.
In response to this, companies have been trying to double down on meeting and exceeding customer expectations with every brand interaction – even if the customer is not consciously evaluating them. While doing this at any scale will provide its challenges, organizations with millions of customers and even more touchpoints face a degree of complexity that can certainly be daunting.
However, while technology is certainly a factor contributing to these higher expectations, it also has a critical part to play in turning these challenges into lucrative opportunities for organizations committed to improving and optimizing their customer experience.
Figure 1: How important is customer experience optimization?
Company respondents: 257 Agency respondents: 199
The good news is that most organizations place at least some importance on customer experience optimization. The vast majority (96%) of companies deem it to be at least ‘somewhat important’, with 41% calling it ‘critical, a high priority for the organization’.
In comparison, agency respondents are significantly less likely to say that customer experience optimization is ‘critical’ to their clients. Only 26% of supply-side respondents stated their clients’ perception of customer experience optimization as ‘critical’, while 70% said their clients saw it as ‘somewhat important’, 15 percentage points more than company respondents.
Not only is customer experience optimization almost unanimously deemed important by
companies and agencies alike, their perceptions on its benefits are also relatively similar. The vast majority of responding companies cited higher engagement and conversion rates (94%) as a main business benefit derived from optimizing conversion rates, which was also the most popular business benefit cited by agency respondents.
Figure 2: What are the main business benefits of customer experience
optimization?
Company respondents: 256 Agency respondents: 197
Company respondents were also likely to identify loyalty and increased customer value as key reasons for customer experience optimization. Two-thirds (66%) of responding companies selected better brand perception and loyalty, while half (50%) selected renewal, cross-sell and upsell.
It is clear that while the directly resulting financial value is the key driver, for many companies the primary benefits around customer experience optimization are concentrated on improved
customer satisfaction. Better engagement, brand perception and a greater affinity to purchase repeatedly all positively contribute towards the bottom line, but they are all born out of providing a better experience for customers and getting their trust.
4.
How Are Organizations Optimizing CX?
Although organizations generally appear to have committed to the optimization and development of the customer experience they provide, most have not reached their ambitions in this area. Much of the technological infrastructure and processes required to create the multichannel experience customers expect is still being dissected and understood rather than being deployed at organizational scale.However, recent years have seen businesses take strides in this area, with many believing they are now in the position to begin capitalizing on the vast opportunities that are available. As
companies begin to turn the corner with their CX efforts, it is interesting to explore how they are approaching the process of customer experience optimization.
If building a trustworthy relationship with consumers is a primary focus of customer experience, then it stands to reason that privacy would be a significant part of a company’s optimization efforts. As part of their CX efforts, nearly half (47%) of client-side respondents say their organizations ‘thoroughly’ optimize in the context of ensuring complete visitor privacy, with a further 42% ‘partially’ doing this, as shown in Figure 3.
Company respondents
Figure 3: To what extent does your organization currently optimize the customer
experience for each of the following tactics?
Respondents: 291
The chart above also illustrates the extent to which organizations are optimizing their ability to respond to individual customers in real time and across multiple channels. Less than one in five organizations are ‘thoroughly’ optimizing the customer experience by responding in real time to the voice of the customer (17%) or improving visitor retargeting (16%). Just 9% are delivering omnichannel personalization thoroughly and half (50%) are not doing it at all.
However, companies are more likely to optimize the customer experience as it relates to site performance. Almost all company respondents (96%) are optimizing the customer experience by
monitoring website performance. More than four in five respondents optimize by executing website testing and optimization (84%) and by speeding up web page load and responsiveness
(83%).
Organizations may recognize the importance and benefits of customer experience optimization, but the evidence suggests many are only focusing on what may be required of them (privacy) and the basics (site performance). While meeting expectations in these areas is critical, it is merely the minimum in terms of what customers are expecting.
The holy grail of customer experience is to move beyond these hygiene factors or ‘table stakes’ by creating personalized experiences in real time across all channels and platforms. Yet, most organizations are using customer data to optimize only two or three digital channels. More than four in five (83%) are utilizing customer data to improve the experience of their desktop website, while two-thirds (67%) are doing the same with their email campaigns.
Figure 4: Through which online channels do you / your clients optimize the
customer experience using customer data?
Company respondents: 248 Agency respondents: 194
Just half of the responding companies are using customer data to optimize the customer
experience on their mobile site, despite many websites seeing the majority of their traffic coming from mobile devices. In comparison, agencies are 36% more likely to say their clients are
optimizing their mobile sites with customer data.
An even smaller proportion of companies are using customer data to optimize the experience delivered via mobile apps. Around one in every five companies (21%) and agency clients (18%) are currently doing this. Given the intimacy consumers have towards their smartphones, this suggests most organizations are currently missing out significant opportunities to make their mobile and overall experience better.
Despite the wealth of customer data that can be attained from search and social, plus the ability to easily test and iterate, only a minority (37% and 30% respectively) are using any kind of customer data to optimize these channels. This may be indicative of the isolated attitude organizations are taking towards their CX optimization, as articulated by one respondent: “We have no tactics executed really, only individual points of CX efforts in limited business silos that do not take into account full journey or cross-company experience.”
The same is likely true with non-digital channels that organizations use to engage with
consumers. Call center (68%) is the only offline channel where more than half of the company respondents are using customer data to optimize the experience, while around a third are doing the same with print (36%) and in-store (33%).
Figure 5: Through which offline channels do you / your clients typically optimize
the customer experience using customer data?
Company respondents: 196 Agency respondents: 175
What key lessons has your organization learned from using data to optimize the
customer experience?
“I don’t think I can say we really have learnt things as we are just in our infancy. We have done a lot of data modeling which we believe is telling us more about what type of customers we want to attract, and which of our customers are the most profitable, but we are yet to really translate that into the experience at each touchpoint with the exception of our call center.”
Company respondent
It is critical that business make greater use of customer data to optimize these offline channels. For instance, the idiosyncrasy of consumer media habits has changed how producers should be creating content for television. Historically, programs were created for large, but faceless audiences. Now, as Ralph Rivera, Director of Future Media at the BBC recently pointed out, content needs to be created with actual individuals in mind in order to be successful. Only
organizations who are effectively pulling customer data from other parts of the business can achieve this.
With organizations currently using customer data to optimize the customer experience in only a handful of channels, there is clearly a long way to go before achieving the customer experience marketers envision. In order to truly create an experience that delights customers, organizations need to use all their customer datasets, irrespective of channel origin, and across the full
5.
Activating the Single Customer Profile
The growing number of touchpoints, alongside a greater ability to determine when, where and how consumers engage with brands has shone a spotlight on how non-linear the customer journey is. With consumers just as likely to purchase online as they are offline, the path to purchase has never been more distinctive on an individual basis.To truly get to grips with the individual paths consumers take to purchase, businesses need more than just the assumptions and generalizations grounded in aggregated datasets. Organizations focused on optimizing their experiences should have the ability to collate all of the data on the past activity of a given individual to build a better picture of the customer’s lifetime value. Given the importance of customer experience to many organizations’ long term strategy, it is not surprising businesses also recognize the importance of achieving a single customer view (SCV). The vast majority (83%) of companies believe achieving a single customer view is critical to long-term success, with more than half (51%) ‘strongly’ agreeing with the statement.
Company respondents
Figure 6: ‘Achieving a single customer view is critical to our long-term success’
Respondents: 196
However, acknowledgement does not translate into immediate results. In order to achieve a single customer view, businesses will have to transition from the legacy systems and antiquated
processes that have managed and governed their use of data, to new platforms and marketing applications that enable integrated use and manipulation of data. Achieving this is no easy feat, yet as organizations have clearly identified, doing so is critical to success.
That being said, as useful as the single customer view is, the SCV only illustrates past customer activity, without the ability to predict future behavioral patterns.1 In order to determine how a
customer may act in the future, and how to shape an experience around such predictions,
organizations need to create and use single customer profiles, which can build a better picture of future intent.
Figure 7: Do you / your clients currently use a single customer profile for all
marketing applications?
Company respondents: 210 Agency respondents: 168
The chart above suggests that creating and utilizing a single customer profile across all marketing activity is still a work in progress for most businesses. Less than one in five (18%) of the
responding companies are using a single customer profile for most of their marketing
applications. In comparison, 45% are not using a single customer profile at all. Agencies are 27% less likely to say their clients don’t use a single customer profile than companies themselves indicate.
The ability to optimize the customer experience to a highly personalized level is predicated on the ability to understand a consumer beyond their previous purchase habits. Currently, most
organizations are collecting behavioral (81%) and transactional (78%) data to optimize their customer experience (Figure 8). However, they are considerably less likely to collect social (32%),
attitudinal (29%) or job-related information (28%) for the same purposes. While this information may not give useful insights in isolation, in a broader, data-rich context, such information can prove extremely useful.
With 37% of companies making use of a single customer profile in only a minority of their marketing applications, and a further 45% not utilizing a single customer profile at all, it is clear that they still have plenty of scope to improve. As well as joining together the different datasets they have collected, these companies should also consider diversifying their sources of data to enrich customer profiles.
Figure 8: What types of data do you / your clients collect for the purpose of
customer experience optimization?
Company respondents: 206 Agency respondents: 167
Just over three in five client-side organizations (62%) are collecting data from email with the intention of enriching customer profiles. However, this is the only offsite source where more than half of the responding companies are actively using the platform to improve their ability to optimize the customer experience.
Less than two-fifths of company respondents are using social media (37%) and search (35%) data to add depth to their customer profiles. Even fewer organizations are maximizing data from in-store transactions (20%), display advertising (20%) or mobile apps (16%) for the purposes of customer experience optimization. Company respondents are also twice as likely as agencies to say they are not using any of these owned offsite data sources in a bid to improve the experiences of their customers.
Having a rich pool of data is a crucial element to activating the single customer profile and for truly providing a personalized customer experience. Consumers are most likely spending more time off the main brand site or owned platforms than the other way around, yet it is not a case of ‘off of site, out of mind’. Organizations invest plenty of resources in engaging with consumers via other channels, yet do not utilize the insights to optimize the customer experience.
Figure 9: From which offsite sources do you / your clients collect data to enrich
customer profiles?
Company respondents: 198 Agency respondents: 156
Until organizations are adequately able to profile current and prospective consumers, creating a truly personalized customer experience will remain elusive. In order for businesses to attain such capabilities, data must be able to flow seamlessly throughout the organization, a competency considerably easier said than done.
6.
Data Collection and Analysis
Capabilities
This decade has seen data become the next big thing, underappreciated and overrated in quick succession. The narrative surrounding (big) data may have been overwhelming, and at times overbearing. Yet, as organizations transition into more technology-driven operations, the emphasis on data is becoming increasingly validated.
Organizations seeking to deliver the highest degrees of sophistication with their customer experience require a real-time integrated infrastructure to meet the demands of today’s
consumers. However, as Figure 10 illustrates, the majority of companies are still in the nascent stages of creating the ultimate customer journey.
Company respondents
Figure 10: How would you rate your organization’s capabilities in the following
areas?
Respondents: 108
The aforementioned chart depicts how client-side organizations rate their data capabilities. Encouragingly, 71% of companies self-assess their ability to collect data about individual website visitors as at least average. In addition to this, more than half (56%) are collecting user data from CRM, POS or other online data sources. Being able to do this is a key early step for developing a single customer profile.
That being said, the rest of the chart is a stark reminder of how far organizations have to go in their customer experience optimization efforts. Only two in five can analyze data that comes
from different systems at least at an average level and fewer still can integrate user data from different systems into one profile store (32%) or use cross-channel or cross-device data for real-time website personalization (19%).
Businesses appear to be lacking many of the capabilities required to effectively use and manage their data, which impacts how data is perceived in the organization. For 85% of companies, there is an acknowledgement that they are not able to extract full value from their data sources (Figure 11).
Company respondents
Figure 11: Use and perception of data
Respondents: 196
What key lessons has your (or your clients’) organization learned from using
data to optimize the customer experience?
“The ability to access the data we already have across different systems and pull them into a data lake is critical – yet very difficult and time/resource consuming. So much so that it hinders other projects and we must wait a long time to see any benefit from the data.”
“Although we own the data, in order to take action, it is necessary to allow other participants to analyze it for us. This way we can get over the lack of expertise and capacity.”
“It’s harder than it looks! Most are unwilling to make the resource commitment on anything other than an incremental basis, therefore core architectural upgrades which are vital to moving forward only happen when the existing overdeveloped ‘topsy’ architectures start to collapse into themselves – the ‘neutron star’ situation.”
Survey respondents
With nearly two-thirds (62%) of company respondents often feeling overwhelmed by the volume of incoming data and just 27% able to turn all data into something useful and actionable, it is clear that many organizations are experiencing similar growing pains. While being cognizant of
this may be a relief, there is no time or room for complacency. Being in the position to deliver a superior customer experience is a significant competitive advantage, therefore acquiring and mastering the tools and skills to do this should be among the most urgent of priorities. When addressing the issues that are preventing organizations from optimizing customer experiences more effectively, it is hard to ignore the impact data is having. More than half (51%) of companies and 49% of agencies are citing insufficient resources as a significant barrier (Figure 12). While this may not be exclusively data-related, it is important to note that data is believed to be a broad skill modern marketers need to have, according to Econsultancy’s Skills of the Modern Marketer report2. The only skill set area deemed more critical to a modern marketer over the
coming years? Customer experience.
Figure 12: What is preventing you / your clients from optimizing customer
experiences as effectively as you / they would like to?
Company respondents: 236 Agency respondents: 185 Note: Respondents could select up to three options.
Companies also cited data quality/accuracy/consistency as a prominent barrier to optimizing customer experiences. Client-side respondents were 52% more likely to select this as an issue than their agency counterparts (44% versus 29%).
As the degree of sophistication required to meet the expectations of customers increases,
marketers have to also improve their understanding and ability to leverage the data. Irrespective of how data was or is perceived, it is impossible to see a future where it doesn’t play a critical part in shaping business performance. The evidence, just like the data, is overwhelming.
7.
Modeling the Customer Journey
While most data will have some kind of usefulness in particular circumstances, not all data is perceived as equal for the purposes of customer experience optimization. The data sources and types used in such activities will be indicative of the areas organizations wish to improve or explore.
Considering that the majority of businesses are collecting behavioral and transactional data for customer experience optimization (Figure 8), it would make sense that many would be pulling data from web analytics. The vast majority (93%) of client-side respondents are pulling web analytics data as part of their customer experience efforts, while the same proportion of supply-side respondents report their clients do this.
Interestingly, company and agency respondents are also just as likely to say that data is pulled from CRM/data warehouse (64%). However, this is the end of the similarities as 59% of companies say data is pulled from customer satisfaction surveys, compared to 48% of agency clients.
Figure 13: From which of the following sources do you / your clients pull data for
customer experience optimization?
Company respondents: 213 Agency respondents: 168
Although a large proportion of businesses are already feeling overwhelmed by incoming data (Figure 11), it’s worth noting that most companies are only using a minority of data sources as part of their optimization efforts (Figure 9).
While the usefulness of the data acquired from a marketing automation platform will be dependent on an organization’s capabilities in this area, it is more than likely that almost all companies utilize email as part of their marketing activities. Yet only 45% are using email service provider (ESP) data for optimizing the customer experience. Companies should be seeking to add to the data sources they are using for customer experience optimization as their ability to utilize
available to help store and manage vast amounts of data from multiple sources, as well as remodel data for future campaigns, only 9% of companies are using DMPs as data sources for customer experience optimization.
Table 1: What is the split (in percentages) between first, second and third-party
data you / your clients are typically using?
Company
respondents
Agency
respondents
First-party data (e.g. website data, CRM data, explicit
preferences) 76% 68%
Second-party data (i.e. someone else’s first-party data,
typically obtained through a strategic partnership) 15% 17%
Third-party data (e.g. data acquired from data providers) 9% 15%
Company respondents: 184 Agency respondents: 142
The same thinking extends itself for the table above. While concerns over privacy may dissuade companies from using second and third-party data (Section 9), when used in appropriate
contexts, external data sources can provide great value. Currently, organizations are most likely to leverage attribution (52%) or customer lifetime value data (45%) for data modeling, both first-party sources (Figure 14).
Figure 14: For which of the following practices are you / your clients currently
leveraging data modeling?
Company respondents: 159 Agency respondents: 147
Most organizations typically lean towards ‘last click’3 as their default attribution model, which
puts a heavy weighting on the last stage of the journey, whilst ignoring the rest of the journey. While more than half are leveraging attribution, this is still a relatively small proportion given its rising appeal, particularly in the context of driving marketing efficiencies.
Lookalike data models allow organizations to extend their reach by building larger audiences from smaller samples. Just over a quarter (27%) of company and agency respondents are
leveraging lookalike audiences, but with social platforms opening up these capabilities in coming months4, organizations should explore this further. By refining first-party data appropriately and
combining this with the scale and insights of the likes of Facebook, Twitter and LinkedIn, companies can capitalize on opportunities that were previously not available, all via third-party data sources.
What experience optimization tactics performed better or worse than expected?
“Affinity gave us surprising results. We weren’t expecting success from affinity-based campaigns, but we were proven wrong.”
Company respondent
3 https://econsultancy.com/blog/64717-marketing-attribution-four-key-takeaways-from-digital-cream/ 4
https://econsultancy.com/blog/66006-11-good-or-bad-things-that-may-or-may-not-happen-in-digital-8.
Integration Needs to Become a
Priority… Now
With many still in the early stages of developing their customer experience optimization capabilities and wanting to make better use of their data, organizations need to begin shifting their focus. Companies may have gotten better at collecting data from their first-party sources, but there are much more data sources for them to tap into. Despite this, 62% of companies feel overwhelmed by the volume of incoming data (Figure 11)and this is without most businesses collecting individual user data from mobile apps (35%) or user data from reference data providers (16%) (Figure 10).
Companies should be seeking to improve the sophistication with which they approach customer experience optimization. However, the inability to do this and manage their growing database is partially due to the lack of integration throughout the organization. This is exemplified below, as just 10% of companies have tied together customer data from multiple channels, technologies and databases.
Figure 15: When it comes to integrating data for the purpose of customer
experience optimization, which of the following best describes you / your clients?
Company respondents: 232 Agency respondents: 179
Seven in ten are just beginning to connect their various technologies and databases but acknowledge there is a long way to go. Although around a third (34%) of companies state they have become more effective at integratinguser data from different systems into one profile store (Figure 16), only 9% claim this is a ‘strong’ capability. On the other hand, 45% say this capability is ‘weak’ for them and 23% do not have this capability at all (Figure 10).
Company respondents
Figure 16: How effective is your organization compared to one year ago in respect
of these capabilities?
Respondents: 116
When given the opportunity to discuss the reasons why customer experience optimization in their organizations has not been as effective, a significant proportion spoke to the difficulty of working within legacy systems. For organizations early on in the process of transforming their customer experience this is a common issue. However, in his blog post about digital marketing mega-trends for 20155, Econsultancy Founder, Ashley Friedlein explained that, in order to have the “seamless,
omnichannel personalized customer experiences” marketers have been envisioning, pulling this together will require more than just technical integration.
Connecting the dots will require the integration of people and processes just as much as it
requires the integration of technology. Creating this infrastructure on a bedrock of just technology will not manifest itself as a joined-up experience, as this requires a human element as well. The process of experimenting with different variables of the customer experience cannot be done without the understanding and knowledge of the marketer and the expertise of an engineer. Both are required in order to maximize the value provided by an integrated platform.
With many organizations just beginning to pull their disparate technologies, skillsets and knowledge together, organizations that have been making a concerted effort in this area will surely reap the rewards. For organizations that claim customer experience optimization is ‘critical’, but are not in the process of integrating across the breadth of the business, it is time to review organizational priorities.
Elaborate on any specific challenges your / your clients’ organization is facing
around customer experience optimization
“Customer number is so high that it takes time to analyze all of them.” “Lack of resources and training in customer optimization.”
“Legacy systems and customer journeys, prioritization on the development roadmap.” “Organizational silos and lack of analytical expertise is a bıg obstacle in our company.” “Poor data at source and inflexible CRM system with lack of automation.”
“There are too many areas that work in silos and not specific process and procedures in place. Plus budget is not being focused in the right areas, e.g. optimizing the website, investing in CRM technology.”
“We have several marketing applications of various ages that do not communicate between each other because the data model behind is not constructed to centralize customer data and feed each application as needed.”
“Disparate data storage makes it difficult to create a single customer view – much of our customer data is effectively unavailable to us.”
“It’s still in it's infancy in our company. Much of the focus is on improving search/functionality rather than optimizing based on customer experience.”
“We need to find out how to better leverage our in-house database to provide data and insight for our marketing comms.”
“They don’t properly measure or know where to start to measure, so it’s giving them bad data then they don’t make any decisions using it properly.”
“They are generating a huge amount of data and have difficulty analyzing this and then feeding that back into the personalization of the website.”
9.
The Customer Data Challenge
In the bid to provide consumers with personalized customer experiences, organizations must invariably acquire and make use of customer data. Optimizing experiences without the use of single customer profiles or without knowledge of a consumer’s previous activity would result in repetitive, unintuitive interactions that will act more as a deterrent to repeat customers than a sustainable competitive advantage. In this multi-device, multichannel world, a key role of customer data is to enable brands to build relationships6.
This is something most companies appeared to have grasped, at least to a certain extent. Nine in ten brands are using customer data to better understand current customer needs and behavior,
with a third (33%) claiming to harness customer data ‘thoroughly’ for this activity. However, while this is the most popular use of customer data within businesses, it is certainly not its only use. Around three-quarters are using customer data to optimize marketing mix decisions (75%) and marketing budget allocation (74%).
Company respondents
Figure 17: To what extent does your organization leverage customer data for each
of the following tactics?
Respondents: 238
Of the tactics listed, organizations are least likely to use the customer data they have acquired for the purpose of predicting future customer needs and behavior. Only 14% of brands are currently doing this ‘thoroughly’, a difference of 19 percentage points compared to the proportion of those using data for understanding customer needs and behavior. While it has already been established that most companies are struggling to process their vast datasets into actionable insights, there are other reasons for this discrepancy that are worth exploring.
https://econsultancy.com/blog/65367-three-s-a-crowd-how-first-party-data-builds-customer-In order to create one-to-one relationships with customers and accurately predict their future needs, businesses require access to quality data. While this can be acquired through second and third-party sources, most business will opt for user registrations and onsite activities to acquire their data. More than three-fifths of company respondents (61%) state that they need full control of their data in order to optimize for customer experiences effectively.
Company respondents
Figure 18: ‘We need full control of the data (i.e. first-party cookie basis) to
optimize customer experiences effectively’
Respondents: 193
Organizations that actively acquire first-party data do so in a transparent transaction with customers, an interaction which ultimately engenders trust. This is in comparison to third-party cookies that many consumers are not aware of, while those who are conscious of this are deleting their cookies or blocking the resultant ads7.
However, as well as consumers entrusting companies to use their data in appropriate ways, they are also expecting their data to be safeguarded and protected. Data security is an increasingly pressing issue for the general public, who have seen many large companies fall victim to hackers wanting to get their hands on their customers’ data. The subsequent public cries of privacy invasion alongside the PR disaster that follows are less than desirable outcomes.
Avoiding this is high on the pecking order of things to achieve and ensuring the protection of customer privacy is a priority. The majority of responding companies (89%) say ensuring
complete customer privacy is a tactic they are employing to optimize the customer experience, as shown in Figure 3. However, while privacy issues can be positive for customer experience
optimization, privacy can also be a hindrance when trying to improve the customer experience.
7
Company respondents
Figure 19: ‘Privacy concerns prevent us from personalizing customer experiences
as much as we’d like to’
Respondents: 195
Figure 19 shows that over two-fifths of companies (41%) state that privacy concerns are significant enough to deter their efforts in personalizing their customer experiences, with 29% disagreeing with the statement. Companies with revenues of over $241m are more likely to view privacy issues as blockades to personalizing the customer experience (Table 6), whereas smaller organizations that may be less concerned about public and legislative scrutiny appear to perceive it as less of an issue.
While it is certainly important to be mindful of privacy issues and legislation, it is also important to maximize customer data as it relates to delivering your customer experiences. With
in-company legal resources often spread thin, seeking expertise is of critical importance so that the parameters of customer experience and privacy do not become compromised.
What experience optimization tactics performed better or worse than expected?
“Connecting pieces of content worked well, as did being transparent with the way in which it worked. Being more discrete with how the data was being used also saw better results.”
10.
Appendix
10.1.
Additional data
Agency respondents
Figure 20: To what extent do your clients typically optimize the customer
experience for each of the following tactics?
Figure 21: What types of data do you / your clients collect for the purpose of
customer experience optimization?
Company respondents: 206 Agency respondents: 167
Agency respondents
Figure 22: How would you rate your clients’ capabilities in the following areas?
Agency respondents
Figure 23: How effective are your clients compared to one year ago in respect of
these capabilities?
Agency respondents
Figure 24: Please indicate whether you agree or disagree with the following
statements.
Agency respondents
Figure 25: To what extent do your clients leverage customer data for each of the
following tactics?
10.2.
Data cross-tabulated by company size
Table 2: ‘Achieving a single customer view is critical to our long-term success’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 35% 40% 54% 50% 64% 62% Somewhat agree 45% 30% 33% 39% 21% 35% Neutral 5% 23% 4% 0% 6% 3% Somewhat disagree 5% 3% 0% 7% 9% 0% Strongly disagree 10% 3% 8% 4% 0% 0% Respondents: 169
Table 3: ‘Due to perceptions around ‘big data’, anything related to data is
becoming a harder sell internally’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 10% 7% 8% 4% 3% 9% Somewhat agree 35% 27% 33% 32% 38% 38% Neutral 40% 33% 29% 36% 9% 35% Somewhat disagree 10% 13% 25% 18% 31% 9% Strongly disagree 5% 20% 4% 11% 19% 9% Respondents: 168
Table 4: ‘We often feel overwhelmed by the volume of incoming data’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 5% 20% 38% 21% 9% 18% Somewhat agree 45% 40% 33% 50% 61% 39% Neutral 25% 23% 17% 11% 15% 27% Somewhat disagree 15% 7% 8% 14% 9% 12% Strongly disagree 10% 10% 4% 4% 6% 3% Respondents: 168
Table 5: ‘We’re not able to extract the full value from the data sources we have
access to’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 35% 40% 63% 50% 58% 47% Somewhat agree 30% 53% 29% 36% 36% 47% Neutral 25% 0% 4% 4% 3% 3% Somewhat disagree 5% 7% 4% 7% 3% 3% Strongly disagree 5% 0% 0% 4% 0% 0% Respondents: 169Table 6: ‘Privacy concerns prevent us from personalizing customer experiences as
much as we’d like to’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 5% 3% 4% 4% 15% 12% Somewhat agree 40% 37% 33% 25% 27% 33% Neutral 20% 30% 29% 29% 18% 39% Somewhat disagree 25% 30% 21% 36% 30% 9% Strongly disagree 10% 0% 13% 7% 9% 6% Respondents: 168
Table 7: ‘We are able to turn all data into useful information and act on it’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 15% 7% 13% 7% 3% 6% Somewhat agree 30% 10% 21% 36% 6% 21% Neutral 25% 20% 8% 14% 21% 12% Somewhat disagree 25% 53% 33% 21% 36% 44% Strongly disagree 5% 10% 25% 21% 33% 18% Respondents: 169
Table 8: ‘We need full control of the data (i.e. first-party cookie basis) to optimize
customer experiences effectively’
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Strongly agree 11% 17% 25% 22% 24% 21% Somewhat agree 32% 43% 42% 37% 33% 55% Neutral 42% 33% 21% 37% 30% 15% Somewhat disagree 11% 7% 8% 0% 9% 6% Strongly disagree 5% 0% 4% 4% 3% 3% Respondents: 166
Table 9: Barriers to customer experience optimization
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Complexity of customer journey 25% 50% 44% 44% 48% 38% Lower business priority 25% 13% 16% 30% 27% 24% Disparate marketing tools 20% 23% 20% 30% 36% 32% Data quality / accuracy / consistency issues 20% 53% 32% 30% 36% 53% Under-developed optimization processes 50% 37% 44% 30% 48% 41% Lack of justification or a clear ROI 15% 27% 20% 26% 9% 12% Insufficient resources (including budget and staff) 45% 60% 68% 41% 39% 56% Poor marketing technology 25% 13% 16% 15% 21% 9% Difficulty understanding customer needs / behavior 0% 13% 16% 15% 6% 12% Respondents: 169
Table 10: Current use of a single customer profile cross-tabulated by company
size
<$1.6 million $1.6 - $16 million $17 - $80 million $81 - $240 million $241 million - $1.6 billion More than $1.6 billion Yes, for most ofthem 32% 28% 17% 16% 7% 19%
Yes, for some of
them 32% 24% 22% 44% 27% 16%
Yes, but just for one
or two of them 5% 12% 17% 0% 10% 10%
No 32% 36% 43% 40% 57% 55%
10.3.
Respondent profiles
Figure 26: Which of the following best describes your job role or type of
organization?
Respondents: 613
10.3.1.
Business focus
Figure 27: Is your business focused more on B2B or B2C?
Company respondents: 197 Agency respondents: 155
10.3.2.
Business sector
Figure 28: In which business sector is your organization?
Company respondents: 203
10.3.3.
Geography
10.3.4.
Job role
Figure 30: What best describes your job role?
Company respondents: 197 Agency respondents: 156
10.3.5.
Revenue
Figure 31: What is your annual company revenue?
Company respondents: 197 Agency respondents: 154
