Next Best Action Needs Next Best Data
The investment in analytics has accelerated. In fact, for most organizations the investment in analytics has outpaced the investment in data management. Organizations have been in an ‘arms race’ to fuel their digital transformation with Next Best Action, Next Best Experience, and Next Best Offer analytic engines. Most have received mixed results. Insights have been described by some users as “slightly better than common sense” as well as “misleading on occasion”. While helpful, most organizations have concluded that those solutions need to mature and that something is missing.
But so what?
Here’s an important question that you should answer – what data drives those analytic solutions? One banking organization invested in a modern Next Best Offer analytic solution that was, analytically speaking, very sophisticated. And they fed it data from their data warehouse, which was fed from account systems with a minimum of data quality and matching applied. The results were mixed. While some offers were relevant, many others were off target and based on historical information. A wealth management company rolled out next best action to their advisors, identifying actions such as sending a “guide to savings for millennials” to their customers who fit into that segment. Again, the results were mixed, and the organization concluded that they had taken a step forward, but it would ultimately be a long journey towards truly personalized Customer Experience. There is clearly more work to be done. Significant improvements will be gained by simply feeding better data to the existing analytic solutions.
Here’s a second important question to ask – if you believe that data is the problem, do you think the answer is a consolidated customer data foundation that is integrated with those analytic solutions? It isn’t. Complete customer data is a necessary foundation, but it contains an overwhelming amount of data that would flood the analytics tools. It will often contain contradictory and time-sensitive data points that may lead the analytic solutions astray. What is required is a Customer Insight System that leverages Artificial Intelligence to serve up Next Best Data (NBD) for each unique customer. From the 360 (a complete identity and relationship graph of customer and related data), Next Best Data utilizes analytics and Artificial Intelligence to determine the context of the usage; it then presents only relevant data for the moment and for the specific interaction that is occurring. Rather than analyzing the products a customer owns to determine that a rewards credit card should be offered, NBD takes in all Customer 360 data and understands relationship patterns, campaign responses from household members, allowing the Next Best Offer engine to correctly determine that a credit card offer will fail, but it is the right time to offer a brokerage account. Contextual data is the rocket fuel for Next Best Action, Next Best Offer, and your data-driven digital transformation.
Many organizations that have invested significantly in analytics are now investing in Next Best Data and utilizing a new technology, a Customer 360 Insight system, to bring all data together and determine what is relevant, or contextual for each interaction, each offer, each action. A Customer 360 Insight system drives deeper customer analytics, omni-channel personalization at the individual level, and marketing transformations. Market analysts such as 451 Research are referring to this new class of software product as a “Customer Intelligence Platform.”