Tuesday, March 10, 2009

Achieving ROI with Customer Experience/Text Analytics Solutions

Welcome to 2009 – we’re in a recession.

Perhaps you are
-a retailer
-a travel/hospitality company
-a consumer goods company
-a high tech products company (hardware or software)
-a financial services company
-a media company

In short, you’re like one of the many companies that have decided to use customer experience intelligence solutions, like the Clarabridge Content Management Platform, to establish a text analytics-based voice of the customer initiative.

Why, you might ask, should you be looking at such an initiative in 2009 – when companies supposed to be cutting costs, getting efficient, and doing whatever they can to stay profitable, solvent, and alive? Is customer experience a “nice to have,” or a “need to have” solution?

Anecdotal insight from existing Clarabridge customers would suggest that it is very much a “need to have” solution. Text analytics, applied to customer experience management, is an important way to weatherproof your company against the economic storm we’re currently experiencing. A few big reasons:

1) ONLY THE EFFICIENT SURVIVE – and Customer Experience Analytics solutions create immediate efficiency. Most businesses collect and process customer feedback (survey content, call center content, email content) manually, and spend too much money, and too much time manually reading, coding, and analyzing content, particularly unstructured, text-based content. One of our customers reduced a staff function from 25 analysts to fewer than 5 after adopting Clarabridge, and increased its ability interpret feedback from a fraction of feedback to 100% of feedback. Another customer cut market research spending year over year by over 25%, more than covering the first 2 years of cost for the solution, and is now getting actionable feedback from customers within 24 hours of capture, down from process that used to take 30 days from capture to analysis.

2) ALERT DRIVEN INSIGHTS CATCH PROBLEMS BEFORE THEY COST YOU MONEY. Text analytics solutions do a great job of tracking experiences quickly, and quantitative metrics can measure the magnitude of a new problem before the problem causes cost, customer satisfaction, and resource impacts to your business. A leading software manufacturer uses alert driven analytics from Clarabridge to catch the “fast-growing” issues associated with new software releases so they can quickly kill bugs and errors BEFORE they affect the entire customer base – averting millions of dollars of support costs.

3) USE A SCALPEL, NOT A CHAINSAW TO CUT COSTS WHILE RETAINING DESIRABLE CUSTOMERS. Many customer-oriented companies engage in a technique called market segmentation to identify and analyze the buying patterns and preferences of discrete segments of their customer base. Before cutting a product or service expense, our clients use Clarabridge to assess how valuable the product or service is perceived to be. Others run trial cost cutting programs and evaluate the impact of the cost cutting on their “desirable” customers – the most loyal, the most profitable, and the highest net worth – to make sure they’re not engaging in an action that will drive away the desirable segment. Hotels are using Clarabridge to assess which amenities can be cut without adversely affecting business travelers. Retailers are assessing which product lines can be cut without impacting frequent customer loyalty.

4) SAVE BIG BUCKS WITH DATA-DRIVEN, INSIGHTFUL BIG DECISIONS. Over time, companies inevitably have a moment when they have to make a BIG decision. Perhaps it’s to roll out an expensive new product. Or kill a high support cost product. Or tear down a property that seems unfixable in some way. Before making the decision that can impact the company by millions of dollars, our customers use Clarabridge to validate the decision. One customer considered whether to tear down or modernize an old property due to customer complaints about noise levels and the age of the building. Using Clarabridge they were able to determine quickly that customer feedback from the property was not statistically more or less negative than feedback from newer properties, and the company subsequently decided NOT to tear down the property, averting millions of dollars of unnecessary expense.

In short – return on investments (ROI) can be clearly tied to operational, analytical and strategic use of Customer Experience Analytics, and solutions from companies like Clarabridge don’t just generate cost savings in the short term, they allow better decisions to preserve loyalty in the long term – preserving customer relationships, loyalty, and corporate profitability

2 comments:

Nithi Vivatrat said...

Sid: I enjoyed your post. I agree with your analysis that there is a measurable ROI, measured in terms of cost savings, for using Clarabridge. While I understand your post was focused on the justification of these investments in this current economic climate, I just wanted to make sure that strategic import, regardless of the current economic factors, of better customer insight didn't get missed.

I'm not in this world as much as before, but here is my opinion: those organizations that have a greater understanding of their customers than their peers have a decisive advantage when it comes to innovation and strategic decision-making that will enable them to outmaneuver the competition. Leading organizations should find existing CRM and related initiatives lacking if they don't incorporate text analytics -- there will just be an incomplete awareness of the customer.

I believe that the companies that are most likely to survive economic times like these will be those that focus on keeping their customers happy. Investments to gain additional insight into the customer experience -- particularly when competitors are cutting back -- will pay dividends not just in short-term cost savings, but also in long-term competitive advantage, especially as economic conditions improve.

Hope that was useful. Look forward to further posts!

Julia Patrick said...

I'm looking for a good company dealing with customer experience analytics and fraud detection. Any recommendations (we are a small-scale company)?