Understanding the power of next-best-action recommendations
In simple terms, next-best-action is a data-backed, technology-driven approach that enables brands to deliver the right message, content or recommended action to each customer in real time. It's an essential component of any best-in-class customer experience strategy.
Through the power of AI, real-time CX platforms work to predict the outcome of multiple possible recommended actions and decide what action should be served up to each specific customer to help them continue the journey that's right for them. Every decision that is made and action served is tailored to that customer and based on their preferences, purchasing history, behaviors and more. This technology also allows businesses to deliver truly individualized experiences at scale, in real time. It's the ultimate form of individualization.
Incorporating next-best-action into your own CX strategy not only improves customer journeys, it also significantly improves loyalty, sales, revenue and customer satisfaction. For example, EY found that next-best-action in the financial services industry has shown increases in client response rates, reduction in client churn, and improved NPS.
How does next-best-action work?
There are three key steps involved: collecting data, analyzing data, and delivering real-time recommendations.
Leading platforms such as Alterian's Real-Time CX Platform with customer journey analytics and customer journey orchestration gather mass volumes of data from all available channels and sources and use the power of AI to rapidly analyze it and decide what the next-best-action should be for that specific individual to enable them to take the journey that's right for them.
Three examples of next-best-action in practice
1. Timeliness—financial services
A bank implements customer journey orchestration so that any time a customer logs into their banking app, a next-best-action is delivered as a real-time notification warning of unusual account activity.
Benefit: improved customer sentiment and strengthened security and trust.
2. Reducing costs—telco
A telco group has next-best-action working to continuously learn from customer support interactions across its different digital channels. Using a real-time CX platform, the telco is able to identify behaviors of common customer issues and use this to deliver a next-best-action that recommends a digital self-serve resolution. This enables customers to resolve their issues without needing to engage with a high-cost channel like a call center.
Benefit: reduced call volume, reduced costs, increased customer satisfaction.
3. Individualization and cross-sell—travel
A travel company utilizes next-best-action to boost individualization and overall customer satisfaction. By drawing on travelers' previous booking history and preferences, next-best-action enables the business to deliver individualized holiday destination and travel package recommendations, as well as recommend complementary products and services they may be interested in.
Benefit: improved booking experiences, improved customer satisfaction and ratings, more repeat visits and loyalty.
Four things to remember when implementing next-best-action
1. Always champion a customer-centric approach. This means implementing strategies that always consider the customer, as well as providing employees with the support, tools and technology they need to be customer-centric advocates too.
2. Measure the impact by establishing clear objectives that can be used to evaluate the impact and success of next-best-action strategies. Measuring the return on investment and effectiveness of next-best-action recommendations allows you to identify what is and isn't working, as well as gain insights into the actions that are delivering the best results so you can continually adapt and improve the customer experience. Recommended key metrics to track:
- Revenue generation
- Cost reduction
- Customer lifetime value
- Abandonment rate
- Customer satisfaction
3. Assemble a cross-functional team to prioritize solving specific customer problems. This ensures your business will deliver a customer-centric approach across all departments and eliminate working in silos.
4. Do your due diligence when researching and selecting technology, considering what solution will most seamlessly integrate into your business. Points to consider about the platform include:
- Data integrations
- AI and advanced analytic capabilities
- Real-time processing
- Multi-channel delivery, testing and optimization capabilities
- Privacy and security
- Scalability
If you're ready to implement technology that allows you to deliver next-best-action recommendations, we recommend you do this in a staged approach. Start small, focusing on one specific problem. Once success can be demonstrated, organizations can scale next-best-action recommendations more broadly.
Once you have the tech in place to determine what your customers want and are able to deliver that to them, you have a major advantage.
This enables truly consistent cross-channel experiences, resulting in happier customers, greater engagement and loyalty, and more conversions.
Ensuring you have technology in place that allows you to deliver next-best-action recommendations is critical to giving your customers the best experience. Leading brands are already relying on next-best-action recommendations to fuel their business growth. Now more than ever, individualized CX is critical.
Ready to deliver next-best-action recommendations?
Optimize your customer experiences with real-time, individualized recommendations.
