What are customer insights?

Understanding what drives customer behavior is vital for providing exceptional customer experiences. Customer insights are the key to gaining this understanding, offering a detailed look at the preferences and motivations of your customer base.

This guide explains what customer insights are, why they matter, and how they can transform your approach to customer experience.

In this guide:

• What are customer insights?
• How do you collect customer insights?
• Consumer insights and ROI in CX
• Upgrading customer experiences in real-time
• Actioning customer insights
• Case studies from leading companies

What are customer insights?

Customer insights are pieces of information gained through the analysis of customer data, behavior and feedback. They provide a deep and holistic view of your customers, their preferences, motivations, pain points, and expectations. By analyzing this data, companies can spot ways to better optimize their services to the needs of their customers.

How do you collect customer insights?

Consumer insights are gathered from a number of sources:

Behavioral data

This involves analyzing customer actions, such as purchasing history, website interactions, and social media engagement. Understanding how customers behave can help businesses identify trends and opportunities.

Demographics and segmentation

Customer insights often involve segmenting customers into groups based on demographics like age, gender, location, and income. This segmentation allows businesses to target specific customer groups with tailored strategies.

Customer journey mapping

A customer journey map is a visualization of when and how customers come into contact with a company both on and offline. It can help create consumer insights by deepening a business’ understanding of customer needs, pain points and the best touchpoints to use certain technologies, such as self-service systems or automated interactions.

Customer experience management tech provider Quadient defined customer journey mapping as: “The process of capturing what the customer is doing, thinking and feeling as they complete an interaction or transaction while attempting to achieve some goal or outcome. It is a visualization of the steps that the customer takes on the journey, from the moment they had a need until it is fulfilled.”

By mapping out the customer journey, brands can begin to understand not only who they are designing their services for, but what is holding back current user experiences, therefore creating useful insights that can be used in future CX projects.

Contact center enquiry mining

Contact centers are moving beyond their traditional role as a resource to troubleshoot user issues and are instead becoming a key component of CX strategies. They are also a data-rich resource that companies can utilize to gain customer insights.

Frank Sherlock, VP of international at CallMiner, explains how this data can help reduce customer churn: “With the right technology, contact centers can automatically draw out deeper meaning across all conversations. This allows organizations to uncover unexpected trends, so they have the opportunity to address those fracture points before they lead to customer churn.”

By mining enquiries at contact centers for data from interactions, companies can glean useful information about customers.

Feedback and surveys

By inviting customers to complete surveys, companies can identify trends in the experiences of many customers, which provides a range of insights to build CX strategies.

Fern Roberts, customer experience insight manager at Tesco, has this tips to strike the right balance with customer surveys: "You need to get the survey questions right. It is always a challenge balancing survey fatigue with being data rich. [At Tesco] we are continuously reviewing our customer surveys, and asking ourselves to consider: what are we using the data for? What is it feeding?"

By evaluating survey results with analytics technologies, companies are able to identify key trends at scale. These insights can then contribute to building a better idea of the customer and their digital behavior, thus contributing to future CX initiatives.

Consumer insights and ROI in CX

Consumer insights empower brands to calculate the returns of investing (ROI) in customer experiences. By using customer insights to optimize e-commerce capabilities, this can help increase ROI.

Anders Normann, senior director of customer experience at DSV Panalpina shared his advice on proving ROI from CX: “All this ‘getting ROI from CX’, to me is a journey. I would also advise organizations to carefully consider the ROI discussion in the early days because yes, you collect feedback from the customers and then what? You have insights and new information. Now it becomes a leadership decision to act on it and have the guts to make new decisions from a toolbox that you’re not used to. [For that] you are up against many years of legacy.”

Additionally, by using customer insights, companies are able to uncover the root causes of customer pain points. This can ultimately help to boost customer lifetime values as the issues holding back experiences and frustrating customers are solved.

Watch Charlie West and Ben Daubney from InMoment sharing examples of how customer insights can impact customer satisfaction and ROI, as part of All Access: Customer Insights & Data Analytics 2023

Upgrading customer experiences in real-time

Once companies have the set up to analyze consumer insights, they can use them to react in the moment and upgrade experiences with real time analytics. With predictive analytics, brands can pre-empt issues and address them before they even become a known problem for customers.

To utilize the amount of interaction data available via customer interactions, a growing number of organizations are looking to real-time conversation analytics. These insights provide a deeper understanding of customers, employees and the overall status of the business as it provides a snapshot of the current status of the business and customer understanding. Real-time analytics are instantaneous, which means they can be used in the moment by agents, even while they are communicating with customers.

CX Network advisory board member and senior customer operations leader for CashApp, Joshua Tye, notes the benefits of a brand using analytics to develop a real-time presence in a customer’s decision-making processes: “It creates a concierge-like atmosphere that lends itself to the customer’s goals, promoting consistent quality and efficiency. The stronger your presence is in the decision-making process, the greater the likelihood of consumers making decisions that work in your favor.”

Actioning customer insights

Just over a third of the 155 CX practitioners surveyed in The Big Book of Customer Data and Analytics cited turning insights into action as one of the biggest data challenges they face.

Source: The Big Book of Customer Data and Analytics

Actioning insights can be difficult for CX practitioners as the sheer amount of data collected can complicate locating insight or trends specific to individual customers to boost their satisfaction. However advances in artificial intelligence (AI) and machine learning (ML) are making data analysis faster and easier to perform than ever before. Natural language processing (NLP) enables AI systems to understand and analyze unstructured data, such as customer emails, chat transcripts, and social media posts.

Here are a few ways AI contributes to acquire customer insights:

• Predictive analytics: AI can analyze historical customer data to predict future behavior and preferences. It can identify trends and patterns that help businesses make informed decisions, such as predicting which products a customer is likely to purchase next or when they might churn.
• Customer segmentation: AI can segment customers into different groups based on their behavior, demographics, or other attributes. This segmentation enables businesses to tailor their marketing strategies.
• Personalization: AI-driven recommendation systems use customer data to provide personalized product or content recommendations. This enhances the customer experience and increases the likelihood of making a sale.

Case studies from leading companies

Volkswagen: Gaining insights through a Voice of the Customer program

Volkswagen recently actioned consumer insights in order to launch an ecommerce site that helped boost vehicle sales, even during the pandemic.

After implementing a real-time Voice of the customer program, CX Network contributor, Jason Bradshaw, former chief customer and marketing officer for Volkswagen Group Australia, discovered that real-time conversation data was instrumental to informing CX business cases. With the data collected, Volkswagen was able to determine that 30 percent of customers were happy to buy a vehicle online. Once ecommerce access was launched to one of their models, it sold out within 12 hours.

Bradshaw explained: “[With the pandemic taking hold] March 2020 was forecasted to have no vehicle sales for three to four months as a best-case scenario. We set the team to research and within days had enough data to show that customers were willing to buy online.

“Most [customers] didn’t even want to do a test drive and this drove the implementation of our ecommerce platform. We combined brand experience data about what customers wanted during the pandemic and CX data from online sales to improve.”

Seattle Sounders FC: Discovering new customer segments

Seattle Sounders FC, an American professional soccer club, wanted to improve its fans’ experience outside of the stadium. To do this the club needed to find out more about its customers – what their preferences and needs were.

The club already had a ticketing system, CRM platform, email and personalization tools, however these weren’t integrated and therefore it wasn’t possible to share data between them. This made it very difficult to acquire any useful customer insights that would help the club tailor its experience and drive long-term engagement.

It resolved this by deploying a cloud-based customer data platform from Amperity, which uses machine learning to organize data and can integrate with third party providers such as Ticketmaster. By doing this, Seattle Sounders was able to uncover new customer segments, such as fans who only attend matches when a specific opponent is playing, and customers who are at risk of churn.

Thanks to these insights the club was able to test new ideas, like personalized emails for fans who had previously taken advantage of a program to reserve season tickets. Overall, having a better view of data has led to an 80 percent increase in conversions compared to the previous year.

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