Nowadays, more and more companies are becoming aware of Next Best offer or NBO as it is commonly referred to as.
This three-lettered acronym stands as a derivative of understanding a customer better. A derivative of how streams of transactional data, newfound assets such as social media data, paid data sources and click stream information are being fed back into one gigantic repository of servers and machines. This is resulting in a classic case of mountain coming to the prophet albeit the prophecy. For example, a bank through a plethora of its statistical algorithms gauges where its customer is spending money, which is transactional data. So next time the customer spends money on the same platform, the bank after having done its homework is ready with an ad or a banner. Couple of situations to ponder over!
• What if the customer doesn’t go to the same platform again?
• He or she shops elsewhere on some other medium?
• His/her choices have changed?
Segment-based marketing’s capitalization stops here. The crux of the situation is that, the marketing tactic is segmented and not micro personalized in situations like the example given above.
So, how personalized is your communication?
Our communication with our targeted and intending customers should move from segment-based marketing to micro-personalization. Now here is the moment of truth - following a customer will soon become old school. Being where the customer is going to be will be next up and I believe it will be so for a long time to come. We need to map a customer’s identity with a 720 degree view via their social handles, we need to keenly listen to their Social Media feeds and these feeds will be in turn fed back as customer notes into the algorithms (for our marketing programs).
Firstly, we need to understand our customer’s digital footprints by measuring their habits. In the above example of the bank, following micro-personalization, it can be in a position to understand why is a particular channel working and others aren’t. Connect all the touch points of the customer to have a single-view.
Secondly, these plot points can be extrapolated on a graph of lifetime event series. So, a bank can predict the next lifetime event of a particular customer and be there when he or she engages next. Furthermore, these data structures can bring seasonal impact for life changing events, too.
Thirdly, building hyper personalized customer persona. By understanding recent transactions of the customer, create his or her persona. Understand his/her needs and moments of truth. Analyze whether customer accepted or rejected the offer? All these data points should be fed into machine learning algorithms to make them act smarter.
NBO marketing is a customer-centric approach. The solution is not in finding the customer and keeping at it. It is in the measurable magnitude of the centricity part. Our entire decision taking management philosophies should be centered around analytics to provide real-time offers with hyper-personalization. These are the proverbial needles and the rest is just haystack. Or that’s where the companies today are evolving.
Next Best Offer marketing impacts business drivers. In a cyclical loop they will impact in increasing offer acceptance rates, better up-sell and cross-sell. These numbers are going to reflect back in operating margins, increase in campaign response rates leading ultimately to customer satisfaction and loyalty. This can be achieved only when all the data sources listed above are integrated and proportioned with what the customer wants and what banks want to sell.
NBO might not be a be-all do-all parameter. In principle with proven metrics it could be the silver lining of sending the right offer in the right channel with the right message at the right time to the right customer.