Next Best Action (also known as best next action, next best activity or recommended action), is a customer-centric approach to marketing that considers multiple different actions that could be taken for a specific customer and then decides on the best one to provide. Moreover, Next Best Action commonly requires the need for automated self-learning decisions, using machine learning, to make a decision in real-time that will improve the chances of a conversion at the moment that a customer is making a purchase decision.
The Next Best Action (to deliver the relevant offer, proposition or service) is determined through a combination of the customer's interests as well as the objectives of the business. For example, as a marketing team your simple objective might be to sell a specific product or product range during an offer window, but must be balanced with how the customer likes to be contacted and the likelihood for them to have an interest in that product or product range.
When implemented correctly, Next Best Action can become a continuous way of engaging with customers in the right way, with the most relevant content or offer, using the right channels. Most importantly, it is an automated process that is self-optimizing to ensure it improves over time, which means that it requires very little manual intervention, and becomes entirely 'customer-centric'.
Now, Next Best Action requires a lot of planning, requires a lot of good data and potentially some knowledge and skills that you may not already have in place. More practically, you will find that it requires a lot of time to implement, but as we've just mentioned, it then will require less manual intervention in the longer term, and therefore you will get that time back in the end. Due to this, no business will typically jump straight into Next Best Action, but almost all companies have some form of basic campaign management automation capabilities to build upon, and will undertake a journey towards Next Best Action.
BlueVenn uniquely combines our Customer Data Platform with machine learning and omnichannel campaign management to provide a toolkit that enables everyday marketers to evolve from basic forms of marketing automation to a utopia that we define as 'Customer Journey Optimization' (this is one step beyond Next Best Action BTW), and through the years we have helped our customers to evolve through 5 maturity stages:
Stage 1: Campaign Management
This stage is where the majority of marketers are in their maturity when they speak to BlueVenn, and typically using marketing automation and campaign execution tools to deliver offers, content and experiences to their customers. Using your email marketing platform is a good example – you create an audience or list of customers, you design a creative and then execute the campaign. You may also use the email automation to deliver subsequent emails depending on their reaction to the initial email message. Campaign Management is usually ‘offer-centric’ and ‘process driven’ rather than a ‘customer-centric’ focus because it is a pre-determined set of rules based on your marketing goal. Generally, we identify a lot of manual intervention by the marketing team in this approach, but is also the least complex method of marketing, and therefore is why most marketers sit in this world of basic campaign management.
Stage 2: Campaign Optimization
This is the first evolution that marketers look to aspire to from basic campaign management. Ultimately, this is where the marketing team starts to bring analysis, personalization and additional marketing channels into their campaigns. Most marketers use email marketing as a core channel, but will start to bring in other channels like SMS, mobile app experiences, direct mail, live chat or call center activities. With some degree of integration between these tools, marketers at this stage are ensuring that their customers can choose the channels they prefer to evaluate and act-on your offers, and at BlueVenn we typically see an increase of 1% to 2% in conversion rates for every extra channel used in a multi-channel campaign. Campaign optimization is still however 'offer centric' and 'process driven', but the addition of deeper analysis, personalization and extra channels puts these marketers on their first step towards some level of customer-centricity. There is still a lot of manual intervention by the marketing team in this approach, but the personalization tools you need to invest in, and any integrations that they have will ensure that the manual intervention can be reduced.
Stage 3: Predictive Optimization
This is where you start to put customer analytics at the heart of your campaigns, both in terms of the segments of customers you select for each campaign, as well as an automated way to use campaign results to optimize subsequent campaigns. This is typically the biggest step for marketers to take on their route to 'Next Best Action' and 'Customer Journey Optimization'. This is because it involves statistical modeling tactics and a deeper understanding of data analytical techniques, which are not commonly skills found in most marketers. From Day 1 BlueVenn's focus has always been to empower everyday marketers with the analytics and predictive modeling tools to make this evolution easier, and through machine learning wizards and simple drag & drop analytical tools it enables marketers to build models, test them and insert them into campaigns and journeys. This stage is still 'offer centric' but it starts to radically reduce the need for your own empirical knowledge and manual intervention, and start to fully rely on statistics and the predictive models to do all the heavy lifting. When you hear about 'data-driven organizations' this is the stage that ensures you qualify as one!
Stage 4: Next Best Action
This is the logical next step for marketers that are comfortable with the use of predictive analytics and modeling, but is also significantly a paradigm shift from being 'product-centric' to becoming 'customer-centric'. At this stage, machine learning takes your predictive modeling to a new level through the introduction of ‘self-learning’. What this means is that your predictive models can start to improve their own performance and accuracy. For example, once you build a predictive model to understand what channel a customer is most likely to respond to, as these campaigns execute and responses are collected, the response data powering the models will start to fine-tune how they work. Next Best Action is not necessarily about knowing the best product or message to serve up to a customer, but when to offer it and how to communicate it. It is 'customer-centric' because it is using the customers’ own behaviors to choose what to serve to them, rather than the marketer's decision.
Stage 5: Customer Journey Optimization
This is the aspirational goal of all marketers and the utopia for any organization looking to become 'customer-centric' and deliver omnichannel customer experiences. Customer journey optimization takes into account the fact that not all offers, products, services and conversations are relevant at all times. Moreover, journey optimization allows for arbitration across several potentially competing recommendations, combining them where relevant, and overruling some recommendations where not. This is a complex and arduous stage to achieve, which combines many self-learning predictive models for various tactics. For example, you may have models specifically created for acquisition, which will differ from your churn and reactivation models designed to reduce the loss of customers. However, once realized, this stage creates a fully automated omnichannel customer experience that appears effortless and relevant for your customers, and for your internal marketing team, it hugely reduces the needs for manual intervention and starts to change the make-up of your marketing team, in terms of skills and capabilities. This is a world away from basic campaign management and to achieve it requires 5 critical elements of people, processes, data, technology and culture to all work together to achieve it, and if you're interested in how to perform a Marketing Transformation in this way then I would recommend this Marketing Transformation eBook.
So, how can Next Best Action be used to evolve the customer experience?
Watch a recording of this 30 minute webinar from BlueVenn's JOIN Digital pop-up conference in April 2020 to find out how "Next Best Action can Supercharge the Customer Experience":
Why not see it in action yourself? Register for the next live demonstration of the BlueVenn Marketing Hub and Customer Data Platform
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when we will cover:
- Unifying data to create a Single Customer View.
- Improving customer intelligence with data analytics.
- Using machine learning and Next Best Action.
- Segmentation and RFM modeling.
- Omnichannel customer journey optimization..
- Multi-touch attribution.
