Customer Journey Analytics for Successful Ecommerce

• Customer Analytics
• Digital Analytics

By Smriti Misra with contributions by Yash Bhattacharya

We can all agree that COVID-19 has changed the way we shop. Many consumers have been forced to adopt digital channels to shop online for everything from essentials to luxury items. Even though for some of us, the digital shopping affair started much earlier, the absence of the physical retail space during the pandemic has accelerated online retail.

Research suggests that a whopping 63% of shopping occasions begin online and nearly 50% of consumers shop on mobile more often than in-store.  

These trends are largely a result of companies using eCommerce as a way to create delightful customer experiences (CX) rather than just treating it as a transaction. With customers only engaging with brands in the digital space, companies want to make the retail journey enjoyable, personalized, and memorable. And one of the most effective ways to achieve this is through Customer Journey Analytics and an understanding of individual customer behavior.

Understanding Customer Journey Analytics

Customer analytics is at the foundation of creating experiences that resonate with customers. It’s the art of using customer data to extract actionable insights about the customers and improve their retail experience. Uses of customer analytics typically fall in three buckets –

1. Reducing Customer Retention and Churn:
   The application of analytics to predict which customers have a high propensity to churn and identify retention strategies and mitigate revenue loss.
2. Customer Segmentation:
   The use of clustering algorithms to identify relevant and actionable customer segments; this can help managers plan their marketing spend more effectively to improve customer engagement and acquisition. This also enables effective cross-selling and up-selling of products to customers.
3. Improving Customer Experience:
   The systematic capture of customer data and analysis of that data to gain actionable insights; for instance, brands are using customer satisfaction analysis to understand if their customers are getting what they expect from them or social media analytics to understand customer sentiments. Insights gained from this type of analysis can help brands improve customer satisfaction scores.

I believe there’s no better way to understand your customer than to put yourself in his/her shoes. One way to do this is by assuming the role of a mystery shopper and assessing your experience at each touchpoint. Identify what you liked or disliked through the purchase journey. Now, do a similar exercise with a competitor brand to see where you stand against them. In a way, what you would have done is to create a customer journey map for a single journey. However, this activity tends to get more complex as you try to map out journeys through multiple channels and touchpoints over a long period. It gets even more complex when you try to orchestrate these customer journey maps. That’s where Customer Journey Analytics (CJA) comes into play.

Customer Journey Analytics is the process of analyzing customer behavior over time and across multiple touchpoints, measuring the impact customer behavior has on business outcomes. In simpler terms, CJA is an assessment of how a customer engages with your brand during their customer journey. It offers a comprehensive understanding of customer interaction across channels, providing detailed insights about the customer’s engagement, movement, and how much time they spent at each touchpoint; helping you determine pain points from the customer’s perspective.

A 2018 Gartner survey found that nearly half of IT and business leaders who invest in customer analytics see customer journey analysis as their top priority. It’s even more important in times of the pandemic, where customers begin their journeys again in altered contexts and existing customer journey maps will have to be re-drawn based on their changed behavior. Customer journey mapping and orchestration is a continuous process with both short-term and long-term benefits. It’s almost a strategic decision to change the way a company operates.

Because it’s a continuous process, I like to think of customer journey analysis as “a journey of journeys”.

Customer Journey Mapping vs Customer Journey Analytics

Even though they may sound similar, the two processes are very different from one another and work towards different goals. The most notable difference between the two lies with the customers themselves.

Customer Journey Maps are designed by business teams even before a customer has been onboarded, and are a positive mapping of how the customer’s journey might pan out. This is completely subjective as it is never based on the customer’s real journey, and hence the mapping cannot accurately predict customer behavior or pain points during his or her engagement with the brand.

Customer Journey Analytics on the other hand offers a comprehensive view of the customer’s actual journey with your brand, in real-time. Marketing teams can not only access millions of these interactions but leverage the true engagement data in real-time and optimize business operations accordingly.

Customer Journey Mapping can simply serve as a visual depiction of what the customer experience may be, it is not dependable as the actual engagement can be very different. Analytics provides a more comprehensive understanding of customer engagement, areas of improvement along the journey, and how your brand can leverage these insights to improve CX.

Customer Journey Stages

For a better understanding of Customer Journey Analytics, you need a conceptual understanding of its three stages: Acquisition, Activation, and Adoption.

• Acquisition: This is the initial phase where a potential customer is in the market exploring solutions to resolve their problems. It is through acquisition channels such as organic searches, advertisements, review sites, or simple verbal referrals, that they will discover your company. The prospect will then proceed to investigate your products and services, explore options on your website and possibly even chat online for further information. Once the prospective client is satisfied, he may engage in a trial period, or sign up for the service after signing a contract with your company. 
• Activation: From the Activation stage, the prospect is referred to as a customer or a user. The customer will be taken through an onboarding process that may be automated, which is usually the case for B2C companies. But for B2B companies, depending on the product you may also have training sessions with specialized personnel. Activation for on-demand services and e-commerce platforms is usually correspondent to the first purchase. This is the most vital stage of the journey, as your company gets the opportunity to make a good first impression. This leads to your customers develop opinions about your brand and develop a stronger business relationship based on the quality Customer Experience you offer.
• Adoption: Once Activation is successful, customers migrate to the Adoption Stage. Communication between your brand and the customers will be limited to emailers, product updates, special offers, and best practices. But your product needs to become a part and parcel of their personal lives or business operations. The more indispensable your product is to your customer, the less likely they will be to churn, and more likely to become promoters of your brand. 

Importance of Customer Journey Analytics

In today’s digital ecosystem, customer experience is of paramount importance. Enhancing CX and offering a seamless journey not only makes it easier to retain existing customers but also simplifies approaching potential customers, increasing your sales, and optimizing ROI.

Analyzing the customers’ journey across touchpoints is the answer to brands finding blindspots within the journey. Only when you know what to fix can it be addressed and only then can your business truly offer a seamless experience over time and across touchpoints. CJA can help your business leverage detailed insights to better serve existing customers, offer them products and services based on their retail history and interests, attract new customers and stop losing potential customers mid-journey. Customer Journey Analytics is important to best understand your customer base, offer a seamless experience, and serve them to the best of your brand’s capabilities.  

Drivers of Customer Journey Analytics Success

Cross-department collaboration:

• Customer journeys typically expand across multiple channels and would require collaboration between multiple departments and business units (e.g. Marketing, sales, customer service, finance, etc.). Therefore, a cross-department team is critical for the success of a CJA solution.

Data architecture and data model design:

• Most brands have access to cross-platform customer data, but stitching that data together for a full view of the customer experience requires expertise and focus.
• The ability to resolve, match, and stitch customer data across multiple systems is the first step to ensure a successful CJA solution.

Micro-journeys before mega-journeys:

• Don’t fall for the trap of trying to capture every customer journey. Being exhaustive is a fool’s errand. Finding the overlap in the most important and broken journeys may be more fruitful because then you know what to fix.
• A good place to start is to pick a micro-segment or a specific customer persona and try to understand its micro-journey.
• Identify and prioritize two or three channels that you would like to examine for a pilot build.
• Choose one customer journey to focus on and build a CJA solution that you can later expand to other channels/ touchpoints.

System integration, data capture, and governance:

• Typically, several customer-facing and back-office systems would need to be integrated for a CJA solution. Identify these systems (e.g. CRM, DMS, research partners, etc.) and address the integration requirements.
• Every potential engagement point, for both communication and purchase, should be captured. Only then can firms completely understand their customers and their journeys via analytics. Identify the data gaps, data sources, and data collection mechanisms.
• The success of a CJA solution depends on quite a bit on data quality. Bad quality data will only bring misleading insights. Set up a data governance process early in the life of the program.

The role of authentication:

• You will be better able to consider the customer across sessions and devices if they authenticate.
• Are your customers willing to authenticate or otherwise make themselves known to you in significant numbers? If not, are you giving them enough of a reason to be a repeat customer?
• Do your technology and UX make it easy to authenticate? Look for ways to reduce authentication friction to near zero. Security is critical, but getting in should be as simple as possible. Think Face ID and Touch ID in an app – from the customer’s perspective, it just works.

Benefits of Employing Customer Journey Analytics

Customer Journey Analytics should be a continual component of any business operation wishing to offer premium customer experiences and some of the benefits of a robust CJA solution are as follows:

Reduction in drop-offs and customer churn

Analyzing and understanding behavioral patterns of customers can help predict not just customer satisfaction but customer churn, and gauge when a customer might be inclined to drop off. Your business can monitor the churn rate using CJA and then optimize offerings to keep customers satisfied and engaged with your brand.

Optimization of CX

Customer Journey Analytics is a continuous aggregation of customer data from every touchpoint that a customer engages with. These data from the varied sources help to create a unique customer persona based on their interactions with your brand over time. The automated analytics processes retrieve the historical data every time the customer engages with your business and enhances the experience based on the customer’s preferences and habits. CJA can help you optimize the customer’s experience in real-time, without human intervention, and effect a positive change in the ROI.

Identification of potential customers 

Every brand wants to convert as many prospects into customers as possible, and analytics is the answer to figuring out where the potential lies. Once the potential customers are identified and their intent to purchase can be recognized, your business can focus its efforts more effectively. CJA can also help your brand with information about existing customers who can be convinced to purchase products related to what they are looking for. 

A customer purchasing a mobile phone will be shown a range of phone covers that they might need, and this is where CJA assists in cross-selling, promoting offers, and developing brand loyalty in customers both new and old.

Optimization of business operations 

Customer Journey Analytics can help identify the viability of a journey for customers. Based on the inefficiencies that are pinpointed by the analytics solution, you can optimize your business processes to best suit your customer’s needs and see to their satisfaction while engaging with your brand. With analytics providing insights for both the micro and macro-interactions, bottlenecks can be removed, operations can be smoothened out, efficiency can be maximized and seamless CX can be offered. CJA can help your brand identify the customer’s needs before they do, optimize operations accordingly, and deliver premium retail experiences.

Smriti Misra

"An accomplished pre-sales and solutioning professional, with a career spanning about 8 years of demonstrated success in various roles from Java Development to DevOps to...
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