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Anticipating Customer Needs
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Anticipating Customer Needs

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Imagine software that can predict how a customer will react – what service he will want to buy next, how much money he is ...

Imagine software that can predict how a customer will react – what service he will want to buy next, how much money he is
willing to spend, or whether he is in fact planning to cancel his contract and move to one of your competitors. Your customer
service representative would always be one step ahead of you customer: offering him a better deal, upselling at the right
time, convincing him to try a different product rather than leave.

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Anticipating Customer Needs Document Transcript

  • 1. ARTICLE One Step Ahead: Anticipating Customer Needs Author: Rob Walker, Vice President Decision Management, PegasystemsImagine software that can predict how a customer will react – what service he will want to buy next, how much money he iswilling to spend, or whether he is in fact planning to cancel his contract and move to one of your competitors. Your customerservice representative would always be one step ahead of you customer: offering him a better deal, upselling at the righttime, convincing him to try a different product rather than leave.Wouldn’t that be the holy grail of CRM?The reality is that such systems already exist today. Based on aggregated learnings from the entire customer base as wellas each individual customer, a centralised customer decision hub can anticipate how a conversation with the customer willdevelop. Rather than following a strict and inflexible script that by definition can’t fit all situations, it can support the callcentre representative to select the next best action at the point in time when he is talking to a customer.Like a chess computer anticipating moves, it follows the conversation and compares what is happening with knowledge it hasgathered in the past, probabilities of churn, risk or upsell opportunities. Like a chess computer anticipating moves, it makesa decision in real time on what the best response to the customer should be and then displays this suggestion on screen.Even better, the software doesn’t only jump into action the moment the customer calls in or visits the website. It also worksinvisibly behind the scenes, constantly looking at the customer database. Is there reason to believe that one of the customersis unhappy and considering leaving? Maybe he has called a few times with complaints or technical problems that couldn’t beresolved quickly. Maybe he has dropped a remark about looking into other options when he last spoke to the helpdesk.Even if all these conversations have taken place with different agents, or some of them have happened through otherchannels such as over the counter in a store or by email, the software will spot a pattern and flag it up – suggesting, forexample, that the customer should be proactively contacted with a particularly attractive offer to prevent him from leaving, oroffered an alternative package to better suit his requirements.Sound too good to be true?Large organisations like Vodafone, Orange and BSkyB in the UK have already installed software such as Pegasystems’Decision Management and been using it to improve their customer relations and better monetize interaction time. At someof these organisations, a live decision making engine is now used by as many as 5000 call centre agents at the same time,steering them through live conversations. One company has improved its success rate for ‘inbound marketing’ during
  • 2. One Step Ahead: Anticipating Customer Needscustomer calls from under 2 per cent to over 50 per cent, the future.with a conversion rate of sales to offers of 54 per cent. Forsome products, this is even higher. Return on investment About Pegasystemswas estimated at 2500 per cent. Pegasystems is the recognized industry leader in business process management (BPM) and a leading provider ofOrange UK, since installing the solution, has been retaining customer relationship management (CRM) solutions. Wean additional 4 per cent of their most valuable customers help some of the world’s largest companies achieve neweach month, translating into a £2 million increase in levels of agility, enhance customer loyalty, generate newgross operating margin per month. Average call handling business and improve productivity. To find out more visit ustimes have stayed the same and even gone down in some at www.pega.com/CRMinstances.A glimpse into the futureClearly how well this software works depends on the qualityof the data it uses. Since it is a self-learning solution, thecustomer decision hub is constantly improving. The moretransactions it has analysed, the more behavioural patternsit has seen, the more precise its predictions become.This requires the call centre agents to record what eachcustomer has said, but also how he has said it – capturingnot only words and actions, but also moods. Since judgingwhether a customer is in a good or bad temper can besubjective, technologies are being developed that determinemoods based on voice analytics. This makes the datacapturing more scientific and more reliable.Given the vast amounts of valuable information stored in thisway, the next obvious step is to mine this data and knowledgefor long term strategic decisions.Coupled with a BPM system, the decision making engineturns into a powerful business intelligence and planning tool.It allows users to simulate ‘what if’ scenarios and learn frompast campaigns and actions. It can help point out scope forimprovement within the call centre operation, for example ifsome agents are particularly suited to dealing with certainscenarios. When planning marketing campaigns it canpredict effects on call volumes, agent load, and averagehandling time, helping to plan staff levels and workloaddistribution. And finally, by running simulations the enginecan look at how promotions interplay – how selling more ofone product will impact on other products.The possibilities are almost endless, and currently we areonly just seeing the beginning of the customer experience ofFor more information, please contact your Pegasystems representative, visit us on the Web at www.pega.com, or email us atinfo@pega.com. © Copyright 2010 Pegasystems. All rights reserved. 2011-02