Predictive analytics is the branch of data mining concerned with the prediction of future probabilities and trends. The central element of predictive analytics is the predictor, a variable that can be measured for an individual or other entity to predict future behavior.
With the usage of predictive analytics, organisations with declining survey response rates, can predict and address individual customers in need of remediation. This can, in turn, significantly boost CX programme ROI. According to the White House Office of Consumer Affairs, for every customer who bothers to complain, 25 other customers remain silent. Predictive analytics in CX help companies give a voice to the silent majority and helps them recover silent detractors.
Predictive analytics allow you to hear, understand, and proactively engage with customers who may never provide feedback. Even companies that have efficient, well-funded feedback programmes in place, usually only hear from 5 to 10 percent of their total customer base. Without data on all your customers at the individual level, you can’t confidently prioritise your limited resources to drive customer feedback.
The idea of combining direct survey data with other forms of customer information to actually predict the concerns and behaviors of all your customers holds tremendous potential—not only for identifying silent customers who may be dissatisfied or upset, but more importantly, for executing dynamic offers, personalised incentives, and customer-focused policies that build loyalty and drive new business.
Predictive analytics increases the value of your customer data and your ability to act on customer sentiment. Since the world is overwhelmed with data, marketing messages, and requests for input, many customers tune out the well-intended transactional or relationship surveys from the vendors with which they do business.
Take Amazon for instance. They are considered to be one of the most successful companies in the entire world, and much of their success has been determined by their ability to use predictive analytics. Amazon uses predictive analytics to track what you search for on Amazon and then they dedicate a huge percentage of their screen space to “recommend” products for the user to buy. Each of the products recommended is based on different algorithms using predictive analytics programmes. This power to predict has allowed Amazon users to experience shopping in a new, elevated way.