Some 93 percent of businesses are unable to use analytics to accurately predict what individual customers will want in the future, according to a new report from analytics leader SAS.
Most businesses are at risk of trapping their customers in a cycle of repeated recommendations, the report conveyed.
The report found that more than half (54 percent) mistakenly believe that they are ‘best-in-class’ or transformational when it comes to using customer intelligence to shape their marketing campaigns.
Additionally, most companies are planning to collect less customer data as a direct result of general data protection regulation (GDPR).
Information about customer’s physical location and personal contact details will both see an eight percent drop, according to the report.
Meanwhile, basic demographic information and web browsing behaviour follows close behind at six and seven per cent respectively. The report warned that this will impact companies’ ability to effectively understand their customers as individuals and tailor their offerings as a result.
GDPR presents an opportunity to improve data hygiene as companies reduce their data collection habits, which could benefit the customer in the long term.
Nevertheless, companies will have to balance the need to ease GDPR compliance by collecting less customer information with the need to maintain enough data to enable effective customer analytics, the report said.
Other key findings from the report found that only eight percent of companies can view their customers as a ‘segment of one’, and only 10 percent can use online and offline analytics.
Tiffany Carpenter, head of customer intelligence at SAS UK & Ireland, commented: “No matter how many organisations say they’re using artificial intelligence and predictive analytics to improve their customer experience, the reality is clearly far behind the talk.”
She added: “Too many companies are not using all the information available to make accurate predictions about their customers’ latest tastes and circumstances, trapping them in the digital shadows of their past selves. As a result, businesses are missing out on new revenue streams, not to mention the risk of damaging their customer relationships.”
