How companies can unlock emotions through data empathy

Data can enable enterprises to gain knowledge about customers and their preferences, it cannot provide insights into the reasons behind these preferences without context.

By  Lester LamMar 31, 2023 3:19 PM
How companies can unlock emotions through data empathy
Although data can provide businesses with a strategic direction, it is empathy supported by context that can lead to meaningful success. Empathy is the most crucial factor in any long-term success we can derive from data. It empowers enterprises to make a positive impact on a customer’s day, thereby helping enterprises to acquire customers for life. Businesses that show empathy to their customers, in turn, receive empathy from customers. Even a minor gesture in the right direction can create a great difference. (Representative Image: Jon Tyson via Unsplash)

In a data-driven world, it can be hard to find empathy, because it often feels like we are just another number. Yet, it is that ever-elusive empathy that is the key to unlocking a far greater value in business. In the indispensable umbrella of customer experience, empathy has emerged as a necessary and differentiating factor.

Although data was introduced to us with the bold promise of enabling us to understand consumers by simply downloading and analyzing it, this is only a partial truth. Simply put, although data can enable enterprises to gain knowledge about customers and their preferences, it cannot provide insights into the reasons behind these preferences without context. This is a roadblock in forging emotional connections with the customers and impedes better customer experiences.

Data empathy makes it possible for businesses to affirm the feelings of customers and relate to their positive and negative responses, enriching their overall experience. To build a real connection with consumers, it is necessary for enterprises to first gain a thorough understanding of their preferences and demands. When applied to customer data, the empathy translates to an understanding of the customers, of the people behind the experience on offer.

An example of a company that has successfully integrated empathy and data is Netflix. While the company leverages data to personalise its content recommendations, it also adopts an empathetic approach by enabling users to provide feedback on the content they consume. Netflix uses this feedback to enhance its recommendations, thereby ensuring that users receive content that they genuinely enjoy. This approach results in an experience where users feel seen and understood by Netflix, leading to the production of content that resonates with them.

Foster meaningful relationships through data-driven empathy

Over the years, many tools have been developed to attain the empathy of consumers. The latest innovation in empathy might just be the use of data. Data-driven empathy humanises data by giving life to personal insights in a manner that enables organisations to know their customers beyond the insufficient information that crowds traditional record systems.

It enables enterprises to become relatable and purposeful and respond to their customers’ foremost interests, by taking into consideration their perspective first. To succeed, organisations of today must know where the data is located across the organisation, how it is used and who is using it and then connect it to human insights, to make data empathetic.

In 2022, empathy has become an important differentiator for customer experience (CX). Understanding where data is located across the organisation, how it is used, who is using it and connecting it to human insights is an important step in bringing empathy forward.

The absence of empathy in data

In the present day, data has become necessary to create an efficient customer strategy. Through the collection of valuable feedback and relevant information, organisations can improve their decision-making, predict trends better, enhance customer service and make pricing adjustments. However, it is possible for data to be presented in a manner that does not reflect reality.

For businesses to thrive, contextualisation of data is vital. Just like diagnosing a patient with diabetes based on their body temperature is inaccurate, it is also not right to take sensitive business decisions relying on data out of context. Contextualisation is important to generate insights from senseless data. It is not sufficient for organisations to just have information about the buying patterns of the consumer, they also need to understand the reason behind those patterns.

Ultimately, businesses need to accept the limitations of algorithms, and that the only way ahead is to combine human discretion with algorithmic decision-making.

The roadmap for building a “data-driven empathy” culture

Some important factors can enable your enterprise to build a culture focused on data-driven empathy:

CX leadership skills - To improve CX, measures must be taken to make the culture span throughout the organisation. For enhanced CX, employees must possess a sincere desire to contribute to the transformation. Organisations must take active measures to ingrain CX leadership skills like customer-mindedness, orientation toward people, tenacity, creativity, business savvy, change readiness, and communication skills into the core of employee development. To boost data empathy, businesses must form a committee consisting of stakeholders across analytics and business functions, focused on prioritising CX across the enterprise.

Clarity on ROI - Organisations must have clarity on the nature of the data being collected and how the return on investment can be derived from it before investing. As efforts toward enhancing CX are usually accompanied by a hefty price tag, organizations must be aware of the investment fully to derive a favorable ROI. To generate a structure around the end goal of CX and what the investment will look like, organisations can leverage the data to create a customer journey map as well as an actionable roadmap.

Proper utilization of data - Organisations must take active measures to understand the available data, its owner(s), and how it is being used. This can be achieved through conducting a data audit across departmental functions to uncover the multiple data points that are being collected by an organisation. This can provide organisations with a total view of the available data and the parts of it that can be used to improve CX. The audit must comprise the following factors—source, frequency, feedback and data management. Collaboration with the technical and analytical teams is another step that can be taken.

Employee engagement - Organisations can yield the best results and ensure success in the long run in CX by engaging employees in a plethora of meaningful ways. Employees can be engaged through actions like creating a customer champion program and establishing well-defined CX principles. By promoting inter-department collaboration and empowering employees across levels to make data-driven decisions, organisations can also enhance empathy.

Customer engagement - Enterprises can drive customer engagement by collecting customer feedback and subjecting it to careful observation, empathy and ethnography, that is understanding the factors that are typically unstated by the consumers. Ahead of this, AI/ML-enabled points of engagement can be established at every step of their journey with the enterprise. Necessary actions can be taken cross-functionally, based on insights taken from collected data at specific junctions for studying customer actions.

Rich insights for end-to-end CX - Enterprises can deliver the best customer experience by setting a benchmark for customer satisfaction. This can be achieved by analyzing customer actions and factors such as discovery, purchases, items received, after sales services, repeat purchases, recommendations, purchasing behavior, and purchasing history.

Actionable insights for prioritizing issue resolution - With collated insights, enterprises can resolve urgent issues in the short term, long term, and instantly help build trust and empathy.

Dynamic skill sets and technology - Organizations must invest in automated, integrated technology to connect data into a unified view and create specialized employee training programs for data proficiency and maximum productivity.

Empathy marketing - Enterprises can strengthen empathy across the organizational culture by timely releases of success stories/case studies of the enterprise resolving various customer problems.

The future of data-driven empathy

Although data can provide businesses with a strategic direction, it is empathy supported by context that can lead to meaningful success. Empathy is the most crucial factor in any long-term success we can derive from data. It empowers enterprises to make a positive impact on a customer’s day, thereby helping enterprises to acquire customers for life. Businesses that show empathy to their customers, in turn, receive empathy from customers. Even a minor gesture in the right direction can create a great difference.

In customer experience, empathy means hearing the customer and understanding their needs as well as appreciating what they need even when it is unsaid. The goal for businesses should be to take data-driven empathy to the next level to sense and understand what the customer is telling us beyond the data.

The writer is the executive vice president and global leader of consulting, HCLTech. Views expressed are personal.

First Published on Mar 31, 2023 3:19 PM

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