Next-best-action marketing
Next-best-action marketing is a customer-centric marketing approach that considers the different actions that can be taken for a specific customer and decides on the ‘best’ one.
The "next best action" is determined by the customer's interests and needs, and the marketing organization's business objectives and policies. This is in sharp contrast to traditional marketing approaches that first create a proposition for a product or service and then attempt to find interested and eligible prospects for that proposition.
Enabling technology
Since early this century, the technology has been available to allow a company to achieve next-best-action capabilities in high volumes as well as in real-time.Another approach to next-best-action is using machine learning to access the impact of specific activities on Consumer Experience or measuring the impact of actions on latent affinity for brands or their products. It is widely understood that superior customer experience drives revenue growth. A CX based Next -Best-Action AI system can be developed and deployed at scale. A traditional measure of CX is the Net Promoter Score introduced by Frederick Reichheld. Using supervised AI techniques where the desired outcome is a high CX, Next-Best-Action recommendation engine can be implemented.
History
The Next Best Action paradigm is not new nor is it only applicable in marketing. A similar concept was suggested by John Boyd of the United States Airforce. In a military context it describes thinking on the fly with distributed, local decision-making versus planned campaigns and objectives. In marketing it has only recently been possible to make decisions fast enough on an enterprise scale to build a ‘mini-business case’ in real-time, considering many courses of action before deciding on the best one.From a business perspective, the rise of the next-best-action paradigm has in part been triggered by an increasing emphasis on inbound marketing. Organizations have found that volume in the inbound channels is increasing in recent years, while outbound channels customers have become less tolerant of receiving outbound marketing solicitations; 2) new regulations limit spam or spam-like activities, telemarketing calls and direct mail; and 3) customers are increasingly Internet savvy.