The Business Value of Customer Experience: A Data Platform Framework

How does something like “better customer experience” translate into dollars and cents? How can companies compete with the memories and expectations set by Apple Stores, Amazon returns, or Disney’s Magic Kingdom?

Many turn to sophisticated data management systems to create a single view of the customer — a necessary step for a superior customer experience. But adopting these powerful platforms requires making a business case, getting approvals, and unlocking tight budgets. And while a single view of the customer is an economic asset, it doesn’t have value on its own. 

The business value of better customer experience

To describe the business value of improved customer experience, we’ll use a framework that depicts value delivered to customers and the business; and value sources that are direct (e.g., revenue) and indirect (e.g., time savings).

Ideally, a unified profile, powered by a data management system such as Data Cloud, is more complete and accessible than any customer profile you already have. (If it weren’t, you’d just use that other profile, right?) So the activities you do on the data will be more accurate and insightful.
More specifically, the analytics, reporting, model building, and AI acting on your customer data will all be better – likely much better – because the underlying data is more complete, accurate and up to date. The segments your analysts develop will be more nuanced, accurate, and useful. The predictive models will deliver better predictions. And measurement plans will represent reality more exactly, assuming customer data is carefully combined with outcomes (like sales).

To use a Formula 1 analogy, imagine you only had a quartet of Pirelli racing tires, called slicks, medium size, and you were asked to say something about the team using them. Since Pirelli has a monopoly on Formula 1 tires, you wouldn’t be able to say much beyond the generic. But if you had a tail decal, you would know the vehicle and the sponsor’s name. Now you’re like a marketer who can deliver a more personalized experience.

Economic value accrues gradually, as you collect more and more signals from the customer – customer Alex looked at Alpine cars, watched a Castrol promo reel, checked out the softshell jackets on sale, etc. – enabling you to put messages, offers, images, ideas in front of customers that they want to see, as Formula 1 actually did.

The value of efficiency

In addition to calling out value delivered to customers and the business, our framework describes benefits from higher revenues and lower costs. Revenues come from delivering a better customer experience, based on more complete, timely customer data fed into marketing operation and analytics. Lower costs come from efficiency.

How does a platform like Data Cloud deliver efficiency? Workflows and processes are determined by the systems that surround them. A unified platform like Data Cloud gives you access to more tools to automate manual steps, increasing productivity and efficiency, which lowers costs.

One of our customers had a manual reporting process that required data analysts to spend time cutting and pasting data from dozens of sources to create a consolidated view, delivered quarterly. Organizing that data in Data Cloud, they were able to deliver real-time reports at will without any cutting and pasting, saving hundreds of person-hours each month.

Another customer overlooked the fact that enhanced privacy and compliance are sources of indirect value. Making it easier to collect and respect a customer’s data and preferences, platforms like Data Cloud not only manage legal risks but improve the customer experience by enhancing trust.

Customer data as an economic asset

Most of the value of Data Cloud comes from increased effectiveness and efficiency. But is there additional value to the business for simply having a more organized customer data asset? We think so.

Students of the science of infonomics recognize data as an asset. Data can raise the overall value of your business, most obviously, if you decide to sell or go public. It also gives you what economists call option value, meaning the ability to do more in the future. For example, when you launch a new product, you already have a cache of potential customers and insights.

In his now-classic “Infonomics,” Gartner analyst Doug Laney said: “In … customer relationship domains, for example, many businesses would rather forego cash from business partners in lieu of a cache of information.”

Two ways customers realize additional value from Data Cloud’s data asset are in advertising and managing technical debt. As pseudonymous IDs like cookies and app IDs fade away, marketing and media need more first-party data to work and scale. And Data Cloud can unlock information trapped in legacy systems and other silos, transforming inert data debt into a positive asset.

What is the range of values you can expect to see from a platform like Data Cloud? Nobody can answer this question in the abstract – there are too many variables – but we have anecdotal evidence.

Some cross-industry surveys indicate that various response metrics – including response rates to campaigns, engagement rates on websites and apps, and conversion rates for promotions, offers, and general campaigns – can improve around 30%–35%. Cost savings seem to average 15%–20%, on average.
Of course, AI and agentic AI platforms, such as Agentforce, have the potential to deliver much more value across the enterprise, enhancing experiences and efficiency. But we all know that the value of AI depends on the value of the underlying data and how well your tools can harness it.