Thought Leadership

What is Next Best Action Marketing? Benefits, Challenges, Best Practices, and More

The concept of delivering the right message to the right customer, at the right time, and via the right channel has been around for some time. Next best action marketing can best be described as an evolution of this concept, evaluating the customer’s past behavior, recent actions, interests, and needs in the context of the organization’s marketing goals to identify the most effective action (making an offer, a promotion, reaching out by phone, sending an email, etc.) to achieve desired outcomes.

How Next Best Action Marketing Works

Next best action marketing essentially reverses the traditional marketing equation, placing the customer at the center and targeting offers and actions to meet the individual needs of each consumer in the moment. Traditional approaches, on the other hand, focus primarily on the company’s goals, products, or services, developing offers and actions first, and then seeking to identify the right audience for those specific offers or actions.

Next best offer is a term that’s often confused with next best action marketing. Next best offer focuses exclusively on the offer, and while an offer can be one possible action taken, next best action is more all-encompassing, allowing brands to determine not only when to make an offer but also when not to make an offer. Instead, next best action marketing includes a variety of potential actions, including service actions, messaging, and more.

Next best experience is a term (one that we’ve coined here at NGDATA) that encompasses both next best offer and next best action. Next best experience may include an offer, action, alert, notification, message, educational piece, content asset, or any activity that serves to enhance the customer’s unique experience in line with business goals.

Benefits of Next Best Action Marketing Next Best Action Marketing

Today’s consumers increasingly demand that brands are in tune with their needs, interests, and priorities, and they expect companies to deliver messaging that’s relevant to those needs and interests. Consumers are individuals, not demographic groups or customer segments, meaning the traditional broad approaches to marketing and even segmentation often fall short of meeting the demands of modern audiences. Next best action marketing enables brands to laser-focus their messaging and craft highly individualized experiences unique to each individual consumer.

A data-oriented approach, it allows companies to put the vast volume of data they gather about each individual consumer to use to identify the next best step in the marketing or sales process for each prospect. That means that each individual prospect may have a unique path-to-purchase. And customers who feel valued as individuals are more likely to become loyal customers and even brand advocates.

Another key benefit is that it enables brands to avoid mistakes that could potentially drive prospects away. For example, if a particular consumer is nearing the point-of-purchase but their past behavior and other data indicates that they’re not likely to convert, making an offer at this stage can be perceived as aggressive by the consumer. With next best action marketing, marketers can identify these potential pitfalls and take alternative actions that continue to nurture those leads, rather than alienate them. Leveraging next best action marketing right means fostering brand loyalty and reducing customer attrition.

Finally, next best action marketing can improve marketing budgeting when done right. Instead of wasting resources to deliver messages, offers, and other actions that are unlikely to make an impact on the audience, resources are devoted to pinpointing the specific actions with the greatest likelihood of producing the desired result from every individual consumer.

Challenges of Next Best Action Marketing

One of the primary challenges associated with next best action marketing is that it requires a totally new approach to thinking about customer interactions. Many marketing teams are accustomed to approaching the marketing process from the left to the right, first developing products and services, promotions, and crafting campaigns around those opportunities in hopes of attracting the right audience.

Next best action marketing requires marketers to instead think about the process in reverse, first identifying the needs and wants of the target customer, and then crafting personalized buying journeys with the best odds of success for each individual prospect.

Examples of Next Best Action Marketing

One of the simplest examples of next best action marketing in action takes place everyday in restaurants around the world. Companies like Starbucks, for instance, allow customers to to completely customize their coffee. Waitresses often recommend appetizers, wine, and other options based on what menu items guests express an interest in.

In addition to restaurants, other service-based industries, such as hotels, offer examples of next best action at work. A hotel concierge, for instance, will engage in one-on-one interactions with guests to ensure that they have an excellent experience, recommending activities and other services and amenities that are perfectly targeted to an individual guest’s needs. A business guest, for instance, is likely to have different needs than a guest staying at a hotel for a vacation.

Best Practices for Next Best Action Marketing

Companies can leverage next best action marketing to better forecast and predict leads, conversions, and the overall bottom line, as well as important metrics such as cost-per-acquisition. By more accurately identifying the prospects most likely to convert, companies can optimize their marketing budget and other resources.

Next best action marketing isn’t a replacement for inbound marketing. Instead, using the two concepts in tandem can amplify results. Inbound marketing is valuable for drawing in leads, qualifying prospects, and informing consumers about your brand. Next best action is a supplementary approach that allows you to more effectively nurture those qualified leads through the path-to-purchase with a personalized experience.

Driving real value for customers relies on being able to anticipate and meet their needs at every stage of their journey. The Intelligent Engagement Platform combines real-time scoring with decision-making capabilities to guide the next best interaction at exactly the right time.


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Recommended Reading on Customer-Centric Marketing

For more insights on customer-centric marketing, next best action and next best experience, and other data-driven marketing strategies, visit our blog or check out one of our recent posts below: