A next-best action is a personalized recommendation or offer that guides a customer toward their next logical step of engagement with a brand. Done well, it anticipates the information, assistance or inspiration that a customer needs or expects in that moment, advancing the customer journey toward a mutually beneficial outcome. Instead of pushing messages based on the brand’s priorities, a next-best action focuses on the customer’s needs, wants, and desires. It meets each customer in the moment of interest with the right message, on the right channel, at the right time, helping to guide the customer toward an action such as downloading an app, scheduling an appointment, filling a shopping cart, or renewing a subscription.
By adapting to each customer’s context, a next-best action breaks the mold of static, one-size-fits-all campaigns that follow a rigid cadence. Every customer moves at their own pace, with their own preferences and behaviors, and next-best actions ensure that engagements are relevant, timely, and welcome – not random and repetitive.
What Makes a Next-Best Action Different
A next-best action is generated based on a complete, contextual understanding of a customer, up to and including a customer’s relationships such as a member of a household or business. Content being delivered may differ based on any number of conditions and variables, such as a customer’s lifetime value, average monthly spend, purchase frequency, etc. Content may also differ based on time, channel, customer preferences or real-time behaviors, such as a browsing session or a call center interaction.
Next-best actions are not synonymous with triggered actions, which refer more to the cadence of messages. A triggered action might contain next-best action content, or the triggering criteria itself may be driven by a next-best action rule, such as a shopping cart abandonment triggering a message to a particular customer at a specific time – with the message personalized for an individual customer based on the real-time journey.
The Next-Best Action Balancing Act
Because a next-best action is delivered in the context of an individual customer journey, the customer’s preferences for frequency of communications or channel will ideally be balanced against the message being delivered.
If a customer indicates they only want to communicate via email, for instance, it might not make sense to let them know about a limited time flash sale. It is also possible that a next-best action is no action at all. For example, a customer may be placed in an audience segment that is scheduled to receive an email offer for a 10 percent discount on a product. A customer who buys the product is then removed from the segment and the email is pulled (up until the moment it’s opened). If the content is available, perhaps the customer then moves into a segment for which a next-best action is a thank you letter.
Optimizing Next-Best Actions: Data, Channels, and AI
Important considerations for companies building out next-best action engagements include how much content and which channels are available, as well as the type of behavior a brand is trying to encourage.
It is also vital to monitor the performance of next-best actions over time, using the results as an integral part of a feedback loop and refining the strategy moving forward. Results will ideally be fed back into a unified profile, which will of course then provide a deeper customer understanding, yielding more refined personalization and next-best actions that continue to be in the precise cadence of the individual customer journey.
Another consideration is how and when to use AI. Existing use cases include AI-powered segmentation, such as predictive machine learning models dynamically moving customers in and out of segments. Or using GenAI to expand and refine content. AI can help create a more data-driven, automated approach while also making it possible for companies to consider even more variables when designing a next-best action strategy.
How Redpoint Powers the Next-Best Action
Next-best actions can be thought of as having three layers: profile, context, and interactions. Redpoint is heavily involved in the first two layers (profile and context), with a real-time decisioning engine that takes brands to the edge of the interaction layer, where a decision will be passed off to an ESP or another communication technology.
Redpoint builds a unified profile that provides the needed context and situational awareness of an individual customer that is necessary to execute a next-best action that is in the cadence of the customer journey. A customer may fit into one or several campaign flows, and Redpoint’s real-time dynamic segmentation capabilities consider an endless number of variables to determine which tactical segment a customer belongs to at a specific moment. The key to the Redpoint next-best action is that it can support an unlimited number of personalized messages, content or communications, which it will evaluate at each interaction inflection point in the context of an individual customer and channel.
By giving brands a complete and current view of every customer, Redpoint ensures each next-best action feels relevant and timely – improving engagement rates, reducing churn, and deepening loyalty.
Redpoint also factors in each organization’s operational and strategic considerations. For instance, one company’s messages might reflect a focus on brand building, while another company builds a next-best action strategy for a nurture campaign, or a win-back campaign.
To see how leading brands are using next-best actions to transform CX in real time, watch our webinar where my colleague Beth Scagnoli and I discuss the important role next-best actions can play in a personalized customer experience, and how Redpoint helps brands optimize their approach. For access to the webinar, click here.
