Not knowing how your customers interact with your product is a surefire way to make business decisions based in poor judgement.
A great user experience is a result of understanding your customers better than anyone else. The customer is everything — this mantra has always served the service industry well. And since services now include subscription-based software products as well as real-world interventions, it’s more vital than ever to find out about who your customers are, what they want, where their frustrations lie, and what values they hold dear.
Customer analytics is the science of interpreting behavioral data to reveal trends, common experiences, likes and dislikes in both your existing and potential customer base. But what exactly is customer analytic software and how does it work?
What is customer analytics software?
Put simply, customer analytics software is a type of marketing analytics tool used for analyzing all the data you hold regarding existing customers as well as prospective ones. Customer analytics goes further than mere statistics about your customer demographics. It can provide insights into how they behave and what they think, fear, enjoy, and desire. If this sounds too good to be true, think again.
As early as 2018, according to Forbes, 70% of enterprises were increasing their spending on customer analytics, with 58% experiencing a significant increase in customer retention and loyalty. Mordor Intelligence predicted an annual CAGR for the analytics sector of an astonishing 18.2% between 2021 and 2026. Since so many businesses are evidently investing in this field of enquiry, so should you to remain competitive.
We’ve identified 10 products we think are leaders in the field of customer analytics solutions. We’ve tried to indicate an ideal use case for each one. We hope it’s helpful.
Top 10 best customer analytics software and tools
Here are our top picks for the best customer analytics software in 2023:
- Best for: Accurate persona generation and customer segmentation
Segment describes itself as a Customer Data Platform and has over 20,000 clients including such household brands as Dominos, Levi’s, Staples, IBM, and Annheuser Busch (makers of Budweiser beer).
The platform tracks customer behavior from early touchpoints like opening a marketing email to adding items to a shopping cart or logging in to a subscription service. Segment can use any piece of customer data you hold in your CRM, warehouse database, mobile, or web app.
Segment is named after its focus on delving into the data for either marketing, product development or data management. The platform appreciates that analytics are only as reliable as the underlying data that generates them. To this end they have created developer-friendly API integrations to systems like Google Analytics, the Facebook pixel, and Adobe Analytics. This ensures your incoming data is complete, coherent, and comparable.
Data compliance with GDPR, CCPA and other privacy legislation is assured. You can generate different customer profiles, and then target them with products and marketing messages tailored to their preferences.
Segment offer generous free trials and demos, and the paid subscription starts at $120 per month for up to 10,000 monthly visitors. There’s bespoke enterprise pricing too.
- Best for: Data preparation and visual communication
Tableau bills itself as the “world’s leading analytics platform” and with over a million users, they aren’t exaggerating. It’s a suite of business intelligence tools, which includes a beautiful set of dashboards for displaying customer data, and a “prep” tool for making sure your data is clean, complete, and connected in the first place.
It’s one of the strongest offerings in terms of visualizing data, which makes sense. After all, the real value of insight is how it can communicate the need for change or innovation. You can build your own analytics dashboards in Tableau, graphically displaying only the metrics you find the most helpful.
There’s a good mobile version of the platform, meaning distributed and hybrid workforces can access it on the go.
Tableau offers role-based pricing tiers, depending on the depth of engagement you’ll need. You can also choose whether to deploy it entirely in-house, via Tableau’s own servers or via the public cloud. Tiers range from $15 per user per month (Viewer) to $42 (Explorer) or $70 (Creator). There are also add-ons including their AI-powered forecasting tool, Einstein Discovery.
- Best for: Full funnel visibility
Describing itself as a solution for “advanced product and marketing analytics”, Kissmetrics services SaaS and ecommerce clients of all sizes. Current clients include Unbounce, SendGrid, Microsoft, and Carvana.
Kissmetrics claims to track individual customer behavior across their whole lifecycle, rather than focusing on individual online sessions. The aim is to deliver real insight into behavior, allowing you to build repeat custom and customer loyalty. Customers have described 25% increases in trial engagement and up to 30% improvement in conversions.
Metrics tracked include new trials and subs, customer churn, trial to signup conversion rate, MRR, time to sign-up and other indicators of customer interactions. You can divide customer data into cohorts and populations and create simple, highly visual customer activity reports. Readymade dashboards include full digital marketing funnel visualization.
Kissmetrics do face some criticisms on Capterra for setup time and the lack of dashboard flexibility. Their pricing is also a little steep — $299 (3 seats, 10K users) or $499 (10 seats, 25K users) per month. However, for whole pipeline visibility, it’s a great tool once fully integrated.
- Best for: Customer journey mapping
Through correct marketing attribution, Mixpanel hopes to "help you convert, engage, and retain more users." Uber, Buzzfeed, Expedia, and Yelp are among the companies that use it. Mixpanel, as the name implies, allows you to construct real-time custom dashboards for data collection on the performance of your product or service.
It offers to assist you in better understanding your sales funnel and identifying any weak spots. Mixpanel is also built for those who don't know how to code, allowing them to connect to massive data lakes or virtual warehouses like Snowflake, BigQuery, or Redshift without having to make SQL connections.
Mixpanel’s workflows are bright, straightforward, and can be easily shared. Group Analytics is an analytics feature for B2B and SaaS users that allows you to look deeper into how subscribers use your product, which can help with marketing and product development.
Mixpanel uses enormous amounts of data to help you develop marketing strategies for segmented cohorts of users — helping you make sense of your customer journey. It's more suited to major companies than startups using no-code platforms.
Mixpanel offers a free basic version and a $25 monthly growth tier. With an Enterprise membership, you can unlock all of Mixpanel's features as your business grows, but you'll need to request a quote.
- Best for: Privacy and simplicity
Marketing itself as a real alternative to Google Analytics, Plausible is also strong on data security, privacy, and simplicity. It’s ideally pitched for those who don’t want 1000s of features but just require a straightforward dashboard displaying key engagement metrics.
Simplicity is key — Plausible claims its script is 45 times smaller than Google Analytics, so it ought not to slow down your site at all. This also translates to less resource consumption, so it’s probably the greenest data analytic platform, if that’s one of your key brand values.
In terms of privacy, unusually, Plausible doesn’t apply cookies, and it anonymizes all customer data, keeping no individual personal information to sell on. In keeping with its policies on transparency, the platform’s underlying code is open source, and available for inspection on GitHub.
There’s a free, unlimited 30-day trial and pricing is based on traffic volume, on a sliding scale. This works out at just $9 USD a month for 10,000 pageviews, $69 USD for a million and bespoke pricing if you rack up more than ten million.
- Best for: Enterprise and scaling up
Salesforce probably needs no introduction, being as close to a household name as business analytic software gets. They partner with Tableau for analytics (see above) but also offer sales, marketing, and ecommerce tools, as well as a comprehensive CRM platform, Customer 360
Customer 360 is a collaborative CRM tool designed to be visible to all departments to ensure that everyone is working from the same playbook. It integrates with Slack for easy interdepartmental communication and there’s even a dedicated AI, Einstein, enabling sales and marketing reps to access accurate customer behavior predictions.
For enterprise businesses or SMBs with big scalability dreams, Salesforce is a powerful suite with second-to-none training facilities and resources (including a blog, research papers, video content, events and Trailhead, an eLearning portal.
With all this on offer, Salesforce’s platforms come at a premium, although there is a SMB version for their CRM, beginning with the essentials suite at $25 per user per month and rising to $75 for their “complete customer service solution”. For anything more elaborate, it’s best to contact one of their sales reps for a quotation.
- Best for: Product teams looking to analyze customer behavior and engagement
Similar to Mixpanel, Amplitude is a customer analytics tool that allows you to create customer journey maps to better understand your current customer experience.
Shopify, Ford, Peloton, Webflow, and Pepsico are among the early adopters of this solution. This data analysis tool that has been regarded as the top product analytics tool on G2, which is a significant distinction.
Amplitude integrates with your ecommerce, app, or website's portal to provide detailed information about your product's performance. Churn rate, feature engagement, and shopping cart abandonment rates are among the business analytics and insights you'll get. However, event tracking allows you to track any component of your product you choose.
Amplitude features A/B testing, cohort development, and user behavior analysis across many devices to delve deeper into such items. If you're building a digital product with the goal of reaching critical mass, Amplitude would be a fantastic investment.
There is a freemium version, as with most of these tools. All other levels, which will be priced based on data volume, will require a quote.
- Best for: SEO analysis and early engagement
The other household name on our list is of course Google Analytics, which is a perfectly good place for SMBs to start when digging into prospect behavior. You won’t learn much about your existing customers that you can’t already glean from your CRM. However, Google is a great resource for information on how prospects are finding your landing pages and engaging with your content and advertising.
You’ll also be accessing data that only Google can obtain, including point of origin information, so you can see which sites are referring traffic your way. Best of all, for a startup or small business, you can access Analytics for free, so long as you have a Google account (which accompanies any of Google’s other products, such as Drive or Gmail).
Then there’s Google 360 for enterprises who want gold standard data from the search engine giant, but that will set you back $150K a year! However, even the free offering provides a surprising number of metrics, including sessions, users, average time on page, bounce rate, and more. These can be segmented by geographical region too.
- Best for: Website and product feedback and improvement
Another major analytics platform, with over 900K websites using it, Hotjar boasts clients including Adobe, Nintendo, Decathlon and Panasonic. They use some unique features to display customer behavior including page heatmaps (showing which parts of your site are most popular) and recordings (anonymized screen recordings of individual user behavior).
There are also plug-in widgets for your site including feedback forms and surveys, and dozens of integrations are available, either natively or via Zapier. The Hotjar dashboard displays behavioral metrics which go beyond the typical and include customer sentiment (how they feel about your product or service).
You can compare metrics in various snapshots so that, for instance, you can analyze how a product change or site redesign has affected customer engagement. Hotjar is one of the platforms which best enables product or service improvement.
Pricing is a little complex, with two plans — Observe (for behavioral insight) and Ask (for active feedback). Within each plan there are several tiers, with free or low-cost variants and business versions which become more expensive depending on the number of customer sessions (observe) or responses (ask).
For instance, on the Ask plan, 5000 monthly responses would cost $289 USD per month for business users. An observe plan requiring 8000 monthly user sessions would cost businesses $589 USD per month.
- Best for: Revenue enhancement and free trial conversions
Pendo leads with revenue as their main concern — using customer behavior data to identify your most profitable products and activities. It segments users into high or low revenue generating and encourages proportional marketing and sales spend.
The platform is popular with SaaS B2B clients including Citrix, Insightly, and Infor. Insightly, for instance, report an increase in user onboarding engagement of 1540% while tripling their freemium to paid subscription conversions. Indeed, free trials are Pendo’s big success story, with a 60% boost in conversions promised on their site.
Pendo boasts an impressive 4.5 stars from almost 200 reviews on Capterra, although there have been some technical issues with URL tracking reported. However, Pendo’s support and customer feedback scores highly if you encounter any issues with deployment.
Of course, there’s a freemium version! There are three paid tiers too, but you’ll have to contact their sales team for specific quotes.
What are some examples of customer analytics at work?
To give you an idea of how you might use the insights obtained from the above platforms to optimize your products, make accurate business decisions, convert more prospects, or increase revenue, here are some typical examples:
- Acquisition: Where prospects come from, when they land on your site, what other products they’re considering, how they behave on your site, key demographics. Result: Improvement of landing pages, better marketing, better SEO.
- Revenue: Which customers are the most recurring, and which have highest LTV (customer lifetime value). Result: Improved pricing tiers, new add-ons developed to enhance revenue.
- Retention: What’s your churn rate and what factors make some customers cancel subs? Which offers, discounts and demos convert the most prospects? Result: greater focus on churn reduction measures, better designed discounts.
- Engagement: What product features are most popular? What do your customers say about you on social media? How much time do they spend using your service? Result: Product enhancements and more features to increase time on platform.
These are just examples of the kinds of customer insights you can glean from customer data. More and more sophisticated algorithms and AI-driven systems are being innovated each month by software developers, so it’s worth keeping your ear to the ground.
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