Most people didn’t use to pay much attention to text analytics. Maybe natural language processing and computational linguistics didn’t strike them as terribly exciting. Or maybe the potential business application of the capability wasn’t so glaringly obvious. In any case, with the announcement last week that Clarabridge, a leader in text analytics, has secured a whopping $80 million in equity funding, led by Summit Partners, General Catalyst Partners, and Yuchun Lee, text analytics just got a whole lot sexier.
To be fair, this space has been heating up for several years now with the proliferation of social data and as more companies come to realize that tuning into the voice of the customer not only in the social media realm but across all customer feedback channels is now a strategic imperative. Clarabridge has been successfully riding the wave, enjoying more than 150 percent revenue growth over the past three years while rapidly growing its customer base, which includes major brands like Walmart, Marriott, Choice Hotels, PetSmart, Dell and Best Buy. At this point, it seems likely that an initial public offering is just around the corner.
Recently, the company, which competes in the somewhat nebulous Customer Experience Management space, has been largely focused on rolling out a concept it calls Intelligent Customer Experience (ICE). The concept was a central feature of its rebranding initiative earlier this year. The idea is that companies can use ICE to listen to and analyze all sources of customer feedback in order to “operationalize the insight” across all parts of the company, engage directly with customers, and make smarter business decisions. Now companies can get answers to key questions that may have eluded them in the past. For example: “What is top one customer complaint across all channels?” Or: “What are the best opportunities to increase customer satisfaction and loyalty for customers living in a particular geographic region or speaking a particular language?”
The new funding will be used to expand global operations, fuel new product development, increase marketing reach and raise brand visibility. To that last point, I’m delighted to have just published a licensed Deep Dive analyst report, which includes a case study on an innovative voice-of-the-customer program at Best Buy, and I’m looking forward to participating as a speaker in a co-branded webinar with the company’s chief marketing officer next month.
Text analytics is a fascinating area and one where Clarabridge obviously excels. Its algorithms are among the most sophisticated out there, automatically diagramming each piece of customer feedback to identify which words are nouns, verbs, adjectives, or pronouns, and so on. The algorithms can determine the structural relationships that exist among the words and how the different syntactical elements are bound together, ultimately determining sentiment and meaning and generating any number of actionable insights. And they do all this on a massive scale.
Who knew that diagramming sentences could be so riveting – or, in the case of Clarabridge, so profitable?