I had a chance to hear a bit from April Field, consumer affairs manager for ConAgra, the food giant that makes products like Hunt’s Tomatoes and Chef Boyardee. It also makes use of PolyVista for text mining.

ConAgra has 75 agents taking customer calls in a work-at-home model and last year took about 300,000 calls. Last fall, the company embarked on a “raised bar program,” part of which entailed agents taking down customer complaints verbatim.

“It’s hard to fix something if you don’t know what they don’t like about it,” Field said. “No matter how colorful the commentary, it’s word for word in the verbatim.”

ConAgra began text mining those verbatims and has applied some interesting business processes based on the analytics. For example, when the company changed the recipe on a “whiskey steak” frozen meal, switching from a barbecue sauce to a Dijon mustard-based sauce, many customers complained about the change. ConAgra sent a message to all who complained explaining that the recipe was different, along with a coupon for ConAgra products.

ConAgra also uses text analytics to monitor its manufacturing operations. For example, when the company started receiving a large number of complaints about excess vinegar flavor in its Beanie Weenies baked beans, it was able to track the batch number back to the plant and check on any formulation issues and who was working that day.

In another incident, ConAgra was receiving complaints that its ReddiWhip whipped cream was too watery. Through text analytics, it discovered that one grocery chain in the eastern United States was not refrigerating it properly.

Additionally, social networks like Twitter and Facebook provide huge promise for text analytics. But, as Fern Halper of the Hurwitz Group writes in her post on the Text Analytics Summit, companies need more than that:

On the technology panel, all of the participants (Lexalytics, IBM, SPSS/IBM, Clarabridge, Attensity) were quick to point out that while social media is an important source of data, it is not the only source.  In many instances, it is important to integrate this data with internal data to get the best read on a problem, customer,etc. This is obvious but underscores two points. First, these vendors need to differentiate themselves from the 150+ listening posts and social media analysis SaaS vendors that exclusively utilize social media and are clouding the market. Second, integrating data from multiple sources is a must have for many companies.

The conference attendance also seems to be shifting slowly from the vendor and consultant crowd to more and more end users, many of whom are struggling to find ways to get text analytics projects funded.

As Gerard Britton, a speaker at the conference noted, they may find an unexpected ally in their legal department.

Text analytics offers the chance to save big on e-discovery, Britton said. Even a midsize company can spend $10 million a year handling e-discovery issues. Text analytics isn’t going to remove all of that, but it can save 35 to 40% of the reviewing costs for e-discovery, Britton said.

Consider a legal action where a company has to hand over documents relative to the case of the opposition. Thousands of documents are given to a room full of attorneys to determine whether a set of documents is relevant to the case. Text analytics can, at the least, cluster like documents together so that, for example, one attorney is reading email and documents that relate to one another versus multiple attorneys having to go back and forth over the same email string or product documentation.

“Lawyers bill by the hour. They understand this,” Britton said. “Speeding up goes against the grain. You need a platform that provides you with time per document. In even medium size litigation you can have cluster in the thousands.”

Britton has built his own tool using SPSS’s Clementine, some Java programming and some simple SQL code, but vows the legal — or perhaps more likely the finance — department will be willing to pitch in on text analytics if it can cut e-discovery 40%.

But of course, despite all the cool technology we saw at the Summit, as my colleague Mark Brunelli notes in a story on Intuit’s text analytics initiative, text analytics are no substitute for human interaction.

I spoke with the president of DMG Consulting last week about her recent report, which identifies two new markets in contact center technology — customer experience analytics (CEA) and desktop analytics (DA). Fluss predicts the number of CEA implementations to approach 1,000 by the end of 2011. She expects the number of DA seats to exceed 1.5 million during the same period, that’s growth of 100% in 2009, 50% in 2010 and another 50% in 2011.

Now one might question the relevance of a consulting firm defining a market segment and then predicting its growth, but Fluss contends that people questioned her years ago when she started following speech analytics in the contact center — and that’s turned out pretty well so far. As for customer experience analytics and desktop analytics?

” We see the coming together of marketing and service,” Fluss said. “It’s analytics — not reporting on steroids — that are going to drive that. The last really exciting thing we had [in contact center technology] was speech analytics. DA and CEA are also in that category of high value. They’ve been struggling to find their niche and I think they’ve come to the point [where] they’re real.”

And while there’s likely little appetite for investment in the contact center in the next year or two, given the current economic climate, that optimistic growth prediction is a factor of the current size of the market and the savings these applications can produce, Fluss said.

Desktop analytics, tools that measure departmental performance and the agent’s experience with desktop servicing applications, has been used by IT departments for years, Fluss noted, but when it comes to determining how well agents are serving customers, there’s a big difference between running quality assurance on a couple hundred calls out of one million a month and using analytics.

“If you’re an agent and all of a sudden there’s latency in response time of a second to two, the impact to the agents is significant, but if you don’t have a way to measure it, you’ll never know,” she said. “Desktop analytics provides that transparency and supplies savings from 1 to 5%. I think desktop analytics is just a gift.”

Desktop analytics vendors include Knoa, eGlue, Iontas, which approach the market from the application side and Verint and NICE, which come at it from the contact center side.

Customer experience analytics measure the customer experience during IVR, self-service and Web interactions, adding in agent supported situations and fulfillment of the request, Fluss said.

“We have vendors that claim to do one and two but nobody who’s closing the loop yet, with fulfillment, but that’s what we need to do,” she said.

CEA vendors include: ClickFox, eGlue and EnKata, Iontas, Merced and Nuance.

“It’s about call reduction and reductions to average handle time,” Fluss said. “What’s the contact center mentality? Do more with less. That’s why this is a gift.”

Still, getting funding for the contact center remains a challenge. According to Gartner’s annual survey of more than 1,500 CIOs, attracting and retaining customers dropped from their second highest business priority to fifth this past year.

Yet Gartner warns that despite the economy, companies need to redouble their efforts to extend tools, training and compensation to customer service representatives, particularly when it comes to extending channels.

Gartner predicts that by 2012, managing Web interactions will be a core competency of the contact center with customers expecting customer service reps to know everything about them at the time of interaction – down to their recent Web posts in relevant online communities.  That means by 2014, standard practice in 30% of contact centers will be to have two monitors on each agents’ desktops.

Companies like Comcast have already started down that path. I interviewed Frank Eliason, about his company’s online service initiative last week.

Gartner issued a release this month, identifying four areas contact centers need to focus on to create a higher impact at lower costs: personalized customer assistance; better contact center application design; integrating Web interactions into the contact center; and speedy and accurate service interactions so agents can more quickly navigate multiple channels.

All of this sounds sensible and it’s hard to argue with the fact that companies that commit to their customers and contact center now will reap the rewards when the economy turns around. I’m just curious if the money and initiative will come and if it does, just who was able to convince senior management to spend it and how.