Every time your customers interact with a Web site, a record of their actions is created. Each time a digital device is used, a trail of user-generated digital breadcrumbs is left behind. The content of phone calls to your service center has the potential to generate even greater insights into customer wants and needs. And many people provide personal information of their own accord–posting more about their days on Facebook than they tell their spouses.
This is the source of Big Data–from sensors in your phone or embedded in everyday products; from social media sites, digital photos, GPS signals, and transactional records. In fact, so much data is being gathered that 90 percent of the data in the world today has been collected in the past two years alone.
All of this information is a virtual goldmine for any customer-centric organization. After all, the ability to better understand the customer is at the heart of any organization’s capacity to provide customers what they want and need.
Unfortunately–and there’s no kind way to put this–history shows that most companies fail miserably in using data to better understand their customers. Most importantly, not only do the majority of established companies not use customer data to benefit their customers, they use it to “sell” instead of “serve.” Why not do both?
A Radical Solution: Use Customer Data To Benefit Your Customers
The concept of Big Data means that companies of all sizes can now cost-effectively analyze the terabytes of data surrounding their customers to drive new insights and competitive advantages.
Think of the benefits: You can anticipate customer needs. You can operate in ways that save your customers time and money. You can provide better products and better information. You can answer strategic questions to unlock the doors to your future: What do customers want to know? What services will entrance them? Where are the best opportunities for innovation? What services could competitors offer, and should we do it first?
At the heart of any customer-centric company is a culture focused on the needs and behaviors of its customers and what their customers’ value–serving and catering to their desires, rather than simply selling or “pushing product.” Those who wish to thrive can get ahead of the curve and become masters at using data to make customers’ lives easier and more enjoyable.
Any Company Can Leverage Big Data To Become More Customer-Centric
Big Data is really just lots and lots of little data that can be handled and analyzed at scale, in a cost-effective manner. Much of it is structured data gathered and stored in databases of companies like yours in the normal course of business, while unstructured data is readily available across social networks and online communities.
With the ability to leverage massive amounts of complex customer data well within the reach of any firm, there is no excuse not to intelligently use this data to inform strategy and decisions. Even so, many established firms have not leveraged technology or shifted their organizational structures or processes to allow the intelligent use of customer insights.
For those that do, the impact can be both profound and–in some cases–relatively simple. We've seen a broad range of companies leverage customer data to improve customer experience and drive competitive advantage. For example:
- A midsize mechanical contractor contemplates ways to leverage sensor data from hundreds of client systems to make technicians smarter, better allocate resources, and drive greater value for their educational and health care clients–separating them from their competition in a radical shift from standard industry practice.
- A health-care provider looks for ways to provide a single view of the customer, integrating data from multiple touchpoints–Web, call center, inbound and outbound mail, and more–to reduce high-cost interactions while simultaneously more quickly and more efficiently meeting customer needs.
- A regional bank leverages customer segmentation and branch-level performance data along with unstructured social and voice-of-the-customer (VoC) data to individually identify at-risk customers, and prioritize personalized “service recovery” initiatives.
Even a few years ago, the IT and analytical resources required to store and analyze the massive volumes of customer data meant only large, established companies held the advantage. No more. In fact, the legacy systems that typically gather this data and store it in disconnected operational siloes means the advantage has shifted to smaller and/or more agileenterprises.
Stop Simply ‘Selling’ And Start ‘Serving.’ It’s OK–You Can Do Both
At present, most customers are content to leave their trails of personal data behind them. But as they get even “smarter,” this is changing. Smart customers are realizing that companies use their personal data for financial gain. This is acceptable to most customers–if used to make their lives easier. But far too often, companies don’t.
Smart customers already expect more from the companies that wish to serve them. Companies that leverage Big Data to become more customer-centric will find themselves able to meet these expectations–and continue to get closer to their customers.
But for those companies that don’t soon, it’ll be too late. They will find the data they’re using to “push product” is going to dry up–as customers fed up with being “sold to” elect to share only with firms that use their data to better meet their needs.
Adapted from the book "Smart Customers, Stupid Companies: Why Only Intelligent Companies Thrive, and How to Be One of Them," by Michael Hinshaw and Bruce Kasanoff.