Investing in Customer Insights Pays Dividends

Investing in Customer Insights Pays Dividends

A few weeks ago, I moved into a new home. This is an experience that I’m sure many of you can relate to as exciting and stressful, along with every other emotion on Plutchik’s Wheel. Of the many tasks at hand, one stood out – securing an Internet Service Provider. As a remote worker, fast and reliable internet service is essential. So I did my research. Who are the top providers in the country, and of them who are available in my area? How do their respective speeds, contracts, and monthly costs compare? This narrowed my scope to two – my existing provider and one that I’d been with many years ago. Let’s call them ISP-a and ISP-b.

I finally settled on ISP-b. They offer an excellent download speed, don’t require a contract, and are competitively priced. This is all fantastic. However, the real reason I chose them: customer experience. While the internet connection that ISP-a offers is technically superior, everything else falls short. From information gathering on their website through painful phone interactions when troubleshooting or adjusting the service. With everything else going on, I didn’t have the heart to deal with cumbersome communication, so when a friend said that the customer service with ISP-b has been great, I was sold.

This is but a small illustration of just how much customer experience matters. Today, it easily makes or breaks the purchase decision. It covers every interaction that your customer has with your brand, from advertising messages, website visits and content consumed to purchase transactions and customer service exchanges.

Given this, brands strive to deliver on experience. The first, vital step in doing this – understand your customers. In a newly released Harvard Business Review Analytical Services study, sponsored by FocusVision, an overwhelming 98% of business executives agree that customer understanding is crucial to creating relevant experiences.

In the same study, however, only 23% say that they understand very well why their customers do what they do. This is a fundamental disconnect. Without knowing how your customers think, feel, and act, you can’t deliver those relevant experiences.

We live in an age where we are inundated with data, yet we are struggling to harness that data in meaningful ways throughout our organizations. Over recent years big data has been considered the holy grail of data-driven business decisions but as useful as it is, it only tells part of the story. Martin Lindstrom, founder and chairman of Lindstrom Company and author of Small Data: The Tiny Clues that Uncover Huge Trends’ notes in the report; “The biggest problem with corporate data today is that everyone is so obsessed with getting big data solutions on board. But you have to get your hands dirty to see the world from the customer’s point of view. You have to put yourself in their shoes and feel what they feel. Then you have something valuable.”

Cue customer insights that combine big and small data to create a holistic view of the customer. It blends the website analytics, clickstream, and social interaction data (amongst many others) that tells you what your customers are doing, together with the surveys, online research communities, and mobile ethnographies (again amongst others) to explain why they are taking those actions.

Don’t get me wrong. This is not an easy or straightforward task. The vast majority of companies are grappling with this struggle. The HBRAS study found there are four broad impediments to customer experience management success:

  1. Organizational silos
  2. Systems and processes
  3. Prioritization
  4. Knowledge sharing

We, as Insights professionals, are all too familiar with these impediments. Often our voice isn’t strong enough to reach across the organization and/or the mandate isn’t clear that the small data captured through online interviews, research communities, or mobile ethnographies really does offer invaluable insight for the business. In many cases, the better, faster, cheaper drive has bulldozed investments in systems and processes that would enable better prioritization and knowledge share.

Yet, the HBRAS study also showed that a small group (15%), the Leaders, have been able to make significant strides in addressing these impediments while combining big and small data to create a holistic view of their customers.

The successes of these Leaders illustrates the clear benefit of Customer Insight integration, not just as 85% cite increased customers satisfaction/loyalty/retention, but they are also seeing the business gains that everyone is striving for: the successful introduction of new products and services, greater operational efficiencies, and positive impact on the bottom line with revenue growth and increased profitability.

Business transformation is very real. It touches every single department and requires a rethinking of how things have been done for decades, in some cases centuries. The shift to data-driven business means that the role of insights is also shifting, becoming central to business operations across the board. While the move to integrate all types of data into cohesive insights and to integrate this knowledge into all areas of the business is a steep mountain to climb, it is a journey that has to be undertaken for future business survival.

Read the full report here, and be sure to sign up for our webinar for deeper insights.

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