Customer Intelligence - Still Waiting for the Revolution
Think about the world before the industrial revolution. There were no factories, no organized labor and therefore no systematic ways of producing goods and services. Instead there were a myriad of individuals or small workshops working in isolation, sometimes producing masterpieces of craft and art that we admire to this day.
I think the analogy applies very directly to the state of customer intelligence today where, despite all of the advances in data, technology and the stated objective of most companies to embrace “analytics” or “customer intelligence”, this still remains an area which in my opinion is at best a cottage industry within most large organizations.
That is a shame because the benefits of making customer intelligence part of an organization’s DNA are clear. In a recent survey by Aberdeen Group they found that whereas 54% of leading companies (defined by revenue, average deal size and market share) are using “predictive analytics”, only 24% of so-called “laggard” companies are doing so. In other words using customer intelligence techniques does seem to be strongly correlated with business success.
Of course there are some standouts – a while back it was Capital One which was touted as a leader in the use of analytics and experimentation to drive continuous innovation and financial performance. Even if that was true it is one of only a few companies that seem to have been able to create what I would best describe as a customer intelligence “factory”.
What would it take to have that kind of capability? Well let’s start with the fundamentals which are key to the success of any factory – skilled labor, appropriate tools, consistent processes and quality raw material which, in the case of customer intelligence, means having easy access to quality data. These things all exist in many organizations but are rarely combined to create a production facility which can routinely and reliably deliver actionable insights into customer behavior. In most cases, and with a lot of effort or investment, “works of art” such as a major new segmentation scheme or a new approach to predicting certain kinds of customer behavior will emerge and get the organization’s attention at least for a while. But the momentum gets lost as other business issues come into play.
This is a topic I will be exploring in upcoming blog posts – what does it take to embed and embrace customer intelligence in an organization so that it becomes an indispensable and routine component of decision-making at all levels? In particular I will talk about a framework that we at Quaero have developed to assess in detail an organization’s current level of customer intelligence sophistication and map out the things it needs to do to evolve to a point where it is a mature and critical corporate asset.
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