Posted by Dave Frankland on October 20, 2011
Forrester believes that we have entered the age of the customer — an age in which customer obsession matters more than any other strategic imperative, requiring firms to focus their strategy, energy, and budget on processes that enhance knowledge of, and engagement with, customers.
It sounds straightforward, right? Which of us doesn’t wish to become more customer-centric? Yet we see few executive teams that treat customer understanding and intelligence as a strategic imperative. Don’t believe me? Look at the agenda or the minutes from your last several executive team meetings or board meetings. How much time was devoted to understanding customers better or to leveraging that customer knowledge in new ways to drive business success?
Our research shows that fewer than fifteen percent of firms operate at a strategic level of Customer Intelligence. These are the firms that have turned customer knowledge into a corporate asset. The vast majority of them drive improvements in customer acquisition, retention, satisfaction, revenue, profitability, and customer value. And they apply CI broadly within the business. Ninety-five percent of strategic intelligence firms use CI to drive corporate strategy, versus 30% of those we categorize as functionally intelligent. And 87% of strategic intelligence firms use CI to drive business operations, versus 19% of those at the functional intelligence level.
But before you switch off and tell me this is someone else’s job, be aware of the role of executive management. Strategically intelligent firms are far more likely to have a senior-level sponsor or champion: 46% of them strongly agree that their company has a C-level evangelist or champion for Customer Intelligence, versus 20% of marketing intelligence firms and 7% of functional intelligence firms.
And even if you have hired the right people, they are struggling right now. They need your support and focus. We live in an age of big data, in which firms are data-rich but insight-poor. And that data is coming at firms in an ever-increasing array of formats, making integration and customer insight increasingly difficult. Meanwhile, customers expect a positive and consistent experience and are more empowered than ever before to let you — and their hundreds or thousands of contacts — know in real time when things aren’t just how they would like them to be. Your Customer Intelligence team needs to invest in new people, processes, and technologies to help the business become customer-obsessed.
And recognize that this transition won’t happen overnight. Companies such as Disney, Harrah’s Entertainment, and Best Buy have been customer-obsessed for some time, and they continue to invest to maintain that customer obsession. In recent years, we’ve seen companies such as Macy’s, Intercontinental Hotel Group, and a slew of consumer packaged goods firms invest heavily to amp up their customer obsession and put the customer at the heart of what they do.
But, before you sign on the dotted line, what should you demand of your Customer Intelligence team?
- Relevance — CI teams should demonstrate that they can translate customer insight into business-friendly language and then act as the advocate for the customer inside the organization.
- Collaboration —At its most effective, CI becomes systemic within the organization, central to decision-making and supporting functions as diverse as marketing, product management, finance, and HR.
- Timeliness — Empowered customers choose when, where, and how to interact with firms. Challenge your team to power intelligent interactions at whichever touch point they occur and irrespective of whether they are company- or customer-initiated dialogs.
- Customer obsession — It’s easy to get lost in the buzzword factor of customer obsession or to overlook it as a corporate initiative, but CI teams need to live it, too. CI teams can help make the buzzword a reality by advocating for what’s right for customers, protecting the personal data that they trust to you, and delivering value in every interaction.
Customer Intelligence is a key enabler of customer obsession (watch the video below for more of my thoughts on this topic). Let’s face it; it’s hard to obsess over a nameless, faceless bunch of customers about whom we have limited information beyond a billing address or a receipt stub. The more we know about our customers, the better we can serve them. And, which of us doesn’t want to do that?