True customer centricity must reach far beyond the roles of‘Chief Customer Officer’ and ‘Data Scientist’ to avoid organisations being ‘data rich’ but ‘insight poor’.
Many who create these roles are often merely following a competitor who got there first; adding a‘customer at our heart’ slogan to the company mouse matt or corporate coffee mug, whilst failing their customer time and again.
The best retailers see these roles as enablers to an intimate, more profitable relationship with their customers.
Julian Grindey is an energising and inspirational MD/COO/Trading Director, skilled in leading profitable change and transformation, inspiring strategic vision and commercial delivery and in driving retail and digital growth. Proven in delivering exceptional growth from turnarounds and scale up, in key omni-channel operators, including private label and international product sourcing strategies.
The pandemic is gifting many retailers with new customers, filling their basket because their competitors have either been forced to close or haven’t evolved in a digital world, exposing their customers to short comings across the entire customer journey.
Winning trust, by demonstrating alignment, brings long term commercial advantage. This crisis is favouring those who demonstrated the importance of their customer some months before covid-19; for the others their fortunes might be short-lived unless they act now.
Delivered well, customer insight improves decision making and creates a defensible advantage, but it’s complex and must be driven right through the organisation to be embraced by everyone, not a specific individual or department.
Successful organisations display three important traits:
1. Customer Obsession:
Culture drives performance. It enables successful transformation but requires an enterprise-wide mindset, role-modelled by the most senior leadership and manifesting in a collective obsession to understand nuances in customer behaviour and satisfy them with a compelling proposition that wins loyalty over the long haul.
First, the business must have realised that commercial success is a bi-product of customer centric decisioning, with all departments aligned to this agenda.
Done well and the organisation will:
– have an intimate understanding of their customers behaviour, both descriptive and prescriptive.
– prioritise the customer’s needs before all other stakeholders.
– drive the creation of new products, with less waste and inefficiency.
– eliminate pain points within the purchase journey that lead to promiscuity and attrition.
– develop mature business strategies, built upon trust and be difficult to imitate.
– recognised that customer retention is far more important than acquisition.
2. Owning the Customer Experience (CX):
In the last decade, it has been increasingly fashionable for retailers to appoint a Chief Customer Officer (CCO). Introduced with best intentions, but too often becoming powerless figureheads, creating a silo for CX in separate kingdoms isolated from the rest of business.
The CCO will make a lasting difference if they have the power, influence and resources to engage the entire workforce; creating collaborative company-wide decision matrices, aligning goals, dis-aggregating data, and co-ordinating customer performance standards.
Jeff Bezos proclaimed the purpose of Amazon is to become the most customer-centric organisation on earth and; “every single employee must own the CX”.
The CCO must not dilute the individual’s impact on CX; they must instead champion it in delivering the customer proposition.
3. Insight Based Decisioning:
On-line trading, loyalty programmes and advanced CRM platforms gather customer data in volumes never known before. Converting this data into the meaningful insights, used to take ‘next best actions’, should be a collaboration between the scientist, the marketeers and the product teams.
What’s required in the process:
Start with a detailed understanding of what customer data you need to collect and what decisions you will take with it:
– Getting the right data is much more important than gathering every last scrap.
– Think pareto; 80% of the best insights will come from 20% of your data points.
– Prioritise the data before scaling up.
– Define broader customer segment understanding before focusing on micro-segments or personalisation. (walk before you run).
– Customer metrics. e.g. counts, measures, and ratios can give you enough to make meaningful decisions, remember to iterate your insights as you learn from them.
Forming Insight –
This involves clustering data into themes. Traditionally segmenting was done by life-stage and wealth (social demographics), but as insight intelligence matures there are moves towards behavioural and attitudinal insight; the basis for predictive analytics. There is a common purpose irrespective of the level of insight maturity reached;
– identify customers’ value triggers and then score and rank them to facilitate effective targeting and personalisation.
– start at a Macro (broad group segmentation) and master those before advancing to micro or personalised insights.
The Action Playbook –
Guided by your data purpose, build a library of offers, a few hundred is a good starting point to focus on the customer basics:
– Purchase conversion.
– Retention-loyalty triggers.
– Spend development–cross selling and up selling.
For many retailers, siloed processes and organisational models prevent effective collaboration and make it difficult to align the data science, marketing and merchandising teams. There is a strong case for a CCO to break down silo’s and align departments around the common cause.
Digital customers are promiscuous when demand is driven by price and availability. Switching is simple and takes place with alarming regularity.
Customers yearn to be recognised by their retailer, but most retailers are only just starting to appreciate the power of insight. Full potential will only be realised when totally integrated into a customer centric culture within a perfectly aligned organisation.
Done well; the retailer earns loyalty, advocacy and optimises life-time value.
Done badly; it becomes costly tokenism, exposes a lack of authenticity and destroys trust.
Julian Grindey can be contacted on 07969 397916 or at email@example.com