Racing to relevancy: three hurdles to customer insight
The relevance of your marketing message is the most powerful driver of marketing success. You can have a great offer, but if the product does not interest the consumer, your message will be ignored. The main thing is to understand needs and preferences at the customer level.
Using customer-level insight to create more relevant interactions -- in all channels, not just outbound messaging -- fuels growth because customers will respond more favorably to your marketing messages and will purchase more from you. It also will improve profits because, as your marketing becomes more targeted, it will also become more efficient, with fewer unwanted, ignored messages.
This seems obvious, yet most companies score very low on the relevance scale. There are a number of factors at play, but here are the three most common hurdles businesses face in the race to get relevant:
First, the company does not know the ROI of improving message relevance. This is the most common and the most difficult hurdle to overcome, as there is a natural resistance to change inherent in most organizations. Without a compelling ROI story, change is unlikely to occur.
Second, the company simply does not have their data organized to generate better customer insights. And they have been unable to fix the problem sufficiently due to a lack of experience or unwillingness to invest in fixing it.
Third, the company does not have the knowledge and experience to execute the appropriate analyses to yield superior customer insight. The talent to do this is actually quite scarce in the marketplace and it is difficult to recruit and retain such talent. The most talented customer insight people tend to go to service companies where they can work on a variety of clients and projects.
Clearing these hurdles requires some work, but it is not as daunting as you might think. Here's how to do it.
Clearing hurdle one: unknown ROI
If you're trying to understand how much improved customer insight can increase growth and profits, there are two approaches you can take:
First, gather information on competitors' success stories and then project the potential impact for your business. Then design and execute a high-relevance pilot program to measure the potential ROI and then use those findings to make your case. Test against one of your largest programs
Follow these steps even if you run a pilot, as it will enhance the credibility of the investment you recommend. You can gather information from industry publications, trade shows, blogs, any place where one-to-one marketing is discussed. Also reach out to companies that provide one-to-one marketing services; they will often share some results achieved with their clients.
Clearing hurdle two: data insight
Regardless of how much third-party information you gather, you will need to estimate the effect that improved customer insight will have on your business. It may be useful to speak with one-to-one marketing services companies or consultants on the best approach. Many can provide a stand-alone project designed to project the ROI of improved customer insight for your company.
If management is already convinced that investing in better customer insight is a good idea, but getting the right IT infrastructure in place has proven elusive, you should consider outsourcing. There are multiple options, from having an IT consulting firm design and build a solution that can be managed internally to implementing a fully outsourced solution that is hosted at a marketing service provider. Should you decide to go either of these routes, consider carefully, as there are a variety of business models and technology options available. Technology is constantly evolving, and you will want to make sure that you find the most appropriate customer insight applications for your business.
Clearing hurdle three: skill gap
Finally, if you feel that you have your customer data in reasonable shape but are unsure of exactly how to proceed, or if you simply do not have the resources to execute customer insight analysis, there are a couple of options. The first is to hire an analytic services company to provide the support you need. The other is to develop or “lease” a customer insight application that will make it much easier to develop customer insight internally, using less experienced resources. Given the high cost of outsourced analytics and the desire to retain customer insights within the organization, this is often the best solution.
By clearing these three hurdles, you'll discover valuable insights into your customers' needs and wants, helping you pull ahead of your competitors in the race to relevance.