Customer Intelligence Blog

At a gathering we hosted last night in midtown Manhattan, I met with a group of marketing and data professionals and we discussed the characteristics of successful Customer Intelligence. With industries represented ranging from real estate to financial services to retail, we got a pretty good sense of what makes (or breaks!) efforts to gather and use customer information in an effective way across the entire organization so that there is a positive bottom-line impact.

Here are 7 characteristics we came up with – 7 important requirements for successfully creating and leveraging Customer Intelligence across an organization to drive significant bottom-line growth and provide increased value both for the customer and the organization serving that customer:

1. Infrastructure

Without the appropriate technological and procedural infrastructure to capture and store customer data, there can obviously be no Customer Intelligence. However, it doesn’t have to be expensive or complex – depending on your organization’s size or complexity, this can be as simple as an Excel spreadsheet (or a yellow legal-pad, if your organization is really small!). Hand-in-hand with the technology should come the appropriate procedures for using that technology effectively – else no one in the organization will actually use it!

2. Data

Equally obvious, without customer data there can’t be Customer Intelligence. Once the infrastructure is in place, it’s got to be used to capture and store the appropriate data (emphasis on “appropriate” – don’t capture data that isn’t necessary to create greater value both for the customer and for your organization, but do capture all the data that are necessary to do so).

3. People

The appropriate people in your organization need to use the infrastructure to capture the appropriate customer data that forms the foundation of Customer Intelligence. Unlike Nike, it’s not enough to tell these folks to “just do it:” they need the proper training, incentives, and company culture to support them to do so (see item #4 below!). And they need to be willing to do it – some folks just don’t “get” the need to understand customers and to use that understand to drive business results in a mutually beneficial way, so you may need to make some staff adjustments in order to get this part right.

4. Organization

This is a critical component of good Customer Intelligence; without the proper organizational structure, people will not have the incentives or supporting culture to make CI a reality. An organization must be set up so that people are in reporting structures that address the importance of CI and make it an integral part of the functions that the organization performs. For example, is CI represented as a separate function, are there separate CI teams in different business functional areas to support those areas, is there a centralized “Office of Customer Intelligence” (or database marketing and analytics, or decision management, or analagous function) that serves as a clearing house and repository for dispensing best practices across the organization and ensures that CI is being properly used throughout? There are many different ways to address it, but CI must be a visible and important part of your organization.

5. Customer engagement

CI is a two-way street: if customers feel comfortable with your organization and know that your company values their business and engages in respectful and trusting interactions, then customers will be engaged with your company and will share more of their needs, understanding that the more they share, the better their customer experience and the better the level of service they will get (see #7 below). So your organization must always do what it can to build customer trust, to improve customer value, to deliver on service promises, and to keep the lines of communication wide open, in order to create the high levels of customer engagement that are necessary for successful CI.

6. Privacy and sensitivity

Customers must absolutely feel that their information is kept private and secure, and that they are being protected in all of their interactions with your organization. We’ve all seen the stories of organizations dropping the ball on data security: laptops being stolen, data transmissions being intercepted, credit card numbers being stolen, and so on. The repercussions from those breaches are a loss of trust, a loss of customers, and ultimately a loss of business, so this cannot be stated too emphatically: you must do whatever it takes to ensure that all the data on your customers is kept private and secure, and let your customers know that you are doing so, to build the trust required for effective CI.

7. Value

Last but not least, you must always provide more value to your customers through the development and use of CI. Without creating this additional value, there is no reason on earth that a customer would want to share any further information with your organization, plain and simple – more Customer Intelligence should always equal more value for the customer. You shouldn’t ask for a single piece of additional information from a customer without knowing in advance how that new knowledge is going to allow you to create better value for that customer (see #2 above!). Correspondingly, that increased customer value should also yield more profitability for your organization, in terms of better product fit, better retention, increased levels of consolidation, cross-sell, and repeat business, and so on – it should be a win-win.