In Ridley Scott’s 2013 movie, ‘The Councillor’, a philosophical Brad Pitt tells a stressed Michael Fassbender that, “you don’t know someone until you know what they want.” Although clearly never intended to be used as a business quote, it does offer a polarising reminder of the importance of understanding what’s important to your customers if you really want to know them, says James Frampton, SVP and GM, EMEA, SugarCRM.
Unfortunately, most businesses don’t have a good view of their customers. And those that have a better picture than most don’t really have the full picture. They most likely have a fraction, a blurred, hazy image of what their customer looks like. Research shows that 91% of CRM data is missing and 70% goes bad every year, meaning your data probably isn’t as good as you think it is.
Get a complete view of your customers
Fundamentally, if you don’t have a complete view of your customers however, then your business isn’t achieving its full potential. For those that don’t already recognise it, then the impact is likely worse than they think. This can manifest in a number of different ways.
For example, if your sales and marketing activity is sub-optimal because you don’t know your customers, then not only are you failing to get the most bang for your buck, but you also can’t accurately forecast or troubleshoot your pipeline which can lead to revenue loss. You won’t know enough about what’s happening and what’s going on, to be able to identify missed opportunities and the size of the gap.
This then results in increased costs, as you look to try and understand what’s gone wrong and why your sales and marketing tactics aren’t delivering. You may also end up spending extra on purchasing third party customer profiles to try and get a handle on the situation, when all the data and potential insights have been right in front of you the whole time. If you don’t understand your customers then it’ll likely be a struggle to keep hold of them, leading to higher customer churn.
The importance of predictability
These issues converge into a lack of predictability, which ultimately means you can’t accurately forecast. The knock-on impact ranges from being unable to predict what segments do well in marketing campaigns, to inaccurate sales forecasting and even business performance forecasting. Anywhere you have to look into the future you suffer.
By the time you’ve seen the issues, it will be too late to do anything proactive, as you’ll have to wait for unmistakable red flags on trailing indicators like financials and campaign conversion rates to appear. By then, whatever action you take on them will be reactive and only limit the damage, rather than preventing it.
Building a high definition view of your customers
The only way to prevent this from happening and unlock accurate predictions is by building a high definition view of your customers. Despite CRM being around for almost 30 years, for most companies, as mentioned above, the customer view is still decidedly low res: Incomplete, out-of-date, wrong and focused on the current state.
To do this, organisations must begin by redefining their 360-degree customer concept, drawing on accurate, up-to-date information from multiple sources and from across the organisation and then adding the key missing component: time. By incorporating a complete historical record of every change event in the customer journey, organisations will achieve full situational and directional awareness of their customers and their business.
To really differentiate in today’s market and into the future, tools like AI on their own, however, is not enough. Not only must businesses leverage AI, but augment it with vast amounts of third party data in order to make more accurate predictions and implement prescriptive motions so that employees and even customers are more empowered than ever.
Putting this into practice
A great example is predicting customer churn. Knowing if a customer might defect to one of your competitors, or simply stop using your products or services, is a hugely valuable asset. But all too often, businesses lack the ability to see the clues that might indicate churn. This is due to the lack of complete data around the customer.
Even if the customer data you are collecting is of good quality, it may not provide the level of granularity and insights needed to accurately predict churn potential. But, if you have the element of million and millions of third party data points comparing an individual’s actions against countless other people you can start to get incredibly accurate statistical models that will tell you earlier than ever if there might be a problem. And, if the insights are available to front line customer-facing individuals and not locked inside analytics tools meant for business analysts you might even be able to identify and deter a customer from leaving before they even formulate the notion in their minds.
Precise insights can make the right decisions
It sounds scientific, but when you have this level of AI power at your fingertips, you can get this level of precise insights, make the right decisions fast and nip problems in the bud, thus salvaging customer relationships without any loss in customer satisfaction.
Only by building a high definition picture of your customers, their past behaviours, their likes, dislikes, wants and needs, and combining it with accurate predictions about their future behaviours will customer-facing organisations unlock the true benefits of predictability, achieve a competitive advantage and growth into 2021 and beyond. It’s now time for every sales leader to ask themselves, how well do I really know my customers, how clear is my picture, and what more can I do?
The author is James Frampton, SVP and GM, EMEA, SugarCRM.
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