My prior post talked about the value of customer data. Your next question will naturally be, “so how do I leverage what I know about my customers to my advantage?” There are many ways to transform insights into increased market share. The lists below are examples but by no means the only things you can do. However, I would suggest that you see your customer data and its application as a source of intellectual property, something to be guarded and leveraged wisely.
It can enable you to increase revenue by:
- Identifying those likely to buy in the near term
- Separating those customers who need an offer to get them to buy versus those who would buy regardless
- Determining the right accessories or ancillary purchases to promote based on a customer’s purchase
- Highlighting the “next best” products based on your customers’ purchase patterns
It will also help you retain your customers by:
- Understanding the customer journey and the experiences that matter
- Identifying those likely to defect
- Ranking your customers by their lifetime value so you can reward your best customers
Lastly, it can also help you reduce your costs by:
- Enabling you to conquest smartly, targeting those that look like your best customers
- Determining the best conquest sources and communications
Are you leveraging your customers’ data to increase your market share?
A former colleague of mine always referred to his clients’ customer data as their crown jewels. He had a point. No one else knows as much about your customers’ behavior, attitudes, and preferences. If your customer data doesn’t seem valuable to you, imagine if your competitors had access to the very same information. What would they do with it?
There has been lots of talk about analytics as a source of competitive advantage. More recently, big data has promised to uncover untapped value and insights. However, have you thought more holistically about the resulting customer insights and intelligence? Used wisely, what you know about your customers can be a source of competitive advantage. It can help you increase market share by promoting the right product at the right time to the right person using the right channel. It can provide insights that enable you to improve marketing ROI, conversion rates, and conquesting. It can help you identify customers likely to defect, uncover what you need to do to retain them and help you determine if they are worth retaining based on their future lifetime value.
Finally, if you aren’t thinking about your “crown jewels”, I bet one of your competitors are. They may be able to purchase data about your customers from a third party vendor and use it for conquesting. If you don’t think customer data is valuable, your competitors do and they are willing to pay for it.