Role of IT in Customer Retention and Customer Life Cycle Management
The digital customer is different! With internet and smart phones becoming an integral part of life, there are various stimuli on TV channels or social media which start to create a latent need for products in the minds of customers. Unlike customers of the past, today’s buyers prefer to be informed about the product before they go to purchase – or better still, close the transaction on the net with hardly any human contact. With exponential growth expected in mobility and the consequent demand for smart phones and the ubiquitous availability of internet at cheaper rates, this trend is likely to get further reinforced, and may quickly become the norm.
The conventional business environment saw traditional methods used to understand the customer such as surveys through personal or group contacts with experienced “interpreters” slicing and dicing insights gathered in specific ways, which served to align brand and product strategies with these inputs. Hence, as a corollary, situations affecting the outcomes are somewhat dated by the time any decisions are taken. Further, decision making is largely dependent on expert interpretation of a sample size which, by default, may exclude exceptions or possible emerging trends which cannot be definitively extrapolated. Organizations cannot ignore the new digital customer wherein the journey to buy a product actually starts much earlier than he/ she visits the store. The visit to the store is merely to transact, execution of which culminates the purchase process. The moot questions to be answered here are “Are you available when the customer thinks of your products”, “Can you seamlessly provide answers to his/her questions”, “Can you connect and convert your customers each time they indicate the need” and more importantly “Can you hear the ‘digital’ voice of your customers?”
Welcome to the digital world where two big constraints are taken away. One, there is hardly any time lag for processing of data thus making the results extremely contextual. Two, we can look at the ENTIRE data set and strive to interpret every single response from the customer. Taking a sample and analyzing and validating hypothesis/results is giving way to find similarities and associations between customer segments and across situations, geographies and events in newer ways that can be imagined. Placing that brand at the checkout counters, whenever the warning for thunderstorms was raised, increased sales by 20 percent. Data and co-relations are driving results and not the other way around.
Over the last five years or so, storage costs have declined while processing power has increased manifold. This combination is changing the game for understanding and managing customers over their life cycle while opening up limitless possibilities in harnessing this data for the “next big idea” – something every organization will need to inevitably do simply to survive in this new world. Today, Big Data is a really good proxy for occurrences; correlations offered by Big Data help us capture the present and predict the future. This could also be extended in identifying the correlation of customer service which is especially true in the white goods industry where Customer Life Cycles extend far beyond the instant buying decision and nurturing relationships are clearly co-related with the strength of the brand for the next purchase or the possibilities of value added offerings.
Traditional organizations develop expertise in IT Shared Services at various geographical levels to sustain and support traditional ways of working, But the ‘new world’ will require very different ways of collaborating with the “fringes” of an organization so that digital strategies connect across functions in order that Customer Insights (and its translation into strategy) becomes a case of Commercial Differentiation and not just a tick- in- the- box of applying the latest jargon in Technology while continuing with traditional methods of operation. In the emerging world of technology, words, locations and relationships are all connected nuggets of data - making digitization passé and “Datafication” the new normal of recognizing the digital customer. This heads-up to the organization can be a great lever for being proactive in engaging the customer and is arguably the biggest opportunity that Big Data can provide today.
Organizations that are serious about jumping onto the digital bandwagon and harnessing the power of Big Data need to combine the expertise of IT with the knowledge of Customer Insights and connect with the customer through all stages of the product lifecycle. Digital-savvy resources in Marketing need to be exposed to the complex constraints of IT while Marketing- savvy IT professionals need to possess the ability to spot business opportunities that new technologies can offer. This can happen only when IT folks truly understand the nuances of customer behavior and their relationships with brands. This collaboration may create a new Digital Organization where IT teams become the catalysts for Digital Transformations, which is now long overdue. The Digital Roadmap with Technology and Customer at the core will be the key differentiation in the future and the organizations that recognize this faster will be the ones that get off with a head start.