You likely use data to measure your customer experience. You definitely have numbers that your executive team uses to measure fiscal success and the business’ financial needs.
While those numbers are helpful, being data-aware or insights-driven are two entirely different beasts.
Saying that your company is insights-driven does not make it true.
Just because you have data doesn’t mean that it’s easy to understand, or even that it’s easy to use. An insight-driven company, as opposed to one that is data-aware, will find a way to put every number to use—and that can be overwhelming when you have a lot of numbers to sort.
To be insights-driven, you must build a company-wide infrastructure. It must not only support providing detailed insights for each function, but must also be able to intake data and make the output useful.
The benefits that you reap from being insights-driven are innumerable. In Insights-Driven Businesses Set The Pace For Global Growth, Forrester says
insight-driven companies are on pace to make $1.8 trillion annually by 2021.
These businesses grow faster because they know what customers want - and they deliver. According to McKinsey, these types of organizations are 23 times more likely to acquire customers and 6 times as likely to retain them.
But what does it actually mean to be insights-driven?
There are four markers of an insight-driven organization:
- Cross-functional data democratization
- The ability to pivot quickly based on customer feedback
- Implementation of available technology
- Constantly measuring the progress of customer-driven initiatives.
Data moves cross-functionally
For many companies, specific metrics are usually siloed to one function. For example, customer satisfaction (CSAT) is used by customer success, net promoter score (NPS) is used by product, and annual recurring revenue (ARR) is used by sales.
However, 42% of organizations strongly agree that information silos reduce the quality of the insights a company gains. To solve this problem, the same report recommends that businesses “build a closed-loop insight process into every facet of their business”.
Closed-loop analytics include metrics from every part of the customer journey: from the time they first interact with your blog, all the way through to when they potentially churn. They make use of data collected by every function within a company. Every team is then able to see the impact that their individual metrics have on other key business pulses.
A data-aware company may do this for some aspects of the business, but an insights-driven one will make it easy for every team to know exactly where they fit in. Insights-driven businesses are able to work cross-functionally on projects that closely address customer needs, sentiments and expectations. They start to expand beyond team-specific metrics and use insights from across the company to make the best decisions for their customers.
Quickly pivoting based on customer insights
When you understand what your customers are looking for, you can quickly change your strategy to address it. Manage your data and analytics efficiently, and your whole team will know where to look to understand customers’ ever-changing behaviors, expectations, and needs.
Using customer insights to impact your experience, marketing, sales structure, and product initiatives boosts key metrics like customer satisfaction. For instance, according to the CMO Council’s Empowering the Data-Driven Customer Strategy study, 38% of marketers worldwide say their primary challenge in being more insights-driven is trying to use a fragmented system to deliver a unified view of the customer experience across touchpoints. In that same study, 30% cited silos of customer data as being one of the greatest barriers to moving quickly with customer focus.
In order to act quickly, organizations need a central customer data repository for timely data analysis. Secondly, these reports need to be accessible (and in a readable format) to the average user. If everyone needs to put in a work order to the data analyst to gather their insights, the speed of action will drastically decrease.
Using updated tools to supplement knowledge
Many companies have lots of data but nothing in place to properly handle it. Only 17% of businesses say that they have tooling in place to properly integrate insights across their whole company. Even for companies that do have the tools to properly interpret data, 78% of them struggle to know the right way to do so.
An insights-driven business makes use of updated tooling, such as data pools, to help supplement cross-team knowledge. Data lakes are huge buckets of raw data that can be stored until they are needed for analysis. While these can be helpful for data-aware companies, an insights-driven company will realize that they need to take on a new form in order to be useful. Data pools are a smaller version of lakes—they break out function-specific data into smaller segments to make them more manageable for individual teams.
For example, data that is specifically relevant to marketing or sales would be available in their individual data pools. This makes finding and using the data much more efficient.
Beyond how you store the data, there are also new technologies that can shift the type of data that your company is taking in. With the recent growth of AI technology like text analytics or customer intelligence software, there are even tools that can do all of the work of analysis for you. Qualitative and quantitative customer data, along with operational data can be pulled in from data lakes like Google BigQuery or Amazon S3 for deep insights that impact almost every corner of a business. Insights-driven businesses work faster, not harder, to understand what their customers are keen on.
Measuring the impact of applied insights
As businesses start to shift from being data-aware to insights-driven, there are five key benchmarks that are useful in measuring success.
While data-aware businesses will still have markers for success, businesses that are driven by insights have a deeper set of metrics to benchmark by. Each initiative will move the needle on specific metrics - many of which are linked to the business’s success. Insight-driven teams know how their work contributes to each KPI and measure their progress using these metrics.
Being insights-driven allows you to compare yourself to yourself, rather than other businesses outside of the scope and structure of your industry. You’re consistently able to measure how you are improving in strategy and execution by looking back on your performance from the past. Even better: these insights are couched in real-life insights from your actual customers.
Iteration is the name of the game: as you make changes and address customer feedback, make sure to compare your progress against your benchmarks. If the needle isn’t moving in the right direction, it’s time to try something different and dig into what went wrong.
Insights-driven businesses are leading the way into the future. Creating an insights-driven strategy for your company means finding the holes (or lakes!) in your data, and starting to execute a plan to make them more actionable. Sourcing as much data as possible, both from existing sources (think quantitative customer and operational data) and from new sources such as qualitative customer feedback, will help you get the cleanest cross-section of what your customers are feeling.
Kapiche is a new platform built specifically for customer insights teams to understand qualitative data from multiple sources, discover the 'why' behind every score on a deeper more contextual level than previous possible and to help measure the impact of those scores on other key metrics (such as revenue). This quick demo video will show you how it can work for your customer insights team.
As an insight-driven business, you’ll need to deliver on:
- Operating models that are based on specific insights
- Insights being actionable (and taking action on them)
- Continuous learning and experimentation in the name of gaining deeper insight
- Strategic investments based on customer insight
- Team-wide collaboration, collection, and interpretation of insights
It’s no longer just about understanding the customer, it’s about understanding where the customer is motivated to go next and meeting them there.
Everyone wants to do customer insights right but they're setting themselves up to fail if they rely on tools that automate what humans already do manually. That's just automation and isn't true innovation. Customer insights teams today are allowing technologies to reveal the areas that need the most improvement.
With the Kapiche platform, customer insights teams are finding success with the discovery-led approach. They aren’t spending weeks manually coding datasets with hundreds of thousands of pieces of feedback or waiting for vendors to update their code frames. They are getting time back time to understand the behavior drivers and reporting actionable insights across the business. And this is happening because their text analytics solution is doing all the heavy lifting for them.
Curious to see how it work with the Kapiche platform? See this demo video.