an introduction by Luminas Found & CEO D. Keith Pigues
Don’t confuse market research, customer information, competitive intelligence or other forms of external information used to understand how you’re serving or propose to serve customers with the all-important customer insight.
The European Society for Opinion and Market Research (ESOMAR) has been operating for nearly 70 years and stands as the global association for the research industry. ESOMAR conducted research looking at the best way to demonstrate the value of investing in customer insight. This article highlights the findings and may be the best piece of work on customer insight ever published – no kidding.
There is no substitute for the use of customer insight in making confident business growth decisions. ESOMAR’s research concluded that internal functions pursue three strategies in order to create high performance customer insight teams, and showcase the value of (investing in) insight. There are three major takeaways we suggest all senior leaders consider to secure the critical customer insight to make more confident decisions that support organic growth.
1. Be really clear about the core purpose of the customer insights organization – to future proof your organization and add value – better equipping the business to deal with disruption and change.
2. All customer insight must inform the current and future business thinking – it must get to the C-suite and shape the business strategy.
3. Don’t get boxed into evaluating the customer insight investments using ROI only – it will result in the organization seeing this invaluable resource as a cost center rather than a value creator.
At Luminas, we have found that organizations and leaders who take this perspective in developing and using customer insights consistently make more confident growth decisions. This is a critical area of focus as your organization charts the course to restart growth in 2021 in beyond. We suggest keeping this article by your side to guide your efforts.
written by David Smith and BV Pradeep
The findings clearly allow ESOMAR to recommend that client internal insight functions pursue three (overlapping) strategies in order to create high performance customer insight teams, and showcase the value of (investing in) insight. Below we review each of these strategies:
One: Focus on value creation – be clear that your core purpose as an internal customer insight team is to future-proof your organization and add value – ensure that you constantly act with intentionality to deliver this purpose
You need to be clear that your primary role is to future-proof the organization and make it better equipped to deal with disruption and change. Insight should not be boxed into the corner of being perceived as a reactive, market research order-taking cost center. Make sure you are the go-to team when it comes to identifying and outlining the implications of powerful strategic foresights. There are three questions to ask:
- Strategic foresight: Are you building a reputation for being able to spot and seize, in a timely way, critical opportunities that lie at the heart of driving value and growth in the business?
- Pro-active not reactive: Where are you on the journey from being a market research, order-taking team that is on the fringes of the business, towards being pro-active in driving change?
- Commercial acumen: Are you constantly demonstrating the business impact that customer insight is having on the business? Are you showcasing, to all senior management throughout the organization, the business acumen and commercial awareness of the insight team, so that it is clear you are a value creator, not a cost center?
Two: Ensure your positioning within the organization gives you access to the C-Suite and the business strategy – this will allow you to deliver powerful customer insights
It is important to secure a direct line of sight to the C-Suite. This will mean that you are aware of the organization’s business vision and future strategy and will ensure customer insight informs current and future business thinking. This positioning will also help customer insight professionals gain access to all the sources of data we now use to derive a customer insight. Ask yourself these questions:
- Customer centricity: Where are you in terms of being seen as the lighthouse (the North Star within the business when it comes to understanding customer behavior)? Are you at the center of creating an organization genuinely committed to customer-centricity?
- Holistic analysis leadership: Have you secured access to all the customer insight data, and are building a reputation as the expert in integrating the evidence into a holistic picture to tell the customer story?
- Be the insight champion: Are you building a reputation as being the insight champion? Do you have the strategic vision and forensic energy to unearth powerful insights that tell us how best to change and influence customer behavior? And are you leading the way in how we utilize digital, AI and machine learning (ML) generated insight?
Three: Ensure that you are not solely relying on ROI metrics but confidently showcasing the value of insight using a mix of success criteria
You need to be confident in ensuring that benchmarks and ROI style metrics are not the only way in which the insight team is being evaluated by senior stakeholders. These measures have a part to play, but they only provide a narrow assessment of the role insight is playing. The key is using a mix of hard and soft measures. The study showed that there was widespread concern that going down the ROI route would box customer insight into the corner of being seen as only a cost center – rather than a value creator. Ask yourself the following questions:
Avoid the tyranny of metrics: Are you resisting calls to use ROI metrics as the sole measure of your effectiveness? How close are you to hitting the sweet spot in using a mix of metrics and more qualitative measures to demonstrate the success and effectiveness of insight?
Telling the Insight story: Are you regularly disseminating, throughout the whole organization’s management, compelling insight success stories – case studies demonstrating the value of insight? Where are you – in terms of socializing your success – deploying innovative communications techniques to demonstrate the way insight is setting the future direction of the business?
Creating a learning organization: Are you taking responsibility for creating a learning organization with insight at the center of an agile, customer-centric culture that is capable of continually adapting to change?
The ESOMAR project was led by David Smith, DVL Smith, and Finn Raben, Director General, ESOMAR – working with the following team: Adam Phillips, Director, Real Research; Reg Baker, Independent Consultant, and Vanessa Oshima, President and Founder, HeartData. In addition, BV Pradeep, Global Vice-President CMI – Market Clusters, Unilever has been closely involved as the ESOMAR Council Member overseeing the project.
originally published by Research World