Question: Is your organization buyer-centric?
If yes, please read on. If no, please read on.
One common trait of all successful businesses is that they have customers who are at the center of all their operations. We're leaving behind one-size-fits-all sales funnels and price wars with the competition. If you want to get and build relationships with clients, you and your team need to do so on a one-on-one level. However, today, to be client-centric, you'll need to use data and analytics to understand your clients' needs and proactively evolve your services and products in tandem with those needs. Both disruptive businesses and political campaigns use data and analytics as the baseline of their entire model. Against this competitive environment－don't get left behind. To that end, let's explore the importance of putting clients first and why data and analytics are vital for delivering on this core value.
Typically when it comes to analytics it's easy to get overwhelmed. I think it's important to keep John Doerr's "Measure what matters." in mind. Hence when it comes to measuring success in an organization, most buyer-centric organizations look first to sales figures. Don't get me wrong, these are all crucial indicators of growth, but they aren't the complete picture. Do these numbers explain the persona of who is buying your product? Do they describe what the right product mix is? Do they show if you are about to lose a client? Do you know which clients are the most profitable, or the least? Do they tell you what you need to do to stay competitive in the future?
These are the areas where having useful data and analytics is imperative. The insights they can give help you work with your clients, optimize human resources, innovate with evolving markets and trends, and grow profits. And you are in good company, industry analysts McKinsey states, "high-performing organizations are three times more likely than others to say their data and analytics initiatives have contributed at least twenty percent to earnings."
Data analysis can help you shape and reshape your connection with clients, market effectively, and drive more profitable sales for your company. Here are a few ideas to help you shape your plans:
Segmentation- Segmentation is the division of client data for parameters such as revenue, location, product usage, revenue, profitability, buyer roles, sales cycle length. Segmentation is not just for marketing! Segmentation also helps you assess which groups are most profitable for your business, enabling you to identify the most valuable customer segments and avoid wasting money on sectors that are unlikely to yield conversions. Another idea is to calculate customer lifetime value, which determines what the client is worth to the company as compared with others. This valuable metric becomes even more useful if you can factor out cost-to-serve and get to lifetime value in terms of profitability. There's a report called the Whale Curve that I've written about a lot. In brief, it allows you to graph your clients by profitability, so you learn which client brings profit and which causes you to lose profit. This report is valuable. Overall－ in the long run, knowing which customers to focus on and invest in is crucial to maximizing your profit.
Integration- Do your systems “talk” to one another? Do your ERP, CRM, HRIS, and ECM systems exist as individual silos? Are staff forced to conduct searches in each application in order to surface valuable data? Many clients use their ECM system as integrative middleware to allow searches, reporting, capturing, and records management of documents that lie both within the ECM and within other business-critical systems.
Agility- In this fast-paced economy, it has never been more important for companies to maintain flexibility. As gaining new clients is more difficult, companies are increasingly focusing on growing and keeping their existing clients, rather than try to find new ones. Successful data-driven customer retention programs continuously allow you to adapt to your client's needs. Do they have the correct product or service mix? Are there gaps in the client's mix? How is the vertical market performing as a whole? What is your share-of-wallet? I could go on and on. Delving into your data gives you the ability to adapt to your client's changing needs, anticipate problems, offer new solutions, and be able to provide a better overall strategy. Another aspect of agility is the automation of routine tasks. One of the most utilized features of an ECM is workflow. With it, organizations can batch scan important documents like purchase orders and invoices. The data locked within these documents can be captured and populate Into other systems which can kick-off task assignments or approvals. Once workflows are in place, staff can be reallocated to more strategic duties.
Optimize your pricing- There is no more significant lever for impacting your bottom line than pricing. However, pricing can be complicated and confusing. Price optimization is the process of finding the best possible price for a product or service. Typically companies make the same three or four mistakes in setting their prices. For instance, many organizations make the mistake of applying the same margin to their entire product line or letting sales reps "always" take 15 percent off or using an equal premium to every client type. Analytics can be used to build pricing structures based on customer size, segment, purchasing behaviors, cost-to-serve. Overall, these tools aggregate and analyze pricing and cost data both from the internal sources and those of your competitors and derive optimized price variants. Using analytics to determine your pricing can deliver margin gains of two to four points. Also, enterprise value rises－averaging three percent. In a highly-competitive market and with changes in customers' needs, price optimization has become a must-have.
The shift towards becoming a buyer-centric business is complicated and long-term. But integrating data and analytics into your strategy and methods of working, along with adopting the modern features and functions of products such as ECM can bring about substantial benefits for your customers, employees, and bottom line.