Challenging the Status Quo: How Customer Data Can Overturn Conventional Wisdom

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By: The CDPa Team

Data doesn’t lie.

While the specific insights gleaned from a dataset may vary depending on how the data was collected or what it was used for, the data itself — in our case, customer attributes and behavior-specific data — can only tell the truth.

As organizations begin to integrate customer data into their business operations, uncomfortable moments can arise. Business strategies and marketing campaigns have historically been guided by educated guesses and conventional wisdom. A company creates an image of their typical customer and designs operations in order to satisfy that persona. But what happens if that image is wrong?

Pivoting to customer-centricity can sometimes cause organizations to rethink what they thought they knew about their customer and their business. We spoke with four CDPa Founders about moments when customer data challenged conventional wisdom during their careers, as well as the question of how to deliver the unexpected news to company executives.

At a previous company, we operated under the assumption that the average consumer visited the brand a few times per month. However, when we dug into credit/debit purchases with tokenization, we found that the number was closer to once per quarter.

It’s important to stress that the conventional wisdom isn’t “wrong.” Instead, you should preface the new information by saying that we have new tools and datasets that enable us to understand our consumer at new depths. For example, start with “What we found was… “

  • Lynn Hemans, Vice President of Consumer Intelligence and Strategy at the Hershey Company

When working with a portfolio of brands, there was a presumption that the best customers of each separate brand were the most valuable. The customer data analytics showed that the customers that were most profitable, most sticky and had the highest lifetime value were those who shopped across our brands. When telling that story to executives, you should revisit what the conventional wisdom was predicated on and then show exactly how the true, analytics-driven customer data tells a very different story.

  • Sebastian diGrande, Member of the Board of Directors at Big Lots

I’ve seen two strong examples of conventional wisdom turning out to be misguided. At one multi-brand retailer, there was a belief that the customer base for one brand was radically different from the other brand. However, when we actually examined the customer data, we learned that over half of that brand’s buyers also shopped with the other brands in the portfolio.

At a separate retailer, there was a specific product launch that was deemed a massive success when viewed through the lens of traditional retail metrics like sales and inventory sell-through. But, when the retailer looked at the same performance through the lens of the customer, they saw dramatically lower repurchase rates, lifetime value and net promoter scores for the customers acquired during that period. It turned out that marketing had done a great job in getting customers to try the product, but the product itself did not perform well for a wide variety of the customer base.

  • Chris Chapo, Senior Vice President of Data and Analytics at SKIMS

I’ve worked with many companies in a range of verticals that use loyalty programs. These organizations largely look at loyalty programs solely through the lens of increasing transactional frequency. However, when companies begin to pull in additional data points like customer lifetime value, total lifetime spend, and predictive CLV, it transforms the loyalty program into a center of profit and business value. This kind of shift doesn’t just challenge conventional wisdom — it can also change how companies approach customer service policies, promotions, and even inventory.

When you have to convince an executive that their conventional wisdom isn’t correct, lean into the data. They may have an emotional attachment to their historic ideals, so using data to build your business case removes the emotion from the conversation. Building a business case tied to KPIs and showing the dollars that could be gained from the shift is a winning argument.

  • Jeanne Jones, Vice President of Community and Customer Marketing at Amperity

Are you ready to challenge the conventional wisdom at your organization with customer data? Check out our most recent playbook and learn how to identify and appeal to the most valuable customers at your organization.

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The CDPa Team

The CDPa exists as a forum for people who believe in responsibly using customer insights and data to drive customer-centric growth. Together we elevate the best practices and tools in a space for collaboration to drive personal development and commercial success.

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