That focus on individual customers means we’re entering a world of extreme segmentation. This new focus is a key strategy for companies that realize that understanding and meeting individual customer needs addresses what Forrester data has identified as businesses’ top two priorities: revenue, and customer experience transformation. Big data, of course, will play an enormous role in addressing both of these priorities, but without a systematic way to harness data and turn insight into action, your efforts are doomed.
On its own, big data addresses only part of your data problem: turning more data into deeper insight. Many companies have already bought into this and are investing heavily.
But it’s not enough. Big data alone does not validate the value of insights against business outcomes, deliver insights into where those original insights create effective actions, or create continuous learning.
Systems of Insight — the business discipline and technology to harness insights and consistently turn data into effective action — deliver on what all the big data noise can’t promise: tested insight at the point of action and continuous learning. In Forrester’s research, we identified a type of digital predator, the insights master, which has built entirely new business models around systems of insight. Amazon and Google were pioneers; more recently, Facebook, LinkedIn, Netflix and Uber have fit this profile.
Insights masters share some common behaviors. They bring together insights teams that unite developers, data and business experts to work directly with a digital leader, with a budget and an outcome to manage. The teams also utilize agile continuous-delivery methods and source data from everywhere, working collaboratively to codify, approve and deliver insights to software.
But how do you apply systems of insight to customer experience Three factors influence your customers’ perception of an experience with you: how effectively your company meets customer needs, how easy you are to do business with, and how positive or negative an experience made the customer feel. Systems of insight can improve all three by doing the following:
Forrester estimates that gearing up your first systems of insight and evolving your current capabilities to a digital insights architecture will take one to three years and $2 to $10 million — not a trivial sum. The cost may seem prohibitive but, without systems of insight, you’ll just be producing a lot of “interesting” data with no actionable insight in an era dependent on creating personalized customer experiences.
Brian Hopkins is a vice president and principal analyst at Forrester Research.