The World Economic Forum is calling personal data a "new asset class: a valuable resource for the 21st century that will touch all aspects of society". But companies will need to understand how they can gather customer information without compromising the customer's trust. A recent research we conducted at Cequity showed that 88 per cent of consumers who were asked for personal information are okay with sharing it. So consumers are happy to share personal information as long as they see a "value add" for themselves. And organisations with trust-based information sharing relationships with customers will have significant competitive advantage over those with traditional data gathering relationships.
How the world has changed. Today many companies do not need factories to produce products, they just need customer data. Companies like Amazon leverage these petabytes of customer data to become more customer centric. Amazon aspires to be "Earth's most customer-centric company." Numerous mission statements are sprinkled with customer focus. But in reality it is hard to actually be customer centric. Prof Ranajoy Gulati summarises this beautifully: "In fact the big leap that companies need to make is to "not sell what they produce" but to "solve customer problems" and then suddenly "who produces the product is no longer important "because you start "owning the problem space".
Customer-centric companies tracked by Gulati between 2001 and 2007 delivered shareholder returns of 150 per cent while the S and P 500 delivered 14 per cent. While research like this looks great, one wonders why there are not too many companies who "really put the customer at the centre". Only companies who are great at "disruption" seem to truly belong to the category of obsessively customer focused. A customer-centric organization's business is built completely around the customer and customer data. This kind of company has a strong understanding of the customer's value and what the customer represents to the business's profitability. With this knowledge, a customer-centric company adapts everything it does - from research and development to to customer service - to deliver the best value at the right cost to their customer.
In this new age of the customer, companies need to get the following key strategies embedded in their fabric: