For B2B companies, implementing strategy has not always been a priority as it has been for B2C brands. Yet, as the B2B landscape evolves, and current purchasing managers are becoming more digitally savvy, the time to start leveraging the learnings from the B2C sphere has come.
What is one of the most important components in delivering on this strategy? It’s customer data.
Customer Data Is The New Oil
Ever heard the expression “data is the new oil”? It was coined in 2006 by Clive Robert Humby, a British mathematician and entrepreneur in data science and customer-centric business strategies. He realized early on the potential and value of customer data, and slowly but surely, the rest of the world caught on.
And while consumer brands have now been highly aware of this potential for quite some time, many B2B brands are only beginning to explore what’s possible. Most companies use a tiny percentage of the data they already own, with clunky legacy systems, disconnected databases, and a lack of automation slowing the process down. This, in short, means that the majority of B2B companies are leaving a lot of money on the table.
The B2B winners of tomorrow will be those who realize, today, the power of customer data and understand how to leverage it in their digital experience strategy.
Data Will Put You On The Right Strategic Path
Running a successful business means making good decisions—day in, day out, every day, all year round. Important, strategic decisions about what your brand stands for as well as the current and future direction of your products and offers. But also more minor, ongoing decisions about how to continuously optimize every single part of your operation for better outcomes, such as happier customers, increased new business, and lower churn.
Creating a culture and process where those decisions are based on data can catapult your business toward faster and more significant growth.
The world and buyer processes are growing increasingly customer-centric. This means that the ability to capture, understand, and use customer data in building new products, solutions, and buying experiences will differentiate the brands that are genuinely making an impact from those who struggle to keep up.
Businesses Who Leverage Customer Data Generate More Profit
It’s really that simple—leveraging customer data increases profit. Basing your strategic decisions on data rather than hunches will, not surprisingly, produce better outcomes.
McKinsey surveyed over 700 organizations globally and found that those who invested in analytics to capture competitive market intelligence could not only target their audiences with greater success but also were able to better optimize their operations and supply chains, to the point where they managed to generate on average 6 percent more profit.
And as access to affordable technology and user-friendly tools has increased, these opportunities are not just for the top layer. In fact, most organizations can start generating measurable value from their data immediately if they only know how to do it.
Customer Data Supports B2B Sales Teams In Their “New” Consultative Role
Today’s B2B buyer is digitally savvy and prefers to do most of the research (which means most of the buyer’s journey) on their own, online. As a result, the role of sales teams in B2B is shifting to a more consultative approach. Selling in this new environment is about building trust and becoming that consultative partner that makes the buyer feel safe with their choice.
Observant sales representatives can use customer data to closely monitor their clients without being intrusive and step into the process when the timing is right.
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Leverage Customer Data For Innovation and Opportunity
It’s important to understand that customer data can improve and optimize areas across all of the organization. It’s not just sales or marketing that benefits from a structured approach to customer data—it’s every part of the company.
According to recent research by Frost & Sullivan, the areas of focus and innovation with the highest priority for manufacturers in 2021 include:
- Customer Experience & Satisfaction
- Improving Operational Efficiencies
- Launching New Products & Services
These are all areas where customer data play a crucial role. Research from the University of Texas at Austin and the Indian School of Business shows the information-intensive services industry reported an average increase of nearly 40% in sales per employee for a 10% improvement in data usability, while other verticals averaged an equivalent increase of nearly 20% in sales per employee.
Let’s have a look at five of the ways B2B companies can use customer data to craft their digital experience strategy:
- Using customer data to identify patterns
- Applying insights from customer data to improve productivity
- Forging innovative services and solutions
- Leveraging customer data to build loyalty and personalization
- Removing organizational silos that are stalling growth
Using customer data to identify patterns
Knowing exactly what customers are purchasing, how many times each buyer is contacting customer service, and how they behave on your website before, during, and after a purchase provides you with essential insights.
Pattern data is instrumental as you plan your spending and activities through all stages of the customer journey. Buying history, behavioral data, and post-purchase surveys help you understand where there is friction in the process and how you can grease the wheel of growth to increase pipeline and sales velocity.
Applying insights from customer data to improve productivity
While there is often a lot of focus on sales and frontline monetization opportunities, many of the most significant gains and lowest-hanging fruits are found in the operational context. Proper understanding and use of data can help you optimize processes and reduce costly inefficiencies. Not only can you save money by doing so, but you can also improve the customer experience.
Forging innovative services and solutions
Customer data can be the foundation for brand new online marketplaces and exciting new business models. And many existing companies are well-positioned to capitalize on the opportunity to create new innovative products, services and solutions as they often have long-standing client relationships, financial strength, deep industry expertise, and scale.
To innovate these new services and solutions, companies should start by focusing on a set of specific outcomes, like reduced churn or increased up-sells. And to speed up the process of getting results, create small, focused teams and let them experiment with and release new products based on data. With this approach, organizations can significantly improve their returns without massive investments.
Leveraging customer data to build loyalty and personalization
Customer data can also be used to improve and personalize the customer experience. B2C commerce has made a lot of progress when it comes to using data to create engaging, individualized experiences. This has set the standards online, which means B2B customers are now increasingly expecting the same level of personalization.
This demand for personalization has been further accelerated during the pandemic, as face-to-face interactions are increasingly being replaced with digital ones.
Companies who leverage customer data to create a seamless experience across digital channels—social, email, and web—will gain a loyal following.
Removing Organizational Silos That Are Stalling Growth
Creating platforms and databases where all parts of the organization can access and sync their data is an efficient way of aligning all teams around the same business objectives and measure impact in a meaningful way. Companies who take an agile approach to data management, integrating all data and making it accessible, are the ones who tend to become market-leading. To succeed, IT departments need to become more customer-centric, and marketing teams must become more data-driven. And to achieve this, leaders in IT, product, marketing, and sales all need to work together around a shared data set.
Data Monetization: Selling Data as a Product
One aspect of customer data that an increasing number of B2B businesses are starting to lean into is that data in itself is a product of value. The data collected by companies can be helpful to other players, and as such, it can be monetized and sold as a product. While it is estimated that only 1 in 12 companies are leveraging data in this manner, acceleration is likely with the increased usage of IoT (Internet of Things) and connected devices.
Your customers are constantly researching products and solutions to help them solve problems. They’re doing this online: comparing prices, reading reviews, and browsing websites. This holds just as true in the business-to-business (B2B) as in B2C.
It’s time for B2B organizations to start leveraging all the learnings from the B2C online shopping model and applying them in B2B sales. Those who dive deep into their customers’ data to continuously improve and iterate on the customer experience—before and after the purchase—will stand out as winners in the competitive B2B marketplace.
Regardless of where your company is on your growth journey, chances are that you have tons of valuable customer data assets that could be put to better and more active use. The best approach is to adopt a data-driven mindset from the very get-go and not wait for the perfect moment to start.