‘ALL’ to ‘N’ to ‘1’
My life is split between long weekends with my family in Cheshire and most working weeks spent in London. It’s a strangely dislocated but effective solution that gives me dedicated time for business and quality time at home.
However, this arrangement also works because of one very alimentary factor… I am surrounded by excellent eateries. Just a short walk from my apartment in Shoreditch there is a superb Italian restaurant. I eat here at least once a week. And the fact that I am often eating alone is never an issue…
Recipe for success
The staff know me.
The hostess shows me to an unobtrusive but well-lit table where I can quietly read my book.
Before offering me the menu the waiter instinctively asks if I already know what I want to order… he remembers that I invariably pick my favourite pizza or pasta.
The service is rapid, the food is delicious and, as the waiter clears my plate, he always delivers the calorific coup de grace: “We do have chocolate fudge cake with fresh cream on the menu tonight.” It’s the one gastronomic indulgence he knows I can never resist!
It’s a great recipe for success.
Interestingly, there is another restaurant nearby where I eat less frequently and where I am not so well known. However, even here I am recognised as a single diner and my experience is tailored accordingly: secluded table, prompt service and very good food.
These two experiences are an object lesson in intelligent business…
The people in the second restaurant are making a rapid assessment of me. They are narrowing me down from ‘All’ customers to a segment of ‘N’ customers – lone diners – and serving me appropriately.
The staff in the first restaurant are taking this one step further and narrowing me down to a market segment of ‘1’. In so doing they are improving their efficiency (fewer trips to my table). They are enhancing my customer experience whilst promoting sales (the chocolate fudge cake). And they are increasing customer retention (this is my default restaurant because I know I will be able to read my book, enjoy excellent food and receive prompt, attentive service).
Sadly, it’s an object lesson that’s lost on many banks. Compare and contrast those restaurants with the service I get from my business bank…
Every eighteen months, my Relationship Manager changes. Reluctantly, I’ve learnt to accept this as an inevitable reality of banking life. But what I cannot accept is the fact that most of the bank’s information on me and my business also walks away with the old manager. No-one, it appears, has the nous to share it!
Every year the bank sends me a new arrangement letter for my business loan. And every year it contains inexcusable errors which I have to find and point out to my ‘most surprised’ new manager!
Every week I log onto the business banking system and am presented with a plethora of functions that I never use. However, when I want to make a simple payment, the system stubbornly defaults to the one account I never, ever use to make payments.
You begin to get the picture.
There is a great scene in Breaking Bad where the main adversaries ask the protagonist: “Who are you?” He responds by demanding: “Say My Name!” He’s challenging them to reveal what they know about him and daring them not to realise who he is. This is how I often feel when dealing with my bank. I know they have the data – the snag is, they don’t.
And that brings me neatly to the topic of…
It seems to me that most large organisations are doing something with big data. Many are diligently constructing ‘data lakes’ and building pipelines to fill them. But do they really know how to leverage and exploit this growing asset?
Frankly, I doubt it. But, on one level, this probably doesn’t matter. After all, data lakes are relatively cheap to construct so it seems sensible to store information rather than profligately throw it away.
However, on another level, we do need to ask some serious questions about the value that big data is actually delivering. Because, despite some serious searching, I can find precious few examples where tangible business benefit is being derived. And, judging from my experience, this may explain why banks – and their customers – are the biggest losers…
But let’s think positively. Let’s try to imagine the difference it could make if banks really got to grips with customer data – shifting gear from ‘All’ to ‘N’ to ‘1’.
My bank could use all the data it has about ‘All’ its customers to improve the way it serves us all (greater efficiency, better service, more profit, improved retention). It could then use all the data it has about the ‘N’ customers in my sector (e.g. small business owners) to provide me with insights about my business. Most importantly, it could use data about my business, the market segment of ‘1’, to tailor – very personally – the way it does business with me. By going from “All” to “N” to “1” the bank could create the ultimate business relationship – a virtuous circle where the more we do business; the more business we do.
So, we have the data, we have the tools, we have the unmet need – now let’s innovate!
In their definitive book on mass customisation – ‘The New Age of Innovation’ – the co-authors (C.K. Prahalad and M.S.Krishnan) say:
“There is a fundamental transformation of business underway. Forged by digitisation, ubiquitous connectivity, and globalisation, this transformation will radically alter the very nature of the firm and how it creates value… value is based on unique, personalised experiences of consumers. Firms have to learn to focus on one consumer and her experience at a time, even if they serve 100m consumers. The focus is on the centrality of the individual”.
This is the central challenge: the future belongs to those companies that can make really effective use of data – personalising the experience of each and every customer. As more and more services become digitised and commoditised, customer loyalty (or stickiness) will be increasingly driven by the data they have shared with a company. This bond strengthens with every customer interaction as does the quality of data. The really clever companies are the ones that will use this rich intelligence to simplify and focus their services – creating a uniquely individual customer experience.
And it doesn’t stop there. This challenge extends to the innovative use of new interaction and communication methods. For example, one of our Clustre member firms specialises in big data analytics and visualization. They have just teamed with another of our member firms specialising in the creation and delivery of video communications.
Together they have created a compelling solution for commercial bankers who want to produce instant personalised videos for their clients – programmes that incorporate deep and relevant “All” to “N” to “1” insights.
The goal is to create sharply focused, more informative communications. These videos package research and insights in a uniquely personal format. By linking the content of every video to a customised dashboard, individual viewers can directly select the insights and information they most want to receive. It is the ultimate in personalised communication.
Essentially, this is a self-service tool where an end-user within the business (e.g. a Corporate Relationship Manager) creates a video on a particular topic, wraps that video into a dashboard template and then broadcasts it to an audience (e.g. one or more clients).
Based on the subject matter of the video, the corporate banker can also upload various supporting data sets. The CMS for the tool allows the user to match the data to various 2D charting elements, such as line and bar charts. The video and associated charts can then sit within a dashboard template – instantly accessible via the customer’s browser.
What’s more, the tool enables the banker to link specific highlight points from the video to events in the data. These key data points are flagged up on the dashboard chart as the video runs. This provides a much more interactive customer experience during broadcast. Following broadcast, the customers can also interact with the data and forensically explore a topic.
This tool could, for example, be used to create content for Company Treasurers (the “All”), go on to tailor this for Treasurers in a given sector (the “N”) and then personalise it further for an individual company Treasurer (the “1”). For instance, it could reveal how a particular company compares to the rest of its sector on a very specific issue. In short, this tool can tell an individual Treasurer some industry-wide things they might want to know, some things they might want to know about their particular sector and even some deeply personal things they might want to know about themselves. Clever stuff.
But can it feed the imagination and suggest a chocolate fudge cake? Sadly, that is an altogether stickier challenge.
Andrew Simmonds – Clustre