What Do You Really Know About Your Customer Base?

In this excerpt from their book, the authors ask some challenging questions and make the argument that to answer them, you’ll need to conduct your own customer-base audit.

We call this the customer-base audit.

As an organizational leader, you’ll be very familiar with your company’s key financial statements and monthly management reports. But what do you really know about the people who pull out their wallets and pay for your products and services? In The Customer-Base Audit: The First Step on the Journey to Customer Centricity (Wharton School Press, 2022), experts Peter Fader, Bruce Hardie, and Michael Ross start you on the path toward really understanding your customers’ buying behavior as well as the health of your overall customer base.

We’re not interested in the demographic profile of our customers. Were not interested in their attitudes. Were interested in understanding their actual buying behavior.

Another reason for failing to undertake these types of analyses is technological barriers, be they real or imagined: “We don’t have the data,” or “It’s too difficult to get the data.” That may have been true 20 years ago, but now it’s a rather hollow excuse. (If you are working in a digitally native company, you have no excuse!)

We believe that there’s a set of fundamental analyses that are foundational for any executive wanting to gain an understanding of the health of their organization’s revenue and profit streams and the feasibility of their growth plans.

Time and again, we’ve seen how insights derived from these descriptive analyses can have a profound effect on a firm’s operations.

If you’re struggling to answer these questions, you are in good company. In our experience, most senior executives are unable to do so, regardless of whether their organization is primarily B2B or B2C, sells products or services, or is a for-profit or nonprofit.

A nonprofit supported by charitable donations may want to perform the associated analyses for both its financial supporters and the people it serves through its charitable activities. The same applies to two-sided markets, such as Airbnb, that often view both their constituencies (e.g., hosts and guests) as different kinds of customers.

Excerpted from The Customer-Base Audit: The First Step on the Journey to Customer Centricity, by Peter Fader, Bruce Hardie, and Michael Ross. Reprinted by permission of Wharton School Press.

As a senior executive, you have spent countless hours discussing budgets and expenditures. Focusing on the top line of the income statement, you’ll probably have looked at sales by product line and geography. Quite possibly you have looked at product profitability as part of a product line rationalization exercise.

So please consider turning off your ad blocker for our site.

Quality Digest

منبع: https://www.qualitydigest.com/inside/customer-care-article/what-do-you-really-know-about-your-customer-base-081723.html