Johanna Johansson is a blog contributor and Project and Business Development Manager at Telenor Sverige.  Johanna is also chairperson of the trade organisation for online marketing in Sweden.

Standing in line at the supermarket, it can be an amusing exercise to try figure out something about the people in front of and behind based on what they have in their carriages. How many cats does she have to need all that Purina? Is he throwing a party or planning to eat those tubs of ice cream by himself…

Curious cashiers, I am sure, must wonder about people’s personalities, families, and living situations based on their purchases. It is precisely this kind of analysis, however, that is a serious task for any company working with customer data.

Every company has some level of customer data. It could be a purchasing behavior; it could be basic demographic behavior. But how can a company take the quantitative information that they regularly gather and use it as a competitive advantage? It is the knowing of the data and interpreting the data in a way that corresponds to user behavior and attitude that can make it a unique and competitive advantage.

I would assume that most companies today are using customer data just to make brief segmentations. Whenever they have a campaign coming out or a newly launched product, they segment the customers and target some of them with an offer. But if they were to take a more customer-centric approach, they would focus on building loyalty with the customer on the customer’s terms. So, instead of trying to segment the customer base to fit the campaign, they would create products and services that would be tailored to specific customers to begin with. It is a matter of turning their approach outside in, so that their understanding of the customers becomes the guiding light towards better serving them.

The primary barrier for adopting this approach is organizing and creating processes appropriate for this type of a mindset. The way most companies operate today is that they have their product; they do a one-off campaign; they broadcast to different media like TV, radio, print, to a large population; and then they hope that some people will be attracted to it. It becomes almost like a lottery.

What we know today that we didn’t realize decades ago is that users are being influenced continually, not necessarily by the broadcast messages, but mostly by their friends and the people that they trust. They can trust companies, they can trust friends, they can trust family, but all of these different influences are as important as a company’s own message, so they always need to be taken into account. And when all the customer data is available, if you have the correct tools to see the correlations, the whole picture starts to become clearer.

Ultimately, it comes down to the need to create an organization that adapts to a new way of thinking. We have to ask ourselves “How can we make these customers even more loyal and valuable for us?” rather than “How can we make this product more profitable?” This customer-centric approach towards product development will be required in the future for all industries.

Last but not least, transparency is essential for this approach to work. It is critical not only that companies obtain users’ consent to utilize their information, but that they explain how they intend to employ it. Most users would agree to give out some personal information in exchange for having good services that are continually updated and improved according to his or her behavior and preferences. It is a fair agreement between the parties, one of which is giving out its information in exchange for receiving a better experience, a better product, or something that is improved and based upon customer demands.