If the founders of Netflix had only listened to their customers in 2007, when Netflix was a respectable business renting out DVDs online to 7 million members, they would’ve wholeheartedly made the switch to blu-ray. This strategic choice based on internal data would’ve undoubtedly led to more profit and new customers. Reed Hastings and Marc Randolph chose an entirely different route all the same: they launched a new service that meant their customers no longer received physical media but could stream via the Internet. This was a choice that resulted in a threefold growth in customers over three years.
Internal data shows exactly how you did today or yesterday
The concept that the customer is the main focus has, by many organizations both small and large, been translated into the need for investment in smart CRM and sales solutions, Google Analytics accounts and quantifiable customer service. A slice of business intelligence that produces valuable customer data: internal customer insights that tell you exactly what your turnover is, how many visitors your website attracts every month, how the visitor navigates the space within your online walls, whether they are satisfied and - if you do it right - what they want and need.
External data tell you where your customer is heading next
However, these very customer insights won’t tell you a thing about tomorrow. Nothing about trends and developments in the market or the way your competitor is manoeuvring. And there is no insight at all into the wishes, interests and dreams of your audience. If Reed and Randolph had listened only to their existing customers in 2007, they would’ve made these customers very happy with the latest technology. But the outside world expressed other wishes, which they managed to map, so that it became the basis for these gents taking a different route altogether.
Know your customers’ needs and wishes without asking
Being - and staying - relevant and current, today as well as tomorrow: that’s what external focus is all about. External big data, market insights on the basis of search and orientation behaviour, provide answers to questions such as: What is my target group looking for? Where are people searching online? And what are the trends and developments within my market? It is impossible to answer these questions using only internal data.
What about customer insights? Their value remains undiminished: essential as a building block for loyal customers. After all, even Netflix, number one streaming platform, still has almost 4 million DVD subscribers. Why? Because over 34 million Americans are still without broadband Internet. And because all their 200 million customers are just as valued as their fresh views on everything outside their customer base.