Superior insights groups sit decisively outside marketing and other functions and often report to someone
in the C-suite—the CEO, the chief strategy officer, or
the chief experience officer. The i2020 research shows
that insights leaders in overperforming organizations
report to these senior executives more than twice as
often as their counterparts in underperforming organizations do (29% versus 12%). Kantar Vermeer’s work
with dozens of firms across industries indicates that
this number is increasing, and we expect that in time
this will be the typical arrangement.
At Unilever, Stan Sthanunathan reports to a
member of the executive board—coauthor Keith
Weed, who leads marketing, communications,
and sustainable business functions. This reporting
structure makes CMI a fully independent function
with direct lines to the CEO. In this position, CMI
can be objective, collaborate on an equal footing
with other functions, and challenge or even set the
direction of functional and organizational projects
Take CMI’s push to make advertising pretesting a
standard procedure. Because Unilever is the world’s
second-largest media spender, improving advertising performance by even a few percentage points can
translate into hundreds of millions of dollars in reduced costs and new revenue. And yet in the past, ads
were often launched without hard data about their effectiveness. To change that, CMI implemented a disciplined testing program; using consumer surveys and
software that reads facial expressions, the CMI team
can now see if people find the ads authentic, relevant,
and conversation-worthy—before they’re aired. Poor
ads are killed while powerful ones are given the go-ahead, and CMI collaborates with marketing to boost
their performance. Ad creators originally saw the testing program as a threat to creativity and resisted it. But
it proved so effective that marketers now embrace it,
knowing that it helps them do their best work and that
successful ads figure into their bonus computations.
CMI’s independence is enabled by having autonomy over its own budget, a mandate to drive
business performance, and accountability for helping other functions achieve business targets. Thus
when CMI recommends, for example, extending a
brand into new local markets, it works in close partnership with marketing on the strategy and execution, because falling short would be as much CMI’s
responsibility as marketing’s.
HBR.ORG BUILDING AN INSIGHTS ENGINE
ABOUT THE INSIGHTS2020 RESEARCH
To understand the organizational strategies, structures,
and capabilities required to drive customer-centric growth,
a global team launched the Insights2020 initiative in 2015.
Researchers conducted in-depth interviews with more than 350 business,
marketing, and insights and analytics (I&A) leaders, along with online surveys of
more than 10,000 practitioners in 60 countries. Kantar Vermeer led the project in
partnership with Esomar, the Advertising Research Foundation, LinkedIn, and Korn
Ferry. The Wharton School engaged an expert panel to validate and extend the
research, and an analysis of LinkedIn’s 400-million-member database discerned
the interaction behaviors of executives at the most customer-centric firms.
Respondents were divided into two groups—overperformers and
underperformers—on the basis of their companies’ three-year revenue growth
relative to their competitors’. The firms were then compared across an array
of marketing and I&A dimensions. The results confirmed a strong correlation
between customer centricity and revenue growth and identified the essential
features of high-performing, customer-centric organizations. These fell into
three broad categories: a superior ability to provide a consistent, personalized,
meaningful experience across all touchpoints; a singular commitment from
every department to meeting customer needs; and the presence of an insights
engine—typically an independent I&A function that participates fully in business
planning and organizational strategy. Of these three categories, the insights
engine—the focus of this article—had the largest impact on revenue growth.
Further analysis revealed the 10 characteristics of superior insights engines
detailed in this article. To gauge your firm’s performance on each characteristic
and see how you compare to average and top-performing organizations, try out
the Insights2020 benchmarking tool here: www.Insights2020.org/Benchmark.
For most companies, the business- and brand-planning cycle is the driving force behind strategy
development and execution. This is where decisions are made about where to play and how to win.
And it’s here that resource allocation and budgeting are formalized and performance is monitored
against goals. If insights groups are to help drive
strategy, their activities must be aligned during the
planning cycle with those of strategic planning, marketing, finance, sales, and other functions. That’s
why substantially more overperforming firms than
underperforming ones (61% versus 46%) include insights leaders at all key stages of the planning cycle.
We find that insights-function involvement in the cycle varies by industry; it’s especially strong in retail.
Here’s how CMI participates in the planning
cycle: “Where to play?” is fundamentally a question
of where to direct growth investments—in existing,
adjacent, or new markets. To help determine this,
CMI uses a bespoke software tool called Growth
Scout, which mines millions of data points on consumer demand across demographics, regions, and
countries to quantify the potential value of deeper
category or brand penetration. A typical application
might be to gauge the impact of, say, increasing the