Using Analytics to Improve Customer Engagement

Organizations that turn data into insights are gaining competitive advantage through improved connections with consumers.

by: Sam Ransbotham and David Kiron

For many U.S. farmers, improving agricultural productivity while meeting consumer demand to reduce the use of pesticides and chemicals on crops became a goal during the 2000s. To help farmers manage pests, plant diseases, weather conditions, and yields, dozens of startups emerged to offer apps and data services — part of a precision agriculture boom. Many of these companies failed or struggled as data alone proved insufficient; farmers also needed help interpreting the data. By 2016, a new variety of data-oriented service providers was helping farmers apply their harvested data.

For example, WinField United, the seed and crop-protection division of Land O’Lakes Inc., helps farm operators analyze millions of data points from multiple sources, to boost per-acre production. WinField United taps sources such as controlled experiments at test farms, performance data gathered from sensors provided by equipment manufacturers, and extensive weather data. Analytical and decision-support tools use these myriad data sources to present individualized recommendations to the company’s customers. The analytics helps grow more than crops; it fosters loyal relationships with core customers in the process.

According to Teddy Bekele, WinField United’s vice president of agricultural technology, there is a great disparity in the use of technology and analytics among farmers. But for active adopters, the return on investment can be dramatic. “We are working with farmers who were averaging about 150 bushels per acre but, after following our recommendations, are now producing 195 bushels — paying for their incremental investment five times over,” says Bekele.

By helping its customers achieve measurable gains, WinField United strengthens the bonds it has with them, deepening customer engagement. “Farming is very relationship-based, so, on top of the data, our goal is to get them to say, ‘WinField United is giving me the right advice and helping me make the right choices,’” says Bekele. Analytics is helping the company move from a strictly transactional relationship with its customers to one in which it is perceived to be a trusted adviser.

Winfield United’s program exemplifies heightened demand, across industries, for better customer engagement that depends on data and analytics.

About the Authors

Sam Ransbotham is an associate professor in the Information Systems Department at the Carroll School of Management at Boston College, as well as guest editor for MIT Sloan Management Review’s Data & Analytics Big Ideas initiative.

David Kiron is the executive editor of MIT Sloan Management Review.

Contributor

Allison Ryder, senior project editor, MIT Sloan Management Review

The authors conducted the research and analysis for this report as part of an MIT Sloan Management Review research initiative sponsored by SAS.

To cite this report, please use:

S. Ransbotham and D. Kiron, “Using Analytics to Improve Customer Engagement,” MIT Sloan Management Review, January 2018.

Acknowledgments

Kathy Ball, data management manager for exploration and production analytics, Devon Energy Corp.

Riccardo Baron, vice president and senior quant analyst and casualty modeler, Swiss Re AG

Bruce Bedford, vice president of marketing analytics and consumer insights, Oberweis Dairy Inc.

Teddy Bekele, vice president of agriculture technology, WinField United

Lori Bieda, head, Analytics Centre of Excellence, Personal and Business Bank, Canada, Bank of Montreal

Kristen D’Arcy, head of performance marketing and media, American Eagle Outfitters Inc.

Anindya Ghose, professor of business, Stern School of Business, New York University

David Gumpert-Hersh, vice president, business analytics group, Wescom Credit Union

Arthur Hu, chief information officer, Lenovo Group Ltd.

Glenn Kelman, CEO, Redfin Corp.

Gerhard Kress, vice president of data services, Siemens AG

Carl Marci, chief neuroscientist, Nielsen Consumer Neuroscience, Nielsen Co.

Christopher Mazzei, global chief analytics officer and global innovation technologies leader, EY

Janette Smrcka, director of information technology, Mall of America

References

1. S. Ransbotham, D. Kiron, and P.K. Prentice, “Beyond the Hype: The Hard Work Behind Analytics Success,” MIT Sloan Management Review, March 2016.

2. S. Liss, “Amazon Gains Wholesale Pharmacy Licenses in Multiple States,” St. Louis Post-Dispatch, Oct. 27, 2017.

3. M.J. de la Merced and R. Abelson, “CVS to Buy Aetna for $69 Billion in a Deal That May Reshape the Health Industry,” The New York Times, Dec. 3, 2017.

4. S. Ransbotham, D. Kiron, and P.K. Prentice, “The Talent Dividend: Analytics Talent Is Driving Competitive Advantage at Data-Oriented Companies,” MIT Sloan Management Review, April 2015.

5. Maturity categories are based on how respondents answered two questions about the extent to which their organizations use analytics to gain a competitive advantage and innovate.

6. L. Winig, “A Data-Driven Approach to Customer Relationships,” MIT Sloan Management Review, October 2016.

7. S. Parakilas, “We Can’t Trust Facebook to Regulate Itself,” The New York Times, Nov. 19, 2017.

8. T. Mennesson, “The Coming Consumer Data Wars,” MIT Sloan Management Review, August 2017.

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