Big Data

Who are my Most Important Customers?

Bill Schmarzo By Bill Schmarzo CTO, Dell EMC Services (aka “Dean of Big Data”) September 19, 2011

I was recently running a customer workshop on how big data and advanced analytics could power some of their key business initiatives. One of the participants, from the business side of the organization, looked at me and said that she only needed to answer three simple questions:

• Who are my most valuable customers?
• What are my most important products?
• What are my most successful campaigns?

The more I thought about these “simple” questions, the more I realized just how “not simple” these questions really were. Because of the new insights available from these new big data sources, companies are able to take these types of “simple” questions to the next level of sophistication and understanding.

Let’s look at the most valuable customer question. When we ask who are our most valuable customers, do we mean largest by revenue (which is how many companies today still define their most valuable customers)? Or do we mean the most profitable customers, contemplating more aspects of the customer engagement including marketing and sales costs, cost to service, returns and payment terms (which is how some of the more advanced companies think today)? Or by adding social media into the mix, do we now mean our most influential customers, and the value associated with their circle of friends?

Companies are learning that their most profitable customers may not actually be their most valuable customers because of the net influencer effect that they have on a larger community of customers, and the profitability of the “baskets” associated with that community of customers. Same with the most important product question, which retailers have understood for quite a while now (think loss leaders like milk that drive store traffic even though they don’t drive much in the form of profits), and consumer good manufacturers understand as well (think category strategies and the use of flanking products to protect their premium-priced core products).

Those nebulous and hard to define words like valuable, important and successful allow the business users to move beyond just financial measures, and to consider the entirety of the contributions those customers, products and campaigns make to the business. It is the basis for a more engaging business discussion about what data sources could be valuable in defining “valuable” and what analytic models could be used to quantify “valuable.” It’s the basis for a wonderful conversion that we can have with our clients about defining those valuable, important and successful words in light of what big data and advanced analytics can bring to the table.

The business opportunity embedded in big data analytics is extensive and it is imperative that organizations recognize its potential. This week, I will further touch upon big data analytics and its advantages in my speaking session titled “Do it Right – Proven Techniques for Exploiting Big Data Analytics” at the Strata Conference in New York City, Thursday September 22nd at 4:10pm.

Bill Schmarzo

About Bill Schmarzo


CTO, Dell EMC Services (aka “Dean of Big Data”)

Bill Schmarzo, author of “Big Data: Understanding How Data Powers Big Business” and “Big Data MBA: Driving Business Strategies with Data Science”, is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He’s written several white papers, is an avid blogger and is a frequent speaker on the use of Big Data and data science to power the organization’s key business initiatives. He is a University of San Francisco School of Management (SOM) Executive Fellow where he teaches the “Big Data MBA” course. Bill was ranked as #15 Big Data Influencer by Onalytica.

Bill has over three decades of experience in data warehousing, BI and analytics. Bill authored EMC’s Vision Workshop methodology that links an organization’s strategic business initiatives with their supporting data and analytic requirements, and co-authored with Ralph Kimball a series of articles on analytic applications. Bill has served on The Data Warehouse Institute’s faculty as the head of the analytic applications curriculum.

Previously, Bill was the vice president of Analytics at Yahoo where he was responsible for the development of Yahoo’s Advertiser and Website analytics products, including the delivery of “actionable insights” through a holistic user experience. Before that, Bill oversaw the Analytic Applications business unit at Business Objects, including the development, marketing and sales of their industry-defining analytic applications.

Bill holds a masters degree in Business Administration from the University of Iowa and a Bachelor of Science degree in Mathematics, Computer Science and Business Administration from Coe College.

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0 thoughts on “Who are my Most Important Customers?

  1. It will be a wonderful thing when companies in general embrace the concept of ‘most important customers’ as you describe it — it is so important to look beyond current ‘value’ (ie, revenue, or even profit) and include the less tangible elements such as the ones you describe, as well as future potential and opportunities for meaningful collaborations. Properly defining ‘most important’ will help companies allocate resources to build advantages in the right places.