We’re in an age when what customers think — and do — matters more than any other business factor, and so the gold rush of customer insights is on. While tactics continue to evolve as firms develop more sophisticated approaches, one thing is certain: Companies that are advanced at being insights-driven outcompete the majority of less insights-mature firms by a wide margin.

35% of firms will go beyond surveys to capture customer feedback.

2020 will see changes in technology choices, insights sources, and approaches to deriving customer insights, but only some firms will succeed. Here are three of our predictions for 2020:

  1. Customer alienation from survey overload will increase firms’ analytics efforts by 20%. Firms drown their customers in survey requests to gain insights into experience quality. Many customers submit themselves to this process, hoping for better experiences. But firms have rewarded these customers poorly: Customer experiences haven’t gotten better for three years. By the end of 2020, we’ll see the backlash: More firms will see declining response rates as disappointed customers snub the ubiquitous feedback requests. As the ROI of surveys decreases, the portion of firms that go beyond surveys will increase. These firms will add data science and analytics skills to their customer experience (CX) teams. And they’ll invest in text and speech analytics technologies to mine data from customers’ digital and call-center interactions to understand customer sentiment.
  2. Firms will try to build in-house consumer insights platforms — but many will falter. Rather than rely on third-party technologies or services, brands and agencies alike will acquire tech to create internal business- or customer-insights capabilities. While B2C firms are increasing their use of external help for customer analytics, intelligence, and insights strategy, we saw 21% growth from 2018 to 2019 for bringing customer insights execution in-house. Theoretically, this allows firms to be more agile and innovate faster against customer needs. But this in-house movement will stall when companies realize they don’t have the technical or analytic chops to maintain sophisticated insights systems long-term: Forrester expects that half these efforts will falter.
  3. Forty percent of firms will launch a data literacy lifeline by 2020 to ensure survival. The desire to become insights-driven is universal, but so is the struggle to execute. Most business leaders still rely on experience, “gut feeling,” or opinions when making decisions — only 48% of decisions are made based on quantitative information and analysis, a stat that has changed little in the past few years. Some employees feel left behind, alienated by data and technology they don’t understand. Others worry about dependencies on the work of employees who are less skilled with data. Firms will create formal programs to promote greater data literacy across all roles in an organization — those who capture information but might not recognize it as data, those who work with data to deliver insights, and those who must make critical business decisions based on insights.

The firms that have succeeded at deriving customer insights — and taking immediate action based on them — have raised the bar for insights-driven CX. Customers’ expectations for improved experiences keep rising. As companies scramble to improve their data and analytics competencies to meet those expectations, they’re pursuing new tech, organizational changes, and data — lots of data, from new and different sources. But a word of warning: The resulting increase in data hunting will run smack into the countertrends of creating data broker registries in the US and global anti-surveillance sentiment and tech innovation to limit access to data. In 2020, we’ll see the battle for more data versus regulation and privacy heat up considerably.

For more customer insights predictions, read our full report. To understand the major dynamics that will impact firms next year, download Forrester’s Predictions 2020 guide.