dunnhumby-the genius company...

"Customers today are very disloyal; it is so hard to make them stick to us. How much ever you try, creating a loyal customer is just impossible."
"Well, maybe finding a loyal customer is very difficult, but can you tell me how loyal YOU have been to your customer?"

Now that's a very real conversation a dunnhumby consultant usually has with the CEO of a potential client. And CEOs don't like to hear that answer most of the time. But that is exactly how dunnhumby, a small and fast-growing Cincinnati marketing research and consultancy firm, is making money-for itself and for its clients. There are two things about dunnhumby in my mind that make them one of the best small companies in the US right now.

Insight

The data never lies (as long as you understand them). Many market research firms have access to huge databases, but very few of them have succeeded in creating “magic” out of it. One very powerful example they showed us was that of a huge US retailer- dunnhumby managed to show them (for the first time after 30 years of their existence) that around 2% of their customers contributed to almost 30% of their revenues and also who this 2% were. Now all the retailer had to do was to focus majority of its marketing dollars on that 2% to get the greatest return on investment. The beauty of the dunnhumby philosophy is that they go against almost every commonly (and often stubbornly) held paradigm in brand management, the most important one being-"The best way to make more money is to get more customers". They have proved that there is a better way of doing it-especially in fairly mature markets- and that is to make more out of existing customers, by really being loyal to them, by creating value for them over and over. Backed by a super-smart data analytics team they are able to achieve this goal through intimate knowledge of who each customer is (think of the granularity in a database of 40 million customers) and what value proposition would make sense for that customer. End result? The customer is happy, the retailer is happy and dunnhumby gets paid-everyone wins in this game!

People

When I visited the dunnhumby office, I could literally feel the energy in the air, every person I talked to was completely pumped up. They are so passionate when they talk about the kind of work they do. They love the impact they (as a ~300 employee company) are able to create in giants like Kroger (to see a more detailed analysis check out the case studies section in their website). The culture of the company is so open and friendly. Every employee (from the senior-most managers to the entry level worker) sit out in the open and people interact very freely with each other. The structure of the office itself is very different from a common office building and lends itself to a collaborative atmosphere. It is rated as one of the best companies to work for (in 2007) by The Sunday Times and I am definitely not surprised!

Company Website: http://www.dunnhumby.com/