In early 2020, shortly before the emergence of the novel coronavirus pandemic, a team of XP executives went to China to learn firsthand about some of the world's most innovative companies.
They visited tech giants like Tencent and Alibaba, as well as startups that, despite being newly established, already had millions of customers and generated billions of dollars in revenue.
During the meetings, each company was asked what its main competitive advantage was. The answer was virtually the same everywhere: their greatest asset was customer data.
“The Chinese emphasized that, with data, they can provide the best possible experience and be more efficient in the offers they make to customers,” recalls Renato Cunha, Chief Strategy and Transformation Officer at XP Inc.
The obsession is so great that, according to Cunha, some companies enter new businesses simply to capture more data and information from consumers and, thus, generate additional value for their activities.
The visit to China yielded positive results for XP. The number of professionals dedicated to data at XP has now surpassed 200 people.
“Obviously, XP already had a data agenda before the visit to China, but after that we realized it needed to be accelerated,” says Cunha. “Nowadays, it has evolved within the company's own transformation process.”
The number of data professionals at XP has already surpassed 200 people.
XP has indeed changed a lot in recent years. The company has grown explosively and entered several different businesses, such as credit, insurance, and payments. To support such rapid growth, it was necessary to transform the company. How was this done?
“XP needed to have a very robust backbone to remain dominant in the various verticals in which it operates,” says Cunha. “One of the key points was understanding that we should be increasingly customer-centric.”
In this sense, data plays a crucial role. It helps to better understand the customer, and it is from this data that the best possible product can be defined for each specific profile.
Cunha points out the direct benefits of effectively applying data to customer experience. The main one is personalization: by capturing customer information, the company can make a more informed – and therefore more assertive – product offer.
This concept fits within what XP calls the Next Product to Buy. The company has hundreds of investment products, and each client has a risk profile and an investment policy. Through intelligent data analysis – and only through it – the company can determine, with a good degree of accuracy, which product would make sense for the client to acquire next.
Through intelligent data analysis – and only through it – the company can determine, with a good degree of accuracy, which product would make sense for the customer to buy next.
“In our app, for example, we already have product recommendations that perfectly match a specific customer's profile,” Cunha points out.
Regarding customer experience, efficient data management can bring other benefits. "When a person browses the website, I can identify which topics they like most and then create tools that improve their level of engagement," explains Cunha.
It doesn't happen overnight for a company to become data-driven. It requires a cultural shift and organizational changes.
Starting in 2020, XP began creating business units that brought together several multidisciplinary teams. They have the autonomy to develop end-to-end products, from conception to market application – exactly how the world's largest technology companies, such as Facebook and Google, operate.
The data team doesn't operate in isolated areas, but rather in conjunction with other business segments of the company. Therefore, they need to be involved in missions that, in some way, generate value for the company and, consequently, for its clients. At XP, it's worth noting that it's common for data scientists and engineers to work side-by-side with sales teams.
“Our ambition is that, when asked what area they work in at XP, employees of any specialty will answer that they are involved in the mission of delivering product X to client Y in the best possible way,” Cunha concludes.