In theory, customers would be at the heart of every business. In practice, there’s a real tension that between business interests and customer needs and wants. All customers want great quality, service, and functionality at the lowest possible price, but businesses exist to deliver a return to their shareholders. So although most businesses start out with a focus on customer needs, bit by bit their attention shifts to profitability, operational efficiency, what their competitors are doing, etc, etc, etc. Over time they become less customer-centric and more company-centric or competitor-centric.
The rub, of course, is that for every business that does not pay close attention to customer needs, there is a competitor who does. And no matter how efficient a business is, unless it produces what customers want to buy it will not be successful over the long term.
Businesses that recognise and respect that tension, however, improve their profitability by adopting a customer centric strategy. By looking at every problem or opportunity from the point of view of the customer, the business gains new market insights and is better able to compete. They remember that the customer always has a choice.
Today’s renewed focus on being customer-centric is due to globalization and the internet, and the increased choice that customers now have as a result. Power has shifted away from the salesperson having all the knowledge, to the customer. An hour’s desk research now produces a list of suppliers in any given market, as well as a host of unbiased, real-life consumer reviews of how well the company or product performed when used in anger. When customers make an important purchase, they can spend as much time as they want researching their options and are quite likely to know more about it than any salesperson. The company that wins their business will offer the best value for their particular situation – whether they are looking long term or short term, whether they want something cheap and cheerful, or something they expect will last a lifetime.
So being customer centric means putting the customer at the heart of decision making and planning; being aware of different customer needs, and catering to a specific segment. Apple has done this to stunning and profitable affect.
Showing posts with label customer focus. Show all posts
Showing posts with label customer focus. Show all posts
Wednesday, 24 August 2011
Wednesday, 20 July 2011
How to Listen
- Pay attention
- Don’t talk
- Don’t think about your reply while the other person is still speaking
- Pause before replying
- Think about what the other person has said
- If it’s helpful, say back to them what you understood they said
Wednesday, 20 April 2011
Customer delight .. and customer dismay
Thinking about being customer focused has made me a lot more aware of how some companies behave and a few recent examples seem noteworthy.
Just a few days ago, I wrote to company that assists me when my car breaks down to enquire whether their service has VAT on it or not. There is no mention of it on the invoice, but I assumed it must. A few other folk had wondered too and posted things on the internet. One such person had a reply saying that a VAT invoice would cost him £15. He was outraged and complained vigorously. I sent a polite email enquiring about a VAT invoice. They informed me that it would cost £15 for a VAT invoice, but made no mention of whether there was VAT on their service. There isn’t. It would have been easier (and shown some thought for the customer) to just say so. I don’t think that is customer-focused; to the point of being obstreperous. It’s a good job their roadside manner is so superb.
On the plus side, I recently had my hair done at a new salon. On the morning of the appointment they called me. O-oh I thought. My heart sank as I envisaged the stylist being ill, or changing the day, or the usual reasons that hairdressers call. No. It was none of those reasons. As my appointment was at lunch time they wanted to know if I wanted a complimentary sandwich. I was literally speechless for a moment or two. I then recovered and said “Yes please – a salmon one”. How customer focused are they? They totally understand the stresses of their customers getting their hair done in the lunch hour. I was one delighted customer - who is telling ALL her friends!
Then today I had reason to return a bottle of booze to my local supermarket. They are part of a company which prides itself on not selling more expensive than the competition. And advertises the fact. When I pointed out that another supermarket was selling it for £5 less (I’m not making this up) they said – "that doesn’t apply to us!" Not – “we will make sure we check it out”. Or, “thank you for telling us”. But with a solemn face – “that doesn’t apply to us”. I’ll be watching their prices a lot more carefully in future.
Now “the customer is always right” doesn’t mean that the customer IS always right. Many customers belly-ache about bad service but still go back. Perhaps because the product is so good or perhaps because they have no choice. But when a company comes along with a good product, and little ways of delighting their customers, the customer switches without a backwards glance.
These instances show something of these companies attitude to their customers. Funnily enough the hairdresser is expanding, taking over the city-centre premises next door, and taking on more staff. Coincidence? Maybe. But there again, maybe not.
Just a few days ago, I wrote to company that assists me when my car breaks down to enquire whether their service has VAT on it or not. There is no mention of it on the invoice, but I assumed it must. A few other folk had wondered too and posted things on the internet. One such person had a reply saying that a VAT invoice would cost him £15. He was outraged and complained vigorously. I sent a polite email enquiring about a VAT invoice. They informed me that it would cost £15 for a VAT invoice, but made no mention of whether there was VAT on their service. There isn’t. It would have been easier (and shown some thought for the customer) to just say so. I don’t think that is customer-focused; to the point of being obstreperous. It’s a good job their roadside manner is so superb.
On the plus side, I recently had my hair done at a new salon. On the morning of the appointment they called me. O-oh I thought. My heart sank as I envisaged the stylist being ill, or changing the day, or the usual reasons that hairdressers call. No. It was none of those reasons. As my appointment was at lunch time they wanted to know if I wanted a complimentary sandwich. I was literally speechless for a moment or two. I then recovered and said “Yes please – a salmon one”. How customer focused are they? They totally understand the stresses of their customers getting their hair done in the lunch hour. I was one delighted customer - who is telling ALL her friends!
Then today I had reason to return a bottle of booze to my local supermarket. They are part of a company which prides itself on not selling more expensive than the competition. And advertises the fact. When I pointed out that another supermarket was selling it for £5 less (I’m not making this up) they said – "that doesn’t apply to us!" Not – “we will make sure we check it out”. Or, “thank you for telling us”. But with a solemn face – “that doesn’t apply to us”. I’ll be watching their prices a lot more carefully in future.
Now “the customer is always right” doesn’t mean that the customer IS always right. Many customers belly-ache about bad service but still go back. Perhaps because the product is so good or perhaps because they have no choice. But when a company comes along with a good product, and little ways of delighting their customers, the customer switches without a backwards glance.
These instances show something of these companies attitude to their customers. Funnily enough the hairdresser is expanding, taking over the city-centre premises next door, and taking on more staff. Coincidence? Maybe. But there again, maybe not.
Tuesday, 19 April 2011
How Customer Focused are you?
We all like to think that our businesses are customer-centric, just as we are all convinced we are good drivers. Yet the numbers of dissatisfied customers, like the number of accidents on the roads, points to the story being a little different
Customers are always right; they are the ones with the budget, the choice and a world full of connected information. And because their choices determine the success of our businesses, it pays to focus on what the customer wants. And needs. And is prepared to pay for.
But how do we know whether we are customer focused? Or whether our business is customer focused? What metrics determine our ability to focus on what the customer wants? As always in business, actions speak louder than words:
What do you think defines a business that is truly customer focused? What would you measure if you were CEO of Barclays bank, Coca-Cola or the Virgin empire?
Customers are always right; they are the ones with the budget, the choice and a world full of connected information. And because their choices determine the success of our businesses, it pays to focus on what the customer wants. And needs. And is prepared to pay for.
But how do we know whether we are customer focused? Or whether our business is customer focused? What metrics determine our ability to focus on what the customer wants? As always in business, actions speak louder than words:
- Customer lifetime value (rather than one year, or the typical but arbitrary three years)
- Revenue by product/service (if they don’t like it, they won’t buy)
- Repeat purchases (you might get ‘em once, but dreadful service or lousy products don’t create fans who come back time and time again)
- Number of complaints & number of customers won back from problems
- Number of recommendations
- Number of unsolicited letters of delight
- Time since last purchase
- Time since last meaningful discussion
What do you think defines a business that is truly customer focused? What would you measure if you were CEO of Barclays bank, Coca-Cola or the Virgin empire?
Wednesday, 9 February 2011
Mad Men: lessons from episode one
Despite dropping too many hints to everyone I know and I few people I do not, no one bought me Mad Men Series 1-3 for Christmas. A disappointment that could only be rectified by an overnight Amazon Prime delivery. Needs must (sigh). The 1950’s would have been as shocked by Amazon as we are at their bad boy attitudes.
The opening episode saw the heart-stoppingly suave Don Draper fretting about cigarette advertising. Readers Digest say that cigarettes might be bad for you. His Lucky Strike executives are coming in for a creative meeting. He has no idea what to do. Draper is in a fix.
He does two things that are instructive. Firstly, he talks to people about smoking; anyone, anywhere. Because he is Don Draper and he spends a lot of time in bars, he talks to the waiter who offers low-key but pertinent insights. Secondly, he talks to his scary research lady about her scary research.
In the meeting, when the client turns to hear his brilliant ideas, he still hasn’t got a clue what to suggest. He thinks the research is stupid, and the problem insolvable. Why would anyone buy something that might harm them?
Of course, we know the answer to the conundrum. People don’t care that cigarettes are dangerous. They just want to enjoy one of life’s pleasures; which Draper figures out just in time to keep the account. He lets every other cigarette be dangerous - Lucky Strike is the one that contains “toasted tobacco”.
As it turns out, the research was absolutely right and what Draper had discarded turned out to be the key to unlocking his creativity. Although Mad Men is fiction (or is it?) it is based on (some) real people and very real advertising and marketing issues. Which is perhaps what makes it so watchable.
Many great advertising and marketing people have pointed out that you need to understand both your product and your market in order to come up with a compelling proposition. Draper makes it look easy, Ogilvy admitted it was hard work and tedious. Both knew it was necessary.
The opening episode saw the heart-stoppingly suave Don Draper fretting about cigarette advertising. Readers Digest say that cigarettes might be bad for you. His Lucky Strike executives are coming in for a creative meeting. He has no idea what to do. Draper is in a fix.
He does two things that are instructive. Firstly, he talks to people about smoking; anyone, anywhere. Because he is Don Draper and he spends a lot of time in bars, he talks to the waiter who offers low-key but pertinent insights. Secondly, he talks to his scary research lady about her scary research.
In the meeting, when the client turns to hear his brilliant ideas, he still hasn’t got a clue what to suggest. He thinks the research is stupid, and the problem insolvable. Why would anyone buy something that might harm them?
Of course, we know the answer to the conundrum. People don’t care that cigarettes are dangerous. They just want to enjoy one of life’s pleasures; which Draper figures out just in time to keep the account. He lets every other cigarette be dangerous - Lucky Strike is the one that contains “toasted tobacco”.
As it turns out, the research was absolutely right and what Draper had discarded turned out to be the key to unlocking his creativity. Although Mad Men is fiction (or is it?) it is based on (some) real people and very real advertising and marketing issues. Which is perhaps what makes it so watchable.
Many great advertising and marketing people have pointed out that you need to understand both your product and your market in order to come up with a compelling proposition. Draper makes it look easy, Ogilvy admitted it was hard work and tedious. Both knew it was necessary.
Monday, 17 January 2011
Work with your hands, and all you get is dirty hands
Until very recently, increasing efficiency meant creating a software system to store relevant information about part of your business. Instead of doing the job manually, or on spreadsheets, it went into a database system. Software systems improve productivity and efficiency, whether it is linked to other aspects of a company’s work (ERP) or stand-alone.
It is a hugely successful approach that all businesses have embraced.
The focus on these projects is the data that needs to be stored in the system. If you put the right information in, we thought, you will get the right information out. The only problem is that all the emphasis went on putting information in, and hardly any focus was on understanding the data.
As the big system trends, such as accounting, CRM and ERP, are becoming more mature, we are now turning our attention to what all this information means. And increasingly we are finding that it is not as self-explanatory as we thought.
Firstly, data isn’t neatly together in one place. Rather, it is in a number of different systems that were created at different times for different reasons.
Secondly, traditional system reports are geared towards efficient systems, not business insight.
Thankfully, a new generation of software tools is coming to the rescue. They are focussed entirely on finding meaning from existing data and are priced to be attractive to businesses of all sizes. For example, Microsoft’s SQL Server Integration Service, Analysis Services and Reporting Services are included in all versions of SQL Server from 2005 at no extra cost.
This changes the nature of business competition. As well as having products and services that customers value, which you can produce cost effectively, visionary businesses are looking at their systems to find new insights and meaning within customer information. And they are using those insights to improve the value they provide to customers.
It is a logical next step. We’ve all spent 25 years creating software systems; now it’s time to use that information profitably. As my father is fond of saying, if you work with your hands, all you get is dirty hands. But if you work with your head ....
It is a hugely successful approach that all businesses have embraced.
The focus on these projects is the data that needs to be stored in the system. If you put the right information in, we thought, you will get the right information out. The only problem is that all the emphasis went on putting information in, and hardly any focus was on understanding the data.
As the big system trends, such as accounting, CRM and ERP, are becoming more mature, we are now turning our attention to what all this information means. And increasingly we are finding that it is not as self-explanatory as we thought.
Firstly, data isn’t neatly together in one place. Rather, it is in a number of different systems that were created at different times for different reasons.
Secondly, traditional system reports are geared towards efficient systems, not business insight.
Thankfully, a new generation of software tools is coming to the rescue. They are focussed entirely on finding meaning from existing data and are priced to be attractive to businesses of all sizes. For example, Microsoft’s SQL Server Integration Service, Analysis Services and Reporting Services are included in all versions of SQL Server from 2005 at no extra cost.
This changes the nature of business competition. As well as having products and services that customers value, which you can produce cost effectively, visionary businesses are looking at their systems to find new insights and meaning within customer information. And they are using those insights to improve the value they provide to customers.
It is a logical next step. We’ve all spent 25 years creating software systems; now it’s time to use that information profitably. As my father is fond of saying, if you work with your hands, all you get is dirty hands. But if you work with your head ....
Wednesday, 1 December 2010
The Customer Intelligence Journey
When I started my career I couldn’t understand why EVERYONE didn’t want to be in marketing! To my way of thinking, it was the central activity for any company. Despite a long career in or close to the marketing function I still feel the same way.
Without marketing, no one knows about your product or service. Without marketing, no one knows how your product or service might help them. Without marketing you have no business.
Yet marketing has become more complex over time. The emergence of the internet and social media mean that would-be customers have many more options to familiarise with your product and service, as well as your competitors’ products and services. And alternatives to both. Today’s purchaser has the opportunity to be better informed on a wider variety of subjects than ever before.
Marketing people are slowly waking up to the fact that whilst the consumer is getting more clued up, so, perhaps, should they. They are starting to think about how much they know about their customers and prospects; and beginning to realise that it’s less than they thought.
It’s not that the information isn’t there. No. It’s just that the information is all over the place: in different systems, in different departments, in different formats. It hasn’t been entered correctly, or checked. It hasn’t been cared for in the way that someone might care for something that is REALLY VALUABLE!
The Customer Intelligence journey is that of starting to understand your customers and prospects by looking at the information you have, as well as the gaps: and starting to make some sense of it all.
It’s a journey because getting to know people is an on-going process. A process that requires smart use of today’s sophisticated technologies, and a process that requires a different way of thinking about what’s important in business. A process that starts to put customers at the centre of things.
A place I’ve always felt they belonged.
What’s your experience of understanding your customers and prospects from data within your company? Have you started on the Customer Intelligence journey? Are you considering it? Leave a comment and join the conversation!
Without marketing, no one knows about your product or service. Without marketing, no one knows how your product or service might help them. Without marketing you have no business.
Yet marketing has become more complex over time. The emergence of the internet and social media mean that would-be customers have many more options to familiarise with your product and service, as well as your competitors’ products and services. And alternatives to both. Today’s purchaser has the opportunity to be better informed on a wider variety of subjects than ever before.
Marketing people are slowly waking up to the fact that whilst the consumer is getting more clued up, so, perhaps, should they. They are starting to think about how much they know about their customers and prospects; and beginning to realise that it’s less than they thought.
It’s not that the information isn’t there. No. It’s just that the information is all over the place: in different systems, in different departments, in different formats. It hasn’t been entered correctly, or checked. It hasn’t been cared for in the way that someone might care for something that is REALLY VALUABLE!
The Customer Intelligence journey is that of starting to understand your customers and prospects by looking at the information you have, as well as the gaps: and starting to make some sense of it all.
It’s a journey because getting to know people is an on-going process. A process that requires smart use of today’s sophisticated technologies, and a process that requires a different way of thinking about what’s important in business. A process that starts to put customers at the centre of things.
A place I’ve always felt they belonged.
What’s your experience of understanding your customers and prospects from data within your company? Have you started on the Customer Intelligence journey? Are you considering it? Leave a comment and join the conversation!
Wednesday, 24 November 2010
Basic human drivers
Good marketing and advertising reaches us at an emotional level, without us even realising. Or putting it a different way, it answers needs inside of us that we are not really aware of.
But what are our needs? What are the emotions that we respond to? I found a list of basic human drivers attributed to Dr Kevin Hogan, which I thought made rather interesting reading.
Do you agree or disagree with the list? Would you add or remove anything? Should marketing be considering such psychological factors? Comments, thoughts and debate all welcome.
Here’s the list: 16 basic human drivers
But what are our needs? What are the emotions that we respond to? I found a list of basic human drivers attributed to Dr Kevin Hogan, which I thought made rather interesting reading.
Do you agree or disagree with the list? Would you add or remove anything? Should marketing be considering such psychological factors? Comments, thoughts and debate all welcome.
Here’s the list: 16 basic human drivers
- Sex/romance
- Acquisition/saving
- Bonding/connecting
- Learning/curiosity
- Eating
- Defence/fight or flight
- Nesting
- Vengence
- Status
- Power
- Loyalty
- Order and organisation
- Independence
- Acceptance
- Altruism
- Physical activity
Subscribe to:
Posts (Atom)
Posts
