In a world where competition is rife and growth is hard to come by, many brands have sought to embrace more customer centric approaches, or move towards customer obsession as a way to re-orient their business to remain relevant - and for good reason. Recent research by Forrester has found that customer obsessed businesses experience 2.5x higher revenue growth than those who aren’t customer obsessed -and customers are 1.4x more likely to trust a customer obsessed brand.
Despite the benefits however, Forrester research also found that companies today are no more customer obsessed than they were 5 years ago, meaning despite all of the hype and talk many businesses have struggled to move the agenda forward within their businesses.
A good idea that’s difficult to execute on
"Customer obsession is the good idea that is easy to agree with but hard to do" Shar VanBoskirk, Forrester Vice President and Principal Analyst
To be customer obsessed requires an organisation to put the customer at the centre of an organisations business strategy. It requires a fundamental re-think of the enterprise strategy, its operations, and its culture in order to deliver on an approach that puts the customer at the centre of decision making.
To become customer obsessed is no easy feat and often falls short due to:
A lack of strategic clarity: many identify customer obsession as a key strategic differentiator but fail to create the clarity around what customer obsession means in practical terms for the organisation. Without that clarity employees are left to decipher what they believe to be important and what they think is being asked of them.
Lack of real desire to change: whilst many want to reap the rewards, few have the real desire to change, lacking a catalyst to force the business to re-orient.
Short-termism: customer obsession wains quickly as benefits aren’t realised in the short term. Many fail to understand that re-orienting the business is a long term strategy not a short term tactic.
Confusing CX with customer obsession: whilst CX is a mechanism to enable the transition and enhance the customer experience, having a CX strategy does not equate to being a customer obsessed business.
Building towards customer obsession
For some brands, the payoff of becoming truly customer obsessed simply isn’t there, but moving up the maturity ladder still makes sense. Whether you are seeking to adopt a truly customer obsessed approach or simply seeking to move the dial and become more customer centric, there are a number of practical steps your organisation can take to evolve from your today state:
Stop obsessing over the wrong ambition & vision Too often businesses orient their ambition around the desire to be the Netflix of X or the Amazon of Y. Whilst these are well known examples of customer obsessed businesses, they do little to ground an organisation's plans in reality and orient the business around its customers. You don’t have to be Amazon or Netflix to be customer obsessed. Creating a clear customer vision and defining what customer obsession means in the context of your organisation is an important first step to help team members understand what it means for the business and for them in their role.
Foster a thirst for the customer To effectively serve your customers you need to understand them. I am not talking about knowing who your target market is, I am talking about understanding customers deeply. What drives them? Motivates them? Where are their biggest challenges and pain points? Customer obsessed companies have a genuine thirst for understanding the customer and seek to capture continuous feedback and insight that is act upon in. That thirst needs to permeate through the entire organisation – not just customer facing functions to influence how the organisation operates. It also needs to go beyond having a voice of customer program. Capturing and centralising feedback is useful but what is done with it is what matters most.
Tie success measures to the customer Customer obsessed organisations adopt a balanced approach to measuring performance and key customer metrics alongside of other key business performance indicators. Measuring customer metrics enables businesses to understand the effectiveness of the strategy, remain focussed on what is important and ensures employees are able to see how what they do impacts customer outcomes. But measurement often isn’t enough. Creating transparency and focussing the team around customer metrics day to day is key to changing employee habits and mindset. CoolBlueBezorgt, the delivery arm of online retailer CoolBlue wanted to ensure key customer performance indicators were always front and centre, so to do so, its CEO Pieter Zwart starts every presentation he makes with the Net Promoter Score or NPS for the brand. Each morning, all employees are also shown their NPS-scores of the previous day so they can either be celebrated or learned from. This approach helps CoolBlueBezorgt to remain focussed on customer metrics that matter and that move the dial for their business.
Re-engineer processes and how the organisation prioritises Customer obsessed businesses seek to ensure that internal siloes and ways of doing things aren’t imposed on the customer. Organisations who are customer obsessed use customer insights and feedback to prioritise areas of focus for improvement and innovation that will best serve and meet customer needs. These organisations also seek to empower employees with the autonomy to make decisions that serve the customers interest day to day. Alaska Airlines is a great example of a brand adopting an initiative to better empower employees and serve the customer. Each employee receives an “empowerment toolkit” with vouchers and tools they can use to help customers. Their philosophy is simple: "We train then we trust employees to do the right thing". Based on loose guidelines, people are trusted to customise responses. Air miles, money, restaurant vouchers, and fee waivers are some of the gestures proactively given to them to use to act and do what they think is right based on the situation.
Be prepared to kill some sacred cows Building a customer obsessed business and embedding a customer obsessed culture will inevitably mean you need to change the way your business thinks and operates, and for legacy businesses that inevitably means change. Change is painful and change is slow. Businesses who are wedded to the how things work today and are not prepared to challenge old assumptions or do away with outdated practices and products that no longer resonate with the market will fail. Building customer obsession will challenge everything that is known today about the business and its customers, and that inevitably means organisations will need to be prepared to kill some sacred cows to move ahead.
How customer obsessed is your business today? Some key questions to ask yourself:
Do you really know your customers beyond your target market? Do you have mechanisms to capture feedback ongoing from your customers and do you utilise it to make changes within the business?
Do team members prioritise time to spend listening and observing customers? Or is it seen as a task or chore on top of the day to day priorities?
Are your employees equipped and motivated to put the customer first, and rewarded when they do?
Which processes and organisational structures are stopping rapid improvements and innovation?
What customer improvements have you shied away from because they were too hard to implement?
How do you fund digital, customer-centric initiatives? Are they seen as a one off project cost or just a cost of doing business?
Looking to shift your culture and become more customer focussed or even obsessed? Get in touch - we would love to help.