Customer Strategy

Co-create to disrupt the disruptors

Forget what you think you know about customer journeys, profit drivers, and client behaviour. Get ready to change your internal processes and capabilities. It’s time to deploy new techniques in co-creation to let your customers design the best version of your business that it can be.

by Martin Herbert (contact)
5 minute read

“You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new.”

The quote – it’s from an interview Steve Jobs gave to Inc. magazine in 1989, explaining where great products come from – is often used to denigrate the role of market research. Customers don’t really know what they want – so why ask?

It’s true that people aren’t always good at predicting what they will do, or will like, in the future. Running a straw poll of customers and designing products that matched the majority verdict would be a disaster. On the other hand, it would be a stretch to assume that what worked for Apple under Jobs holds true for businesses today.

Apple is an outlier who is rarely paralleled in terms of size, scale and vision. Few companies have the same leeway to gamble with customer desires, particularly in an era when customer-centricity is so essential to success.

 

 

 

 

 

And today, companies are no longer bound to surveys and other traditional forms of feedback. With a sophisticated arsenal of tools at their disposal, they stand to gain a far clearer picture of what people are looking for.

So how can businesses understand and adapt to customer demands? And how can they work out what those demands really are, perhaps even gaining a level of clarity inaccessible to the customers themselves?

Understanding the process and mapping the journey
There is a movement away from focus groups, towards ethnographic research techniques – in other words, observing subjects in real-world settings. A researcher might accompany a customer to a supermarket, for example. This provides more reliable insights into their behaviour than asking them to recall the experience.

Of course, the downside is that it’s very hard to simulate ‘natural’ behaviour when being tracked by a researcher. It can also be prohibitively expensive. As a result, some companies are using self-ethnography. Customers log their own experiences using wearable tech or a smartphone. This can help brands understand, what they eat, how they move through a shopping mall, or what they dislike about their hotel room.

Brands are also turning their attention to customer journey mapping, where feedback is collected at every interaction point. A business might collate website analytics and call centre recordings. And they might use data mining techniques such as sentiment analysis to interpret social media posts. By focusing on the bigger picture, rather than individual interactions, they are able to better hear what customers are saying.

Too much to ask? Not in the age of super-fast analysis and agile implementation. As enterprise software becomes more flexible, there is far greater scope to deal with a fast-moving marketplace and fickle customer demands.

These kinds of analytics techniques, when applied to real-time or unsolicited customer input, allow companies to move beyond quantitative data collection. Rather than simply describing what the customer is doing, which traditional big data has always done well, they foster insight into why a customer is behaving that way.

Shaping customer experience
This knowledge can be used to guide marketing strategies, as in the case of motivational segmentation. If you can separate your customers into different groups (for example, those motivated by value versus those motivated by novelty) you can target emails and other interactions more precisely. 

It can also help improve and tailor services. In the hotel industry, personalisation is now seen as a major differentiator, allowing traditional operators to deliver something beyond disruptors like Airbnb. Operators are using analytics techniques to build a single profile of each customer and deliver services in line with what they’ve said – or shown – they like.

Other service industries are following suit. The airline Lufthansa, for instance, is investing heavily in its digital strategy in a bid to deliver personalised passenger experiences. Noting that segmentation is dead, it blends together multiple data sources to glean behavioural insights. The goal is passenger loyalty – critical in an industry where just 15% of passengers make up over 50% of trips.

In essence, brands need to stop treating customers as passive consumers of services and products, and more as co-creators. Rather than responding unpredictably to your offerings, the customers themselves have the power to shape their journey through your business.

For companies that get it right, there is scope to disrupt the disruptors. Visionary, maverick strategies – such as those favoured by many insurgents – are a roll of the dice at the best of times. But listening to what existing customers are saying and doing can transform your customer experience (CX) strategy, ensuring you’re providing the optimal versions of the services and products they already love.

The final piece of the puzzle is executive sponsorship. There needs to be a seamless link between adapting to customer co-creation exercises, articulating a new approach and ensuring it’s delivered well. Executives have to blend what they say, what they do and who they tell to ensure, ultimately, the customer get the experience that brings them back for more.

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