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Customer-driven strategies that succeed

By CCIWA Editor

Disruptive businesses are making their competition irrelevant by creating new products and services that meet the needs of their consumers.  

In the process they’re leaving behind organisations that place too much emphasis on beating their competitors, says Jean Van Den Heever, director of Perth-based business advisory firm Business Planning Services. 

A more customer-centric approach can also offer another benefit to business – cost savings. By eliminating functions that don’t add value to the consumer, a business can reduce costs on factors that an industry is normally competitive in. 

This two-pronged approach is called value innovation, defined as “the simultaneous pursuit of differentiation and low cost, creating a leap in value for both buyers and the company”.  

Van Den Heever cites Cirque Du Soleil as an example of an organisation that has benefited from value innovation.

“When the circus industry was in a downturn, they really created some additional value to the service offering that wasn’t previously in the market,” he says.  

“For instance, they decided not to use animals in their performances, which was costly, and instead put a lot of emphasis around making the consumer experience much more exciting and creative.” 

Understand your customer 

To create a consumer-centric solution, you first need to understand the customer journey – from initial inquiry to purchasing and after-sales support – with the view to identifying any pain points.  

To achieve this, you need quality data to create realistic strategies. An understanding of the customer journey and any pain points can be obtained from online surveys, focus groups and face-to-face interviews or phone calls with customers. 

“The most successful businesses are also able to understand when the need of the consumer changes,” says Van Den Heever.  

“The need of the consumer a month ago or a year ago could be different to today. Many people keep making the same mistake by thinking the same need persists.” 

Brand 

Understanding the customer journey not only helps create a consumer-centric value proposition but also gives the business a consumer view of how it’s perceived. This information is important to help build an authentic brand and value proposition that addresses the need of the consumer. 

Internal processes 

Creating an innovative, consumer-centric product requires a new way of thinking within the organisation.  

“People sometimes associate innovation only with a new product or a new piece of equipment or technology. But 80 per cent of innovation, for me, is within the walls of the company – changing the way you look at things and the way you do things,” says Van Den Heever. 

“For example, an internal understanding of the brand – of what the business stands for and its belief systems – is the key to driving that behaviour.” 

Resources 

To deliver and execute on the strategy, you need to make sure you’ve got the resources to make it happen. The greater your capacity, the more likely the strategy will be executed.  

Define and communicat 

A key component of a customer-driven strategy is to define it, write it down and communicate it to staff. 

“If people just talk about these things and don’t actually define them, it’s difficult to communicate to staff,” says Van Den Heever. “The successful businesses are also very good at communicating strategy to their employees, so they – in turn – can inform customers.”  

“Most business owners understand their value proposition and what their brand stands for. But not many businesses actually communicate that properly to their staff.”  

New eyes 

Challenging the status quo with a company is key to creating an environment to incubate innovation. An external consultant can help an organisation broaden its view.  

“It becomes more and more difficult for people to broaden their view the longer they’ve worked with the same management team,” says Van Den Heever. “So, if your core group of managers have been working with you for 10 years, they’re likely to say, ‘we’ve always done it this way’ or ‘this really works for the customer’.  

“We need to challenge that. We need to say, ‘there’s different ways of looking at this’. A lot of times, pain points don’t just belong to your company – they’re an industry issue.” 

Continual improvement 

You need mechanisms in place to monitor and listen to customers changing needs. Van Den Heever suggests that big businesses need to track customer satisfaction daily.  

“You need technology to automate collection of data so that it doesn’t become resource intense and you end up getting bogged down,” he says.  

This can involve online customer ratings or short online forms. “A lot of my clients use very basic things like Survey Monkey. There will be a link at the bottom of the invoice that asks for feedback on the work that they undertook.  

“If you use this approach, try to make it as easy and automated for the client. You don’t want more than three or four questions. And, depending on the size of the job and the value to the client, it shouldn’t take long to fill in. 

“And if you have tele-sales or support staff, you can get them to ask customers if they’d mind holding for a quick survey after they’ve finished talking.” 

To keep companies focused on the customer, CEO’s incentive packages are driven around the level of customer satisfaction. Some businesses rely heavily on satisfaction ratings and set KPIs against them. 

For small businesses, gauging customer satisfaction can be simply obtained through face-to-face discussions with the client on a regular basis and at the completion of the project. 

 

 

Disruptive businesses are making their competition irrelevant by creating new products and services that meet the needs of their consumers.  

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