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Why Customers Are The Answer To All Your Problems (If You Ask the Right Questions)

Last week I asked whether it is employees or customers who are more important to an organisation. If you missed it read “Customers Care About a Product’s Value, Not How the Company Treats Employees” now and catch up.

I knew it would be a provocative question but I still didn’t expect quite so many comments! So this week I decided to be just as provocative and talk about the issues that challenge many businesses. And where the answer to whatever problem they have is actually quite simple. For me, customers are the answer! They can either answer or help you overcome any challenge or issue you may have.  Read on and then let me know if you agree.

 

How can I innovate more successfully?

 
According to an excellent article by Harvard Professor Dr Srini Pillay “Humans have a natural aversion to innovation because it involves a healthy dose of uncertainty and risk.”
 
 
Unfortunately, we try to reduce this risk by referencing past events to help us to predict the probability of our future success. Dr Pillay concludes that possibilities rather than probabilities are more likely to lead to better results.
 
I would concur with this statement, as the world is changing too fast to rely on past events as a predictor of anything in the future. This is why I say that customers are the answer!
 
It is only by getting closer to our customers and being constantly curious, that we have any chance of increasing our success in satisfying them.
 
It therefore makes sense that we involve our customers in helping us innovate. Not as a judge of concepts, which is what many businesses do. This is wrong because we know that consumers don’t know what they want, at least not until they see it.
 
However, they do know what their pains are; what is wrong with a product or service and what they would rather have. Co-creation and in fact ongoing conversations with our customers is the only way to stay ahead of the game.
 
In another article, this time in the HBRHeitor MartinsYran Bartolomeu Dias and Somesh Khanna from McKinsey shared the results of numerous interviews they conducted in Silicon Valley, the home of US (tech) innovation.
 
They conclude that it takes many skills and cultural changes for most organisations to become more innovative. These include:
  • Audacity and grit: The determination to continue despite failure. And I would add the acceptance of failure and the license for employees to fail too.
  • Strong leadership and true collaboration: An inspiring vision and the tenacity to make it happen – together.
  • Give employees autonomy. We all need meaningful work. The chance of helping an organisation grow is what motivates top employees. That and the freedom to make decisions based on clear goals but without directive processes on how to meet these objectives.
  • Build platforms, not products. This may be the hardest for many organisations to grasp. Giving your customers the opportunity to decide what and how they use what you produce, and how it should be changed is the route to success. Networks and co-creation are the future that is already here. And customers are the answer!
 
  • Think like engineers and customers. Everyone in an organisation should be encouraged to look at problems from the customer’s perspective. It always amazes me how we seem to “take off our consumer hat” when we arrive at our place of work!
  • Know that money only gets you so far. Innovation has a much shorter shelf-life than it used to. In fact, best-in-class organisations have a continuous process ingrained in their culture.
  • Get acquisitions right. Many companies are looking for acquisitions for a way to quick-start their innovation. But it is difficult to get the timing right. The current value is good but potential growth is better.
 
The article concludes with an interesting comment that it is “leadership in business model innovation that offers the deepest and most transformational insights.” I would add it’s our customers too!
 
If innovation is a challenge for you and you know your process is not optimal, then you might like to read “Improving Ideation, Insight & Innovation: How to Prevent Further Costly Failures.”

Where do I find out what issues my brand has?

You’re measuring your sales and hopefully the trend is upwards. You’re following your distribution and hopefully it’s expanding. You’re calculating your profits and hopefully those are also rising. What else are you doing to follow your brand?
 
You would be amazed at just how many brand managers stop there! Even those in major CPG companies! It’s not enough. You know nothing about your customers! Your forecasts are based on outdated information from the past. (and if you didn’t skip to this point but read the previous one, you know why that’s insufficient)
 
The health of your brand and a good estimate of at least its short-term future comes from your work with customers. From brand image and equity,   to co-creation and observation, your customers are the answer.
 
Brand image and equity measurements are vital for helping you to understand what current and potential clients think about your brand. If you want to learn more about the topic then read “What Every Marketer Needs to Know about Brand Image, Equity, Personality & Archetypes.”
 
There is an additional bonus in following your brand image and that is that it acts as an early-warning signal. This is because it almost always starts to decline before your sales do!
 
The reason for this is that we are creatures of habit, retailers included. Change is difficult as a decision has to be made. So we tend to continue with the same products and services until something important happens. Important in the eye of the customer that is.
 
It may be a new brand introduction, a price promotion, bad publicity or negative comments on social media. If these are important enough to customers then they may decide to change brands. And if this impacts a lot of customers, the sales decline can be fast and significant.
 
Better therefore to follow your image as well as comments on social media.
 
Social media platforms can provide a wealth of information about your brand. Of course, different people adopt different platforms for different uses. Pew Research ran a useful analysis in their Social Media Update 2016 of the demographic similarities and differences of channels in the US. It is definitely worth a read to understand these differences, as well as to identify the best platforms for your own brands.
 
Another good source of social media statistics is from Smart Insights. Their “Global social media research summary 2017” combines information from numerous sources and provides a global perspective.
 
The sort of information that can be gathered from social media includes:
  • Natural vocabulary used by your customers.
  • Issues customers have with products and services, often in real time.
  • Trending topics of interest; use trend alerts rather than the keyword tool from Google, which is slower to update.
  • Regional or country differences from topic frequencies.
 
Observation and listening in person can provide extra benefits that social media can’t. The two information sources are thus complementary. In fact, I would consider them to be the best way to identify brand issues, long before running any market research surveys. For more on best practices in customer closeness sessions, check out “Five Rules of Observation and Why it’s Hard to Do Effectively.” 
 
 

How can I grow my brand more profitably?

As you know there are basically only three ways to grow your business:

  • Get more customers to buy.
  • Get customers to buy more.
  • Get customers to buy more frequently
 
You will see that all three ways involve the customer; of course, they do! As you know, one of my favourite quotes says “There may be customers without brands, but there are no brands without customers.” If you still haven’t understood the message, your customers are the answer to everything!
Just think about that for a moment, please. A simple but profound statement, don’t you think? Therefore, your customer is the solution to your business growth and profitability.
 
Speaking of which, sometimes a business is growing but has done so by slashing prices and being on constant promotion. This doesn’t grow your brand, it demolishes it! Both its value and reputation! Read more about this and head the warning in “Are you on the Way to Brand Heaven or Hell?”
 
A far better way to grow more profitably is to understand the value that you offer to your customers. This is done through a PSM (price sensitivity measurement), a price trade-off study (BPTO) or similar survey. These will provide you with the information you need to understand your customers’ perception of your value. Whether your price is too high or too low, you’re leaving money on the table and could be more profitable. 
 

 

Why is market research not enough to understand my customers?

There are so many reasons why running market research is insufficient to really know and understand your customers and your business. I don’t know where to start, but here are a few reasons I’ve come up with (please add your own in the comments box below):
  1. Projects are sample based.
  2. They are at best snapshots of current opinions and behaviours.
  3. The information can quickly become outdated.
  4. They ask questions.
  5. They have limited focus.
  6. People don’t tell the truth.
  7. People don’t know why they do what they do.
  8. Results are extrapolated.
  9. Results are open to interpretation.
 
I could go on and on with this list – and again feel free to add further ideas in the comments below – but you get the idea.
 
Now don’t get me wrong; I’m a big fan of market research. BUT done by experts. Unfortunately, with the ease of connecting with people online and the simple survey platforms offered for free, it is easy for anyone to run a research project today.
 
It’s great that people see the benefit of surveys, but as this subtitle mentions, it’s not enough for truly knowing and understanding your customers. Also, if the reasons I gave above are not enough, there’s something else!
 
The biggest issue from my perspective is that understanding takes far more information than any single market research project can provide. Yes, it may deliver certain answers to a finite number of questions, but to understand your customer you need to get intimate.
 
I wrote a blog on just this topic which you might want to check out for a more detailed plan on getting to know your customers. It’s called “4 “Free” Ways to Connect with Customers for World-Class Understanding.”
 
 

Why are customers always the answer?

There are many organisations that understand the importance of the customer and yet still hesitate to start walking the talk of customer centricity. If you’re one of them, then here are a few statistics that should convince you  – and your bosses – of their importance:
  • Customer centric organisations are 60% more profitable. (Source)
  • The average revenue growth of Customer Experience Leaders is 14% points higher than that of the laggards. (Source)
  • 64% of people think that customer experience is more important than price in their choice of brand. (Source) 
I don’t think anyone can read those numbers and not be excited by the potential for growth. So what are you waiting for?

Conclusions

 
As you see, our customers can provide many if not all the answers to almost any question we may have about our businesses. After all, we are in business to make a difference to our customers lives in one way or another. So it is surprising that we still go looking for our answers elsewhere.
 
If I haven’t highlighted your main business challenge for 2017, then please add a comment below. I’m sure the customer will still be the answer – but prove me wrong!
 

If you’re ready to adopt a Customer First Strategy, book a free half-hour advisory session with me directly in my calendar, so we can go through your priorities and discuss solutions.

How to Innovate More Creatively

I was recently on a trip to the US; a transatlantic flight on a Boeing 747, my favourite airplane – apart from the Seneca II that I used to own. Anyway, the reason I love long-distance flights is because they cut us off from everyday life, although unfortunately no longer the phone nor web these days.

They therefore provide us with a very rare commodity; some precious thinking time. How do we ever get that otherwise? Speaking personally, my brain seems to be constantly under pressure from the challenges of work, family, friends – in a word, living – so I love it when I need to get on a flight, the longer the better.

I watched Transcendence on this flight; it’s about the moment when the human brain and technology become one. I love science fiction (SciFi), because it frees the mind to dream and to be far more creative than the “normal” working environment ever allows.

After the film and lunch were over, my mind turned – of course – to business and how I could set my past, current and future clients free too; how to make them more creative as well as more customer centric. So this is what I came up with, far above the clouds and worries of my everyday world.

The future is in our h ands

We are all wise after the event, but how do we become wise before it? In my opinion, by setting free our thoughts about the future and our creativity. Many companies have an innovation group, but rarely do they set them free, to think big, to think out of the box.

In fact in many cases, they are literally put in their own boxes, separated from the business for which they are supposed to be innovating. Whilst the intention of this separation may be laudable – it is claimed that it provides increased freedom  – it generally doesn’t work, because the group’s creativity is not grounded.

Despite their incredible creativity, even science fiction writers are grounded; their stories are based on facts, a progression from current actualities to future possibilities. I am not suggesting that innovation be limited to the mere renovation of today’s products and services, but rather that they be based upon a realistic progression of today’s realities, rather than pure hypothesis. In particular, they should be developed out of current sociatal trends, behaviors and needs.

Trend following isn’t creative

Are you following trends? Are you happy with the information you are getting from your supplier? We all love to look at new inventions and products from around the world, but just think about what useful and actionable information you are really getting.

I’m sorry to break the news to you, but you are almost certainly getting exactly the same suggestions as the tens, if not hundreds of other clients your supplier has. Reports aren’t generally personalized, or only minimally, so whatever ideas their reports might spark, are likely to be sparking in every one of your competitors minds too!

So if trend following won’t help your innovation, what will? My answer would be many things; isn’t that good to know?

Develop your trends into future scenarios

Trends do not provide you with a competitive advantage, especially for innovation, so you need to first turn them into future scenarios. There are (at least) two ways to do this.

Firstly you can combine the trends and form what are often referred to as axes of uncertainty. When crossed, these form four (or more) new worlds for you to then define, describe and develop. Your possible actions in each of these scenarios can then be identified, so your business is prepared for all major possible risks and opportunities.

“We must never be afraid to go too far, for truth lies beyond” Marcel Proust (>>Tweet this<<)

The second way is by identifying the major trends that may impact your business and then letting a Science Fiction writer describe the world that could develop. It is not so much a matter of being right as being provocative, the more the better. That’s why SciFi writers are amongst the best people to stretch our thinking. They have the creativity to go far beyond what most of us would think about, even when stretching our thinking. After all, the point of future scenarios is to prepare business for the future, not to predict it (>>Tweet this<<)

Visualise the future

Once you have developed your scenario – or two – you should visualise them to increases buy-in and sharing. This can be through a simple presentation, descriptive profiles or more exciting animations and videos.

Lowe’s has been one of the companies at the forefront of such visual development, using virtual reality to develop The Holoroom to show what SciFutures‘ science-fiction writers had developed. The room puts consumers into a new world where they can see their own new world, at least of their home after their planned renovation.

Other industries that are quickly developing new virtual worlds for customers include car and plane manufacturers showing future travel options. Car purchasers can also experience their new cars before actually buying them and can help in the development of cars that more perfectly meet their desires and needs.

Innovating outside the box

In too many cases innovation is built upon reality and a company’s current offers, in other words are renovations not innovations, just a step change from what we have today. New products developed using scenario planning tend to be faster, clearer, more efficient, longer-lasting and overall more attractive.

Technology makes what was even unthinkable just a few months or years ago, a reality today or in the very near future. Everything is moving faster and faster, so businesses must do the same. As this is rarely possible, they must already think the unthinkable today, so that they are prepared when it actually happens tomorrow. (>>Tweet this<<)

Are you ready for the brave new world  that is estimated to be just ten, twenty or at most just thirty years from now? That’s when the point of singularity is estimated to arrive.

If you would like help in improving your own innovation process, or in developing a future scenario for your organisation, please let us know; we would be excited to inspire you.

C3Centricity used an image from Dreamstime in this post.

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