Customer Experience

Is your company well-equipped to grow?

GrowthWhy do companies succeed in the market?  Why not?  How can they move toward success?

Both market success and market failure are critical to understand if you wish to grow over time.   Simple win/loss analyses don’t provide real answers.  Rather companies need to understand the customers who bring you growth, from their point of view.  They are after all the ones who create those successes and failures through their decisions and actions.

This quick 7-question self-assessment will help you understand how well-equipped your organization is to understand your market, extract game-changing insights and effectively act on that insight.

  • CUSTOMERS – Do we really understand our customers’ overall business goals, challenges, processes and needs and why they buy from us and from others?
    • OR do we just use our own opinions?
  • PARTNERS – Do we understand why our partners have chosen to do business with us?
    • OR do we wonder why they don’t always do what we ask them to do?
  • SEGMENTATION – Do we segment our market based on differing value needs and decision-making behaviors?
    • OR do we segment based on demographics that make targeting easy?
  • VALUE PROPOSITION – Does our Strategic Value Proposition drive all aspects of our business, to align value delivery across the organization?
    • OR is it a marketing afterthought?
  • CUSTOMER JOURNEY – Do our assessments, plans and investments include all aspects of the customers’ journey with us, and do we act on all of these journey issues?
    • OR do we focus on the product itself and hope that others address the rest?
  • COMMUNICATIONS – Do we describe experiences and benefits, clearly differentiating our offers from others?
    • OR do we make the same claims as everybody else, focusing primarily on product features?
  • INVESTMENTS – Does our investment profile match the current priorities of our customers?
    • OR does the profile simply reflect what helped us succeed years ago?

If you don’t like your answers to these questions, please contact us.  We can help.

Customers Want Great Experiences

We’ve been hearing plenty about customer experience design recently.  It’s a hot topic at universities, companies and in many online groups.  This is rather exciting to us, because we’ve been doing customer experience design for over 20 years.

In my last post, I described how customers make decisions.  In simple terms, it’s based on the experiences they expect to receive and the positive (or negative) value of those experiences.  Customers do look at features, of course, but they do so to prove to themselves that they will get the experiences you promise.  Customers also have experiences independent of product/service features, such as their discovery and purchasing experience, or customer support.  All of these experiences, whether planned by you or not, differentiate your company from the competition, either positively or negatively.   All of them affect the decisions your customers make.

Given that backdrop, it behooves companies to consciously build your business around the experiences most valued by your customers. First, focus efforts on understanding the experiences that customers would value and how they would prioritize those experiences, then build products, services and go to market plans in service of those experiences.  Doing so is central to our techniques and generates unique insights.

To many, this may sound completely backwards.  Too many companies build their products and services first.  Then as a marketing afterthought, they develop the hopefully compelling reasons that customers should buy. Theirs is what we control systems folks call an open loop process. There’s little or no feedback to point everybody in a single direction that is compelling to customers – no True North to help internal people make the inevitable tough trade-offs.

Customer Experience Design includes discovering what experiences customers value most highly, then examining your competition, your own capabilities and major changes in your market to decide which experiences you can profitably deliver and why those will win customers’ preference. Our open-ended conversations with customers, partners, service providers and other influencers can create true magic when we explore their lives and discover answers to questions you never thought to ask. These are often the deep insights that drive real innovation for you – unique experiences that will delight your customers. Contrast this with other forms of research, which are great at quantifying known issues or getting feedback on existing concepts but far less useful for disruptive insight. Our client-tested customer experience design process can be found in our methodology description.

Why do customers buy? Or not buy?

All companies face this question as they seek more customers and higher revenue.

  • Engineering-Driven companies – the majority of tech companies – believe the right feature set will compel customers to buy and unfortunately pay relatively little attention to other issues.
  • Customer-Compelled companies are obsessed with simply giving customers what they say they want.
  • And Followers believe that emulating the market leader will generate success.

Our experience and that of the most successful companies over time is different.  Each of the above mindsets may work for awhile, but it will not produce a winning strategy over time.  And when customers don’t buy, we often hear “they just don’t get it”.  Yet it’s the Provider who often doesn’t get it, lacking a real understanding of the motivations and perceptions that drive customer behaviors.

Customers decide based on comparisons of their various options – Our offerings, our competitors’ offerings, do-it-themselves or do nothing.  And they assess which alternative will make them better off – which will provide them the most value.  That’s value as they define, experience and perceive it, not necessarily as we define it.

There is a wide range of dimensions involved. Here are a few examples:

  • Amazon.com cares plenty about computers and associated software that is always up and available to keep their virtual storefront open.  When the storefront closes, they lose big money – around $100,000 of revenue per minute.
  • When things go wrong with any product or service, the treatment you get from customer support can either generate long-term loyalty or disdain, either of which will affect future purchase decisions.
  • And of course everybody in the internet age is concerned about the security of the personal information they submit just to do business with you.  Getting that information stolen can wreak havoc on customers’ lives and on your business.
  • Many people simply want to be “cool” (or “rad” or “bad” or “far out”, depending on your generation – these aren’t all teenagers, by the way). Apple has played to this for decades.  One look at an iPod ad makes this very clear.

IPod adEach of the above examples is about customers’ experiences and the impact of those experiences, much more than being about your offering itself.   The features of what you offer are enablers of some experiences, to be sure, but many critical customer experiences have nothing to do with your primary offer.

Customers compare the experiences that you offer them with those of their alternatives.  In some cases, you might be superior to any given alternative while in others you might be inferior.  These experiences, as the customer perceives them, are the heart of the customer value proposition.

Customers typically pay for your offer, so they compare costs as well.  Of course, if they don’t pay, in an ad-supported model, your customer is really your advertiser and your user is the product.

Customers must act in order to get the experiences above.  Those actions may be minimal (e.g., one-click purchasing on Amazon), or they may be very significant (e.g., distasteful price negotiations to purchase a car).

So, in summary, there are three primary components to customer decision making:

  • The experiences you offer, whether superior or inferior to their other alternatives.  These experiences span from initial discovery of your company through purchase, use, troubles (if any) and finally disposal.
  • The price you charge, as compared to their alternatives.
  • And the actions they must take to get these, as compared to their alternatives.

It is our job to understand what experiences are critical to customers and how they perceive us and others.  From this understanding we can create plans – products, services, go to market – that will inspire customers to do business with us.  A robust strategy should be built upon the foundation described above, for each segment of your market.