Today, with the data harvested from social media, CRM systems and streamlined customer intelligence tools, companies have an unprecedented opportunity to understand and respect their customers as people. To show them the love they deserve by placing them in the centre of their strategic universe—to be customer centric. But becoming a genuinely customer-centric organization requires some heavy lifting. Consequently, more and more companies simply pay lip service to the trend, and in doing so, miss the opportunity to channel the collective wisdom of their customers into better business decisions.
To be truly customer-centric you must love and respect your customers. And like love, becoming customer-centric takes commitment and effort. The first step is to redefine your relationship with customers and recognize they are people, not data points.
Focus on Customer Centricity
A customer-centric organization builds an operating model around a deep understanding of its customers, what they value and the contribution each makes to the profitability of the company.
According to EY, this requires:
- Designing business processes that recognize different customer segment needs
- Delivering a positive and seamless customer experience at every touch point across the customer life cycle
- Maintaining an active dialogue with customers (and acting on feedback)
- Fostering a culture that places the customer at the heart of the decision-making process
But here’s the catch. Business leaders today are literally drowning in data. They’re frantically treading water to keep their calm visage above the ever rising tide of data; the white noise of transactional information and the unstructured shouting match of social media. It’s no surprise why they’re motivated to keep swimming. Businesses heap high-praise on data-driven leaders. The logic is simple—if you have the numbers, you have the answers. However, this is a dangerous axiom when dealing with the fickleness of human nature.
Big data makes big promises but for the most part it has been a big let down. What we’ve learned is that the vast majority of big data dissolves into the ether. Some studies suggest that as little as 7% of the data a company collects gets tagged and less than 1% gets analyzed. The majority of that data is transactional, meaning it only reveals what your customers have done, where they have been and how have paid in the past. With predictive analytics, you may be able to postulate about what your customers might do. But no amount of transactional data in the world can tell you why your customers make the decisions they do. Understanding “why” is the holy grail. The ultimate goal.
Social media was supposed to be a savior in this regard. But in the special report, What Social Media Analytics Can’t Tell You About Your Customers, it was revealed that 30% of social media users account for 90% of social media updates. Moreover, the habits, preferences and buying behavior of these “enthusiasts” are markedly different than the majority of your social media audience. So, if you're using social media to engage with the people who you think are your customers and you are using social media analytics to guide your business strategy, you face a very real risk of misreading your customers. To put it another way, if you’re using social media to understand customer motivation— to understand why—you will miss the mark.
This is not to say that big data is not a valuable resource. Nor am I suggesting that social media doesn’t help you understand a unique segment of your customers. Far from it. The point is, that to truly understand your customers, to gain a deeper respect for their motivations and preferences, you need to move beyond big data. Companies need to use more robust tools and engage customers directly in ongoing dialogue. You need to communicate in a structured environment where you can ask good questions and harvest considered responses. Getting to why requires a commitment to hosting your customers in an easily accessible environment where they feel invested in both your brand and the outcome of their input. A place where they feel truly loved.
Photo: Oscar Nilsson