There’s a statistic that one third of small businesses fail within their first two years.
It’s astounding, and one that I think can be vastly improved on. How? Through a shift in thinking, with businesses taking the time to realise who it is that they’re actually selling to.
It seems obvious, but after years of working with countless organisations and on corporate events, I’ve seen many businesses get to the brink of failure because in all their planning, processes and products, they fail to figure out the most important thing: who it is they’re selling to.
Most business owners don’t intend on ignoring their own customer, it happens accidentally. A business is often borne out of someone, or a group of people’s, pure talent and expertise in a sector or industry. As the business grows, the discussion around its objective doesn’t, with many of the processes created around how that business can continue doing what they do best – not what is best for their customer.
These businesses will work so hard on their product, and perfect processes – but fail to think about who it is that’s buying their product. Frustrated at the lack of success or failure to cut through the market, they become discouraged and blame other factors for their problem.
A good starting point when figuring out if your business is focused more on the product than the person buying it, is thinking how you’d sell your product to someone.
Are you saying ‘we are the best option for your needs’ or are you saying ‘we are the best, you need us’?
Creating a customer-centric business means taking an outside-in approach to how you work and meeting customers’ needs. You may have the best product on the market, but who is it that actually needs it, how will they find out about it and how will they buy and continue to use it?
Whilst not even sure who is buying their product, businesses will spend a lot of energy on trying to sell their product. Instead, I’d suggest that before any plans are put in place, businesses ask imperative questions that are actively based around the person who will buy their product and how to meet their needs. Questions include: how does the customer want to be communicated with? Is the customer driven by price or convenience? And what is it about a customer’s lifestyle that saw them purchase your product, and what will make them repurchase your product? And have any – or all – of these questions been addressed by your business?
These questions create a much more in depth view of who it is you’re selling to – which, if you tune your business toward, means that you’re more likely to actually be successful in selling your product.
Once you’ve secured a purchase, the customer-centric business doesn’t stop there – but many others do. It’s not uncommon for a business to fail to recognize their customer beyond the purchase process. Many companies appear to work on the premise that once something is purchased, the buyer can pretty much be forgotten. Unfortunately with increased competition, businesses need to step up, because building loyal customers is not just about good product, but about good engagement too – and that extends beyond initial purchase.
A great industry example of how to become more customer-centric is the auto industry – with a number of auto brands working to keep buyers engaged beyond their purchase, to build a positive and extensive life cycle that works to ensure repeat purchase and long standing, positive brand associations. In fact, entirely new roles are being created to facilitate customer-centric business and attention, with data, insight and activity focused on keeping drivers happy, from the first kilometer to the hundred thousandth. Someone purchasing a car is not the end of a transaction, rather it’s the very beginning.
For businesses, this is when data can be used to inform, not affirm. Data should be used to inform a business about what their customer is doing, not whether their product or process is successful. Data should be looked at in its nuances – enable it to tell you a story not of your product, but of the person buying it. By gaining these kinds of insights you’re able to learn what needs to happen in order to become more customer-centric, and what processes a person goes through to choose and use your product. More importantly, it will tell you what you can do to make sure that customer buys again.
Customers are continuously changing – so businesses need to as well. By framing your business in a customer-centric way, you’ll be a step ahead of the changing dynamic of the market, purely because the nature of your business is set up to work in tandem with your customer. Changing behavior will be relayed to you in real time, so your business can operate like that too.
There are plenty of examples out there of organisations creating the best possible products, but forgetting that their customers’ needs were something completely different. Large corporations are responsible too – TD Bank Canada, an establishment that’s over 150 years old was guilty, however since changing their retail banking strategy, they’ve increased customer engagement and even went viral for a thank you activity they created.
This is why I host a one day lab, annually, bringing together the experts in customer experience to share their insights. This year includes the AVP, Branch Effectiveness of TD Bank Canada to share first hand on how they changed their approach.
So, while you are perfecting your product, or fine tuning your processes, I would also suggest you’re confirming who your customer is too. Look at your business from the outside-in, from the customer’s (and only the customer’s) point of view, and you might just find you have a whole new approach to business on your hands.
This article has been written by Dom Pinto, Director of the Customer-Centric Innovation Lab