13th August 2014
I was asked recently about what the term “customer centric” means in terms of service delivery. Pretty easy I thought: you start with customers, not products. You focus on what those customers want to do. You design any product or service from the customers’ perspective, and you remain nimble and focused on customers’ changing needs and market conditions. Customer-centric organisations want to anticipate customers’ needs and delight them with solutions they might not have thought of, yet they immediately love and value. But what happens when we are standing at the whiteboard thinking about the design of a new product or service, or solving a business problem?
Let’s take a typical business problem: Why is the company losing market share to a rival? And what can it do to win back share? The marketing team can apply solid market research techniques, using logic and rigour to analyse the first part of the problem and find all the pieces of information to explain the situation: competitor activity, distribution figures, promotional spends, and changes in consumer preferences.
Finding a solution for the second question in this problem is harder. We can rely on market research: surveying our customers, doing a needs and gap analysis, concept testing, benchmarking and so on. But there are two problems with using only this approach to find a solution:
• We’re looking in the rear-view mirror. It can tell us where consumers were and what they wanted when we carried out the research but it can’t tell us anything useful about how they might behave in the future.
• It takes the customer feedback at face value. And human beings are notoriously bad at explaining their own preferences. Most of us tend to come out with a statement that reflects what we think we should say rather than trusting our emotions and instincts. Our self analysis tends to result in less self awareness and less useful information for the business with the problem.
There are well known stories of the failures of market research – television shows and devices that tested terribly and then went on to be hugely popular. Known as the Sony Walkman conundrum; in the world that existed before the Walkman was invented and marketed, all available research showed that consumers reacted negatively to the idea of a portable music device. Even after the Walkman had been on the scene for months, focus groups still felt that personal music on a portable device would never take off.
Now jump ahead to one of the most creative and successful business entrepreneurs of our time. Steve Jobs never cared much for market research or focus groups. He once said, “people don’t know what they want until you show it to them.” He believed that there was an ideal music player, phone, tablet and computer and trusted the customers to recognise perfection when they saw it. When asked what market research went into the iPad, he replied, “None. It’s not the consumers’ job to know what they want.”
Retaining customers and gaining new ones is increasingly about delighting them and for that you need to do more than open the doors on time. We’re not saying don’t do market research, but do be aware that imagination, creativity and some brave decisions are also required. As Will Rogers said, Even if you’re on the right track, you’ll get run over if you just sit there.