What naturally comes next is perhaps even more important, and addresses the return on investment especially for direct-to-consumer businesses.
We are talking about customer centricity. It has been a hot topic within organisations and businesses for more than two decades now. Nevertheless, many still struggle to get this fundamental right, which ultimately risks jeopardising business success.
We will dig deeper within this topic and explain the what, the why, and the how of customer centricity, which is so important that we believe it will almost become a currency the near future.
What Is Customer Centricity and Why Is It Important?
Marketing Professor Peter Fader defined customer centricity as a “strategy to fundamentally align a company’s products and services with the wants and needs of its most valuable customers”. In fewer words, it’s the result of a process to understand your business’ end users, solving their problems and – most importantly – creating value for them. Products and services created will need to meet their needs, and generate experiences that will then win and strengthen their loyalty.
Most companies today still encounter some difficulties here This is partly due to the volume, velocity, and also the variety of customer data that exists nowadays, which can easily overwhelm organisations. On the other hand, some organisations don’t own the right systems and tech to segment and profile customers. But the most common barrier, and perhaps the most difficult to overcome, is a more general lack of customer-centric organisational culture. Many companies still retain a product-focused or sales only–driven culture.
A strategic approach to success must be proactive, rather than reactive. It needs to focus on lifetime value rather than short-term volume, and must involve everyone within the business. How to understand which customers are most profitable? How to keep them– and get more from them? To successfully implement a customer-centric strategy and operating model, a company needs to embrace a culture that aligns with them.
Statistically, organisations with a better customer experience show 17% annual growth vs a mere 3% of their competitors. Also, a 10% increase in customer retention results in a 30% increase in the value of the company. It’s predicted that by 2020, customer experience will overtake price and product as the key brand differentiator.
Value and experience are rapidly becoming = new currencies, beating price when both acquiring and retaining customers. They are also vital – especially in an OTT subscription business for sports and entertainment – to compete against piracy. Think of a paid for service with a customer support response rate far from what is expected today. Who is willing to pay for an excruciatingly long process to subscribe (read more about a subscription process in ‘autopilot mode’ here) or when the messaging is confusing and the UX not spot on? Expectations are continuously evolving: customers expect to navigate quickly through any chosen channels, as well as for their experiences to be personalised and tailored to their current needs.
If users have a memorable experience, they are more likely to trust you and rely on you. They will be loyal. Customers are not afraid to leave a relationship when they don’t feel appreciated or treated like they are valued.
What Do You Need To Do?
There are at least 4 key elements any organisation can do to rationalise their process of becoming more customer-centric.
Data is crucial to customer centricity. It’s generated by a mix of listening to customers and observing their behaviours. Think of the analytics for the traffic generated by your website or other owned and operated properties. Decisions need to be data-driven, even if the decision is to do… nothing.
Data helps you get a grip of what your customers’ pain points are, and how their needs are evolving. It informs your organisation about which steps to take in order to be more proactive. Sharing observations across all functions of the business is – once again – key to democratize your customer insights. This will facilitate a direct interaction with customers too, learning from pieces of research, as well as feedback, reviews etc..
#2. Customers’ Needs Come First
Is the customer really at the centre of every decision? This simple question should sit at the core of every action taken within your business. Think like a customer, try and see everything you do from their point of view. Challenge every single aspect of the customer experience – are you making their life better? re you delivering a frictionless experience? Most importantly, always doubt your assumptions. Users want to engage in an innovative and seamless way, and want to hear from you only when it’s valuable to them.
#3. Develop Bespoke Experiences
Every product or service should be presented to the user-base as a solution to their problems. For instance, an OTT service for the streaming of live events is not just another way of consuming content online. It needs to give the user the best experience ever – anywhere and anytime. Only modeling solutions that can deliver most lifetime value will elevate your business to a status of innovative market leader, as opposed to a more static reactor to changes.
Finally, to reiterate what we already mentioned above, encourage a customer-centric behaviour at every level of your business. So, start developing processes to share data and feedback. This will empower everyone in the company to solve users’ problems while providing them with the resources to do it. Also, add metrics to measure the effort of making your strategy more customer-centric in your list of KPIs. And finally, share the results in a transparent and easy-to-understand way. Making sure every member of staff is part of this will help enhance your company culture and set examples of leadership.
Despite some barriers and the quite obsolete view of market research as a cost rather than an investment, a more customer-centric strategy is always possible. It needs to start from the head of the business. It’s not just a matter of seamless delivery of products and services, nor merely a proficient use of customer service.
Focusing on your most valuable customers means admitting that you don’t want to be right for everyone.
It requires a good deal of investment, openness, and the ability to empower every single member of your staff to act as a brand ambassador. The return will come with a long-term growth of the business.
Follow our OTT & Marketing series (links below) for more insights on the subscription business. Our next chapter will go through pricing and plans for a subscription-based service and ask: Can micro-payments be the preferred solution for the future?
3 Reasons Why Free Trial Is a Vanity Metric in a Subscription Business
A Subscription Journey in Autopilot Mode
Who’s Your Buyer Persona? Understand Your Audience