The big mistake at the heart of Customer efforts

In over 10 years of work in the Customer field with a variety of organisations in a variety of industries I have noticed a pattern when it comes to the way that the people (usually the Marketing folks) approach CRM, Customer Experience and Customer Engagement efforts:

  • An intense focus on what can be done to extract more value from our customer base; and
  • Little or no consideration given to the question “How do we add value to the lives of our customers?”

And that is a big mistake especially in today’s always on Internet world where customers who have been milked share their stories on the Internet.

A simple analogy will make this clear.  Imagine that through efforts to date you have saved up so much money in the bank of customer goodwill.  The shortsighted approach is to raid the bank of customer goodwill to ‘grow revenues and profits’ in the short-term: this is how you destroy brand equity.  The harder but long-term sustainable approach is to do stuff that grows the amount of money in the bank of customer goodwill – and to take a portion of that increase in revenues and profits.

Another way of thinking of this is the story of the Three Little Pigs.  Which do you want to be the First, Second or Third little pig?

Alan Mitchell in his latest piece in Marketing magazine has put it well:  “The second level of this brand narcissism……..is where the brand manager forgets the purpose of the brand and starts acting as if it’s the job of the customer to add value to the brand (by paying a price premium or being an ‘advocate’, for example), rather than the job of the brand to add value to the customer.

My advice: forget relationships, forget experiences, forget engagement, focus – obsessively – on the following sets of questions:

  • What exactly is the gap between what we promise and what we actually deliver? What steps are we taking to acknowledge and close the gap? Is the gap growing narrower or wider?
  • What do our customers expect of us (whether we have promised this or not) and how are we doing on meeting those expectations? What are we doing to close that gap?
  • What can we do to enrich the lives of our customers – today and tomorrow? What are we doing to enrich the lives of our customers?

To paraphrase Andrew Grove: “Only those paranoid about continuously creating superior value for customers survive.”

Author: Maz Iqbal

Experienced management consultant working at the intersection of strategy, customer, and technology. Combine a tendency to think strategically with a penchant for getting my hands dirty at the coalface of implementation.