Tuesday, October 27, 2015

“estest to inging” : Revisiting Customer-Centricity



How many of us are bombarded with advertisements touting that “we are the fastest, cheapest, best...the “estest” of any product/service? From Brazil to Beijing and from unsolicited cell phone calls to online banner ads, it is a non-stop nuisance! How demeaning it is to be viewed merely as a dollar value for some marketer who is desperately trying meet his/her KPIs? Don't we need a bit of empathy? Somebody who understands what we need and exactly deliver that? (or deliver nothing if we need nothing!).

Currently, new product/service development and marketing needs a paradigm shift from being “estest” to identifying the “inging” of the product/service. So what exactly is inging? Let's take an example of gym. It is not a rocket science to recognize that a gym is the place of excercising. But do you really think everyone goes to a gym for exercising? Being a gym enthusiast, I can say this with certainty that exercising is just a functional purpose of going to gym. The rational purpose of going to a gym could toning, body building, slimming etc. Depending upon the rational purpose of exercising, the intensity and frequency of training and other aspects e.g. dieting and living (i.e lifestyle) have to be modified. For instance, for slimming one cannot follow a body building program and dieting habits or go on binge drinking and yet expect to loose weight. Thus, inging allows for a product/service to be “customized” and deliver maximum value to the customer. This paradigm shift to inging requires asking a series of “why” questions until one has identified the rational purpose of the product/service.

A clear insight into the rational purpose of a product/service will reveal product/service attributes and consumer benefit, which is critical for customization. For instance, for nighttime diapers for babies, the product attribute is dryness, consumer benefit is better sleep and rational purpose is healthy baby development. Diapers just happen to be a medium to deliver these needs to the parents. These insights into identifying the rational purpose, product/service attributes and consumer benefit are essential for an entrepreneur to develop a marketable minimum viable product (MVP). Any MVP iteratively developed based on these insights will have a higher success during customer/consumer validation phase. This view on co-developing the product/service development is well articulated by Joanne Bischmann, VP Marketing, Harley-Davidson (currently VP Communications) in this quote - “Marketing and product development are so intertwined at Harley-Davidson that it's hard to say where one ends and the other begins. That's one reason our motorcycles get the response they do from the riders. It also keeps us intensely focused on fulfilling customers dreams in everything else we do” (emphasis mine).

Integral to inging is to understand the distinction between between customer (i.e. one who is buying = dollar value) and consumer (i.e. one who is using = experiential value). This distinction is often blurred in B2C sales because one who pays may also use the product/service but, as in the gym and diaper example above, there are exceptions to this rule. In contrast, customer-consumer uncoupling is distinct in B2B sales where the customer is a company whereas consumer is usually an employee of the company. In companies with a command-control (i.e. top down) culture, it can prevent entrepreneurs/marketers from identifying the exact needs of the consumers (and hence of the company), which can misdirect MVP development. In contrast, in bottom-up companies that decentralize and empower the employees leads to better understanding of their needs and requirements. Entrepreneurs/marketers have to ensure that they are in touch with the consumer and not just the customer during the phase of iterative MVP development.

In either cases of B2B or B2C businesses, there are only 3 outcomes following customer/consumer validation - (i) disappointment, (ii) satisfaction or, (iii) delight. Disappointment results from failing to deliver the promise or meet the expectations whereas satisfaction is being able to meet them. Customer/consumer delight results from far exceeding their needs and expectations. A delightful experience is a transformed consumer/customer who will remain loyal not only to the product/service but also to the company and thus have longer life-time value. For instance, Apple has sometimes failed to delight the customers on some of their products or features e.g. the antennae issue in their first iPhone, maps and more recently in bending of the iPhone 6 models. Yet, they have a loyal customer/conusmer following because Apple has scored overall higher on the number of “delight points” across experiential journey of the user. Thus, to summarize, customer-centricity uses a “sales-centric” approach i.e. what we (entrepreneurs/marketers) want whereas consumer-centricity uses a “journey-centric” approach i.e what they (consumers) want. In today's highly competitive environment, to prevent commoditization of products/service, a consumer-centric strategy and focus on experiential value of products/services is paramount because experience cannot be commoditized.