Is Your Firm Really Optimising Value For Your Customers?
According to Forrester, ‘only 5% of CX pros say their company uses a value-for-customer measure to gauge success of their CX.’
Many firms are stuck in old-fashioned ways of thinking when it comes to creating value for customers. Businesses are putting in the effort to improve products and processes to offer the best services, but in most cases, they’re falling short.
Value means helping people reach their goals. However, most of the time, companies work to optimise value to the business under the mere guise of customer centricity. The underlying issue? Businesses are continuously telling themselves they’re doing the right thing.
There are three main myths that we all believe about creating value for our customers.
Myth #1: We Have a “Customer Journey” that Meets Their Needs
Companies often misidentify the following concepts as the “customer journey”:
- Customer lifecycle. The full relationship of a company with a customer – discovery, evaluation, purchase, use, and post-purchase support – is actually the customer lifecycle, not the customer journey. This lifecycle is a collection of macro and micro journeys, and each one must be carefully nurtured.
- Company goals. The customers’ needs are often confused with the firm’s needs. Businesses take action they see as customer-centric, but in reality, they’re trying to get customers to do what they want.
- Company processes. The way journeys are framed often reveals that they are really just a description of the company’s own internal processes and workflows.
The reality: The customer journey is about their needs, not yours.
It’s imperative that your company’s actions meet the different needs of your customers depending on the situation. When you identify the underlying need, you can begin to offer value in an aligned way.
Myth #2: We Deliver Value to Customers
This is not usually true. What companies really do is deliver products or services to customers, and that in and of itself is not “value.”
Value refers to perception and has four dimensions: economic, functional, experiential and symbolic.
Perception is based on context. Two different people who have the same interaction with a company or its product or service may end up with very different value perceptions.
For example, a music streaming service might consider that they provide value for everyone who likes music. But, think of the different ways someone can appreciate music: some want to make playlists for working out, while others are traditionalists who love vinyl records. Which one actually will perceive value from an online streaming service?
These are opportunities to create value that companies must identify.
Myth #3: Data-based Metrics Keep the Customer in the Centre
Organisations may talk about being customer-centric, but that is not always the case when they analyse their methods and processes. Most actions aim to extract value from customers to serve the company’s goals. For example:
- Additional fees to increase revenue
- Cross-selling and up-selling (with products or services they may not need)
- Asking for customer feedback and referrals
- Common metrics are pulling focus away from value for customers. It’s time to realign focus on the customer experience as a whole.