In Part 2 of Think Oak’s Christmas blog posts – The Post of Christmas Present, let’s take a look at the current state of Business, Leadership and Technology. If you missed Part 1 – Click here.
The Post of Christmas Present
“It was the best of times, it was the worst of times… we had everything before us, we had nothing before us…” Charles Dickens
Business, Technology and Leadership are at a tipping point. All 3! The decisions that Leaders, Businesses and Technology developers are making at this very moment will, in my view, seal their fate for the future. Why? Three things:
Trust, Ease of Doing Business and Value for Money
The table below shows 9 areas where Business, Technology and Leadership meets Trust, Ease of Doing Business and Value for Money
Brand Loyalty has become a hot topic over the last decade.
A recent study by ClickFox found that benefits drive loyalty – identifying brand quality (60%), ease of use (46%) and features (40%) as critical for customers when choosing their favourite brands.
First impressions matter: Brands have one chance to win customers over, according to 56% of respondents who said that the first purchase or beginning of service is the deciding factor in establishing brand loyalty.
This is today’s retail reality, and will become the reality for other vertical markets:
- 79% of consumers spend at least 50% of total shopping time researching products online
- 82% of consumers will substitute and switch brands due to an out-of-stock product
- 59% of consumers are willing to try a new brand to get better customer service
A vast majority of all purchases begin online. The expectations have never been higher for retailers to deliver shopping experiences through their website, a mobile app or their social networks. Although the brick-and-mortar store still accounts for most purchases, the beginning of the transaction starts elsewhere.
Innovative retailers are dramatically changing their business model to stay ahead by shifting their storefronts to the digital world. They’re building apps, integrating social media and ensuring a complete Omni channel experience for the customer at every touch point.
Being visible and available to your customer through every channel is highly important for competitive retailers, but how do you retain your customer? What can you do to stop them using another brand or service that’s equally available? Many brands are turning to loyalty management strategies to create a consistent customer experience that provides incentives, and rewards customers for their loyalty.
Although some companies spend billions each year to try to make their brands resonate with consumers, few ever end up with ‘Raving Fans’
But the perks are huge for those who do. Loyal customers consistently come back to buy more, they’re more willing to stay despite increases in price and they become strong advocates for the brand in their own social circles and online.
Not many organisations successfully manage to harness the full potential of “people power” day in and day out, but they need to. Organisations that deliver their brand promise through their people reap the benefits that directly impact customer loyalty, market share and profitability.
Too many companies think of their call centres as an expense to minimise. We believe that it’s a huge untapped opportunity for most companies, not only because it can result in word-of-mouth marketing, but because of its potential to increase the lifetime value of the customer. – Tony Hsieh, Zappos CEO
So, how can you enthuse, engage and empower the people in your organisation? Four things are essential if you are to harness “people power”:
Recruit people with the competencies to satisfy customer expectations
Once you know and understand customer expectations, you can move on and create an organisation with the culture and the people to deliver on those expectations. This means identifying the fundamental behaviour your brand requires and the values that are integral to the brand. You must then recruit people on the basis of those behaviours and values. People matter, but the right people matter even more.
Train employees to deliver experiences that uniquely fit your brand promise
New employees do not walk through your doors and instantly utilise their attitudes, skills and intelligence in the best ways to deliver great customer experiences. Nor can existing employees be expected to transform themselves instantly and alone. Not everyone has the luxury of starting with no employees and recruiting those who clearly meet identified behavioural models.
Training can be bolstered by the use of customer experience success stories to help communicate desired behaviours. Spontaneity also needs to be enabled by training. There needs to be a balance between the human and the mechanical. This is something Disney has long proved adept at.
Encourage employees to demonstrate the right behaviours
Once people have the skills and understand customer needs and expectations, their performance needs to be evaluated against the right behaviours. “People power” requires that you also develop metrics for evaluating the use and impact of core and specific brand behaviours. Reward and recognition systems need to be aligned with these metrics.
Drive the behaviours from the very top of the organisation
The way leaders treat employees is reflective of how employees will treat customers. Organisations that treat employees the way they treat customers understand what the customer experience and “people power” are all about. “People power” cannot be delegated. Leaders must communicate a sense of purpose and constantly reinforce the values of the organisation.
A vital part of the leader’s role is to acknowledge achievements in order to provide motivational feedback to accelerate progress. They habitually catch people “doing things right” and publicly recognise their achievements. They link training and coaching to strategic issues. They remember the connection between what customers want and what colleagues want. Above all, they treat colleagues in the way they want them to treat customers and encourage them to observe and challenge the organisation through the customer’s eyes.
One way to look at this is to consider the extent to which your organisation balances making the numbers with living the values. Successful brands are those that hit their numbers whilst living their brand values.
Value Add Relationships
Strong customer relationships drive sales, sustainability, and growth, especially in today’s economy. Organisations that build and maintain excellent customer and client relationships lead the pack, whereas those that don’t put clients first fall off pace and, eventually, disappear completely.
A big mistake made by many organisations is not realising that customer satisfaction does not always translate to loyalty. A satisfied customer is simply someone who has received what he was promised—nothing more, nothing less. Strong customer relationships, on the other hand, imply that you have delivered something extra or provided added value to the customer. Long-term loyalty and the countless benefits that go along with it are awarded to businesses that go the extra mile for their customers.
The push for stronger and healthier customer relationships needs to start now. Regardless of your industry, here are five tips worth considering as you formulate a strategy for improving the quality of your customer relationships.
Successful relationships are two-way. Loyal customers want to be actively invested in the relationship.
Invest time in getting to know your customers, building relationships with decision makers. Talk about their challenges, their opportunities and their hopes and dreams for the future. This kind of insight can only benefit your relationship as you gain a deeper understanding of them leading to tailored communication and even products and services.
Become a Trusted Adviser
Ideally, customers should view your company as a Trusted Adviser, which means that you are the first person they call when they pursue a new line of business or launch a new project, or if they need help.
To become a Trusted Adviser, consider offering assistance before the customer asks, as a way to demonstrate your commitment to the relationship. By getting involved early in the process, you bring added value to the relationship and gain access to additional selling opportunities.
Regularly sending them industry news and updates will also help to position you as an expert and also communicate that they are top of mind.
Get regular feedback
In addition to offering useful and relevant information, regularly get feedback and advice from customers. Insight from regular feedback improves relationships by highlighting problems that exist below the surface—and also because you’ll be communicating, that you are willing to go the extra mile to make sure you’re meeting their needs. Feedback may also reveal ways in which the relationship can be expanded to include a greater scope of products or services.
Ditch the annual form survey and replace it with something tailored to the individual customer. Whether you use a do-it-yourself survey tool or hire a third-party professional, you are sure to gain important insight into the relationship.
Keep in mind that if you gather feedback from your customer, you must be willing and able to act upon it. Customers who provide you with their feedback expect you to act on the changes they’ve suggested, even if this action is to feedback why the changes can’t be implemented – but be sure to explain why. If you gather feedback and sit on it, you may worsen the relationship with your client.
All customers are unique
Although it’s tempting to make generalisations based on aggregated feedback, the best customer relationships are created when you tailor your strategy to the expressed needs of each individual customer. If one of your larger accounts doesn’t understand a new billing process, you need to determine a better way to communicate your system. Over time, it could turn into a more serious problem than you expect.
Be alert and pay attention to your customers’ unique needs and treat each like your only customer. It may require more effort up front, but it will pay off in the long run.
Keep in touch
Healthy relationships thrive on communication. If your business communicates with customers only at their request or when your company needs something, it will be difficult to leverage relationships as a driver of sales. Instead, touch base often with customers to inquire about their progress and to learn how you might be better able to meet their needs and expectations.
Communication is a key ingredient in healthy client relationships. ‘Raving Fans’ are active participants who willingly offer the time and information it takes for you to achieve the best results.
Word of Mouse
Word of Mouse or Social proof is a psychological phenomenon referring to people’s reliance on the feedback and actions of others to determine what is right and what is wrong in a given situation. Social proof is a concept as old as marketing itself—think of the testimonials in ads and the old-school word of mouth. But the rise of social media has enhanced the importance of social proof because feedback from real people is more easily accessible than ever before. As a result, entrepreneurs and small business owners are realising it’s an important part of their overall social presence.
In the world of online retail, social proof can be a strange thing. In the real world of bricks and mortar, we can see if a shop is busy, or if people are lining up outside the door of a restaurant. We look for these indicators to guide our choices, to provide the social proof we need to validate our decisions. However, on the web, with the behaviour of other people not directly visible, we rely on other indicators of social proof – customer reviews.
Online reviews have become a powerful weapon in the battle for our hearts and minds, and more importantly, our wallets. When it comes to recommendations, unsurprisingly many of us rely on friends, family, colleagues or suppliers. According to a recent survey by Gallup, 90 per cent of consumers trust recommendations from people they know. What is perhaps surprising, is the fact that 89 per cent of consumers are just as willing to trust reviews posted online by complete strangers. Essentially, consumers put almost as much faith in the reviews of anonymous people posting on websites as they do in those they know and trust.
This presents a unique opportunity for retailers. Consumers trust customer reviews 12 times more than they do the manufacturers’ own descriptions. It may not come as a complete shock that marketing content designed to sell us products is sometimes viewed with scepticism. Nonetheless, for consumers to trust anonymous strangers more – by a factor of 12 – demonstrates just how powerful customer reviews can be.
Customers that read reviews are more than twice as likely to make a purchase, and on average spend 11 per cent more than those that don’t. The travel sector, in particular, is one where people tend to place a lot of faith in the opinions of others, with 45 per cent of personal travellers planning trips based on reviews, and 54 per cent of business travellers.
Ultimately, bad reviews (whether fake or legitimate) are inevitable, and in some cases even welcome. Customers are smart, and know that retailers aren’t perfect. Sometimes stock runs out, sometimes a courier service will be late – these are things that customers get frustrated over, but understand the fact that they occasionally happen. When the service delivered is anything less than perfect, it’s a chance for retailers to acknowledge their shortcomings and act to remedy the situation.
Anytime, Anyplace, Anywhere
We’re at a moment of profound change in our relationship with technology. No longer tied to devices, locations or software – the anytime, anyplace, anywhere culture dictates technology organises itself around us and shapes itself to our requirements.
From e-Commerce, marketing automation, social media, mobility, cloud computing, Internet of Things (IoT), Bring Your Own Device (BYOD); new and disruptive technologies are everywhere – and so is the demand from customers and employees to use them. Digital technologies help drive productivity and improve the satisfaction of your customers and employees. But expectations are rising. Customers expect to be able to interact with you at any time and through the medium of their choice. Businesses are expected to operate 24 hours and have global reach. Competition is fierce and the rate of change is only set to increase.
Over the last few years, new channels to market including e-commerce and m-commerce have been introduced and have rapidly grown in popularity, supported by pervasive fixed and mobile internet access and broadband. This has contributed to a huge increase in home delivery, and a reduction in customer footfall for many traditional businesses. Advances in products themselves have driven change, such as digital downloads of entertainment media from books to computer games.
Retailers with many stores recognise that they no longer necessarily need a physical presence in every high street in order to achieve national coverage, and therefore some are reducing their bricks and mortar presence to fewer sites – particularly as long lease agreements come to an end. Other retailers are changing the ways in which they use their existing space to enable new services and new formats. Some are now sharing their sites with other retailers, or partnering with them on a combined customer offering.
Many entrepreneurs test the market through e-commerce before investing in bricks and mortar. Some manufacturers and suppliers are now selling directly to customers via the internet.
These technological innovations have substantially lowered barriers to market entry, making it far easier for new online businesses to be established. Today’s competitors are not just down the road or in the next town, but throughout the country and even across borders. E-commerce is making cross-border trading much easier for retailers.
While we’ve seen several quick-moving organisations embrace amazing customer experience in recent years and build lasting, trusted relationships with their customers, we’re also still seeing a number of older, slow-moving companies continue to fail on this front.
With the various technologies available today, the competition to understand and serve your customer better than your competitor does is getting fierce. Enterprises should care now more than ever about providing a great customer experience.
A common problem organisations fall into is trying to use technology and software to create a customer experience. This is not recommended as it can lead to the focus being on what the technology can do, as opposed to what you can do to enlighten an amazing experience
I recommend you define a customer experience, and then identify what tools and software you need to assist to make it happen. Do not mould your customer experience strategy around technology. Find technology that you can use around your strategy.
Here are some tools you should look into:
- CRM tools for relationship management: keep all data and communications between your company and customers in one spot so that the right people can see it quickly.
- Marketing tools to engage with customers: send trigger emails based on specific actions.
- Online survey tools and customer satisfaction tools: survey customers, get feedback and measure satisfaction.
- Web analytics and tracking tools: Measure engagement, number of site visits and page visits. Build out a customer profiles full of data to help manage the experiences.
In the banking sector, standards have been widely condemned in the wake of the global economic crisis. Corporate values were in the spotlight again when Google was accused by Margaret Hodge UK MP of being “devious, calculated and, in my view, unethical”.
To be successful in the cut-throat world of business, you may think there’s no place for soft values and morals. But holding on to personal principles as a leader is not just about ethics – it can also boost your career and organisation.
Leading with personal values is a leadership philosophy that steps outside of measuring success by job title or rank, personal wealth and power. It is not about emulating the great leaders of Christmas Past. Instead, it is a practice of identifying what matters to you, what you stand for and what values you have in your life. With this basis of knowing your purpose, making the right decisions in life and leadership becomes easier.
Making the right decisions is only the beginning. Leading with values is important for leaders because it creates and maintains company culture, informs employee selection, guides the direction of company growth, and adds meaning to the work required to maintain the organisation. That meaning starts with the leader, and passes down to all levels of the team.
However, understanding your values and doing the “right thing” isn’t simple. In fact, for all of us, it’s a lifetime challenge that requires thought and practice.
Think of it as an oak tree: values are our roots that keep us grounded in what’s important to us. The strength of the values determines the strength of the trunk, branches, leaves and acorns from year to year. A strong oak tree supports the ecosystem around it; a leader with strong values supports the organisational culture and the surrounding ecosystem.
With endless options for products and services, instant access to information, and the power to share their opinions more widely than ever, today the customer is almighty.
Some organisations have actively embraced this new breed of buyer – supporting them with free delivery both ways, 24/7 live customer service, and crowd-sourced product input to ensure the voice of the customer is being heard and embraced. But what else are the leaders of these “customer-first” organisations doing to win the hearts and minds of customers? What can we learn from their focus on creating customers for life, and what does that mean for the people who work at those companies?
Creating a customer first culture can mean something different to every leader. The key is to clearly define what elements make up your version of being “customer first,” and then adjust or create processes, operations, culture, and behaviours that make it a reality. These three things can help make your customer-first culture a reality:
Leaders need to define “customer first culture.”
Embrace the reality that your customer experience will never exceed your employee experience. Creating a customer first culture starts with creating an employee first culture.
Engage the hearts and minds of your people by developing a “story” with big-picture visuals that illustrates your brand promise and the optimal customer experience and people’s delivery roles within that experience.
Identify the barriers inhibiting a customer first culture and whether or not they vary by channel. Engage your people in your desired culture, specifying “how we work together” to deliver a great customer experience.
Address the barriers between functions by making operational, process, or behaviour changes, and ensure each prioritises the customer.
Share what’s working and what’s not. Reinforce best practices for moving forward.
Managers need to act as owners.
Make sure managers know their role and understand the customer first strategy as it relates to your brand.
Ensure people have the leadership and coaching skills they need to act as owners of their business and build the capabilities of their people.
Identify and communicate best practice of what the best managers are doing to drive the customer and employee experience; showcase how others can adopt and emulate those same behaviours.
Underscore the importance of leadership and manager transparency around key measures and drive ownership of the results of the entire team with tools like Customer Experience Dashboards.
Develop guides for fostering ongoing conversations about the journey to becoming a customer first organisation.
Implement feedback loops so managers can provide insight on how well initiatives are working and ways to optimise the customer experience.
Individual contributors need to create authentic customer experiences.
Make sure employees on the frontline understand your brand values and vision, as they will be delivering on it most often.
Engage employees in the organisation’s approach to customer experience and give examples of behaviours that support it.
Make sure individual contributors have the skills and knowledge needed to deliver on the customer-first vision, and help them set clear priorities of what’s important.
Build their sales and service skills, including point of sale, merchandising, and others that apply to your organisation.
Set clear service standards and methods to guide employees about making trade-offs and decisions.
Prepare them to anticipate customer needs in order to exceed expectations.
There’s only ever one chance to make a great first impression. Creating a customer first culture that your entire organisation embraces makes all the difference in how your brand is perceived by customers. Take the first step and set the momentum for your organisation to win customers for life.
Customer Value over Shareholder Value
Shareholder value: It’s been called the driving force of 21st-century business. It’s also been labelled “the dumbest idea in the world” by legendary chief executive Jack Welch, former CEO of General Electric. Welch was able to dramatically increase revenue and shareholder value during his tenure, but GE’s extraordinary accomplishments were not the result of a single-minded focus on beating quarterly profits. Maximising returns is an outcome, not a strategy.
What value do shareholders bring to the companies they invest in? Are most shareholders interested in what is best for the company, or are they in it only for the financial performance of the company’s shares?
Most executives agree that it’s important to create value for the customer. The problem is that despite the good intentions of the leadership team, this mind-set often doesn’t travel further than the company core values posted in the reception of the corporate headquarters or intranet.
Professor Solow, winner of the Nobel Prize for his theory on economic growth, found that only a small portion of financial growth in the world comes from companies making money out of money. Instead, the majority of financial growth comes from companies actually producing a product, developing a new service, or changing the way we conduct business. Consider Steve Job’s unrelenting focus on product innovation and what Apple was able to achieve by creating the iPad, iPhone, and iPod. As we know, iTunes has literally changed the entire music industry!
If you can build a product that will truly change the world, like Steve Jobs did several times, your shareholder value will take care of itself. Your problems will be protecting your distribution channels, defending your intellectual property, and retaining your talent. Which set of problems would you prefer?
I hope you enjoyed the Post of Christmas Present and if you would like to jump straight into the Post of Christmas Future, please click here!