The 1900s through 1960s was known as the Age of Manufacturing. The 1990s through 2000s was called the Age of Information. For the next several decades, businesses will be adapting to the Age of the Customer, a new business cycle where the power has shifted back to the people, and engagement will mean everything.
Forrester Research marks the beginning of the Age of the Customer at 2010, and over the last few years, we’ve seen numerous brands acting on this age, putting the customer first in all that they do. Think Zappos: “We decided that we wanted our brand to not be about shoes, but about delivering the very best customer experience,” said Tony Hsieh. “That’s our brand and I’m pretty confident we can sell any item with that as our foundation.”
Or take Amazon.com CEO Jeff Bezos as an example, moving beyond retail and now to media with a customer focus: “We’ve had three big ideas at Amazon that we’ve stuck with for 18 years, and they’re the reason we’re successful: Put the customer first. Invent. And be patient. If you replace ‘customer’ with ‘reader,’ that approach, that point of view, can be successful at the Post, too.”
While many brands pay lip service to customer-centricity, it’s those that truly are “customer-obsessed” that are already seeing positive results. According to Bain & Company, a 5% increase in customer retention can increase profits by 25% to 95%. A Watermark Consulting analysis also supports the customer satisfaction focus. Taking five years of data from Forrester’s Customer Experience Index, the analysis shows that the brands at the top of Forrester’s Customer Experience Index show far better stock market and revenue performance than customer experience laggards.
So what do customer-obsessed companies do differently than most? Here are 10 top differentiators:
1. They focus on customer satisfaction retention over customer acquisition. In a 2013 Forrester survey of global CMOs, 63% listed acquiring new customers as their top priority, while just 22% said retaining current customers was their top goal. Customer-obsessed companies don’t obsess over wanting more; they appreciate and take care of what they’ve got, letting the brand advocates drive new customer acquisition.
2. They align brand strategy with the customer experience. Customer-obsessed companies don’t just talk the talk on being focused on their customers; they walk the walk. A poll of Forrester’s Customer Experience Council reveals that just 18% align customer experience with the brand strategy, a necessity in creating consistent positive customer/brand interactions and conformational messaging.
3. They are nimble and connected. Customer-obsessed companies break down siloes and create seamless service experiences and customer experiences across the standard and emerging channels their customers are using every day.
4. They use multiple sources of customer data to respond in customer-friendly ways and predict next actions. Customer-obsessed companies create a relationship of trust. They use data to get to know and show that they know each customer, and then they go beyond this to predict and suggest best next actions and purchases.
5. They use customer intelligence to gain insight at scale that leads to better products over time. Customer-obsessed companies don’t just listen to and solicit feedback; they act upon it to develop the products, services and brand their customers desire.
6. They don’t just talk about the customer experience; they invest in it. Notes David Cooperstein in the Forrester report, Competitive Strategy in the Age of the Customer, “a customer-obsessed enterprise focuses its strategy, its energy and its budget on processes that enhance knowledge of and engagement with customers and prioritizes these over maintaining traditional competitive barriers.”
7. They recognize that the customer journey is almost never a straight line. Customer-obsessed companies don’t just deliver on omni-channel service and support, they invest in creating a 360-degree view of the customer that maps the customer journey and details customer history and feedback across all channels. Then they use this in real-time service.
8. They create a connection with the customer post-transaction. Customer-obsessed companies focus on customer engagement both shortly and long after the sale. They communicate proactively and personally in an authentic way.
9. They invest in content creation over advertising. Customer-obsessed companies develop and deliver helpful, shareable content rather than pushing promotional content and advertising.
10. They are flexible to customers’ needs. Customer-obsessed companies realize that customer service and the customer experience is not one-size-fits all and align their processes and empower their staff to make sure that each customer interaction is personalized and satisfying.
The Age of the Customer is upon us. Is your brand becoming customer-obsessed?