FEATURE1 September 2008
FEATURE1 September 2008
Customer-centricrity is all the rage, with even the government getting into the act. Companies and organisations routinely talk about putting customers at the heart of their business.
So what lies behind this increasing focus on the customer? Most obviously, companies are operating in a much more competitive marketplace, and have to fight harder to keep their customers. Consumers are offered much greater choice, and there has been an explosion of marketing communications while the media landscape has fragmented.
At the same time, the internet has shifted power to customers by redressing the imbalance of information between them and suppliers, as well as giving them the means to voice their dissatisfaction when they receive poor quality goods or service. As well as transferring power to the consumer in information terms, the internet has also opened up access. Compare bank branch opening times to 24/7 online banking. Customers know what they want and know when they want it.
With the advent of Web 2.0, many companies are taking advantage of social media by using self-help websites, customer blogs and third-party forums to facilitate dialogue with and between customers. A related trend – dubbed co-creation – sees increasing customer involvement in key business issues. Public forums such as Dell's IdeaStorm.com and MyStarbuckIdea.com, where customers submit their ideas and fellow-customers vote on them, are changing the way companies do business.
Against this backdrop, companies are reframing the way in which they view customers. Since the 1980s, marketing theory and practice have shifted their emphasis from individual transactions to the wider customer relationship. And in the past few years we have seen a further change in focus to what business thinkers Pine and Gilmore have named the 'Experience Economy', where companies have gone from offering products ( e.g. a cup of coffee) to services ( a cup of coffee served in a café) to experiences, where brands like Starbucks suggest that the ordering, creation and consumption of the coffee embodies a heightened ambience.
Many organisations are on a similar journey. Orange's new global ad campaign is based on the insight that, in the words of brand director Justin Billingsley, "We are in the relationships business not the phone business. We want to express everything we do through the relationships we fuel."
This customer-centric world offers enormous opportunities to researchers. We are the voice of the customer after all. Technology gives us lots of new, exciting ways to research customers. And we have at our disposal a range of techniques that not so long ago were seen as innovative but now are commonplace.
But can we really claim to be customer-centric in our research? How often do we really look at the world from the perspective of the customer rather than our clients? And how willing are we to hand over control of the research process to the customer? These are all questions customer researchers should be asking themselves.
What's in it for them?
As customer researchers, we are often guilty of looking at the customer relationship from our client's point of view. In other words, how do customers deliver value – is it through repeat purchasing, increasing spend, buying other services or recommendation? These are the loyalty outcomes we build our research around.
But how about if we think about the benefits of the relationship from the customer perspective? There is often more to the relationship than the basic service being delivered, and it can be valuable to think about what benefits customers gain over and above this. Possible examples include:
• Shaping or reinforcing customers' identity ( e.g. premium or trendy brands)
• Giving customers good experiences ( returning to the coffee example, organisations like Starbucks can offer an appealing place to do some work or somewhere to catch up with friends)
• Helping customers live better lives. Concern about the environment is growing among consumers, but the right choices are not always obvious. Retailers have the opportunity to take on the role of a trusted and expert guide.
There are enormous advantages to thinking through relational benefits from the customer's perspective, instead of viewing these through the lens of the organisation's brand values. This should help organisations understand how to strengthen the customer relationship and achieve the outcomes they desire.
The co-creation of customer research
How can we put customers at the heart of the research process? It will involve much more than seeing customers as research participants instead of respondents. It means reframing research as something we create with customers, rather than something we do to them.
As I've said, the principles of co-creation have been adopted by organisations such as Dell and Starbucks ( Nokia, Peugeot and Lego are other good examples). Why not apply the same approach to customer research, and recognise the way in which the balance of power between customers and organisations has changed? Arguably we can involve – and empower – customers at every stage of the research process.
Defining the agenda
We can let customers define the research agenda. Workshops provide the ideal environment to hand control over to customers. Allowing customers to direct some or even all of the workshop agenda means that the focus of the research is driven by their needs and priorities.
We recently ran a programme of customer-driven workshops for Easynet, a provider of managed network and hosting solutions. Easynet invited a selection of key clients to workshops to explore their business challenges – and what Easynet should be doing to help with these. Rather than pre-empting the issues and setting a fixed direction for the workshop, customers selected the topics for discussion.
Easynet has used the workshop findings to develop future services, as well as improving customer servicing and satisfaction levels.
Quantitative questionnaires are developed in collaboration between agencies and clients, and usually piloted afterwards with customers. However why not involve customers in questionnaire design at the outset?
Again, workshops are an ideal forum for this. We could take our inspiration from deliberative techniques which involve a more collaborative relationship between participants, researchers and clients. The questionnaire could be developed during an interactive session in which these three groups work intensively together, combining elements of qualitative research, brainstorming and problem-solving.
This is another area pioneered by public sector researchers, often for policy reasons. For instance, as part of our work evaluating the impact of the UK government's New Deal, one of the requirements was to give local residents in the community the opportunity to join the interviewing team.
There are also good research reasons why so called peer interviewing can be effective. Participants and peer interviewers are able to develop a more effective rapport with one another, encouraging open conversation about experiences they might have in common.
Again we can apply this approach to customer research, and technology gives us greater opportunities to do so, through interactive elements such as blogs and wikis. Ipsos has developed Opinionator, a qualitative/quantitative online tool that allows research participants to guide the research and have an active input into research questions. The direction of the research project is controlled more by participants than the moderator.
Good customer research should always have action-planning at its heart. This involves turning research insights into actions to help businesses achieve their customer objectives. Action-planning sessions often involve trade-offs between what should and can be done given the resources available.
Again, why not get customers involved in action-planning through the use of deliberative techniques? We have run budget-setting workshops, where participants are given the role of councillors choosing between different spending priorities.
Involving customers in research in this way may sound like a daunting prospect, not least because it involves giving up some control. Clearly some organisations are going to be more comfortable than others about putting the customer in the driving seat. But if companies – and researchers – are going to do more than pay lip service to being customer-centric, we should be experimenting with these different techniques to see what happens when customers are involved in co-creating research.
If we are to conduct truly customer-centric research, we must never forget that all research conducted with customers is part of the customer experience.
We must avoid badly designed, over-long questionnaires with boring, difficult to understand questions and poor routing. There is never any excuse for shoddy design in research, but where we are dealing with customers, it is particularly important that the research is as pleasant an experience as possible.
It is 160 years since Marx and Engels published The Communist Manifesto. Their objective was to revolutionise society, and they suggested 10 measures to achieve this. The aims of The Customer Manifesto are rather more modest, but if organisations and researchers are to become more customer-centric, here are three simple measures to consider:
1.Think about the customer relationship from the perspective of what the customer, not the supplier gets out of it.
2. Regard research as an opportunity to co-create with customers, instead of something which is done to them.
3. Always view customer research as part of the customer experience.
The biggest enemy of the customer researcher is complacency – doing the same things again and again, even if both we and our clients are bored stiff with the results. Depending on the client, different approaches will work better than others but the net effect should be to move us on.
Alex Bollan is research director at Ipsos MORI and her paper Understanding Customer Relationships is available at www.ipsos-mori.com
September | 2008