Five questions to ask yourself about the new customer journeyby
Today’s dramatic shift in buyer behaviour is challenging conventional ways of doing business in almost every sector. Most companies do not realise it yet, but the sales model of the past is broken. No longer can a sales force ‘push’ out to a pool of customers with a straight sales proposition and hope to initiate enough expressions of interest that lead to appointment proposal and sales closure. Nor is a sales team any longer the expert research source for most buyers.
The buy-side now has the means to research and evaluate at their fingertips at any time during their evaluation efforts. The modern business buyer can, and expects to, self-educate before engaging with suppliers. Today’s buyer (often line-of-business rather than IT) is empowered more than ever to rethink scope, requirements, budget and timelines as they embrace the new digital age.
Modern business development is now far more a matter of engaging with potential net new customers right from their initial research stages. The modern business development technique is to be ‘useful’ to the buyer right from the moment they set out on their purchasing journey, based on real prospect intelligence (McKinsey & Company, The New Consumer Decision Journey, October 2015). The buyer’s interest is then nurtured and qualified as they consume ‘interesting outputs’ from the vendor, until the point where they – through their consumption of those outputs – indicate a sufficient level of interest to merit a sales call.
Even more radical change has happened in the way a company deals with its existing customers. Additional sales to existing customers makes up a considerable proportion of new business development for many organisations. This used to be the responsibility of the sales and marketing director. No longer. In a phase shift occurring over the last few years, pioneering companies have realised that every aspect of the customer experience will affect the likelihood of customer retention and development. All directors and departments need to be focused, and measured, on their contribution to business development.
Such an approach therefore needs to utilise customer intelligence and capture the impact each function of the business has on the customer. Product Development needs access to customer intelligence to assess and fulfil demand, and to steer relevant innovation. IT/Operations enhances the customer experience by using customer intelligence to create an efficient and supportive user experience. Intelligent Finance will craft the financial terms and conditions which make it easy for the end customer to buy, to buy more often, and to pay more quickly with less pain. And HR will use customer understanding to match staff skills to customer requirements and personas. In a world where it is increasingly easy to find and switch to lower price equivalents, the importance of added value based on customer knowledge and intelligence is becoming more and more critical to business success.
All this requires a significant change in attitude to the importance of collecting, understanding and using customer intelligence. The CRM application should now be applied as a layer sitting over business functions and overall operating applications – ERP (operations), Sales, Finance & Payments, Customer Service, etc. – a repositioning that multiplies a company’s return-on-investment from customer data many times over. In this way a business can establish a more comprehensive window on the total sum of customer interactions providing valuable intelligence that the company can use across the business. Such repositioning is also fundamental to realigning the self-view that non-sales personnel can have with regards to their role in positively impacting the customer experience.
How, then, to start exploring this new way of working, the ‘new customer journey’? There are 5 key questions that company leaders can explore in order to guide their response to the dramatic changes in buyer behaviour.
1. Do you know who your profitable customers are?
Not all customers are created equal or loyal; some are far more demanding, eating into the company’s profitability. It is vital to examine the data to determine the characteristics and behaviour of different customers and to assign resources accordingly. Indeed, companies now have a wealth of data often locked away in silos which can be made visible to the business through CRM.
2. Are you aligned with your customers’ growth potential?
Having a better understanding of customers, especially a detailed picture of who is most profitable, will help your company build relationships that are ripe for expansion and also ensure they deliver enough customer service to retain the most profitable customers.Is the product pipeline aligned with customers’ projected future needs? Is your company in a position to offer critical “added value”?
3. Do you know how to define your customers’ buying journey?
The traditional “funnel” model has been replaced by the “customer decision journey” – this is where buyers can take full advantage of the technology which is available to them to actively analyse products and services and to switch direction at almost any time. The key for leading companies is to avoid playing catch-up with their customers, and to help put them in a position where they can influence those buyer decision journeys. McKinsey & Company claims that businesses which can optimize their customer decision journey by compressing the consideration and evaluation phases will have a competitive advantage.
4. Where in the customer buyer journey is your company losing prospects?
If the company is losing prospects it is necessary to analyse your existing customers and look at the “journey towards defection” – understanding the different stages will mean that the company can recognise the warning signs and be in a position to intercept and prevent customers from leaving. Existing customers are the best prospects. This underlines the importance of the all-round customer experience across operations, finance and product delivery, and the influence that all departments have on keeping, and developing, that customer.
5. What is the business case for a new approach to customer relationship management/CRM?
To survive and thrive in the digital age, a successful enterprise needs to align to the new customer journey across all customer touch points – sales, marketing, operations, customer service, finance and HR. Business leaders need help to understand the importance of realigning CRM so it can provide the ‘glue’ that enables realignment of the business. CRM is no longer an IT issue, nor a technical marketing project. It is now a strategic tool that gives the individuals within the business a competitive edge in working as a team to achieving the company’s key goals.
Mike Richardson - Managing Director, Maximizer EMEA
As Managing Director (EMEA), Mike is charged with leading and delivering the marketing, sales, service and operational strategy for the EMEA region, alongside the management of the Certified Solutions Provider network.
Mike joined Maximizer Software in 2000, by which time he...