The Business Imperative of Customer-Centric Marketing
It sounds simple and intuitive enough. I mean, are there really any businesses that don’t want – or already claim – to be doing customer-focused marketing? Yet, the reality of being truly customer-centric is more complex than one initially imagines, and is consequently not as widespread in practice as is claimed.
Nevertheless, today’s tumultuous and competitive business climate demands that companies adopt a more customer-oriented marketing approach. The proliferation of new products and services, fragmented media channels, and an increasingly demanding customer require businesses to adopt a customer-centric strategy as a competitive advantage. The alternative is to a) be branded part of the marketing ‘old school’ (a.k.a. ‘talking at me’), b) dismissed by the new age consumer as irrelevant, c) or be relegated to the dinosaur heap of companies that can’t adapt to the new marketing reality.
Customer Centricity in Adventure Travel
The adventure travel industry and all its stakeholders are not immune to this marketing evolution. In fact, the very nature of the industry compounds the business complexities and marketing challenges: thousands of new travel options appearing each year; surging demand from a base of consumers with very diverse needs; a fragmented, entrepreneurial operator group trying to differentiate themselves; and limited operational and financial resources.
The economics alone clearly indicate that this is an industry whose marketing efforts must be guided by the customer first and foremost. For travel operators and other suppliers, a more customer-centric approach can increase operational efficiencies, improve the development of new products and services, and maximize the use and effectiveness of limited marketing budgets.
From the customer’s perspective, customer-focused marketing means higher levels of relevance to their needs, enhanced customer satisfaction, and loyalty and trust. Ultimately, this translates into a higher perceived value of the travel organization in question, and higher revenues for the operator.
Understanding the Customer Centric Organization
The challenge is that customer-centric marketing does not exist in a vacuum. Many organizations, both within the travel industry and in others, have tried to become more customer-oriented in their marketing efforts, yet have failed because the processes, customer support systems, and attitudes within the organizations themselves were not suitably aligned. Customer-centricity, in marketing or any other department, can only be successful when the concept is holistically understood, embraced, and practiced by the entire organization.
In its ideal state, a customer-focused organization is one whose culture, processes, products and services, communications, and other customer points of interaction have been designed and executed to provide the best possible customer experience while meeting its own business objectives. But let’s not stop there. To be fully acknowledged as customer-oriented, these interactions must be validated by the customers, and subject to ongoing feedback and adaptation. In a customer-focused organization, the only constant is change driven by both solicited and unsolicited customer input.
The Perils of Status Quo
As a measure of customer-centricity in practice, very few organizations can confidently state that each point of contact between them and the customer effectively reinforces the customer’s interests. And yet, this is exactly what needs to happen to ensure an organization is effectively managing the customer’s ‘moments of truth’ (points of interaction that influence the customer’s experience, positively or negatively).
Rather than adopting an effective and cost-efficient customer-centric strategy for short and long term benefit, organizations are, more often than not, engaged in ‘strip mining’ their customers for the quick sale and immediate financial gain. The result? Consider the following quote from Jill Griffin, author of ‘Customer Loyalty’.
“Only a small percentage of customers will complain. A typical business hears from only four percent of its dissatisfied customers. The remaining 96 percent go away, and on average, 91 percent never go back.”
Inevitably, this short-sighted approach has the offending company in perpetual customer acquisition mode, a costly, inefficient, and ultimately unsustainable position.
The Art (and Science) of Being Customer-Oriented
Like most worthwhile endeavors, becoming a customer-focused organization is neither simple nor an overnight process. It is not something that can simply be installed or switched on, but is an ongoing process that requires the appropriate motivation, skills and tools. Nevertheless, the resulting benefits and today’s competitive climate make this a strategy you cannot afford not to do.
The underlying concept of customer-centricity is remarkably straightforward: treat your customers as you would like to be treated if you were the customer.
But where to begin? Consider tackling the following areas first in your evolution toward being a more customer-focused business:
Company Culture: If the company culture is not oriented toward the customer first, then all other efforts and attempts at doing so will fail. Every person in your company who comes into contact with customers must understand, embrace and apply a customer oriented approach. They must be encouraged and motivated to do so with the appropriate leadership commitment, technological and process enablement, and compensation system. And lastly, employees need to be empowered to make on-the-spot changes (within parameters) to best address customer needs (think customer service).
Operational Processes: Customer insight is invaluable in developing a customer-oriented business. But if you can’t operationalize what you’re learning from, and about, your customers, then you’re back to where you started from. Evolving to a customer-focused organization means integrating all sources of customer insight (e.g. sales, marketing, customer service, etc.) and linking this to your overall operations. It also means demonstrating the flexibility and responsiveness to adapt your supply chain as necessary to best meet the demands of the customer.
Sales & Marketing: Gone are the days when companies unilaterally determined what, when, where and how customers wanted to hear from them. Today’s customers know what they want from companies (and more importantly, what they don’t want), are more technologically savvy, harder to reach, and frankly a lot less patient.
The solution? Be relevant…from a customer perspective. This requires understanding your customer base and specific segments, based on research, captured data, and the distillation of actionable insights. Relevancy extends to how you defining the value of the product or service you are offering (from a customer’s perspective, not yours), the media channels you are using, the frequency with which you are communicating, and the ‘experience’ each step of the way. If you don’t know what is relevant to the customer, ask them and apply the learning.
To competitively differentiate themselves in the adventure travel industry, operators and other travel providers inevitably must adopt a customer-oriented strategy. The industry structure and customers both demand that this happen if organizations are to be successful.
This customer focus must permeate all aspects of a company’s operations, including every customer touch point and interaction.
Lastly, the process for customer orientation must be organic. It must be accepted as a core element of a company’s culture and strategy, and appropriately configured to adapt to customer input and insights generated over time.
For the next installment of AdventureTravelNews™: Redefining the ‘Customer Experience’.
Many travel operators and organizations continue to believe that a customer’s experience is limited to their on-site activities. Consequently, this perspective gets reflected in the company’s marketing efforts. Yet from a customer perspective, the experience begins long before they arrive at the intended destination and extends long after they return. Understanding this perception gap and redefining the customer experience represents an enormous marketing opportunity for travel organizations to capitalize upon.
Evan Wood is the founder and President of JumpWood Marketing Consulting, a leading provider of strategic and direct marketing services in the travel industry. Find out how JumpWood can improve your customer centricity and deliver a better return on your marketing investment. Visit www.jumpwood.com and sign up for the free JumpWood Report, call 416-840-3452, or email [email protected].