BUSINESS BEYOND COVID
NATHALIE SCHOOLING: Covid-19 has changed your customer, so keep up
Old school leaders may have succeeded with analytics and great products, but a post-pandemic world is all about customer experience
In the Business Beyond Covid series, CEOs and other business leaders and experts in their sectors look to the future after Covid-19. What effect has the pandemic and resulting lockdown had on their industries and the SA economy as a whole? Which parts will bounce back first and which will never be the same again? Most importantly, they try to answer the question: where to from here?
The coronavirus represents not just a public-health crisis, but a crippling economic one, with the most unsettling thing about it being that no-one knows how long it will last or what comes next. We seem to have arrived at a moment when the past is no longer a reliable guide to the future. When “all that is solid melts into air”, as Karl Marx once put it.
Many businesses won’t be around when this is finally over. Whole industries will cease to exist. This realisation forces companies to completely re-evaluate their business model and what I believe is finally a catalyst to adopting a customer-centric, outside-in approach.
In a time of sometimes paralysing uncertainty, what we know for sure is that Covid-19 has redefined what it means to be a customer. Buying patterns have adapted to digital and contactless services, while customers’ wants, and needs continue to modify at speed. It’s not only the basic needs of people that have changed; a whole new set of expectations, values and ideals are emerging.
If you ask yourself who the most important person in a company is, your answer is probably the CEO. Well, think again. To borrow a line from Bill Clinton’s 1992 campaign for the US presidency, “it’s the customer stupid”, and this is what today’s CEOs will come to value more than ever.
While some companies have been successful in prioritising a customer-centric approach, unfortunately, there are many more that have put off investing in customer experience. It’s often been seen as a buzzword or just a box to tick, and now there is somewhat of a catch-up game at play. As customer behaviour continues to transform and adjust to the impact of Covid-19, previous customer data becomes outdated and futile, putting some businesses even further on the back foot.
So where to from here? A good starting point for recovery and growth begins with putting energy into understanding your customer — or rather your changed customer. This presents enormous opportunity for competitive players to get ahead in the new world.
What customers think of you, or more accurately, how they feel about you, is the number one predictor of future growth. It’s customers that make or break a business, and now so more than ever, as businesses are scrambling to recover from this pandemic. Recovery is just not possible without demand.
While the customer might be the most important person to a company, the CEO is undoubtedly the most influential. This being the case, a successful customer experience strategy starts at the top
According to Mark Leiter, chair of Leiter & Company, a strategy, consulting and investment firm, the primary focus of CEOs last century was ensuring a high-quality product offering. This made sense, as the quality of a company’s products was the main way customers differentiated that company from other brands.
This is no longer the case. We now live in a world where quality issues are far less prevalent due to advances in technology and quality assurance. Instead, the main basis on which customers distinguish between brands is customer experience. This trend pre-dates the Covid-19 lockdown. However, it’s likely to accelerate in the post-pandemic world.
Up to now, SA companies, who are about five years behind when it comes to customer experience, have merely paid lip-service to the notion, with very little follow-through. This is something we should hopefully see changing as we forge ahead to rebuild what we have lost.
According to KPMG, the biggest predictor of a company’s future revenue is its ability to retain customers. In part, this is explained by companies being on average four to five times more successful selling to existing customers than new ones.
As economic conditions deteriorate, it’s worth considering the implications of losing customers through poor service. For all the pain, one of the benefits of recession is to sort the wheat from the chaff. It’s like natural selection for businesses. Only the most competitive survive, leading to improved productivity when good times return.
The number one job of the modern CEO in a post-coronavirus world is therefore to ensure their company delivers exceptional customer experience. Leading CEOs already recognise this, seeing themselves as advocates for their customers. A great example is Amazon’s Jeff Bezos. He’s been known to place an empty chair around the table at board meetings. It’s there to represent the customer, providing a constant reminder of exactly who should be at the forefront of all decision-making.
Unfortunately, not all heads of major companies are so enlightened.
While the customer might be the most important person to a company, the CEO is undoubtedly the most influential. This being the case, a successful customer experience strategy starts at the top.
In fact, customer experience should be considered more than just a strategy. To succeed in our new world, putting the needs of customers above all else has to become part of a post-pandemic company culture, and without the involvement of the CEO, this kind of transformation is impossible.
The problem is that customer experience doesn’t always come easily to CEOs of the old school. Many of them owe their success to a combination of supreme analytical skills and keen strategic judgment. This served them well in a world where businesses competed on the quality of their offerings — something inherently quantifiable.
These days, with product excellence a given across leading brands, capturing or retaining market share requires great customer experiences, above all else. This involves empathy, authenticity and, ultimately, an emotional connection between brand and customer. An alignment of values, so to speak.
For those who prefer concepts that can be depicted on a graph, you can see how all these intangibles might be terrifying. But that’s the reality for businesses in today’s tough and uncertain times. For CEOs from the old school, it’s a matter of adapting, or moving on.
• Schooling is a customer experience strategist and CEO of nlighten.