Rethinking priorities: digital technology vs. customer understanding
As digital technologies advance, brand owners, marketers, and strategists become increasingly familiar with technologies and concepts such as e-Commerce, AR/VR, and the Metaverse (and more recently: Spatial Computing. Guess who’s the culprit?). Considering the potential of these technologies, it’s not strange to see brands rushing to jump on the digital bandwagon, eager to incorporate them into their BX. However, even with experts by their side and a huge investment, many brands still struggle to see a good return on investment (ROI). Why?
The answer is simple. These brands have failed to create a compelling BX that could resonate with their target audience.
Through our team’s research of successful digital brand experience case studies, such as Brooks Shoe Finder, L’Oreal’s Skin Genius, and Nikeland, we found that having a solid understanding of the customer is necessary for a compelling BX. It is easy to understand why. Brands can only create experiences that resonate with customers if they have a firm grasp of who their customers are, how they behave, and what motivates them. Without any of this knowledge and all experiences will lack the power to captivate and inspire.
However, many brands and businesses have it backward: they start building their experiences with the technology before going back to trying to understand who their customers are. There are two reasons for this. First, modern brands and businesses are obsessed with operational efficiency, and this obsession can overshadow all initiatives for a more customer-centric approach. Second, not every brand has the proper structure or framework that could help to improve its customer understanding.
Can this problem be solved?
Nurturing a customer-centric culture
To ensure that their BX can resonate with the target audience, brands and businesses must start with customer understanding before focusing on the needed technologies. This shift in perspective requires a fundamental change in the brand’s culture to become customer-centric. Two ingredients are necessary to bring about this transformation: support from senior stakeholders and a clear roadmap for cultivating a customer-centric culture.
For the first ingredient, demonstrating how understanding and catering to customer needs can drive revenue, increase customer loyalty, and enhance brand reputation is essential in garnering buy-in from decision-makers. Luckily, many studies (such as those from Gartner) have already shown the impact of a customer-centric culture on the business’s bottom line. And if case studies aren’t enough, small pilot initiatives with clear KPIs that require small investments are usually more than sufficient to convince even the most stubborn stakeholder.
For the second ingredient, careful consideration of enterprise resources and strategic fit is required to develop a feasible roadmap. Furthermore, brands should always start small, even when they aim high. Instead of immediately trying to roll out multiple customer-centric initiatives throughout the organization, starting with a mixture of easy-to-implement customer listening approaches, such as Voice of the Customer (VoC) programs, is more effective. These small steps give brands the time to readjust their direction and strategy to avoid costly missteps while efficiently providing them with a solid foundation to develop new BX initiatives simultaneously.
With the two ingredients prepared, brands can gradually shift to a customer-centric perspective and be ready to build BX capabilities that inspire customer confidence. It is important to note that shifting to a customer-centric culture isn’t a one-time exercise. Brands must continuously invest in their initiatives to ensure that their culture continues to evolve and adapt to the changing landscapes.
A customer-centric culture is but half of the story
Having a solid customer-centric culture is just half the battle.
Even with strong customer understanding, brands could still fall into the pitfall of creating “engineered insincerity,” a series of automation mechanisms that severely harm brand-customer relationships. If you are wondering what these mechanisms are, look at the number of promotional emails in your inbox and the daily text messages that force you to unfollow.
Customers do not need another 10% discount to celebrate their birthdays or another sock recommendation because they recently purchased a new pair of shoes. Customers want to connect with your brands to become a part of what you are presenting or because your brand is a part of their identity. So act accordingly. Craft BX programs that invite your customers to interact with your brand at a higher level than simply making another purchase. Let your authenticity and creativity take the stage.
Don’t forget to measure
One cannot declare their BX efforts compelling without proper measurements in place. BX metrics are vital as they can be used for multiple purposes. Be it to communicate the rationale for previous investments, validate improvements, set goals and targets, or intervene when remedial action is needed, continuous measurement and observation are required for all BX programs to remain effective into the future.
Traditionally, brand owners, marketers, and strategists have always relied on typical brand aspects, such as brand equity, brand loyalty, etc., to measure how successful their BX initiatives are. However, as the world becomes more agile and stakeholders become more sensitive to operational efficiency, vague definitions alone won’t be enough. While different organizations will use different combinations of metrics, the most appropriate mix will always align with key roles across all functions and departments. From customer satisfaction (CSAT) and net promoter score (NPS) to more financially aligned metrics such as ROI or return on marketing/customer investment (ROMI/ROCI), many metrics can be combined to measure success. Brands, however, have to ensure that all combinations of measurements are aligned with the overall business goals and visions.
Additionally, brands need to take action based on the taken measurements and observations. Without any action, all measurements will be in vain.
Some last words
Compelling brand experiences, be they digital or not, start with a strong customer understanding. Unfortunately, many brands had it backward. They start with technologies only to struggle later as their efforts fail to achieve the desired results. To succeed, brands must first shift to a customer-centric culture and think about how their BX initiatives can be crafted best to suit customers’ changing expectations. Furthermore, brands must constantly think about how they can measure success and how they can best adapt to the changing landscapes. Fail to do so, and it will become impossible to future-proof brand experiences that resonate with the audience.
As brand owners, marketers, and strategists, it is in your power and responsibility to ensure the success of your brand. It’s time to make the changes.