In business, you are courting customers. No customer, no business. Are you going for the guy-or girl-next-door? Or simply, are you chasing after everyone in town? Or worse still, chasing them on the street!
In the midst of reading the mountains of case-studies materials in the AMP (Advanced Management Program) at Harvard Business School, I was told by my boss that I had been assigned a new mission… to go chasing after everyone in my region!
So you ask: “what’s the problem?”
Which ones? So many out there in my region, you know. So, I started to think of what kinds of people fit my wish list.
Yes, first things first, I got to design my criteria…or maybe, craft out a philosophy.
The First Day
Now that the initial excitement is over, I begin to think it over in my head. The hard work has just started… the ‘chasing & courting’ part…
As the newly appointed Managing Director, Customer Acquisition (regional), I started by asking myself this seemingly stupid question: “Who are my customers?”
I believe this is the question being asked since the day the subject of Marketing was practiced in humankind. So this question has been asked by millions of people for thousands of years. And it remains a powerful question, indeed.
By asking the most basic question about customers, the philosophy of Customer Acquisition can be constructed in the following manner: To Know, To Be and To Do (Perform).
(1) KNOW Your Customer.
Knowing your customer starts with customer insight. Fundamentally, a business should remain highly focused on its preferred types of customers within each of its markets and segments. Chasing everyone on the street is a shot-gun approach to customer acquisition. The processes of knowing your customer begins with gaining entry into the customers’ environment they live in or operate in; their experiences in products and services being offered by you and also, your competitors; acquiring full understanding of their ‘stories’ about how they are delighted or turned-off by your products and services, or by the competitors.
Ultimately, you should create an image of your customers based on how deeply and passionately you know them. The clearer the image of your customers the more profitable your business will be, because you have a better chance to win them over than the competitors. Because you know who are your customers are by acquired customer expertise.
(2) BE a Service-oriented Organization
The essence of a service-oriented approach to customer acquisition means achieving the fit between your products/services offering and the true needs of the customer or the market. A company that is striving towards a particular strategic fit objective, and pushing for a new performance frontier, there are two elements that should be carefully examined as they may result in conflicting demands between the company and customer.
(a) Trade-offs. Be prepared to change and to embrace new ways of doing things. Outmoded practices, culture and processes will have to be dropped. The rewards will come from innovation. It is a big challenge for any organization to shift from a product-oriented to service-oriented culture. It involves everyone in the organization.
(b) Capturing Values. Organizations talk about capturing values or value-based management. But unless the customer is an integral part of this process, nothing will happen. The customer is part of us – that’s the true spirit of service-oriented process management in capturing values for both parties.
My holistic organizational structure for a service-oriented Customer Acquisition function is:
(3) To DO. (Performance)
Everything becomes disconnected and confused just when the first shot is fired from the rifle. There’s a host of management textbooks telling the stories of how to win a battle. As we now realize ‘great’ companies could fail, sometimes in the most basic way in managing people, culture and customer.
In a simplified way I would like to reiterate the importance of:
(a) Development of a business model and its execution that stay close to the heart of customer insight.
(b) Alignment of internal assets of an organization such as, processes, structure, culture, values, skills, entrepreneurial spirit, technology. must be a priority task before the first shot is fired. And it must be constantly checked and realigned because of dynamic environment.
(c) Stay Competitive & Focused. The outcome of performance over your competitors is the result of competitive advantage. Sustainable competitive advantage requires focused competitive strategy in which you continue to leverage strengths such as capacity, efficiency and uniqueness that capture the most value out of the economics of business.
At the end of the day, the urgency to shift from product-oriented to a full-fledged service-oriented organization must be compelling enough for its people to actively seek to do things differently. It is the role of management to sustain its focus on competitive strategy and change. GE and Jack Welch knew it and did just that.
Customer acquisition is a cornerstone of service-oriented processes when its function is effectively built upon and operated based on the above philosophy.