Overcoming the customer-centricity dilemma

Publish date:

The customer is everywhere. As more and more channels to purchase products emerged during the COVID crisis, the need for organizations to be present in the sight of the customer became stronger than ever. We are shifting into a new era – one in which companies will need to make more rigid choices about which customer they go after and how to win them over.

The war for customer attention

The need to build meaningful customer relationships is strong, but companies find it increasingly difficult to reach customers in the digital world. Digital players are investing to optimize every pixel and banner, whereas the costs of acquisition through paid channels is on the rise. This war for the customer is escalating, and this will only accelerate in the near future.

In 2025, marketers will need to fight competition, with on average 4,909 digital messages being made visible per customer per day[1]

Moreover, customer expectations are increasing, as they expect interactions to be relevant, real time, and personalized. Without solidification of which channels to deploy to key customers, the next generation of CCOs and CMOs will face significant challenges in orchestrating their customer engagement efforts. There will be tough decisions ahead in deciding which customers you really want to make a difference for. The customer-centricity dilemma is real.

Rethink your customer strategy

Make no mistake, investing in customer centricity works! Businesses that focus on increasing customer lifetime value generate over 1.6x more revenue than other companies [2] But tapping into this potential can be deceptively difficult. What is meant by being successful with customer centricity is often misunderstood. While many organizations that proclaim that “the customer is king” treat all their customers equally well, they are hardly getting close to the concept of a customer-centric business.

To be competitive in the digital space, a strong customer strategy in which the high-value segments are prioritized and heavily invested in through tailored channels, offers, communication, and reward programs, is required.

In a truly customer-centric organization, more value is created for customers who will eventually bring more long-term results for the company.

Connect and select your channels

After finding your high-value segments, getting it right with your channel strategy is difficult. Decades ago, in the 1960s, a television commercial reached over 87% of US homes (45.7 million households) via a single channel [3] Unfortunately, this is the past. Nowadays, customers experience brand engagement through a variety of channels all day long in the morning, at work, when shopping, during sports activities, and during their leisure time. Multiple commerce trends, such as the rise of direct-purchase opportunities with one-click commerce (e.g., Shopify-integrated one-click shops in TikTok or Facebook) or the expansion of engagement channels (e.g., Domino’s Anyware – with the ability to order through any channel, such as voice, tweets, TV, smart watch, or car), are accelerating this. With all of these channels at hand, the key to success lies in deciding which channels you leverage to interest, convert, or grow your high-value segments. Companies that have successfully done this create omnichannel commerce strategies specifically per segment – with clear goals to optimize for. The case of Burger King displays this very well:

How Burger King won at football

Cristiano Ronaldo, Lionel Messi, Kylian Mbappe, and Neymar … you can imagine that having the world’s best football players promoting your brand is a huge investment, especially when your logo is seen by millions of people on a weekly basis. Burger King did the impossible, with an investment of less than €60,000. When Burger King announced that it was sponsoring Stevenage FC – a low-ranking League Two football club – they knew exactly what they were doing. They made smart use of different channels, across different phases of the customer journey, and focused on one unique high-value customer segment to get them engaged.

In October 2019, Burger King announced the #StevenageChallenge. Gamers were challenged to play as Stevenage of the Fifa 20 game, sign the best players, and score goals with them to be rewarded with free BK food. With this challenge, Burger King tapped into a unique customer segment, requiring gamer dedication and skill to achieve the challenges. In addition, they fulfilled the gamers’ desire to be challenged and rewarded. The gamers uploaded videos of their challenges on different platforms, kickstarting the launch of the BK food delivery through UberEats. Research on this customer segment indicated a strong correlation between gaming and food consumption: 80% of gamers regularly consume food or drinks while playing their favorite games[4]

The campaign resulted in 1.2 billion impressions [5] $2.5 million earned media, and more than 25k shared videos[6] .Stevenage sold out of club shirts and became the most-used Fifa 20 team on the popular streaming platform Twitch. Quite a genius way of connecting with high-value customers, isn’t it?

Getting customer activation right

Even when all the right channels are in place, the way you engage with customers is the true differentiator. We see three steps to start activating high-value customers into getting heavily engaged with your company:

1) Centralize your customer strategy. Many companies have been focusing on getting customer information together in one place while still operating in silos with this data. The next step needs to be to make every department a shared owner of the same customer. This requires building strong bridges between marketing, sales, and service with cross-functional teams monitoring and acting on customer intent and feedback.

2) Build multidimensional, yet integrated propositions. Customers expect end-to-end consistency in their interactions with a company. This is about more than just products, adding services, content, experiences, and connections to other brands to the mix. All those activities should take the same line. This step will need to be supported by a good CX infrastructure to manage the vast amount of content and customer data that is required to personalize experiences.

3) Start talking, personally but selectively. Having personalized conversations is not just important from a customer perspective; it is also profitable for businesses. Eighty-one percent of customers are willing to pay more for a person-alized experience with a brand[7] . Building personalized propositions to customers is a long haul when you want to do it right for everyone, so again, it is key to start piloting personalization with a selection of customers you want to invest in. As described in this blog on Customer Activation [8] companies should ultimately develop data-driven customer pro-files and analyze their behavior with AI to predict the potential customer value and opportunities to personalize.

The customer-centricity dilemma of choosing which customers you really want to fight for is unlikely to disappear any time soon. With so many brands searching for attention in the digital space and customers having almost unlimited and direct access to alternatives, it will be critical to prioritize marketing investments for those customers that matter most. Getting customer activation right is a critical part of the CMO challenges in the twenty-first century. This is one of the elements of the Connected Marketing framework [9] which is about enabling customer activation by personalized, relevant, and data-driven content that is delivered in the right moment, by a responsive and interdisciplinary marketing organization that is able to execute at scale through adequate marketing technology.

Learn more

At Capgemini Invent, we help companies to build branded experiences at scale. With our Customer Transformation team, we can help you to create a successful customer strategy for your high-value segments and start building customer connections for tomorrow. Want to find out more? Visit our website here or get in contact with our experts below! This blog was written by Tim van der Galiën and Joris Schouten.

About the authors

 

Tim van der Galiën (Manager Customer Transformation at Capgemini Invent NL)

Contact him here

 

 

 

Joris Schouten (Consultant Customer Transformation at Capgemini Invent NL

Contact him here 

 

 

Sources:

[1]. Statista, 2020

[2]. The Business Impact of Investing in Experience – Forrester & Adobe, 2018.

[3]. Television – Ad Age, 2003

[4]. Consumer Insights: Games and Esports – Newzoo, 2020

[5]. BBC, 2020

[6]. AdWeek, 2021

[7]. The Disconnected Customer, Capgemini Research Institute, 2017.

[8]. On Target! How to ensure your marketing gets results, Capgemini. 2021.

[9]. Connected Marketing, Capgemini. 2021.

Related Posts

digital customer experience

Why cross-channel marketing is so hard (and what to do about it)

Date icon November 11, 2021

To run true cross-channel campaigns you have to make sure that you don’t just collect data,...