The Simple, Proven Steps to Making a Customer-First Organization

There’s a magic question that can turn a company into a customer-first organization.

That question, according to Denyse Drummond-Dunn, is, “What would my customers think about this?” It’s this question that Drummond-Dunn says should animate the actions of all employees at a company.

Drummond-Dunn is chief catalyst at C3Centricity. After working many large organizations, including P&G, she launched her coaching practice with the goal of helping her clients build a customer-first strategy. She will providing some of her insights at her “You Are Not Your Customer” session, 15 June, at the Channel Partners Europe conference.

She previewed her talk in a Q&A with Channel Futures.

Channel Futures: You state that research has shown a significant return on a customer-first strategy. Could you tell us more about these findings?

C3Centricity’s Denyse Drummond-Dunn

Denyse Drummond-Dunn: There are so many research studies proving the benefits of a customer-first strategy. The first one that probably had the largest impact on me and my clients was Watermark Consulting’s 2012 CX ROI study. Using data from Forrester and Temkin, it showed thachant companies that excel at customer experience grow three times faster than the S&P index and a huge seven times faster than those companies that lag behind. Their latest analysis shows a slightly lower benefit than a decade ago (3x vs. 7x), which I hope is an indication that more companies are now adopting a customer-first strategy.

And this is vital, since when we look at how customers react to their experiences, we quickly see the importance of being more customer-centric. Eighty-nine percent of customers stopped doing business after just one bad experience (source: RightNow). And remember, customers tell on average nine people about a positive brand experience. But they tell 16 people about a negative one (Deloitte). The decision becomes obvious, especially when 86% of customers would pay more for a better experience (Temkin).

Therefore, ensure your customers are not just satisfied, but surprised and delighted with your service. They will stay loyal and even pay more than they would otherwise. And the impact on business? A 2% increase in customer retention has the same impact on profits as cutting costs by 10% (HBS).

CF: It’s a hard to find a company that does not present itself as dedicated to the customer experience. Do you have any examples of a company whose actions didn’t line up with their claims/aspirations of being customer-first?

DDD: One example may surprise you because it’s from a leading food, drink and household products company in Europe, known for being amongst the most customer-centric companies around. When I first started working with them, as I often do with a new client, I phoned their customer services. Imagine my surprise to learn that I could only contact them during office hours.

Since they make a lot of food products, customers seeking information or advice are more likely to reach out during mealtime preparation. When I shared this fact with them, and this is over a decade ago now, they realised they still had some work to do to improve their customer-first strategy. I often notice that the most customer-centric companies are always the ones looking to improve. In contrast, many more talk the talk, but in reality, don’t walk the walk.

CF: Do you have any success stories, perhaps from your own career, of how a true customer-first mindset helped a company grow?

DDD: Yes, of course, I have many. Another client, a soft drinks manufacturer in Japan, wanted to launch a new, fruit-flavoured soft drink. Now it may seem logical that when they first contacted me for my support, they were looking at competitors who also made fruit-flavoured soft drinks.

I persuaded them to approach it more customer-centrically, by starting their analysis with all beverage consumers. We then focused on cold drinks, then non-alcoholic beverages, then still soft drinks and finally fruit-flavoured soft drinks.

By working in this way, what I call “zooming in,” for category identification, they discovered that as a beverage containing fruit juice, consumers actually saw them as competing with energy drinks. They positioned their new product in this way, and it was a huge success. Not only did it attract those consumers, but it was also purchased by competitive fruit-flavoured soft drinks consumers. They therefore effectively doubled their category penetration.

CF: Is there anything else you’d like to add?

DDD: I would like to leave with a simple but extremely powerful way for any organisation to quickly become more customer-centric. It’s this: Every time a decision is taken, employees should ask themselves what their customers would think of it. If they realise that their customers would not appreciate it, then the decision needs re-evaluating. I call it the “magic question” because it magically improves customer-centricity in every single company, no matter their size, industry or operating region.