Protean

Survival Strategies Take Many Forms

Survival strategies take many forms. But for any business to survive, it must focus on its most important resource: customers.  Nonetheless, and for a variety of reasons, in times like these the focus is often everywhere else.

Importance of Customers

Businesses can be born with a product, but they die without customers. Companies do not fail because they run out of money. They fail because they run out of sales. Having no cash is usually a symptom of a deeper problem - the business has failed to attract buyers for their products or services.   Think about it…there are few problems within a business that seem insurmountable when sales remain steady…be it product quality, long delivery, bad design…but those exact same ones become life threatening  with a bad order book.  Over simplified?  Sorry, I don’t think so.

Customers provide the revenues needed to achieve profitability. Delight them and they will come back.  In addition to the revenue from purchases, satisfied customers provide free word-of-mouth exposure that enhances your visibility and brand equity.  Satisfied customers are quick to tell others about effective products they've discovered and helpful services that saved them time, money or aggravation. A happy customer will bring more loyal, buying customers, which in turn bring in more loyal, buying customers. In addition, they can provide feedback to improve.

Connect with your customers and give them reasons to come back. It takes more than good deal to make a satisfied customer. Your most loyal customers keep coming back not because of your competitive price but because they like doing business with you. Create a positive experience, which is the combination of everything the customer sees and interacts with. The quality of their experience is the key to a business' survival.

Customer Experience as Core Strategy

Customer experience should be an umbrella strategy of any firm, large or small, if it wants to survive in today's highly competitive marketplace. Everyone involved in the business -- from top guns to cleaning staff -- should be focused on enhancing customer experience. And the company's success metrics should be measuring customer experience.  More importantly, resources should be allocated to improve customer experience, and maintained during slowdowns. All areas of the firm's strategy should boil down to one question: is it good for the customers?
   
How do you go about increasing your customer equity?  Make it easier for people to buy from you!  Start by getting to know them.  Really know them. Gather as much information as you can about your customers. Learn their demographics, and analyze their buying practices and habits.  The level of your customers’ willingness to recommend you is an exceptionally useful bookings forward indicator. Measure it.  Get to know them even better and find out what they like and don't like, their needs and motivations, their perceptions and attitudes. Incorporate their likes into the way you do business, and avoid their dislikes. Try to identify the things that make life difficult for the person making the buying decision and then do everything to remove those obstacles.
 
Many businesses spend exceptional energy determining why they lost an order.  Very few take the time to really confirm why they actually won one.  Don’t assume that you know. Ask…it can be a very surprising experience.
  
The key is to make them value their relationship with you. Contact them with tips that will save them money. Tell them about unadvertised opportunities before you make market wide promotions or product announcements.  Communicate and make them feel special.  They are.

There's not much foresight in a rear view mirror

Today's intensely customer-centric business culture, which took hold in the mid-1990s, has been effective in raising customers' expectations and weeding out lazy businesses that fail to build rapport with their markets. The customer is king - and rightly so. But this does not permit business leaders to abdicate the responsibility for leading their businesses.                         

Entrepreneurs cannot make the bold moves necessary to pioneer new markets and revolutionize services by putting the customer in the driving seat. For the most part, our customers are not visionaries. They don't break the mold. They don't calculate, innovate, and certainly strive at all cost to avoid risk. Intel engineers in the past have been specially trained in decision making processes specifically designed to above all mitigate risk. I'm not suggesting for a moment that business's own performance has not been stellar even in the current conditions...but if your own guiding light customers are of a similar mindset it's dangerous. There's just not much foresight you can get looking in a rear view mirror.

Being different, grabbing market share, and achieving profit don't happen by meekly following the game - it's about breaking the game. The American car market of the 1970s was a stark example. The buying public had accepted that they could either have a reliable car or an affordable car. Then Toyota and Honda showed they could have both and the game changed...permanently. Customer demand, alone, had insufficient power to bring about such a change. The auto press had little clout to improve the car buying public's lot. It was the vision of smart and hungry new players that broke the game.

A related and important point is that the market rarely, if ever, knows what it wants - until it sees it. A strategy based upon reacting to customer whims, therefore, won't allow businesses to develop truly outstanding and successful products in the long term. Incremental improvements might result, and that's certainly not a bad thing, but it's a situation that can easily provide a false sense of security. It's also often table stakes to merely tread water in the same place if not only slow an inevitable decline in market position, price point or both.

This is a significant intersection point with branding and brand equity. A brand is the most important strategic asset that a business will ever possess. Yet even the most experienced marketer might struggle to communicate the concept in a single sentence. Furthermore, if you were to approach the majority of today's business-to-business organisations, they would probably tell you that branding finds little application in a market allegedly filled with dispassionate decision makers. However, an increasingly competitive market landscape is eroding this reality - if, indeed, it ever existed. B2B marketing must follow the example of its consumer-focused counterpart and embrace the notion that a strong brand has the power to differentiate, build and protect those it represents in the face of incessant commoditization.

Modern technology markets offer up the epitome of the value of branding in B2B environments. Traditionally associated with a reluctance to invest in brand, this industry is accustomed to spending vast amounts on technical facilities and capital equipment. Technology markets are especially reticent to channel resources into what it often identifies as abstract concerns and until recently, this attitude was acceptable. Previously, demand for technology predominantly focused on product functionality and cost, conforming to the stereotype of today's B2B model. However, technology suppliers were forced to re-examine this approach as their markets matured. As new technologies grew commonplace and supply grew dramatically proliferated, wider differentiation became essential. Added to this, the effect of increasingly short product lifecycles has further created a need for brands which can exist outside of individual products and services. The continuous introduction of new and competing products, updates and enhancements has forced technology suppliers to look beyond their conventional reliance on product attributes alone. In this respect, a strong brand has the capacity to restore stability to an overcrowded marketplace, and combat the downward price spiral of commoditization.

The incremental development programs discussed earlier create victims in this commoditization environment. They typically don't offer much sustainable competitive advantage, particularly compared to the time required to put them into the market. But they appear safe and saleable so are much more frequently green lighted than fringe programs. Not that anyone argues that they wouldn't want a game changing offering...just that it's hellaciously harder to conceive and deliver one. Studying a number of significant, market changing introductions, including the automotive example outlined earlier offers a place to start. Most markets have one or more "either-or" paradigms within them that all the players abide by. "A car can be either reliable or economical." Find the either-or gap in the given market and bridge it. Double the output and halve the floor space. Leading edge that's not bleeding edge. Whatever. Find the oxymoron and make it obsolete...before the business is.

In that longer term, business leaders themselves must take responsibility for setting the course of the business. More than ever, today's leaders must step up to the plate; to sell their vision, and make it happen. Being customer-driven is not a vision - it's taking the back seat. Sure, the customer is king - but not the master.