In commoditized markets, B2B organizations are under constant threat of watching their customer base evaporate into thin air. Getting caught flat-footed as markets migrate to competitors offering newer products and services. Suffering the consequences of not transitioning from a product-centric company to a customer-centric company.
Is Customer-Centric Enough?
B2B organizations continue to struggle in the shift from product-centricity to customer-centricity. This is despite taking extraordinary steps to do so. Heralding new programs designed to focus the company on their customers. Implementing customer experience initiatives. Beefing up customer service capabilities. Creating new services to improve delivery and implementation. Yet, today such efforts are amounting to a tit-for-tat game with competitors.
It is a frustrating game to play. Leaving many B2B senior leaders to shake their heads and wonder if customer-centricity is enough. It usually is not.
Why It May Not Be Enough
Making the transition from product-centric to customer-centric can be an arduous adventure. In today’s world of warp speed changes in both organizational and buyer behavior, this transition alone may not suffice. There are significant hurdles companies must overcome to make the transition to customer centricity and beyond:
Hurdle 1: Reliance on product-centric information
No matter how hard organizations try to be customer-centric, what really happens is telling. An organization can still rely heavily on product information. This happens both in terms of internal knowledge as well as in content creation for customers. Creating a customer-centric book cover, while the book chapters are product-centric.
Hurdle 2: Lack of buyer and customer insights
This is a major hurdle. Good intentions lacking buyer and customer insights can make such a transition effort unfruitful. In some cases, it can do more harm than good. Unwittingly destroying brand perceptions and actually lessening value perception. Without a good sense of preferences, buyer behaviors, organizational behaviors, culture, and processes, hurdles are too high to jump over.
Hurdle 3: Lack of knowledge in how to create and deliver value
Companies can struggle in developing an effective strategy for delivering customer value. What you can see is “value” introduced as a new initiative, new growth strategy, or a new product. This hurdle can be twofold: one, nothing foundational is changing in terms of providing value from the buyer’s perspective and two, value is treated as a “product.” In essence, required changes in how the business operates are missing and customer value is presented as another product.
Hurdle 4: Diminished and poor value proposition
Overtime, a strong product-centric focus can cause a company to lose sight of value proposition. The sense of value a set of products and services can deliver has been lost. As products are enhanced and new features added, the “superiority” of the product becomes the dominant message. The value proposition becomes diminished each iteration. After several iterations and a time period of a decade, as an example, the organization loses sight of its original core value proposition. And, so does its customer base.
These four hurdles can often be subtle in existence. In order to create transformation, the hurdles must first be amplified. Organizations must first see how these types of hurdles are affecting their ability to make the leap to being customer-centric. Doing so allows you to resolve core foundational issues as opposed to surface level rollouts of “customer initiatives.”
What steps can you take to jump over these hurdles? I suggest a few here for you:
Step 1: Resolve to fix lack of buyer and customer insight. The golden rule of making this transformation is deep buyer and customer understanding. It is simple – do your homework on what buyers and customers’ value.
Step 2: Rediscover core value proposition. Have deep buyer and customer insights help you to rediscover core value propositions, which served as the bedrock of the organization.
Step 3: Understand your customer’s value chains. You cannot deliver value until you learn how they see the value you bring – helps them to deliver their own value.
Step 4: Build a communications platform, consisting of company personas and buyer personas, for the organization to understand three big things. One, the buyers and customers you deliver value to. Two, the values buyers and customers want to receive. Three, how your organization can delivers value to theirs.
These four steps can help you make the transition from being product-centric to customer-centric. They will also help you to rediscover the core purpose and value proposition, which has made your company endure despite losing sight of them. More importantly, help you to extend beyond being customer-centric to a new level of being customer value-centric.
(I welcome further conversations to help you and your buyers become customer-centric. I am very interested in getting your thoughts and perspectives. Please share widely – your peers and colleagues are trying to jump some big hurdles.)