In this series of posts, we examine some of the top mistakes companies make in their customer experience management efforts. This post examines mistake #4: Treating All Customers The Same. Customers have different needs, interests, and familiarity with offerings, but companies often turn their backs on these differences. While it may sound appealing to deliver a great experience to everyone, it’s an impractical goal for most companies.
When a traveler wrote a complaint to Southwest Airlines about how flight attendants were fooling around during the safety briefing and said that she would never fly Southwest Airlines again, Herb Kelleher (founder and then CEO) wrote back a simple note: “We’ll miss you.” What Kelleher understood is that the airline’s value proposition wasn’t for everyone and that it would fail if it tried to cater to everyone.
Here are some tips for avoiding this mistake:
- Identify key customer segments. The first step is to identify the different customer segments that your company serves. While you may start with demographic breakdowns like age or income, some of the most telling segments come from psychographics. Nike, for instance, may have a strong customer segment called running enthusiasts. Once you have a list of segments, it is critical that you prioritize them. Every CX project should identify a primary segment as the audience.
- Track needs across the customer lifecycle. Customer segments represent one slice of how to look at customers; the other is lifecycle. Customers have different needs as they flow through different stages of their relationship. You need to understand how each target segment wants to do things like: Research using your products/services, make a purchase, start using your products and services, have ongoing communications with you after becoming a customer, get help when there’s a problem, etc.
- Walk away from some customers. In order to prioritize some customer segments, you will need to de-prioritize others. It’s critical that you are clear about which segments you are not going to try and serve. If you don’t create that clarity, then people across the organization will continue to push for investments and changes to improve things for those (purposely) underserved customers, taking focus away from your more important customers.
- Get to know customers, qualitatively. It’s easy to fall into the trap of thinking customers are the same if you just look at data about them. To truly understand the nuances across your customer segments, it’s critical that you use qualitative techniques like focus groups, contextual inquiries, and shadowing. It’s also valuable to have executives regularly interact with customers from key segments.
- Listen to customers strategically. Voice of the customer “experts” often talk about getting a 360-degree view of all your customers. While that might make sense in an ideal world, the reality is that companies are forced to make trade-offs. It’s expensive to get feedback, both in terms of out-of-pocket expenses and the opportunity cost of having customers answer questions (there’s a limit to how often you can ask customers questions). So you need to be more strategic about where you focus your listening, a process that we call “Detect” (see the 6 Ds For Voice Of The Customer Programs).
- Design segment-specific experiences. Sometimes your target customer segments will have different enough needs and desires that you’ll want to design different experience paths for them. We often find three areas of difference across segments that can require multiple experience paths: knowledge of the domain, level of willingness to engage in a process, and channel preferences.
The bottom line: Experiences built to meet everyone’s needs often meet meets no one’s.
This blog post was originally published by Temkin Group prior to its acquisition by Qualtrics in October 2018.