What are your customers really buying?

Customer first, customer centricity, customer focus. They're all phrases we've heard and read lately. More often than not, they're scrolled on the annual report, inserted into job ads and career pages or included in AGM presentations and sales pitches. But what do they really mean? What does it really take to become a customer centric organisation, to move beyond the fluffy terminology and actually live it?

In a word... research. And by research, I don't mean forwarding on the odd piece of Facebook generated customer feedback to the products team. Or adding a 'how did you hear about us?' question to the bottom of the checkout page. I mean real market research that enables you to know your customers inside out. In-depth, qualitative research to uncover unbiased customer insights, backed up by quantitative research to test these insights against the broader market.  

Done properly, customer centricity should touch every area of the business and it most certainly should influence strategic and tactical marketing decisions . From STP (segmentation, targeting and positioning) to product development, pricing, comms and distribution channels.

Strategically, market research should play a huge part in how you segment your market, make smart targeting decisions and then position the product or service appropriately to your chosen market.

A well-known case study that highlights this beautifully is that of Quidel, a diagnostics company specialising in the analysis of human bodily fluids. Quidel had developed a market-leading pregnancy test but, prior to taking it to market, they undertook a market research program to uncover customer insights that could be used to position the product effectively.

The research showed that within the relevant demographic segment, there were two distinct behavioural groups who purchased pregnancy tests. Those who were actively trying to fall pregnant (they wanted a positive result) and those who were fearful of having become pregnant (they wanted a negative result). Same product, being bought in different ways by the same demographic profile.

Armed with this insight, Quidel developed two opposing positions for the product. One under the branding Conceive, for the 'hopefuls', and the other under the brand QuickVue, for the 'fearfuls'. Different tactics were then used to communicate the different positions to consumers, from different messaging and packaging to placement within the store (QuickVue was sold along side condoms). It proved to be a highly successful launch, but it wouldn't have been possible without knowing the customer intimately, through research. 

This premise of learning what your customers are actually buying, and not relying on assumptions, is not unique to Quidel. It can, and should, be applied to any product or service in the market, whether you're an ASX100 company or a startup bringing your first product to fruition. 

It requires a flipping of the paradigm, from creating products based on gut feel and then pushing them on the market, to pulling in research driven customer insights, then developing and positioning products and services that fulfil their requirements. 

We're talking about products here, but of course it doesn't stop there. Equally, this concept of customer centricity should be applied to all areas of the business, from pricing and distribution to customer service, in-store experience and everything in between.  

For companies, particularly large ones, who've traditionally fallen into the sales orientation (sell as much as we can) or product orientation (make as many products as we can) categories, turning the ship around and becoming market orientated (customer centric) is not easy. It requires buy-in from the entire organisation and it requires a commitment to leaving all assumptions at the door when you walk in and filling the void that they leave with data.