I used to say that if I only had $1 to spend on my business, I’d spend it on customer experience, vs marketing. I actually think I stole that from Tony Hsieh of Zappos about a decade ago – and it held up for a long time.
The thought process was “Why pay for more customers to enter into a suboptimal funnel when you could spend to make that funnel better for them, and in turn have a better chance to make them love you for the long term?”
The point was to compete on value-added service for the consumer and have that layer become your company’s differentiation when compared to more commoditized approaches (mass retail, Amazon, etc.). Build your brand and defensibility around an amazing experience.
Recently, I was asked that question again and while I still hold what I’ve previously said (or stolen) to be true, I gave a slightly different answer in these later innings of the consumer web.
Today, I’d spend that dollar on learning about my customer. I’m less focused on WHAT we are improving for the customer than I am about learning WHY the customers are doing things and what they are trying to accomplish.
It’s a move upstream. What are the customers’ needs, wants and pain and what’s driving them?
Those are the non-obvious proprietary insights or “customer secrets” that you can use to build a product, service, brand, experience and/or company that are compelling and defensible. That data is more valuable than something incrementally more sexy or useful to meet their needs today. That data is the foundation of your moat for tomorrow and beyond.
Your company is only as good as what it knows about its customers that no one else knows. In this age of measurability on nearly all fronts, the company that spends the time to piece together the less obvious story lines is the company that will own the customer. With proper execution and a continued customer obsession, that company should win.
Steve Jobs was famous for giving customers things that they didn’t know they needed. He was a tastemaker, product builder and artist who also (like all who are successful) happened to have great timing. He also flopped on the Mac, the Lisa, NeXT and so many other projects that he “birthed”. We should all eliminate as many guesses as we can. Jobs’ hit rate was rough, and he was the legend.
Listen to your customers’ words, but more importantly measure, observe and mine their actions. Only then can you begin to own the relationship with them by building what they need and, hopefully, monetizing their trust and attention for the long haul.