We often find ourselves in the position of talking about the strategies companies are building to manage customers. And that’s a good thing. There are three aspects I’m challenging you to think about.
One. Retention, Loyalty, CRM, Customer Experience, CLV, or CLTV (it doesn’t matter), Growth, Upsell, Cross-sell – all are terms we use in different instances, each one of us with its definition behind these terms, of course, to create that mix between customer experience and revenue growth.
Two. Let’s take a step above (not back!), put our strategic hat on, and get serious about understanding market evolution. In that case, we will arrive quite soon to conclude that lines between industries are increasingly blurry. I know you might have heard this theory already; there are examples out there, but here’s one that shows the magnitude of this phenomenon: Bud Light moved in 2021 to create Bud Light beer with different aromas, such as Cola – so, right from the alcohol industry crossing the border of soda, becoming a competitor for traditional brands like Coca-Cola or Pepsi. Yes, we saw something similar in Romania, but the guts to move into the “Coke” territory shows that “blurry” is a soft term for how industries look to evolve. And I will not add to this picture the already “too talked about” digitalization/technology territory.
Three. Do we think we can successfully manage customers in the future by working in silos, managing only one area, or believing in a one-size-fits-all tactic?
Let’s imagine an organizational setup where, with all the best intentions, a company wants to increase focus on being customer-centric.
We have a Customer Experience team managing experience, a CRM team managing campaigns to existing customers, a Customer Retention team talking with potentially churning customers, perhaps a digital marketing team working CLTV, and a Retention or Segment Marketing team managing customer marketing. Of course, every team has different objectives, most probably different managers. And please add to the picture the traditional stakeholders: Customer Support, Product Management & Marketing Comms. I’ve seen this, not once.
Does it work in real-life practice?
Assuming you are working in an organizational setup similar to the one above and have the precise task of creating a seamless customer experience that generates revenue growth & and retention. I challenge you to draw the lines of ownership between the above teams, not by making general statements but by thinking about how they can work together productively. Okay, it might work, but are you sure it’s the best way in the mid-long term?
Rethink to evolve. I’m not saying one should eliminate any of the above roles, but we need to rethink them to adapt to the blurriness of the industries. How? By deciding what roles are pivotal for your business and building a strategy to encompass all of them under one roof.
Let me give you an example. Commoditized market, price is no longer the differentiator, and the barriers to entry are low. In terms of competition, there are three major players and many small competitors addressing niches. You are a new player targeting a 20% market share in 5 years; you have no option to be a cost leader; your only choice is to create differentiators. Now, think about the organizational setup we imagined earlier. What roles are pivotal? Would you choose differently if the market is not commoditized, and you would be a more efficient new player?
I’ve seen this, not once. And it works! Welcome to the ERA of Customer Strategy!