Everything Comes at a Price
What strategy games and sports can teach us about customer management
In today’s newsletter on Scaling Customer Value, I will be sharing a couple of ideas, quotes from others and questions for you to consider. Let’s go!
To start things off, I personally find it helpful to use analogies and visualization techniques to better understand and problem-solve business situations. The more fast-moving and complex the scenario, the more important and useful this becomes as it helps you gain perspective.
Does anyone remember the strategy game Civilization by Sid Meier from many moons ago? In case you’re not into video games, a short synopsis of the game is that you’re setting out to create settlements, grow your population and make your tribe flourish until you’ve defeated the other players either by force or through technological advancement.
In the beginning of the game, you’re faced with a blank canvas and the range of options is wide-open. How the game usually plays out is that the player game strategy often becomes an extension of the player’s own personality, preferences, likes and wants. There tends to be two different playing styles:
Outwards focused strategy: growth, expansion, contest
Inwards focused strategy: research, citizen happiness, development
Either strategy can be a viable option if executed well, but what typically happens is that the decision of not diversifying your efforts and activities translates into a higher execution risk. People often shy away from the middle-option which is a blended strategy of the two because it’s harder and involves a lot more multi-tasking and making difficult choices and trade-offs on what to focus on.
For you gaming aficionados out there, some more details on how the two first-mentioned strategies often plays out is that your foray into new exciting areas makes you lose focus on the things back home and now your citizens are revolting. Alternatively, while you were operating in a silo and busy perfecting your buildings and architecture, you didn’t pay enough attention to emerging threats and suddenly a much more advanced civilization appears on your doorstep and it’s game over.
Why does this matter for customer management?
Whilst you may not always be able to choose your starting point, you need to have control and clarity on what your end game-is in order to figure out the next-best actions are.
Here are three ideas for you to consider:
1. Less is more
Before you spring into action and decide on the next business initiative, ensure those plans are grounded in your customers’ needs, wants and preferences. Not your own. Validate any assumptions that underpins your plans and you may also want to consider doing customer research and insights from surveys and customer feedback capture.
Do ensure that you focus on creating offerings, servicing or content that are aligned to customer needs. Creating fewer, but better and highly relevant customer offerings and interactions consistently is a sound approach to customer management.
“Slow and steady wins the race”, as they say.
2. Think long-term, execute short-term
First identify what your goals are and where you are wanting to go. This is the customer management equivalent to having a business vision, mission and you’ll want to be identifying your North Star metrics to help guide you on your journey.
This may sound a little obvious, but if you’ve ever tried Orienteering (running with a map and compass in the forest) with someone who is trying this for the first time, there is the temptation of start running towards the closest flag marker while trying to map read simultaneously. This is not a good idea.
Nevertheless, it’s good practice to take a moment at the start and study the map, your destination and then work backwards to plan out your route before heading out. Doing things in a linear fashion might not be the best thing to do and you need to start prioritising and evaluating your options.
The same reasoning holds true in a business environment where this roughly translates into Objective > Roadmap > Business initiatives.
Having a clear direction and purpose is key, as it will help you work towards making the sum total of your customer management efforts becomes greater than the individual parts (1+1+1=5).
3. Mix it up
In Marketing, campaigns are often categorised as either Push or Pull marketing.
Simply put, “Push” refers to promotional materials to drive sales and growth, whereas “Pull” refers to creating content or engagement that will create a buzz and draw the customer in. The same concept applies not just to Marketing, but other channels too such as your relationship management and servicing functions.
Common pitfalls in customer management relate to defaulting to reactive customer interaction (which is effectively Customer Support) and where there does exist proactive customer interaction it might be limited to Push marketing only.
To effectively drive long-term growth, you’ll want to ensure that you have a healthy balance and combine both Push and Pull marketing.
Two quotes from others to inspire you
Alice: Which way should I go?
Cat: That depends on where you are going.
Alice: I don’t know.
Cat: Then it doesn’t matter which way you go.
- Lewis Carroll, Alice in Wonderland
“Customer service shouldn’t be just a department, it should be the entire company”.
- Tony Hsieh
A few questions for you to consider
There is a lot to think about when it comes to managing, engaging and retaining customers - but I did say I was going to keep this simple, so here are three key questions to consider which will help you lay a good foundation for next steps.
How important are existing customers for your business and what would you say are their main needs and wants?
To which extent are your current business priorities and key activities/projects aligned with the above?
Does your company predominantly engage in “Push” or “Pull” communications interactions with customers, or is there a blend?
That’s it for now - do take some time to ponder all of this and try to identify at least ONE thing that your business can differently going forward based on what you’ve just read.
Until next time,
Jens