Malcolm Alder is a digital strategy consultant with more than 25 years’ experience and a co-founder of Orchestrate. He is on the Board of AIMIA board member, and was previously Partner for Digital Economy at KPMG. In this opinion piece, he argues marketers that try and “own” customers are probably doing far more harm than good..
Ask yourself a simple question. What kind of human being “owns” another human being? The very concept is so objectionable wars have quite literally been fought over it.
Yet, as digital transaction volumes grow and with ever more stakeholders typically involved from first engagement to completion, we increasingly hear robust debates as to which party “owns” the customer.
As so many companies declare their aim to be customer-centric, or even more grandly, to “delight” their customers whilst genuflecting at the altar of Net Promoter Score (NPS), it seems bizarre and contradictory that they also battle to “own” them.
(Image source: Feed The Beast)
The notion of ownership implies an asset that’s controlled (or can be traded) at the whim of the owner. Most customers would bristle if they heard the term used in relation to themselves and their money; yet it is, frequently.
Furthermore, as ever more information, choice and power moves to the fingertips of consumers at their digital devices, so every transaction is tested on its own merits. Ongoing loyalty and advocacy are harder to attain than ever.
This is why, at an aggregated level, large customer databases, particularly where a large proportion of those customers are demonstrably active and long-term e.g. the Qantas Frequent Flyer programme (QFF), do have demonstrable, sometimes tradeable, value. (Indeed, QFF has been touted by analysts as having a stand-alone value potentially in the range of $2-3 billion.)
Similarly, there are established benchmarks for valuing and trading mobile phone customer bases. This notion of a collective customer asset is fine because it’s based on aggregated, large numbers of individuals where each of them is free to leave at any time if they so choose (even if there is a cost to break a contract in the process). This is very different from “owning” an individual customer.
It’s true that consumers willingly enter contracts with companies all the time eg. banks, credit card providers, utilities etc. Nonetheless, to the consumer, a contract does not imply ownership; nor should it. Contracts are legal relationships between willing, independent parties for mutual benefit. Neither party owns the other and most contracts explicitly recognise that.
Of course companies don’t believe they own the customer in any legal sense. However, objections to the general notion of customer ownership are that, in addition to being unattainable, it may engender poor staff behaviour. Firstly, in online transactions in particular, most now have so many commercial parties involved that it’s often extremely difficult to define who holds the primary customer relationship. Secondly, and far more importantly, is the message it gives within any organisation that uses the term. If you “own” a customer, you don’t necessarily have an incentive to delight them.
As customers, surely the parties we are most likely to stick with, perhaps even be delighted by, tend to demonstrate the following characteristics.
- Clarity – it’s clear who we’re dealing with. In the event that something goes wrong, you know who to speak to and have confidence they’ll fix it.
- Trust – this is an over-used term that has many connotations, but of particular importance is customer trust that you’ll do the right thing with their information; you are diligent about security and respect privacy.
- Fairness – the product or service you’re being offered is at the appropriate quality for the price you are paying. In short, you won’t be ripped off.
- Context – This is a critical element but can vary greatly. For example, if you’re going for a wedding dress fitting, you want a luxurious, unhurried, “special” environment. If you want a pick-me-up coffee on the way to work on a cold winter’s morning, you need the right location with quick, friendly service and a beverage that sets you up for a good start to your day. Online, you want as much direct relevance as possible delivered in a user friendly, easy format.
- Consistency – this is far more important in some transactions than others but consumers really hate having a good experience one day and a poor one the next.
- Human – again, this is more important in some sectors and transaction types than others but even when interacting online only, consumers like a sense that somewhere behind the digital imagery and firewalls, there are real people involved who appear to have an empathy for their situation.
The aggregate of these attributes goes pretty close to that thing called customer experience. It’s not easy to deliver on all of these attributes even when a single company controls them all. In a multi-stakeholder environment, it can be very challenging.
However, if you take a genuinely customer-centric view and apply these characteristics between all parties involved, the chances of success are increased. Yet even if you achieve them every time, you still will never truly “own” your customer.
This article originally appeared at www.which-50.com