Customer insights: Digital is changing who you compete against

You're now up against businesses across industries that provide experiences that are so great your customers will expect the same from you

Customer insights: Digital is changing who you compete against
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If you want to get serious about transforming your business digitally, start with recognizing all of your competitors

It is time to acknowledge that our customers’ digital experience expectations are being increasingly influenced by both their everyday B2C experiences, as well as by disruptive experiences that are jumping industry boundaries.

Brands and businesses are now judged not only on how well they perform in their industry, but also on how well they perform based on overarching categories such as relevancy, social awareness, ease of use and engagement. Gone are the days of solely using the Net Promoter Score to measure customer experiences of your brand. It’s just not good enough.

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Companies need to dig deeper and look at what’s considered "perceptual benchmarking."

In a nutshell, that means watching out for businesses in all industries that provide experiences that are so great that customers will—consciously or unconsciously—look for something similar in your industry. Benchmark the experiences you offer against those. Because your customers’ expectations are no longer limited by what you and your industry peers have been offering so far.

Two dependent developments are driving the need to look for competition outside of your industry: customer expectations are becoming liquid, and a shifting set of characteristics are making brands and their products and services really matter to people.

Expectations are becoming liquid

If you’re in banking, your mobile banking apps should not be just as good or even better than what other banks offer. You should be asking yourself what you can do to address the expectations your customers might have set by the likes of Facebook Messenger (or WeChat, if you do business in China)—both of which have seriously raised the bar.

If your business is a quick-service restaurant, think about how Uber’s reservation and check-out payment process could reset your customers’ expectations for how convenient your reservation, ordering or checkout can be.

Interestingly, it’s mostly (industry) newcomers that begin to set present and future expectations of what best-in-class experiences look and feel like, and their customers have begun to catch on. They aren’t encumbered by such thinking as “But we have always done it that way,” “Our customers are different; they would never would go for that,” or “That’s cheesy for our industrial B2B brand.”

It’s time to cast a wider net when considering the shift in customer expectations and the opportunities to differentiate yourselves vis-à-vis your direct competitors. Otherwise, your analytics might lead you to playing catch-up with companies marked as front-runners in your industry while you lose customers to perceptual competitors.

What people value among brands and brand experiences regardless of industry

Now that you have broadened the playing field beyond your direct and indirect competitors, another important step toward understanding customer value is benchmarking yourself against the right categories.

It’s no big surprise that in a recent survey-based, brand ranking conducted by Accenture, Netflix, Amazon, Apple and Facebook came out on top. What’s interesting is the why. (Bear in mind that these companies influence what customers view as great experiences overall, even if you manufacture and sell shoes.)

They excel at some very specific factors:

  • Fun: Holds my attention in an entertaining way
  • Relevant: Gives me clear and customized information I want, when I want it
  • Engaging: Identifies with my individual needs and wants
  • Social: Helps me connect with others
  • Helpful: Is efficient, is easy and adapts over time

Those may sound a bit soft, particularly if the respondents work in B2B or a “serious” business such as selling welding equipment, electrical componentry or bulldozers. But step back for a second and think: Are you a different person when you do business with your bank from when you shop for groceries? Your objective need is different, but your judgement about whether this has been a satisfying experience is not.

How this impacts your digital (business) transformation

I recently had a conversation with a senior executive who works at a publicly held, U.S. corporation in regard to organizing for digital success. The executive asked me, “Where was the analytics organization?” Following consultant protocol, I stopped and shared that analytics is not the end; it is one of many means to the end.

The end is really all, and only, about actionable insights.

There are many ways companies can take to these insights (I mentioned some of them in my previous post). While each of these would merit a separate post (and some of them I will cover in more detail going forward), they all should start with the question: Who’s my customer and what’s moving them? Increasingly, it’s not what’s happening in the confines of the industry you know.

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