Are you Customer Centric or Product Centric?
Most in business would say “Of Course We Are a Customer-Centric Business.” However, with today’s rapid rate of disruption caused by organizations and Industries who continuously out-innovate legacy organizations. I would say they are lying to themselves and here are my reasons for saying this.
A company is built to sell a product which solves a problem. What happens when the problem the product solves is not an issue anymore? Or what happens when someone else circumvents your products delivery mechanism? How a company or industry answer those questions will determine if they run a Customer-Centric or Product-Centric business. If it were a Customer-Centric Business, they would respond by abandoning any or all of their deliverables components which caused their irrelevance. They would say it’s time to create another business and solve a different problem, or they would say maybe it’s time to create a new delivery system. Customer Centric Businesses always are in sync with what their customers’ want, how they want it and can change fast as their customers change what they want, and how they want it.
Sadly today we see industries and organizations dying at record speeds. The reason is they were Product-Centric. Product-Centric Companies, hold on to the belief that customers want their product regardless whether it still solves a problem or not. Product-Centric Companies focus more on selling the relevancy of their dying product then selling relevant new products. Their customers’ left when the creative or innovative new way highlighted the old ways irrelevance, causing the old way to be the new problem. A problem the innovator is eager to solve.
The Taxi Industry, an excellent example of being Product focused over Customer focused. Uber, built for the same customer. The difference Uber made the means of the Taxi industry’s deliverable obsolete. UBER focused on bringing a better experience to the Customer and completely blindsided a once lucrative industry.
“The Customers experience is not about products it’s about the intersection where products and their customers meet.”
This intersection is under construction constantly, and most of the time the construction workers are completely unknown to those who originally built the intersection. Those who created this intersection simply thought they only had to maintain maybe re-tar or repainted the lines. Those new unknown road workers came in and ripped up the pavement widened the road and put in sensors for driverless cars, completely reinvented this metaphorical intersection where your customers and your products meet.
Industry and organizations must stop in the belief that their current products are their business forever. Yes, currently they are. However, all products are susceptible to being disrupted and made irrelevant. The struggle in this evolutional processes is the admittance of one's irrelevancy is painful. Yes, businesses get too emotionally attached to their current circumstances. Once the decline begins some will start buying up those who decided on an exit plan rather than a growth plan, many will be forced to lower their products price as demand for their product decreases; many will remain in place do nothing and perish without even being missed.
The easiest way to recognize a Product-Centric Company over a Customer-Centric Company is simple. Look how they react to the disruption of their industry. Let’s look at the Taxi industry when it became apparent that Uber’s customer experience was the preferred means of their desired outcome. Here are some of the ways the Taxi industry responded. They rallied their unions, they began arguing in courtrooms, and they perpetrated as much bad press as possible. Here’s what they didn’t do. They ignored the power of the Smart Phone, they ignored an opportunity to innovate, and they ignored the demands of their customers and focused on their own needs to continue delivering the product of their current circumstances. They still are focused on the way it was, and the outdated product they have. The legacy Taxi industry is most definitely a product-centric business model. So the difference between product focused and customer focused is clear within the Taxi industry. What about your Industry, or Organization. Don’t be the company that is so focused on solving yesterday’s pain points that you stop looking to see what is causing pain today, or what could cause pain tomorrow.
I heard a sales pitch recently where the sales representative explains with excitement their differentiator. He bragged his company answers the phone in two rings. I wondered if one day this company would be disrupted by an unknown competitor. A competitor who doesn't even accept phone calls. I thought will this company focus too much on its current product and how it's delivered. Missing the signs of someone else's innovation, an innovation which threatens both their product and their products delivery.
Today many industries will find themselves at the crossroads of irrelevancy. Those organizations who are customer focused, Innovative, and understand the importance of creating a new way before someone else does. And if by chance someone else’s innovation beats them, they respond by reinventing to the new acceptable way. Or creating an even better way. One thing Customer-Centric Companies never do is remain loyal to an irrelevant product, service, or delivery system thereby causing their irrelevance.
“How and where your products intersect with your customers determines your customers’ experience and your products relevance.”
Today’s technology is allowing Innovators to recreate the experience of getting products. It’s not just about product obsolescence; it’s also about the means to a product's delivery which is being threatened and changed by innovation. So next time you hear someone say it’s not about Customer experience tell them to talk with Jeff Bezos, the guy who proves daily, delivering a better customer experience can quickly win over, not just customers, it can completely change Industries. Amazon confirmed business obsolescence is not just about products it’s also about a better experience to the means in getting them. Years ago Leonard Riggio, and his brother Steven, of Barnes and Nobel believed that too much focus on perfecting their online bookstore would cause a distraction from their core brink and mortar business. Back then the Riggio's were too focused on their Products, not their Customer’s, and this proved to be disastrous. Amazon still to this day surprises the unimaginative in their ability to disrupt all industries which are Product-Centric over Customer Centric. The difference today, from Amazon's earlier days, they have the resources to speed up the disruption drastically.
“You can be the vendor with the greatest relationships and lose to the new unknown competitor who delivers a better experience.”
In Closing: Customers don’t care about products. Their emotional attachment is to the benefits of products, and today customers have just as much emotion attached to how they benefit acquiring a product as the product itself. So your product might still benefit some or many, but if your delivery method doesn’t benefit your customers, they will leave to the disrupter who delivers a beneficial change.
R.J. Stasieczko
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Ray Stasieczko
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