The race to succeed is on

Formula 1 racing has magnetic appeal: from its frenetic pace, iconic personalities, high-powered machines to the strategic drama played out on the track. The business world right now is similar. The pandemic has defined a new track to navigate. The flags went down in 2020. A few companies saw the opportunity, but many were slow off the starting line. However, there is still time to redefine your race and close the gap. Understanding your customer and adjusting your business to meet their new needs is fundamental for success. This article describes the two step methodology that will get your organisation onto the podium.

Two dominant themes are playing out in customer strategy right now.

Customer Shift

Firstly, many customer behaviours have shifted. And may not shift back to the way we used to do things. Consumption patterns have changed. Expectations for how brands should engage with customers have evolved.

Winner Takes More

Secondly, the pandemic created a new competitive environment. A few large organisations quickly mopped up market share, while smaller innovators moved into spaces where incumbents were slow to respond. First-mover firms had a head start in 2021 because they course-corrected faster, while rivals have suffered share slippage and revenue erosion. Laggards will require serious strategic adjustments to recover. The race continues and there may still be surprises ahead. A successful customer strategy will drive performance and create long term resilience.

How an insurer moved first, fast

NRMA, an Australian member-owned insurer, recognised the need to respond to situational change early in 2020. Part of their customer base were suddenly cash-poor and juggling finances. They had to work out what to spend money on – and what to stop. Expensive car insurance was in the frame, especially as car usage had plummeted during lockdown.

Most insurers failed to act. NRMA was different. They quickly created a clever value offer of $10 per month for basic car insurance. Pre-Covid, this strategy would have risked cannibalising high value customers. Post-Covid it cut through for customers wanting to cut back but still needing the certainty of being insured. Any of the bigger insurers could have made this offer but NRMA was the first to act and win the customers in flux. The strategy was both a retention play and a churn initiative.

The proof? They got 13,000 new policies instead of just 3,000 for the pre-Covid offer.

Close the gap in two steps

To address these two customer strategy themes, CapFeather designed a two-step approach that gets you ahead of the pack.

Step 1: Current State Experience Audit

We need to understand how your customer has shifted. The Current State Experience Audit explores the how your organisation delivers from your customers’ perspective and involves updating your organisation’s understanding of what it is like to be a customer of yours today. In particular, we assess experience delivery gaps and your customer value proposition (CVP) fit.

Customer Journey Mapping

We focus on leveraging your internal knowledge, existing data and customer research. Unless your organisation has no real understanding of what it like to be a customer, there is no need to waste time and resources on large qualitative mapping research. Internal acumen, accumulated experience and tracking data should be sufficient.

We articulate the end-to-end customer experience by journey stage, including key interactions, touchpoints, episodes and moments of truth. Importantly, we link each stage and interaction of the experience to your organisation’s capability set. This understand of which system, platform, process or human capability is at play helps in developing targeted, actionable change strategies.

The fewer maps, the better. We recommend developing one map - your baseline - and then determine if there are substantial differences in segment, product line or function that require an additional map. For example, a water utility will serve residential customers, business customers and technical professionals like builders and surveyors. They would benefit from developing three distinct maps.

The Journey Map should relate back to your organisational capabilities.

Refining Customer Insights

We bring together primary research together with internal data to: understand what drives and motivates behaviour; assess how behaviour varies across key segments; and determine what value is associated with key behaviours.

Identifying the CX Metrics that Matter

We help you understand what delivery areas create value for your organisation and how to best measure them to drive ongoing improvement.

Assessing the Customer Value Proposition

With an updated understanding of your customer, we help you assess your CVP fit, then determine valuable areas to adjust and innovate your offer.

Step 2: Lean CX©

The Lean CX© methodology generates value quickly, while minimising risk. CapFeather principals Robert Dew and Cyrus Allen developed Lean CX©, which is now a book published by De Gruyter (due for release in April 2021). The core stages are:

1.      Identify potential experience enhancements across all elements of your customer strategy

2.      Lift your value proposition to get cut-through and meet customers where they are at

3.      Develop prototypes of the proposed experience and CVP changes and market test to iterate and de-risk

4. Quickly scale with appropriate controls and optimised go-to-market execution

CMOs and CCOs will immediately understand the benefit of a Lean CX© approach to finding value, because it is fast. They can realise value quickly, thereby generating support from the organisation to do more.

As a CX practitioner or senior marketer a lack of alignment around the customer, value and even go to market needs to be dealt with directly. Lean CX helps to address this by creating a common language for the organisation. By suggesting that the organisation needs to be an ambidextrous firm, that is a firm that creates a difference every day by being able to exploit and explore at the same time. This approach stretches the boundaries of contemporary thinking about how CX can be applied to develop innovative solutions to complex organisational and market problems. Lean CX delivers the framework, supports a crisp commercial dialogue and has a laser-sharp focus on adjacent markets and value creation.

Mac Williams, VP Strategy and Marketing, Asia Pacific, Pearson Education

Read more about Lean CX: How to Differentiate at Low Cost and Least Risk.

National Skin Cancer Centre: Closing the gap can save lives

CEO Paul Elmslie was clear on the value of CapFeather’s research and innovation design focus: “When you are on a mission to save lives, knowing more about the patient really helps.” While attracting more patients would contribute to the growth of NSCC clinics, encouraging more people to have routine skin checks goes to the core of their vision: a world where nobody dies from skin cancer.

The CapFeather team worked with the NSCC to undertake customer research, design and pilot product and service innovations that target important patient segments. Eight insights on patient behaviour were identified from the research. We used these behavioural insights to attract those in need of checks who may not otherwise think to come in. Using the Lean CX© method, we found and tested a novel method for attracting new patients. It lead to a 40% conversion to skin check. The long-term impact of this individual initiative is enormous when considering the organisation’s growth goals and vision.

We thought we knew our patients after 10 years of working with them – but we learned more in one month than in that entire time.

Matt Woollard, COO, National Skin Cancer Centres

Read more about the research.

The finish line

Regardless of what your organisation does or who it serves, a strong understanding of the experience you deliver and contemporary knowledge about what drives and motivates your customer behaviour is critical to generating valuable results. If your organisation has already recovered from the pandemic recession and is outpacing its competitors, you are already in the lead. If your organisation is assessing your next move in the race, talk with us to find out whether we can help get you ahead of the pack.

Contact the author

Cyrus Allen, Managing Partner
cyrus.allen@capfeather.global

Why CapFeather?

We help companies create defensible value through new and sustainable opportunities that are beyond the immediate horizon.

Ambidexterity - the ability to operate your business now, while acting to operate in the future - is needed for sustained growth. While your team excels at business right now, we help you design the path for its future success.

Our expert team partner with your CEO, board and executives to uncover valuable adjacent market positions and exploit them quickly. Unlike other strategy consultants, we believe execution support is critical. We partner with you at the delivery stage, working to ensure you realise true performance improvements.

Founded in Australia with offices in Europe and the USA, our people have worked across global brands and local organisations, all focused on leading in their market.