By Collin Sebastian, UserZoom
Virtually every marketing organization claims to have a laser-like focus on customers. But when the team gets together to discuss ways to stay ahead of competitors, the focus almost invariably turns to competitors’ products: XYZ Telcom examines ABC Mobile’s smartphone and compares its feature set to their latest release. There’s nothing inherently wrong with that approach – it’s important to keep tabs on competitor product development. But there is a risk that the company can get so caught up in product comparisons that they lose sight of the customers and what they really need in a product.
Focusing too much on a specific set of customers is another potential pitfall for marketers. Now that companies have access to more data than ever and are busily constructing personas and analyzing their customer bases – all important activities – there’s a danger that they can lose sight of non-customers, which represent their largest opportunity for growth. The average ecommerce site converts about 3% of visitors, and the biggest companies in the world play in markets so competitive, they’re lucky if they top 30 percent market share. That means the lion’s share of opportunity always lies outside their own customer base.
So, as a marketer, how can you expand your focus and capture the opportunity your competitors’ customer base represents? Research is the key to stealing your competitors’ customers. With the right research solutions and marketing strategy, you can begin to understand why your competitors’ customers are dissatisfied and then position your product or service as the optimal solution. But putting this plan into action also requires a strategy for overcoming barriers to customer conversion.
To understand the scale of the challenge, consider the plight of large cable companies, wireless carriers and banks. Most of their customers can’t stand them – in many cases, these companies have negative Net Promoter Scores. And yet they enjoy a solid customer retention rate. Why? Because their competitors haven’t yet successfully positioned their service as an acceptable alternative and have failed to overcome consumer objections to change.
With an effective approach to research, big cable, wireless and banks’ competitors could learn why customers are unhappy, what they’re looking for and why they are resistant to change. The fact is, customers perceive the hassles involved in changing cable, wireless or banking service providers as much more onerous than they actual are. Competitors in possession of that knowledge have powerful information they can use to steal customers.
For example, a wireless network might discover through research that its competitor’s customers aren’t happy with their service, but they stick with it because they think it would be a gigantic hassle to switch. What if the wireless network used this knowledge to build a wizard that would walk potential customers through the process, demonstrating that switching isn’t so hard after all? And what if the network took that message directly to unhappy customers via a social media campaign that responded to negative messages about the competitor with a better offer and a way to see how easy it is to switch?
Companies can and should focus on their customer base, taking care not to lose sight of what their customers value by spending too much time evaluating competitor products. And it’s important for marketing teams to thoroughly understand their customer base, developing personas and evaluating data for insights into what customers need today and what their requirements will be in the future.
But at the end of the day, the greatest opportunity for market share growth will always lie outside the existing customer base. With the right research solutions, marketers can gauge customer satisfaction levels within their competitors’ customer base and drill down to discover what those customers want and why they resist change. Armed with that knowledge, they can effectively position their products and services as the ideal solution – and achieve unprecedented success.
Collin Sebastian is the VP of product management at UserZoom.