Throughout our lifetime petrochemical companies have been household names with global brands that produce and deliver products that underpin our everyday lives. Petrochemical companies have focused on the products they produce (lubricants, chemicals, and gasoline etc.) as this was their IP and differentiator from their competitors.
The drive by petrochemical companies to transition their focus from product to customer is evolving rapidly due to the changing demands of consumers locally and globally, diverse market segments and governments. The strategies that differentiated petrochemical companies in the past may no longer be sufficient to win out in the future, so there is now a need to switch focus by leveraging and leading the customer centric disruption.
Drive to customer centric
In future it will be increasingly difficult to clearly define not only who the end customer is but also who really owns the customer. In a world where the information available to a customer is ever-increasing, how is customer loyalty going to be measured and maintained?
Petrochemical companies’ drive to be customer-centric is critical in supporting new business models in markets where existing providers (e.g. utilities, retailers etc.) or internet based companies (e.g. Amazon, Google etc.) are leading the way in customer centricity.
The customer is also evolving with a myriad of options to form their opinion of the best purchase, share their views through social media while learning about the products or services and exploring alternatives.
The empowered customer poses a significant challenge for business. Customers expect enterprises or organisations they frequently interact with to ‘know’ them. They want offers that are built around their specific needs and past transactions. They demand relevant and personalised context driven information.
Missing the mark can cost you customers, impact your reputation, have a negative effect on brand and damage trust. On the other hand, when you engage your customers in each aspect of your business, the rewards can be tremendous.
Who is leading the way…
With digital transformation, there is a clear demand to put the customer at the centre or heart of any service proposition. In retail we have seen Amazon who have done it well and are on their way to achieve their vision statement “We seek to become Earth’s most customer centric company”. In media and entertainment it’s Netflix while there are few other examples like Uber and Starbucks who have built their own customer centric view in recent years.
Frequently, we hear two phrases “customer centricity” and “customer user experience”. Some even use these interchangeably. From my perspective, the latter phrase (customer user experience) is a subset of the former (customer centricity).
Customer-centricity is a commitment or a strategy to assure the success of your customer. Whereas, customer user experience is a set of customer perceptions constructed across various interactions via all potential channels with your brand.
If we take the Amazon example, their motto is to start with the consumer and then work backward, not the other way around. This is supported by an amazing data capability that provides Amazon with unparalleled insight into customer behaviour, needs and preferences. The result is a strong focus on delivering a superior customer experience that is measured and improved upon to make it frictionless, affordable and offering new innovative services to customers and ranging from Amazon Prime Video to Echo dot, Alexa, Amazon Go and even drone-based delivery.
Uber is another great example as Uber did not exclusively build their business around a profitability objective. Instead, Uber asked, “How can we make taxiing easier for drivers and passengers?” The answer became the foundation for their business. They clearly understood the customer lifecycle was not only a buyer journey but it takes more to win. Retaining customer loyalty and continuous innovation coupled with a trusted and reliable service was the way to succeed.
Customer centric, what could be the right approach to this transformation?
A transition to a customer centric company is often discussed as a technology-led concept. Although technology is a key enabler for organisations, the cornerstone to success is embedding the customer centric culture into the DNA of the organisations.
Embed the customer view in everything you do.
The mindset has to be “We exist for our customers”. To achieve this, the customer must be considered at the centre (virtual seat at the table) for all aspects of the organisation from strategy, product development, innovation and customer experience etc. This also requires new insight to learn what they buy, what they will need, the challenges they face and how they want to be engaged with technology.
Understand who and how you interact with customers today compared to future.
The approach for customer-centricity should begin with a clear understanding of all customer-facing processes across business channels (Analog and Digital). This then needs to be aligned with the “Future / Next Generation Customer” objectives e.g. deepen the customer knowledge, improve margin and attract new customers with appropriate incentives and increased loyalty as a vision and roadmap.
The customer of the future demands more convenience and feels pressed for time. The expectation is frictionless interactions that provide a simple, consistent and seamless experience.
Improving customer digital engagement
As with the Amazon example, successful customer centric companies start at the top and ensure all levels within the organisation have an involvement and commitment to the customers’ current and future needs. Customer demands will drive the innovation and investment. Organisations have to commit and invest processes and systems to support the new business models which are aimed to deliver higher customer value and centricity.
Although there will be quick wins along the way, the benefits of increased customer satisfaction and loyalty won’t come overnight as this is not a rapid change but rather a long term journey which needs to be measured appropriately.
In this series of blogs we will focus on the organisational and cultural change required by petrochemical industry and the emerging technologies they can use to unlock customer centricity across their organisation.