Companies are recognising the growing importance of constantly reassessing their knowledge as to what constitutes superior customer value. Only by creating strategies that consistently deliver and capture that value can growth be maximised. However selling the concept internally is not always plain sailing when resources are scarce and budget holders have yet to see the results of customer value initiatives translate into profit growth. We share some of the challenges.
It seems not all organisations have truly embraced the scale and scope of the customer value challenge. Despite a plethora of new customer excellence departments and customer value becoming a common phrase in company strategy documents, customer value can remain a poorly understood concept.
Some believe customer value objectives can be achieved by ensuring the company’s brands remain differentiated, supported with an active innovation pipeline and score highly in usage, attitude and awareness trackers. This misses the point and can lead to an internal brand myopia that ultimately nudges brand portfolios further and further from consumer relevance.
Building consumer value must become embedded within the psyche of the organisation. Firstly organisational consensus must be reached on what constitutes customer value. It should then be clearly articulated how it will drive growth and why everyone within the organisation has an important role to play.
This is more difficult than it seems. Many industries particularly those that have faced difficult structural and strategic challenges latched onto customer centricity soon after the financial crash as a marketing Band-Aid. Phrases such as ‘the customer must come first’, and ‘we always listen to our customers’ were used to provide evidence of the company’s commitment to customer value. Unsurprisingly without a corresponding change in behaviour, it did little to solve the problems and give credence internally to the perception of customer value as simply a promotional marketing tool.
Customer centricity is not a marketing strategy. It is a business philosophy that recognises at its core that to be successful companies must become obsessed with consistently delighting, surprising and exceeding the expectations of their customers. This is now increasingly recognised as the single most strategic goal of business.
Nowhere is this more salient than in health wellness and pharmaceuticals. The information and technology revolutions have acted as a change agent across the health markets. It has empowered consumers, shifted decision making towards payers, provided new channel interaction options for healthcare professionals and consumers and given a platform and voice to patients.
At the same time product innovations, are being backwardly engineered and replicated by new global competitors and reaching markets in a matter of months rather than years. This has left projected P&L forecasts based on assumed windows of competitive advantage in tatters and has put new financial pressures on marketing.
In this new paradigm classic marketing models are losing viability. The pharma industry has woken up to this and is moving towards ‘beyond the pill’ business models to enhance perceptions of added-value. Hospitals and healthcare services now understand they must also compete in the hospitality market. Meanwhile OTC medicine is rapidly adopting the business model of a healthcare foundation seeking to extend the role of self-medication to education, patient support and positioning of its brands as an informed healthcare partner .