Companies interact with consumers ‘in a fragmented way’
Surveys across six industries have found that most companies still fall short when trying to deliver value consistently in all the functions that interact with customers.
The reports focussed on the financial services, technology, telecommunications, utilities, consumer goods and retail sectors and were written by the Economist Intelligence Unit. They highlight company efforts to engage customers in banking and insurance, technology and telecommunications. Although each sector has its own strengths and weaknesses, the surveys found that all are struggling to have marketing, sales and customer service work together, share knowledge, and use this knowledge to engage customers.
“When it comes to connecting with customers, certain themes emerge across all of the industries,” says Dan Armstrong, senior editor at the Economist Intelligence Unit, who led the research. “In every industry, most respondents accept that their products are becoming more like commodities. They realise their ability to compete depends on knowing customer preferences more profoundly than their competitors. Yet they often do a poor job sharing and analysing the information.”
Reports on the first three surveys are available now. Reports on the utilities, consumer goods and retail sectors will be released later this month, followed by a final report comparing customer-facing processes in all six industries.
Key findings include:
– Whether companies compete on innovation (telecommunications, technology) or operational excellence (utilities), a majority or plurality of companies cite the ability to provide superior service to customers as their core competitive advantage.
– All six sectors are facing the need to accommodate more value-oriented customers. Five of the six industries rank changes in customer requirements as the second biggest trend to affect their businesses. (The global economic downturn was first.) Respondents in the sixth industry, utilities, cite changing customer requirements as an important trend, but not as vital as sustainability efforts and access to credit.
– Regardless of industry, fewer than one in four executives say their customer-facing departments have consistent processes to analyse and segment customers, gauge customer satisfaction, respond to complaints and incorporate customer feedback into products or services.
– Companies in every industry need to do a better job estimating the lifetime value of customers and allocating resources to their most valuable clients.
In a weak economy, companies need to improve the flow of information from customers to the company, improve their ability to gather information through the web and social media sites, and focus on competing on value rather than price.
The Beyond Transactions series of reports are based on six surveys conducted between July and September 2009. Each survey targeted a different industry. The number of participants in each survey ranged from 84 (consumer goods) to 105 (utilities). The survey included companies with a variety of sizes, and respondents came from finance, general management, strategy, sales, marketing, customer service and several other functions.