Don’t just know your customers, understand them

He is a CX pioneer, blogger, speaker and influencer who applies his expertise in customer experience management, digital transformation and innovation to tackle the challenges that come with Customer 4.0. In the following interview, Cyrill Luchsinger, Senior CEM Manager at Swiss Post, reveals where the greatest opportunities and the simplest experience factors can be found, and where the proverbial bone is buried.

CEM enthusiast and practitioner, Cyrill Luchsinger

Cyrill, everyone talks about customer focus and customer experience these days. Why are companies now rediscovering customers?

I recently spoke to a CEO in Munich, who said: “I’ve got enough to do. I do not want to also have to deal with the whole customer issue. Somehow, along the way from the local corner shop, which knew its customers and what they needed, to the mass markets we know today, contact to customers was lost. Our perception of customers was reduced to merely a transaction.

Now returning is the awareness that it is not the transaction, but the relationship that matters.

Cyrill Luchsinger

There is an ongoing return to basics, a counter movement to all that has occurred; a development that is leading to new tools and opportunities. A point came when companies realized that they did not know the paths their customers take, or even who the customer is. Especially in sectors that survive from frequent new customer acquisitions, such as commerce, tourism, catering, travel, insurance, banks, etc., the customer does not return if the experience worsens. While this is not apparent if it is just a few customers, if the frequency and revenue drop, and you do not understand why, then you are also unable to react.

Most companies then reduce the price …

That’s right. And yet, the reasons why a customer jumps ship may actually be quite minor: a form on the website that does not work properly, a missing telephone number, a minor error on the start page or in the app. The field of CEM is beginning to grow more scientific. We are learning to view CEM in the same light as we do PR and communications. If the process is not completed, the result is always poor. With this in mind, companies like Amazon, Zalando, Flixbus and others, who are fully focused on the customer experience and have built their business model on the CX, are sweeping up the field from behind. They are placing entire industries under pressure. Customers get used to the good experience and from then on expect the same from other suppliers, such as their bank. Until recently, the company Revolut was just a niche provider in the UK market. Today the fintech has 250,000 customers in Switzerland. This inflow of customers was achieved through user-based services.

Are non-customer-based companies viable anymore these days?

The purpose of a company is to have customers. Companies without customers are truly useless. In the commodities trade, a company can produce coffee beans for two customers. With each step along the way to Starbucks, the competitive struggle trickles down to the experience level. Nonetheless, both product and customer-centered conceptual approaches are necessary. You ultimately cannot entirely allow customers to dictate what it is you offer. However, customers can certainly be asked how an offer should be designed. The most honest answers are found by observing customers. Asking people about their everyday routines requires fundamental comprehension and a translation of both spoken and unspoken needs. It is better to observe how customers get along with the tools, as Hilti does; or to conduct user testing by watching them at work on the computer; or to track customer streams in order to draw the right conclusions from them and to learn from them, as they do at Zurich Airport. The challenge is to transfer this model to your own company. In brief: CEM is not purely a science. The greatest challenge is to apply the theory in practice and to transfer the knowledge.

How can you take the first step on the journey from a customer perspective?

The magic lies in understanding customers, not just knowing them. You manage this by listening carefully, observing them, questioning directly; by assuming an outside-in perspective in business and comparing that to the reigning inside-out view. This change in perspective alone triggers change that benefits customers. We all construct our own reality around us. My reality is certainly different from yours, and from that of all other people. Companies are coming to realize that the essential question is: How do our customers individually experience us as a brand, our products and services, in their reality – and not how do we see them through our own. This is when the much vaunted paradigm shift comes in. A good place to start is to get up close, take a good look and listen. Just by doing these things, you take a step in the direction of customer focus – but do not sprint off in the direction of a solution.

Is that the pitfall?

Yes, that is the pitfall in most companies. When we sit down for a meeting, we want it to end with a solution. Meetings that do not result in solutions are not considered to be successful because they appear to have been unproductive.

In contrast, CEM is based on the approach of shedding light on the problem space or problem zone with all available methods and means and gathering as much information as possible from primary and secondary sources. To directly jump into a solution is useless, because the problem is not understood.

Cyrill Luchsinger

Being focused solely on the immediate does not lead to a positive CX. Curiosity automatically leads to thinking about customers. That is a good start. And a good start is the most important.

It is totally fascinating to see how customers perceive us. Each of us is a customer focus expert, because each of us is a customer. Why should being a customer end when we go to the office in the morning? You hide behind rules and routines, the extensive division of labor means that hardly anyone really has the big picture of how a service is provided. That is really a pity. Job descriptions and annual targets are also hindrances to a holistic perspective. Customers do not care whether the service is provided in marketing, sales or customer service. It really does not matter to them. The company’s task is to break down silos and to provide a seamless customer experience.

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