What Is A Customer?

customerWhat is a Customer?

The simplest definition is: Someone who buys things from a business.

A better definition comes from Sam Walton, founder of Walmart. He says the customer is “… the boss. And he can fire everybody in the company, from the chairman on down, simply by spending his money somewhere else.”

Another good definition makes us think in human terms:  “Consumers are statistics. Customers are people.”

And finally a definition of customer that speaks to choice:  A party that receives or consumes products (goods or services) and has the ability to choose between different products and suppliers.

Pulling it all together, here’s my definition of customers for your consideration, which adds the dimension of why we make products to begin with.

Customers are people that products and services are designed to please. They choose what they buy and who they buy from,  which determines the success of companies that make and sell the products and services.

How do you define customers?

Let’s Stop Confusing Strategy and Tactics in Healthcare

strategyI can’t tell you how many times we’ve seen very smart healthcare companies – med tech companies, payers, provider organizations, etc., confuse strategy and tactics. And it reduces their effectiveness every time.

Why do strategy and tactics get confused? First, sometimes there is not clarity about what the real objective is and why. This subjects companies to the paradox Lewis Carroll described this way: “If you don’t know where you’re going, any road will get you there.”  Without a clear end point in mind, develop meaningful strategy to get there is very difficult.

Second, there is so much pressure to get new things to market, it makes it hard to carve out time and think strategically. There’s only time to “do” — even if what is being done doesn’t make good sense.

So what’s the difference? Strategy determines how you will achieve your goal. It represents which map you will use to get where you are going. Tactics are the map details and are all about the doing.

Let’s start with a couple military examples: 1) Divide and conquer is a strategy. Sending half the troops in a frontal assault and half on flanking maneuvers are the tactics that executes on the strategy. 2) Go big, go long, or go home, were the three strategies being considered in the Iraq war. How many troops would be where and when were the tactics, and that’s what got all the media coverage.

Marketing examples: 1) Be first to market is a strategy. Be a fast follower is an alternative strategy. The specific products or services you take to market, the resources you allocate, and the timing are all tactics. 2) First get prospects in the door with a low barrier to entry, then engage them to be customers is a strategy. How you will go about getting them in the door and converting them into customers are the tactics.

 

Don’t be one of the many companies that spend millions of dollars and years of effort on something only because their competitors are doing it. Have a good compelling reason. That way you know where you’re going and why.

Next be clear about what your strategy is, and why. Make sure your strategy is really strategy — and not tactics with the word  strategy attached. Then get into the tactics that execute on the strategy.

Lastly, make sure your team knows the difference between strategy and tactics and why it matters.

Bottom(s) Up! How a Benefits Ladder Can Help You Get Your Marketing Right

Medtech companies, health insurers, and healthcare systems talk a lot about data. My belief is no healthcare executives, providers, or consumers really care about “data.” What they do care about is making good decisions that will measurably improve healthcare and health outcomes, and make or save money. And they see data as a means to those ends, a tool for making those things happen.

So how do you meaningfully connect data with decisions and decisions with outcomes? How do you work in the interim outcomes like improved workflow and increased productivity? How do you know which features and benefits to emphasize and which not to emphasize or even mention? How do you determine what elements to consider including in your value proposition?

One powerful technique we use to identify and prioritize benefits is laddering. We use it in deep dives with clients, and in testing or validating hypotheses during customer research.

Here’s how it works:

At the bottom of the ladder is the essential feature. At the top is the highest level benefit or result.

But first, let’s clarify the difference between features and benefits: Features=description. Benefits=satisfaction. Data is a feature. Good decisions, better workflow, improved quality of care – those are benefits. Those are results that provide satisfaction.

And there are different kinds of benefits (some overlapping): There are core benefits, functional benefits, aesthetic benefits, self-expressive benefits, emotional benefits, and more.

Benefits are what customers care about. But sometimes inside the company, executives, product managers, and marketing managers care more about features. That’s a problem that laddering can help ameliorate.

Here’s what a simple benefits ladder might look like for streaming analytics within health IT, to appeal to healthcare providers.

TOP

  • Improved Outcomes
  • Safer Patients
  • Enhanced Reputation
  • Better Care
  • Faster Decisions
  • Prediction
  • Analytics
  • Data

BOTTOM

Note that the core fundamental feature – data – is on the bottom. Just above that is the next level feature – analytics. Next we move up into benefits, starting with the functional benefit of prediction, which then leads to faster decisions. This set of four captures very concretely what the product is and does. And if we were to unpack these four further, we would get into workflow, efficiency, and productivity.

However as a set, the bottom four rungs on the ladder do not convey aspirations or emotions. And they do not express higher order benefits or results. For that, we need to go higher up the ladder.

A result of faster and therefore better decisions is better care. Which leads to multiple higher order benefits – like enhanced reputation, healthier patients, and better outcomes. And again, unpack these further and you’ll find patient satisfaction, HEDIS scores, etc. Some of these benefits may be produced concurrently, but for simplicity the ladder shows them in linear fashion.

When we go through this process in internal deep dives, we’ll invite clients to attach a heart to the one benefit they believe is the most compelling emotional hook for the product. For providers and streaming analytics… is it faster decisions, enhanced reputation, better outcomes? Is it improved workflow or its outgrowth, saving time?

The ladder they create and the emotional hook they select are well-educated hypotheses. We rely on the voice of the customer for validation or correction.

Bottom line, laddering is a great way to think through what your product or service delivers that matters to customers so you can improve your marketing. Do one for each of your main target audiences. When you do, you’ll notice the bottom rungs of the ladder are the same, it’s typically the higher order benefits that change.

Whether you’re bringing a new product or service to market or need to get better uptake with what you’re already selling, try laddering. It will enable you to transform your thinking, empathize with your customer point of view, inform your value proposition, and set yourself up for marketing success.

What’s your ladder??

Customer or Money: Which Comes First in Med Tech?

As a strategic-thinking med device marketing or sales professional, you know it’s all about putting the customer first. But how do you get your company executives behind you if they’re solely focused on hitting the quarterly numbers and only paying lip service to being customer-centric?

This was the focus of a session I presented yesterday with Mark Kesti at the first Medical Device Marketing Summit, put together by the inimitable Joe Hage.

The goal was to stir up fresh thinking and provide both practical and contrarian tools to win greater company support for practicing customer intimacy and putting the customer first in marketing and communications work. The participants were seasoned and smart. Lively discussion generated good, practical ideas.

Here are five key takeaways:

  1. First means first: Putting the customer first literally means just that- putting the customer first. How? Give the customer a voice when it matters. That translates into giving the customer a voice before you decide on what products to invest in, before you determine technical feasibility for your device or software, before you put your messaging together, and before your sales force hit the streets.
  2. Problems not solutions: When you do give your customers a voice, be sure you’re not asking them to design the solution. That’s your job. Ask them to talk about what is and isn’t working, what problems they want solved, and what a better end state would be like. Don’t ask them what the product should be or what your marketing should look like. NTJ (not their job)!
  3. Direct connection: Get your technical people – scientists and engineers – involved with customers early on. Let them hear problems, concerns, likes and dislikes directly from the customer, not mediated through a report you give them. Help your technical team to experience customer pain points as much as possible. This is where qualitative research methodologies shine.
  4. Money metrics: Not all dollars are equal. Some come at the expense of long-term customer relationships, like through hitting your numbers by heavy end of year discounts. In companies committed to customer intimacy, the lifetime value of a customer trumps hitting quarterly numbers every time. Caveat: Shareholders may not agree. You have to balance the sometimes conflicting needs of two masters in that case: shareholders and customers. Ideally you have shareholders who see the value of long-term gains.
  5. Behavior before beliefs: Let’s say your CEO, doesn’t believe in putting the customer first. He’s all about the money and that mindset pervades the culture. You can beat this too. But don’t try to change his beliefs at first. Get his behaviors to change. Pitch putting the customer first as all about making more money. Speak in ROI terms. Because it’s true. Putting the customer first does make more money.

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More here:

3 Powerful “B4’s” that Put First Things First in Winning Innovation

“But We’ve Always Done It That Way” – Zen, Zero-Based Thinking, and a Fresh Approach

How to Get to Breakthrough Innovation: Desirability First!