Who is the Customer The first step towards finding out what our business is, is to raise the question: Who is thecustomer? - the actual customer and the potential customer? Where are they? How do they buy? How can they be reached? Peter F Drucker
Segmentation Subdividing people with distinctive shared needsand characteristics into reachable groups, based on 3dimension: 1. Who they are ? 2. What they do ? 3. How they think and feel ?
Some areas where we apply segmentationStrategy/ PolicyEvidenced based policies and strategiesTargeting resourceIdentify new people needsDeliveryPlanning number and nature of delivery solutionsIdentifying special needsPlanning for different ‘customer journeys’CommunicationC&M targeting and media choiceInsight and proposition developmentDeveloping effective message
Ways to Segment PeopleUse & Behaviour, e.g. Needs, Benefits,FrequencyPlace Demographics, e.g. Motivations, e.g.Time Need convenience, need reliability,Occasion Gender need support etc.Extent of use e.g. heavy, light Ethnicity Beliefs, desires, wantsPersistency e.g. loyal Family Deep-seated drivers e.g. love,Channels used for contact Age and life stage belonging, praise, security Household type/ composition Loves & hatesLifestyle, e.g. Education Attitudes & Beliefs, e.g.Holidays taken abroad Income and social class In generalMultiple/holiday homes Benefits claimants/non- Government specific e.g. to ourLodgers/rental income claimants brands, servicesWhat money is spent on Working status Balance between time, cost, Physical status convenience Urban vs. rural To value and moneyMedia Consumption e.g. Postcode & regionInternet and digital usage MobilityTV channels, radio, press Moving frequency Influencers e.g.Where most info comes from House ownership Authority figures, e.g.How information is absorbed accountants, solicitors, taxWhat media engage them inspectorsAccess to media Parents, friends, peers Role models Community influences
Ways to Segment BusinessUse & Behaviour, e.g. Needs, Benefits, Motivations, e.g.FrequencyPlace Economic/demographic Need convenience, need reliability, needTime support etc.Occasion Turnover of business Beliefs, desires, wantsExtent of use e.g. heavy, light Loves & hates Number of employeesPersistency e.g. loyal Market sectorActivities, e.g. Attitudes & Beliefs, e.g. Area of business activityMembership of trade bodies Level of profitability In generalLobbying activities Geographical location Government specific e.g. to our brands,How profits are distributed services Number of sites/locations To value and moneyMedia Consumption e.g. Private or limited Influencers e.g.Where most info comes fromInternet and digital usage Authority figures, e.g. police, taxHow information is processed inspectorsAccess to media Community influences Key shareholders Media
Segmentation – Success (1) There is some form of segmentation to guide a bettercustomer experience Segmentation is fit for purpose - investment in it is adequatefor the business Segmentation is actionable – people in each segment canbe reached It’s clear who needs considering separately- who has verydifferent needs etc
Segmentation – Success (2) Segments can be quantified -it’s clear who’s most importantin achieving aims Segmentation is workable- it’s not so complex and granularit can’t be applied Segments have been properly prioritised to guide resourceallocation Key measures -e.g. customer satisfaction - are at segmentlevel
Insight What compels people to act, think & feel as they do? Deep truth is based on behavior, experiences, attitude,emotions or beliefs. Is it relevant to your task? Does it ring true with people?Will people act differently as a result of applying it.
Possible Insight QuestionsWhat are peoples basic motivations?Difference between heavy and light use?How do people think things work in this area?What do people love and hate?What are the triggers, life stage, an event etc.What stops people doing things?Who are the influencers.What is your relationship with influencers?When, where, how & why do things happen?
Insight Transformationa. Collect important pieces of data andinformation.b. Group data to understand what information istelling us.c. Move to insight – the deeper underlyingthought.
Successful ModelMultiple/best sources have been used- formal research & informal ‘closeness’Customers are seen in ‘3D’- who they are, what they do, and why they do itThere is real understanding and insight - capable of achieving change neededThere is insight for important customer groupsThere is customer focus - insight guides decision making, strategies, actionsInsight guides the whole customer experience to make it as good as it can be
Journey Mapping The process of tracking and describing all the experiences that customers have as theyencounter a service or set of services, taking into account notonly what happens to them, but also their responses to their experiences.
Questions?Do you have gaps in your understanding of the experience that customers undergo at the moment?Would it help you to have high impact feedback to challenge conventional thinking?Do you have intractable policy challenges – where you keep trying things but without getting anywhere?Do you need to convince colleagues in other functions about the importance of a customer-focused approach?
Use of Journey MappingUnderstanding the reality of people’s livesFacilitating inter- and cross- departmental workingDesigning and overhauling systems and processesMaking decisions
Will it help?Do pressures to Are there advances inreduce costs technology or commsthreaten to affect that are likely to affectthe customer Are there lots of the way customers ways customers canexperience in an want to interact with access oradverse way? you? experience your service?Are you incurring Are you seeing a shiftextra costs Is the service in the balance ofthrough high offered to a wide channels used?error rates or range of people?avoidablecontacts?
Will it help? Do you deal withIs there is a high or particularly vulnerable orrising number of at-risk groups?customer complaints? Is this an issue that leadsAre you asking a lot to emotional or heatedfrom your customers? exchanges with(What’s it costing customers?them in terms of timeor money, and do Do you deal with issuesthey accept this?) where the cost of failure can be catastrophic?
Journey Mapping Q u a lita tiv e , fo c u s e d o n e m o tio n a l in s ig h ts to te ll a s to r y w ith p a s s io n a n d n a r r a tiv e . P o w e rfu l w a y o f e n g a g in g s ta ff a n d M e a s u re s c u s to m e rs h o w w e ll th e e x p e r ie n c e is d e liv e r e d ; lin k s to c u s to m e r s a tis fa c tio n , C o m b in e b o th m e tr ic s & tr a c k in g a p p r o a c h e s fo rin c r e m e n ta l b e n e fit A llo w s y o u to q u a n tify th e e ffe c t o f ch an g es an d c o n tr ib u te to M a p s s te p s in a b u s in e s s p r o c e s s– a l s o k n o w n cas es a s p r o c e s s m a p p in g . Id e n tifie s w h e r e to a c t to m a k e th e e x p e r ie n c e a s e a s y , p le a s a n t a n d e ffic ie n t a s p o s s ib le
Success? The business thinks in terms of customer ‘journey’- not justa point in time There is recognition of when journey thinking is right forcustomers Journey maps start and end at a relevant point The right type of journey has been applied- e.g.understanding vs. efficiency
Success? If methods used are informal e.g. using frontlinestaff, they are fit for purpose Customer Journey thinking has been appliede.g. to improve the experience The right people have contributed e.g. staff tohelp engagement with customers Customer satisfaction along the ‘journey’ ismeasured in some way & actioned
Questions? Terry Pilcher BCS Management Services Cambridgeshire United Kingdon BCSMgt@aol.comBCSManagementServices.com