Updated: May 12
Manufacturers are arguably facing more challenges and more disruption than any other industry right now. Depending on the outlook of the organisation this can be perceived as either a terrifying disaster or an exciting opportunity for innovation, growth and expansion.
Worldwide, there will be new market opportunities and supply networks to tap into, with room to forge new relationships and develop new ways to access more customers and more expansive marketplaces. The corresponding side to this, of course, is that manufacturers are now competing in a global marketplace on a much larger scale.
This means that in order to take advantage of the vast potential opportunities offered by the current marketplace, manufacturers need to become much savvier around how they are going to market and how they are creating a competitive advantage that will protect their business.
Here are 12 key factors that as a manufacturing SME, you must consider to create a competitive advantage through customer experience, that will enable you to tap into new markets and increase sales in your business.
1. Understand what your customers want so that you can decide what to do about it
The first thing you must do before you do anything else is to understand what your customers want, only then will you know what it is that you need to do about it. Once you have this information, you can determine what things you should concentrate on to give you the greatest return on investment. Knowledge is power and accurate customer research helps you make smart decisions.
To do this, you must first benchmark the effectiveness of your current customer experience. Map out your current customer journey to see where your opportunities for improvement lie. You can also use this process to determine new cost optimisation and revenue-generating opportunities for your business. A design-led thinking approach, as part of a wider research strategy is really helpful at this stage as it will help you define your priorities with the customer in mind.
The problem is that right now you don’t understand your customers well enough, or what is that they truly want and so you can’t create a vision for the future that meets their needs. I cannot drive home hard enough, the point that you must perform customer research. It is impossible to develop a vision for an optimal customer experience, if you don’t fully understand what it is that your customers want, you will never meet their needs.
The biggest mistake I see in companies that are trying to improve the customer experience or expand offerings to meet the needs of new customers is that they skip this one vital step. They come up with supposedly wonderful ideas but haven't spent any time upfront validating whether they actually meet the needs of their customers or potential customers, resulting in wasted time, effort and resources. Dedicate some time upfront understanding your ideal customer and it will pay dividends in the future.
Regardless of where you are in your customer experience journey right now, you will always want to start with customer research. If you do not know who your customer is and what their current problems are, then you will never be able to fix them and you will never create a customer experience that meets their needs and delivers a competitive advantage for your business.
2. Rethink the way you go to market
Does your GTM strategy still make sense, or do you need to apply new strategies to reach new audiences?
This is a very important question that you need to start asking yourself. Challenged with finding new ways to reach customers, which often means cutting out the middleman and selling directly to the consumer. Manufacturers today are rethinking the way that they go to market. They are creating new online business models that allow them to sell directly to customers and are developing websites and interfaces that are optimised to meet the needs of B2C customers. Fentimans Beverages are a really good example of this.
The marketing/sales model used to be quite simple, usually with one light marketing resource, perhaps posting a bit of content on social media here and there - and job done. But it’s becoming increasingly more complicated. Selling directly to consumers is quite a different beast, requiring different strategies and tactics and with a much greater focus on the customer experience and whether you like it or not, this requires you to be good at marketing and sales.
The issue here is that as a traditional manufacturer, you are likely not used to doing things this way and so it can feel a little overwhelming at first. But if you get this right, you have the potential to tap into new markets, create a large base of customers who love you and increase annual growth rates to 10 percent, 20 percent, 30 percent, or even higher.
In this previous article, I discussed how Manufacturers are by nature resilient and have faced industry disruption time and time again, however not everyone made it through the storm. Only the companies that truly faced their current circumstances head-on and made the hard decision then and there to change their business models survived. Today, manufacturers are once again facing an insurmountable number of challenges and it is time to make some tough decisions regarding ‘the way things are done around here.’
The process of rethinking your marketing and sales strategy isn't necessarily easy, but it is systematic. It is time to bring the right skills and knowledge into your business to help you get good at this.
3. Create a clear leadership-driven vision for your customer experience
If you do not know where you want to go, you will not get there. Great customer-focused organisations, winning at the customer experience have a clear vision for what the customer experience should look like.
It is absolutely vital to define an aspirational vision centered on what matters most to your customers and on how it affects your business.
The customer experience must not be viewed as just another subset of marketing or customer service. To be effective, a customer experience program needs to be a strategic priority, aligned to your corporate mission and vision and the wider company initiatives. Companies that drive customer experience as their strategic priority outperform their competitors and studies show that a great customer experience can generate three times greater return compared to companies that have not invested in customer experience and outperform laggards in the same industry by 80%.
You must determine what the strategic goals are for your customer experience program and clearly communicate them throughout your business. Everyone must be bought into the vision for it to be successful.
Some examples might include:
Increased customer satisfaction
Increased customer loyalty
Defining new routes to market
Reduction in operational expenses
4. Drive your customer-led culture from the inside out
A company's culture often has a strong unrecognised impact on its ability to succeed. Manufacturing companies that are successfully winning the customer experience game are creating a customer-led culture, driven by a strong customer experience vision and an entire team that is bought into that vision.
Adopting a customer-centric mindset is just as critical in B2B dealings as it is in direct to consumer dealings. A customer-led culture creates the basis for a great employee experience and research shows that great employee experience inevitably leads to great customer experience. It’s a wonderful life cycle of events that if you get it right as it makes both your employees and your customers happy. A true recipe for success.
Companies that excel at customer experience have 1.5 times more engaged employees than less customer-focused companies, which of course reduces, among other things, employee churn and associated costs.
5. Reassess talent and invest in your people
The lack of specific abilities, and inefficient operating models, have the power to completely derail your customer experience initiatives. Often in manufacturing, lack of access to skilled workers can be an issue, but your customer experience vision is only as good as the operating model and talent that you have to support it.
You will need to consider what skills and talent you need to bring into your business to support your customer experience vision. This will depend on your specific business issues, and what it is that you are trying to achieve, and by when. Perhaps now is a good time to question your current talent model. Do you need to access more remote, offshore resources with different skill sets potentially, or can you upskill/reskill existing employees to deliver your improved experience.
Often considering how you can transition to a more SaaS based business model, which will provide you with the opportunity to leverage the tools subsequent efficiencies that can come along with this can allow you to utilise team members more effectively. Through this method, you can capitalise on more advanced skill sets while also making it easier to retain your employees by providing the stimulation and motivation that comes with removing more mundane tasks and providing them with the opportunity to grow as individuals within your business.
6. Identify the weaknesses in your customer service
The question I really want you to consider here, is how easy are you to do business with and does it feel good to interact with your organisation?
Because fundamentally, this is what it comes down to. 96% of customers say customer service is important in their choice of loyalty to a brand and 3 out of 4 customers will stop using your services, without telling you if they receive less than satisfactory service. Manufacturers must understand that the business buyer today wants the same consumer-like experience that they receive in their personal shopping experiences.
You’ll need to think about what it’s really like to interact with your organisation through the eyes of your customers. Does it feel good to do business with you, or are there some simple improvements that you could make? - ask yourself, how can I make my customers feel special and where are there opportunities for you to create moments that matter for your customers, throughout their interactions with your organisation? Can you make the process of interacting with you easier, either by optimising that process based on the needs of your customers (not just your business), or potentially through the use of technology and tools?
Now, I'm just going to caveat something here. Although there is a huge trend in adopting intelligent customer service tools to streamline customer services, And these tools if used effectively can work wonderfully in helping to more effectively help your customers, increase efficiencies and reduce operational costs, I urge you to look at the way in which you are using these tools holistically, as part of the wider customer experience strategy.
Test what the actual impact is that implementing these tools will have on your customer service and make sure that any tools that you apply for help and not hinder your experience. - optimise for sure, but don’t over complicate things for the sake of it.
Also remember that in a world where we are used to calling customer service and receiving an automated response, sometimes just being able to speak to a real person is the one thing that is missing.
7. Make data-driven decisions and measure your success
Do you know how to access the vast amounts of data in your organisation that can already provide you with most of the information that you need to make data-driven decisions to improve your customer experience?
There are essentially three ways that you gather customer data. By directly asking customers, by indirectly tracking customers, and by appending other sources of customer data to your own.
Chances are that you already have a great deal of the information that you need to generate the insights that you need to transform your customer experience lurking somewhere in your business, but you haven't figured out how to access it, process it and generate enough insights from it. Finding ways to do this will provide you with a large majority of the information you need in order to make strategic customer-led decisions.
8. Define how you will measure and govern your customer experience program
Governing your customer experience program essentially just means that you are establishing a formalised process to measure and monitor your customer experience initiatives, to help ensure program success.
Remember when you defined your high-level customer experience goals? Well, now you need to put a structure in place to measure their success. Because what gets measured, gets managed and with good management comes the ability to understand when things have gone off course and where adjustments can be made to get your customer experience initiatives back on track. According to Forrester, only 34% of companies review their customer experience program status and metrics regularly.
Customer experience governance will always tie back to your leadership vision and must be driven from the top down, but championed by the employees. The specifics here will vary depending on the size and operational structure of your manufacturing organisation, but essentially, CX needs to be everywhere and understood by everyone in your organisation. With leadership owning the CX program, the customer experience governance you put in place will remain front and center for your company, and not risk becoming out-of-view if it sat with just one department.
Practically, consider how often you will meet to discuss the progress of your customer experience initiatives and who needs to be in the room. Then, determine how you will communicate the outcomes of these meetings, the progress of the CX initiatives, and the actions required to the wider business, to ensure that everyone is continually brought into the transformational journey.
9. Take advantage of smart and transformational technology and strategically automate the customer experience (but exercise caution)
As a manufacturer, you will need to embrace new technology, such as the Internet of Things (IoT), cloud computing and artificial intelligence (AI), and the opportunities that it presents in terms of improving the customer experience.
But, manufacturers and quite frankly most businesses, in general, have a tendency to want to fix everything with technology. And while I am obsessed with how we can use technology to enhance the customer experience. I believe that it should be used as just that - an enhancer, not a fixer.
What I mean by this is that you should be careful to use technology as a way of making an already good customer experience better or as part of a wider strategy to do so. Knowing that if you don't get the foundations right on which your technology sits, then it will likely cause you more problems in the long run. - what’s the saying… You can’t put lipstick on a pig. Be wary of technology salespeople and consultants that tell you otherwise, they may not have your best interests at heart.
10. Automate to enhance, but not hinder the customer experience
The same goes for automation, which is such a large piece of the puzzle for manufacturers, that it requires its own stand-alone section. Leveraging the appropriate automation technology and tools in order to create a competitive customer experience in manufacturing is an absolute necessity. If you are going to compete, then your ability to produce with speed, accuracy and you need to be able to get information to your customers quickly.
But once again, I would urge you to proceed with caution. We often get so caught up in technology and automating processes for speed and efficiency, that we forget that customers are in fact still human beings. And as such, require HUMAN contact. How many times have you been frustrated to the point of absolute despair with automated customer service systems...I am going to assume, like most of us, the answer is many. Instead, find a way to provide genuine human interactions.
Yes theoretically, simply automating these services could save you operational costs, but what did this cost you in terms of lost customers? Finding the right balance between efficiency and keeping a good level of human interaction is important. Historically, manufacturing companies have survived based on their ability to build strong relationships with suppliers and customers. Don’t get so carried away by new shiny tools that you forget that when it comes to the customer experience, building relationships should still be the number one priority. Use technology when it is appropriate, but not as a substitute for the things that really matter.
11. Develop a strong business case and plan your roadmap accordingly
As we have discussed, technology, automation tools, and the internet of things have the potential to offer incredible opportunities, but make sure that you have a solid business case for new solutions. Be sure that you are considering all of the benefits and the limitations of these solutions. What are their long and short-term benefits, financially and otherwise?
These technologies have the potential to create incredible efficiencies and opportunities for increased revenue generation, but It’s also essential to understand how to adopt these new technologies strategically. You must understand how you can use these new intelligent tools to solve specific business problems, in order to make a direct impact on the output of your business. The biggest mistake that most companies make in adopting new technologies is that they do it haphazardly, without considering the long-term benefits, or in-fact whether the solution actually solves the problems that they need it to. Thorough research, development, and investment plan should be adopted from the outset.
12. Put the security of your customers at the center of what you do
Last, but certainly not least, keep in mind at all times, that a security breach can ruin your reputation in an instant. With a greater shift to online channels, the threat to customer data and privacy becomes more apparent. You must find ways to strike a reasonable balance between security and the customer experience and adopt strong governance mechanisms to support the secure customer journey.
Thinking about security as an opportunity to enhance the customer experience as opposed to an annoyance that needs to be managed, is an optimal perspective. If your company can guarantee its customers a secure online environment, it will be able to create positive experiences that differentiate your business from its competitors.
Charlotte is an award-winning customer growth & strategy consultant. She helps SMEs get to the heart of what their customers want, so they can create competitive, customer-led strategies to grow their business. Sign up for her free newsletter for practical tips to create competitive customer experiences, tips to leverage your time, new tech, CX hacks, and much more here.