Understand your customers and help them to make better decisions

Actively seek to understand your customers and their behaviour

Organisations want to know how customers behave to fulfil business objectives – attract, convert, sell, retain etc. Understanding why customers behave in a certain way does not come from NPS scores, customer satisfaction surveys or trouncing data. Following all customer activities and transactions doesn’t explain customer behaviour either. Actively seeking to understand your customer’s behaviour creates opportunities to improve business by zooming in on what matters to customers.

Customer behaviour is out of your control

Customer realities conflict with business measurements

Customers that buy your products and say they like them may still summarily switch provider. Collecting and examining piles of data from numerous sources can make organisations blind to how and – more importantly– why, customers behave the way they do. Measuring satisfaction or likelihood of switching does not provide customer context, nor does profitability or effort to serve. Customers have basic dislikes – like waiting, lack of clarity, or perceived low value, but do not necessarily act on them.

An organisation’s practices are what customers experience

What an organisation does – or doesn’t – do in practice is what a customer experiences. The reasons why an organisation treats a customer a certain way is completely irrelevant to them. Organisations that look at their practices and behaviour – and don’t accept the “excuses” around their, people, processes and systems – see how customers are “forced” to behave a certain way.

Behaviour can be observed and has a logic

There are general human expectations around businesses that are familiar – people don’t like to wait, hate uncertainty, don’t want to spend time “learning” something new and they generally appreciate emphatic responses. Following the logic of these principles still requires context:- is this a new customer? is it a familiar product? is there a sense of urgency or social acceptance at play? – in order to correctly interpret customer behaviour.

Behaviour can be influenced

It’s not necessary to understand all aspects of customers’ behaviour to influence certain outcomes. There are specific points in the customer lifecycle and in specific interactions where customers are sensitive to “nudges” in a certain direction. A series of smaller interventions are needed to move customers in a certain direction. These can be tested and piloted, whereby form and timing of information, engagement and transaction can be tested and outcomes observed.

Observing, understanding and acting helps influence customer behaviour

The key to understanding customers is observing them. This is harder than one might expect because it requires abandoning a lot of preconceptions around what is observed. There are specific points where customers can be queried about why they behaved a certain why – when they leave/defect or make urgent requests for assistance. Customer behaviour is often influenced by the barriers the organisation erected itself. Nudging customers in a certain direction is possible but requires understanding their context as well as your own powers of influence.