The 3 components of a great customer strategy

Words by Roberto Lartigue , Partner & EVP, Strategy at Known

Which prospects power growth? That is the question we’re looking to answer. In Chapter 1, we covered why this is one of the most important and impactful questions a business can answer, especially right now. And why researchers and insights professionals are in a uniquely privileged position to do so, if we adopt a test and learn approach.?

In this installment, we will put forward a straightforward framework for defining your growth prospects. In future installments, we’ll bring this to life with a case study. Let’s get to it!

Let’s start with a simple framework: We think a great customer strategy has, at minimum, three components. And here we gather inspirations from three of the all time greats in business and culture.

1. Focus:?

In the words of Michael Porter of the famed Porter’s 5 forces, “The essence of great strategy is picking what not to do.” A great customer growth strategy should tell you who NOT to count on for growth as much as it tells you who to target. Targeting the wrong segments is worse than doing nothing at all.

2. Actionable:

Here we take inspiration from Thomas Edison: “Vision without execution is a hallucination.” As researchers and analysts, our work must, at minimum, be easy for a product team, a media buying team, and a creative team to pick up and use. Otherwise we’re missing the opportunity to help the company actually create measurable ROI from our work. Insights or strategies that don't directly empower downstream action are not just good enough.

3. Test & Learn:

I don’t have to tell you that research and marketing have become exponentially more complex, more nuanced, more data-driven in the last 5-10 years. That also means there is no silver bullet or singular answer to any marketing question. We know every approach, every data source, has pluses and minuses. We know our answers are not perfect. But in modern analytics and marketing we have the tools to refine, to test and learn, to get to a “more perfect” answer. In the words of Beyoncé: “If everything was perfect you’d never learn, you’d never grow.”

But to get there we need our outputs to be something that slots well into tests—something that we can keep iterating, testing, learning, and optimizing. As researchers and analysts, we are not the end, rather the beginning of a massive value stream.

With that, let’s put these 3 components into practice in a hypothetical example.?

1. Focus:?

We start with that first criteria of Focus. Here, we’ll start with the full market we could address, and we’ll look for obvious audience candidates that we should cut. And, to be clear, we’re saying “not today” because frankly once we’ve run as far as we can run with our initial set of growth prospects, we may circle back and decide that the ROI, or those customer behaviors, are now desirable and we want to pick up those markets. But, in general, we like to look 1-2 years out to define our fertile markets.

This may be a pretty obvious point, but as we said in Chapter 1, we’ve been in many rooms where we hear that “everyone” is the target…and that’s not how product development, media buying or creative can be successful. So worth repeating but probably not earth shattering.

2. Actionable:

The second principle is around actionability––ensuring that our insights and strategies directly empower downstream action. And here I want to give you some specific tips that we use at Known.?

Tip 1: Focus your creative (more than media and product)

While it can be true that the media and product focus for an organization maps pretty closely to the growth prospects of an organization, for creative, we tend to focus more narrowly.

There is a good reason we do it this way––for media we need to activate a certain portion of the population, and so our media focus tends to be quite wide––you want a nice, large, wide, rich, addressable opportunity.

The creative focus, if it gets that wide, can get diluted and watered down and not really mean anything to anyone. We want to try to find a group of people with whom our creative resonates with without alienating the larger media and product target.

Tip 2: Translate and pull through to actionability

As researchers, all of our tricks of the trade––the slide decks, workshops, socialization, videos that bring the customers to life, interactive dashboards, persona placemats, etc.––are all attempts to try and transmit the essence of the target customer. And, in doing so, we seek to empower various functions, in product and marketing, to make the right decisions.

Those tried and tested tools exist for a reason and they’re worthy investments, but increasingly they’re not enough.

It’s not enough because companies are typically spending more money and effort to further translate these research deliverables into the tools that are actually usable by product development, media buying, and creative. We absolutely need to find ways to translate and pull through our findings into these domains. This is increasingly non-negotiable and there are a number of ways to do this.

• Creative: How is what we’ve discovered in the target market definition translatable into a format that will fit a client’s creative brief? Which leads to all sorts of interesting questions...You can ask your clients for copies of their creative briefs or you can offer to include it as an additional deliverable.
• Product: Same goes for the PRD (Product Requirement Document) and MRD (Marketing Requirement Document). How are your clients describing their PRDs or MRDs? And how is the deliverable regarding growth strategy or prospect targeting strategy going to fit into these documents?
• Media: Can the identified prospects be easily handed over to a media buying team for activation? Or are they going to need to do a bunch of interpretation and risk getting it wrong, or just not understand what is left behind?

While the essence of the prospect is important, so too are the translation tools that enable them to be actionable by downstream actors.

3. Test & Learn:

We need our hypothesis about prospects to be testable in the real world. This is actually the gold standard to achieve actionability.

Once we’ve focused on who you are not going after, we tend to divide the prospects not just into creative, product, and media buying segments, but we break them into micro segments that are driven by attitudinal and behavioral dimensions, as well as demographics and other pivots.

Ultimately, we want to end up in a place where product and media teams can A/B test various tactics, against various audiences, in various channels to really understand how to best resonate with each of the micro-segments. We also want to understand who is worthy of further investment, and who might, despite our hypothesis and best efforts on the insights side, be a lower ROI bet.

Allright, enough theory! In the next installment, we’ll put this into practice with a very specific example of these principles at play for one of Known’s clients. In the meantime, I've shared with you our tips and framework, what are your tricks and models? Also, I used quotes from Beyoncé, Edison and Porter. Do you have any quotes, inspiration or “rule of thumb” that you use in moments like this? Until then, thanks for reading. Open to comments and suggestions to make this useful to all of you.?