1 - One of the most difficult aspects of being a Management Analytics Consultant is teaching Leaders to think extensively about new customers.
Most of the people I work with struggle with thinking about new customers.
Most of the people I work with struggle with thinking about new customers.
2 - There is a feedback loop that happens between Leaders and Best Customers.
Best Customers generate a ton of profit, so they rightfully garner a ton of Leadership attention.
Best Customers generate a ton of profit, so they rightfully garner a ton of Leadership attention.
3 - This feedback loop (Leaders catering to Best Customers, Best Customers generating profit for Leaders) can take a business in a bad direction.
4 - The failed omnichannel thesis is a perfect example of this feedback loop. You ask your best customers what they want, and the best customers tell you what they want, so Leadership gives the best customers what they want.
5 - Who ever asks prospects (non-customers) what they want?
6 - When you ask Best Customers what they want, you get skewed responses.
The best Macy's customer might love omnichannel solutions.
A prospective Macy's customer isn't attracted to a solution where they have to order online, get in a car, drive to a store, & get the item.
The best Macy's customer might love omnichannel solutions.
A prospective Macy's customer isn't attracted to a solution where they have to order online, get in a car, drive to a store, & get the item.
7 - The feedback loop creates an analytical problem.
The analyst sees, via customer data, that best customers are spending more, and sees, via reporting, that it's getting harder to find new customers.
The solution? Cater MORE to Best Customers. But that's not a good idea.
The analyst sees, via customer data, that best customers are spending more, and sees, via reporting, that it's getting harder to find new customers.
The solution? Cater MORE to Best Customers. But that's not a good idea.
8 - Eventually all brands (who aren't Walmart or Target or Facebook or Starbucks) need new customers.
And by the time the realization comes, the organization is trained to cater to Best Customers, and doesn't know how to relate to new customers / prospects.
And by the time the realization comes, the organization is trained to cater to Best Customers, and doesn't know how to relate to new customers / prospects.
9 - The feedback loop is complete ... too few new buyers, and eventually, an inability to get Best Customers to spend more (they can't infinitely spend more money), it's all over.
Ask Sears. Or JCP. Or most mall-based retailers. Ask mature e-commerce brands, too.
Ask Sears. Or JCP. Or most mall-based retailers. Ask mature e-commerce brands, too.
10 - My industry is largely unwilling to shift even "some" focus from Best Customers to New Customers / Prospects.
But it is a necessary shift. Especially now, at a time when e-commerce brands are posting +20% to +150% gains due to new customers via COVID.
But it is a necessary shift. Especially now, at a time when e-commerce brands are posting +20% to +150% gains due to new customers via COVID.
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