There’s no alternative to customer obsession.
I recently ordered an electric razor from a NZ retailer. It is great that I could order this item online. Nothing exceptional there. So far so boring, but bear with me.
The customer experience and service was pretty good. I was kept informed. I received emails – I appreciated even though I could log on and track my order through a single click. The order tracking site was amazingly efficient. All of that worked well and it took around eight days to arrive. Yes! Time for my shave!
On another scale, think about the convenience of online banking and our current interactions with government compared to how things used to be. Some of us remember the rush to get to the bank to draw money out before they closed – for the entire weekend. I haven’t had to ‘go to the post shop’ to pay my tax or apply for a rego in a while. I don’t miss my cheque book. Online services make my life easier.
FinTech continues to disrupt and innovate – There are new transformational customer focussed experiences that will make life and our interactions even easier. Government continues to innovate too – Peter Dunne promoted 80% of interaction with government would be digital by 2020, others in the D5 have similar commitments. New Zealand is leading the charge! https://www.ict.govt.nz/governance-and-leadership/international-leadership/d5-wellington-2018/.
My point is a subtle one. Amazon can deliver next day, not eight days as with my new razor. They achieved this because they have an absolute focus on improving their service for their customers.
The differentiator in this case is the speed of delivery. All things being equal I’d choose the product that arrived in 1 or 2 days rather than 5+ days. There is a lesson for all of us in business. Speed is the killer differentiator.
Amazon focus on their supply chain management and operations to make inventory and deliveries as efficient as possible. With the extra efficiencies comes cost savings and these too are passed on to customers.
People fear the arrival of Amazon in Australia and inevitably New Zealand. But with globalisation NZ need to compete on the world stage, we need to be efficient to do this. What drives efficiency? A Customer-first view of business is a start. If things were already done with an absolute customer focus, there wouldn’t be a place for Amazon.
And what about the price of not progressing? While we’re thinking globally, aren’t efficiencies and automation one way to protect the planets valuable and limited resources? And if we subsidise inefficient businesses, doesn’t that inevitably lead to unfairness? To international trade sanctions?
I know the arguments about supporting local businesses. Don’t get me wrong, I want to support local businesses, I miss wandering through a bookshop hoping to stumble on a page-turner. The same with CD and DVD stores. But did I go often enough? No, and mostly because of the convenience of online alternatives. Incidentally a logical extension of this is that our cities will turn into experience centres, rather than pure retail centres. Coffee while you get a clothing and footwear style-consultation, before the movie and after lunch.
If we chose to limit the pace of progress for sentimental reasons, where do we start? Where does it end? Maybe we accept four or five day delivery time? Maybe we accept the need to borrow cash from a friend to do the shopping over the weekend because the bank is closed? The point here is that we would have to pick an arbitrary point in time and prevent further progress and innovation from there.
Competition is healthy. If Amazon can do it, why can’t others? Shouldn’t we expect more from people providing services? Shouldn’t we expect suppliers and providers to constantly innovate and improve? If our suppliers aren’t improving to serve us better, what does it say about what they think of us, the customer?
Change can be challenging, but we quickly come to appreciate change once it has happened. Think about life before mobile banking, Paywave, Uber, Netflix, films and TV, or longer journeys before we got better designed and direct roads. It doesn’t matter what technology or improvement I mention – imagine life before it. We wouldn’t tolerate going back. So we shouldn’t be scared of moving forward.
I had the pleasure of listening to Steve Baxter from Shark Tank on Hamilton Island at the Edge conference hosted by Reseller News last year. He talked about speed limitations that ISPs put on their lines. He asked: ‘if throttling is the answer, then what was the question exactly?’. Throttling isn’t the Amazon way. If they were a telco provider, you’d get the very fastest they could offer on day one. It would be faster and cheaper than its competitors.
That’s customer obsession.