Creating an effective demand chain requires companies to pay attention to five key areas:
1. Create a consistent experience
PwC’s Retailing 2020 study projects that no single channel or particular retailer will dominate growth through 2020. Additional PwC research finds that 86% of shoppers use at least two channels as they research, shop, and interact with brands. Manufacturers and retailers need to deliver an “omni-channel” shopper experience from start to finish, across physical, digital, and mobile channels.
2. Gain a better picture of the customer
Alan G. Lafley, Procter & Gamble’s former CEO, often began meetings by asking a series of “what is” questions about the firm’s consumers, before shifting to “what if” queries that could give way to customer-centric innovations. All customer-facing personnel must be involved in the process, and there must be a continual flow of verbal, visual, and quantitative data.
3. Deliver a top-notch customer experience
This is a make-or-break proposition. Researchers at Northwestern’s Kellogg School of Management confirmed that a 7-second reduction in fast-food customers’ waiting time can increase market share by 1%. Likewise, each added second of drive thru wait time reduces the amount customers are willing to pay by at least 4 cents.
4. Innovate with the customer’s help
Injecting an experimental mindset into product and service innovation can disrupt markets. Learn to prototype—and learn rapidly. In describing the Kindle’s development, Amazon CEO Jeff Bezos said a company’s leaders can “determine what your customers need and work backward, even if it requires learning new skills.”10 The strategy has served Amazon well, earning it top rankings in the American Customer Satisfaction Index for 12 years running.
5. Define and measure impact
Companies remain in the early stages of figuring out what to measure and how. “The exact metrics are still being fully developed, but they have to be founded on the return on investment,” says Don Mulligan, CFO of General Mills. The means for measurement will evolve as each new avenue to the customer comes along.
The more precisely a company can assess the performance of its brands, the better positioned it will be to make robust brand and business decisions.