Carol Hymnowitz’s recent Wall Street Journal article “CEOs Are Spending More Quality Time With Their Customers” highlights a trend that can directly impact your company’s competitive strategy.
CEOs of Nike, Intel and Sun are becoming more involved in the selling process, focusing on tailoring products and services to meet the demands of their top customers.
And it’s more than just a ceremonial visit. These CEOs are overcoming objections and negotiating deals, giving them an intimate understanding of market pain and the value they may (or may not) provide.
From a marketer’s perspective, this is a great trend! A CEO who works directly with customers often gains a new appreciation for the strategic landscape. And that makes it easier for marketers to gain the CEO’s support for strategic initiatives. It can also help marketing gain a stronger voice in C-level discussions on business strategy.
From a CEO’s perspective, a deep understanding of true customer needs is a critical variable when shaping your company’s competitive strategy. It gives you an unvarnished look at your position in the market and a clear understanding of the issues your marketing needs to address.
Better yet, these CEO/customer meetings can trigger big ideas that can take your company in exciting new directions. Take, for example, Starbucks.
In the early 1980s, Starbucks was a wholesaler selling coffee beans. On a trip to Milan, Howard Schultz (a VP at the time) visited a coffee bar and came up with the idea to re-create the Italian coffee-bar culture in the United States.
The company founders resisted Schultz’s recommendation to change their business model from wholesale to retail. Recognizing the opportunity, he quit the company and started his own. He achieved immediate success and bought out the Starbucks founders in 1987. We all know the rest of the story.
Schultz’s first-hand experience gave him the insight to create an entirely new market. But it’s difficult to drive such innovation from a VP position. He had to quit Starbucks to make it happen on his own.
Schultz delivered what the authors of the popular book Blue Ocean Strategy call value innovation. Instead of just trying to beat the competition, make the competition irrelevant. Create a leap in value for buyers and you can open entirely new and uncontested markets.
Every CEO dreams of becoming the uncontested leader in a new market space. It’s also the best spot for marketing directors. After all, defining a new market space is usually more exciting and rewarding than battling in the trenches in a noisy market with established competitors.
But it’s rare for companies to achieve this goal. Logic tells me that meaningful value innovation comes from a deep understanding of the market and customers. It’s more than data and customer surveys. It takes big-picture right-brained thinking — empathy, synchronicity, creating meaning.
Remember what Henry Ford said?
“If I’d built what people were asking me for, I’d have delivered a faster horse!”
It seems pretty clear that value innovation is an enormously powerful business strategy. And since CEOs need to drive strategic changes, it’s important to know the market like the back of their hand. But they need to know more than just the numbers. They need to understand customer experiences to truly innovate.
What better way to learn than to experience it than by selling?
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