Here’s How To Stay One Step Ahead Of Your Customers

What to do when the world changes overnight.

I just had two different conversations that have my head shaking.

The first was with a commercial real estate broker who told me COVID-19 was going to create a higher demand for space. The story he was telling himself, his peers and me was that since people will need to social distance, more square footage would be required per employee when they returned to their offices, which he believes they inevitably will.

That made sense to me.

 The second conversation was with a very senior executive from an insurance company—one that you see advertising on TV all the time. He told me his company had adjusted so well to working remotely that they had decided not to go back to their corporate office. He said nobody was going back to the office…ever.

That made sense to me as well. Twitter has announced that its 5,000 employees can work at home forever. And countless companies are considering letting their employees work remotely, at least part of the time, even when we get COVID-19 under control.

That decision, of course, would reduce their need for office space.

The upshot of those two conversations? I am not sure what will happen.

But here is what I am sure of: Every business has customers who are going through a seismic shift right now. Our companies are too. And it is imperative that we navigate these transitions in an informed way.

We’ve Seen This Before

I know we’re all telling ourselves that we live in unprecedented times. Fair enough. But massive, sudden shifts in perspective are not new. Anytime people go through emotional, life-altering experiences, mindsets change overnight. These experiences can be terrible—like a pandemic—or wonderful, like the birth of a child. Think about how differently you viewed the world the day after you had your first child, or when a loved one was diagnosed with cancer. In an instant, your priorities, desires, fears and hopes shifted; things changed forever.

Everyone in the world is experiencing a life-altering event right now, which means that many of our desires, fears, wants and hopes have shifted. We must understand and respond to these shifts as thoughtfully as possible.

Transitional Segmentations

Sophisticated organizations use segmentation studies to put their customers and constituents into targetable demographic and psychographic buckets. Those big corporate words basically mean they use segmentation as a research tool to understand who to sell to and how, when and where to engage with customers and employees. The typical segmentation study is good for three to four years under usual circumstances. To state the obvious, global pandemics are not “usual” circumstances.

Today, the best companies are embracing transitional segmentations to help understand what their customers’ mindset and needs are now, and what their needs are likely to be as the COVID-19 dust settles into a short-term and long-term new normal.

Let me give you six ideas that work when it comes to segmentation.

Six Segmentation Pro Tips

• Be open to the possibility that your company may be in a different business now than you were a few months ago. For example, if you are in the events management business, your customers now need you to help them create and manage virtual rooms rather than ballrooms.
• Be sure to conduct research with existing and lapsed customers as well as prospects. You want to hear their current feelings, concerns and unmet needs.
• Challenge yourself to find new unmet needs that your company can (or could) solve. This is where opportunities for the most dramatic business growth lies.

Now, three watchouts:

• Do not assume that last year’s “brand new” segmentation strategy is still valid today. At the very least, it must be refreshed.
• Be careful not to chase after old customers that have already left you with the same value proposition you used pre-COVID-19.
• Do not wait until the COVID-19 dust settles to invest in researching customer needs. Doing that will leave you vulnerable to more aggressive competitors.

Confront the Brutal Facts

It is time to take a fresh look at your customer segments.

The harsh truth is, you probably aren’t relevant to some of your customers anymore. These customers now have new needs that are being met by a competitor or with a substitute. It’s also entirely possible that they may not be coming back, even IF your company is one of the lucky ones that will be able to “get back to business as usual.” The sooner you understand these harsh realities the better.

The time to begin your new segmentation work was yesterday. The major shift that changes mindsets has already happened. If you act quickly, you can prepare your company for the short AND long term. A transitional segmentation study will give you quick wins and help you to predict how the new mindset will impact long-term future behaviors, wants and needs as the market and consumers settle into a new normal.

The good news is that you are probably still relevant to much of your customer base, but even these people have a new mindset and new pain points. Your first goal should be to quickly understand how you can best deliver what you’re good at in this new context.

That is the beginning of the new normal for you.