NETTING IT OUT

There are patterns to be found in every type of customer scenario. Previously, we looked the at reorder/replenish/renew scenario that is part of the Renew/Replace stage of the customer lifecycle. This report looks at another common customer activity that occurs during the same lifecycle stage, upgrading a product or service.

Although the details of the situation for each customer are different as are the types of products or services being upgraded, there are patterns to virtually any upgrade scenario. When upgrading, the customer typically has four key requirements to ensure that the upgrade is worth the investment in time and money:

• The upgrade offers real and measurable enhancements/advantages
• It is easy to upgrade
• Accessories that worked with the older model/version still work with the newer model
• It’s easy to get up and running on the upgraded product/service

We call these the customer’s “Moments of Truth”—aka “showstoppers”—if you don’t address these issues crisply, you risk losing your customer forever. And, in this troubled economic environment, when customer purchasing goes way down, and upgrading is a tougher sell, it is especially vital that you understand these key concerns of customers.

Once you recognize the common moments of truth, you can identify the types of customer metrics and operational metrics that measure how successful you are at meeting your customers’ ultimate goals for doing business with you. Then you can focus your co-design activities on how to differentiate the experience, products, and services you offer to help customers reach those goals.

Identifying the metrics allows you to recognize:

• How the customer will be “grading” you
• How you grade yourself in helping the customer be successful
• How you can identify and measure business opportunities that can result from providing a great customer experience

A TYPICAL UPGRADE CUSTOMER SCENARIO

The Latest and Greatest

Even in a down economy, new products come on the market. And we love to upgrade to newer models, newer versions, and newer ideas. But, although we want shiny new products and features, we want our upgrades to be easy to obtain and use. Further, in a weak economic environment, it becomes even more important that upgrades are seamless and that there is no loss of productivity or clumsy retrofitting required. Otherwise, we will just make due with older versions and models as long as they last.

Similar for Products and Services, B2B and B2C

Whether you are an individual consumer or a business buyer, you want the same thing when you upgrade. You want to be sure that the investment in the upgrade is worth the effort and the money. If it isn’t, then most of you will probably forego the seduction of the latest and greatest and keep on rolling with what you already know and is working for you.

This Customer Scenario Pattern fits a variety of upgrade situations. Later in this report we’ll take this pattern and apply it to two business scenarios and two consumer scenarios, to wit:

• B2B: upgrading business software to a new version
• B2B: upgrading a service contract for equipment
• B2C: upgrading a cable TV package
• B2C: buying a new car (this year’s model)

Moments of Truth in Upgrading

Although there are always variations on a theme (based on specific customer type, specific service or product line, industry, and context), there are four key moments of truth that show up in some manner in every upgrade scenario, as shown in Illustration 1:

© 2009 Patricia Seybold Group

Illustration 1. In almost all upgrade scenarios, whether for products or services, or B2B or B2C, there are four key moments of truth.

• The upgrade offers real and measurable enhancements/advantages
• It is easy to upgrade
• Accessories that worked with the older model/version still work with the newer model
• It’s easy to get up and running on the upgraded product/service

CONDITIONS OF SATISFACTION FOR MOMENTS OF TRUTH. Although these moments of truth are virtually universal in this type of scenario, sometimes they are expressed in a slightly different way depending on...(more)

(Download the PDF to read the entire article.)