In today’s competitive marketplace, businesses must continuously strive to stand out and make a lasting impression on consumers especially given that customers experience is now the new gold mine in this digital age where the ability to generate electronic word of mouth can exponentially increase sales so much so that 89 percent of businesses compete primarily on the basis of customer experience because we have come to know that when served with a positive customer experience, 72 percent of consumers tend to share it with at least six other customers. Therefore, the studies that found that customer experience is a deciding factor when customers are making purchase decisions is on point.
Having said that, many organizations often find it difficult to compete favourably in the market place because they have not been able to move their product and service above the crowded options and alternatives in the market. The reason for this is because they have not been able to bridge the brand gap. This “brand gap”, can lead to ineffective marketing campaigns, poor product design, and ultimately, a failure to reach business goals.
Some of the causes of ‘brand gap’ include failure to link business strategy to product design, lack of communication and collaboration between the business and design teams and lack of clear and consistent brand identity. Oftentimes, the management team develops the business strategy while the design department is the responsibility for developing the product as a different department without proper collaboration, aggregation or fusion of ideas. This usually lead to a disconnection between the two teams, with the design team working on projects that may not align with the organization’s overall goals and objectives.
To bridge the brand gap, organisations must
- Align business strategy with design:
This means that design decisions should be informed by the organisation’s overall goals and objectives, rather than being made in isolation. This alignment can be achieved by embarking on what experts called ‘design thinking’. This is a problem-solving approach that puts the customer at the center of the process. By involving the design team in the early stages of the business strategy development, organisations can ensure that design decisions are informed by customer insights, stakeholder concerns in alignment with the organisation’s overall business goals. A study conducted by the design firm, Continuum revealed that products that were developed with a deep understanding of customer needs and behaviors had a 73 percent chance of success in the market, compared to a 27 percent chance for products developed without customer insights.
Aligning business strategy with product design will help an organization achieve three things viz (a) Prodcut-Market fit (b) successfully testing new product (c) Innovation. I will expand this line of thought in subsequent write up on this.
Product-market fit refers to the process of ensuring that a product or service value proposition effectively meets the needs and wants of a specific target market. It is the point at which a product or service perfectly addresses the pain point of the targeted market and customers are willing to pay for it. Achieving product-market fit is crucial for the success of any business, as it ensures that the product or service is relevant and valuable to the target market. Failure to achieve product-market fit can lead to low sales, customer dissatisfaction, and ultimately, the failure of the business.
A great example of an organization that has achieved Product-market fit by successfully aligned its business strategy with its product design by incorporating customer feedback into the decision process is Moniepoint.
Moniepoint, a full-service business bank, has evolved from TeamApt’s flagship product. In 2018, Tosin, the CEO of a fintech called TeamApt, observed that the Nigeria’s financial inclusion numbers were very low and thought his company could help improve this situation by servicing Nigeria’s largely unbanked and underbanked people leveraging their market expertise to build a better agency called Moniepoint. TeamApt wasn’t new to agency banking. The company had been building Point of Sale (POS) terminal applications for some of the biggest Payment Terminal Service Providers (PTSPs) in the Nigeria.
TeamApt team went to Sangotedo a bustling open market area in Lagos and some other major markets to conducted market research and they were able to identify three key challenges.
- The problem of reconciliation for Point of Sale (PoS) agents: Agents don’t have access to their transaction history, they had to print two receipts. One for the customer’s copy and the other is the merchant’s copy. They would have to manually check each receipt after the close of business to make sure everything corresponded. It was strenuous.
- Issue of stability: PoS agents were always at loggerhead with customers due to bad connectivity because whenever NIBSS was down, nothing would work. Many a time the transaction will show failed and the customer will be debited.
- Lack of transparency in the commission in the distribution network: Cluster managers and aggregators with the PoS operators in the market had no way of confirming whether they were being paid the correct commissions or not.
Based on these feedbacks, TeamApt decided to incorporate several key features in the Moniepoint App. For instance,
To solve the issue of reconciliation, they added another leg to the transaction process flow where once NIBSS sends confirmation of the transaction to the POS, the terminal sends the transaction to Moniepoint. This allowed agents to get real-time reports of the transactions they have made.
To tackle the issue of stability, TeamApt brought on board the Moniepoint team, an engineer who had been working on their payment switch called Aptent to help upgrade Moniepoint by ensuring better connectivity with banks.
And to address the lack of transparency in commission, Moniepoint ensures Everyone could track what they earned, and how they earned it which incentivized agents to work hard at processing more transactions and delivering the best service to their customers.
Additional, Moniepoint built out a hyperlocal support system for the agents that was very personal. And CEO realizing that Moniepoint has a great potential of becoming a big business refocused 80% of the entire TeamApt team on Moniepoint alone.
Today, Moniepoint is helping over 600,000 businesses to process about 7 trillion Naira monthly and processing $170 billion in annual run-rate transaction value. And Moniepoint has become Nigeria’s largest business payments platform, recognized by the Central Bank of Nigeria as the most inclusive payment platform in the country. Moniepoint got its Microfinance Bank license in February 2022.
Overall, by Moneypoint as a product was able to record astronomical adoption because of its Prodcut-Market fit which was as a result of Moniepoint ability to align business strategy with product design. And this is why the great Steve Jobs, Founder of the iconic brand, Apple said: “You’ve got to start with the customer experience and work back toward the technology, not the other way around.”
Successfully testing New product
In the early 2000s, McDonald’s was facing decline in sales and increase in customer complaints about the appearance and cleanliness of their restaurants. In response, the company conducted extensive customer research to understand their customers’ perceptions of the brand and identified areas for improvement.
Based on these insights, McDonald’s made several changes to their restaurants, including introducing more natural and modern decor, incorporating comfortable seating, and increasing the focus on cleanliness. Additionally, they also introduced a more extensive and varied menu, with options such as salads and fruit, to appeal to customers who wanted healthier options.
These changes helped McDonald’s to improve their brand image, increase customer loyalty and improve overall sales. According to a study by the American Marketing Association, McDonald’s brand equity increased by 18% after implementing these changes, and customer satisfaction increased by 5 percent.
A great example of an organization that has achieved Innovation by successfully aligned its business strategy with its product design by incorporating customer feedback into the decision process is LEGO. LEGO created a mini-site where its enthusiasts can easily submit their own designs. The projects that gather more than 10,000 votes from the community undergo LEGO review and are turned into new sets if the review is favorable. This process is not only limited to collected and analyzed customer feedback but allows for customers to be the complete designers of their products.
Business strategy and product design are two core elements of any successful business. Aligning them can result in numerous benefits for businesses including increased efficiency by utilizing fewer resources and time to achieve their goals, enhancing customer satisfaction by enabling businesses to create products that better meet their customer’s needs, boosting revenue because customers who are satisfied with the product are more likely to make repeat purchases, and Improving competitiveness by helping the product to compete favourable since it is designed with the customers’ need in mind and it also addresses the customers’ pain-point.
Ayodele is an award winning strategic communication strategist who specialises in helping leaders, brands and organisations communicate in a way that yields the desired outcome. He can be reached via email@example.com