The intuitive approach to understanding customer needs seems to be fading in the chemical manufacturing industry, and this predicament puts the sector at risk of customer defection.
Why has this skill faded? It’s an excellent place to start our analysis.
A study by Accenture reveals that almost 78 percent of the chemical industry players are apprehensive of losing customers either to competitors or to sellers from outside the industry.
Their apprehension is not without basis because approximately 58 percent of buyers are more likely to change their suppliers, and 56 percent are considering switching to alternative materials from outside the industry. To make matters worse, the chemical manufacturing sector finds it difficult to attract new customers.
Why? Because of a vast gap between buyers and manufacturers regarding values, priorities, and expectations.
Another survey by Accenture revealed some significant divergences between manufacturers and buyer concepts of relationship-building:
- Chemical manufacturers believe renewable energy-based and recyclable products are more critical, whereas, according to the survey, buyers showed more interest in sustainable, safe, and durable products.
- Chemical companies overestimated results from value-added services, considering them to be a way of differentiation, while buyers showed less interest in such services.
- Buyers ranked logistics and delivery reliability as highly important, a trend companies missed.
How to attract customers and build loyalty
It begins from scratch – from when a chemical manufacturer decides to make a product to when and how they sell it by answering questions focussed on product-market fit, including:
- Is the product what the market needs?
- How will the product be sold?
- What is the buyer/customer preference regarding the product model, its purpose and how it’s sold, and distribution preferences?
- What resources are required to connect these dots?
The truth about a free-market economy is that buyers have a choice and will exercise it. If they do not choose you, it’s usually because they found a more relevant and compelling story from a competitor. And this is at the root of customer defection.
You must be among the buyer’s/customers’ top choices to halt this defection. How? By rethinking your business strategy. The current market is fluid, dynamic, and fast-moving, and manufacturers must align their ‘go-to-market’ with customer expectations. Value often supersedes price as the factor that influences the purchase decision.
Proving the value of products is a layered approach that goes beyond fixing a price and placing the product in the market. It involves building a relationship with buyers by understanding them. Getting to know your buyers is enhanced by investing in data that tracks their responses at every stage of your journey with them, starting from finding the product-market fit to the moment of purchase and post-purchase experiences.
Your every activity – acquiring, retaining, and serving buyers and customers – must be tailored to their needs and expectations. This dedication entices them to stay the course with you and builds stronger relationships. Improving customer relationships through the effective use of technology also helps curtail the defection rate.
A study by Accenture revealed that 46 percent of the buyers of chemical company products are willing to pay an incremental price at the rate of at least five percent of manufacturers if all their needs are met.
Going beyond User Persona
Nearly 99 percent of chemical manufacturers surveyed by Accenture believe customer centricity is essential. Many think they are doing a good job — with 61 percent ranking themselves 8 on a 10-point scale. But that confidence may be misplaced, as the study reveals significant gaps in sellers’ understanding of buyers’ needs.
Companies often assess user personas to determine product-market fit. It is a valuable tool, but the focus is on ‘user experience’ rather than ‘buyer engagement’. At this stage, the understanding of the buyer persona would decrease the gaps in sellers’ understanding of the buyers’ needs. Though the two are different. They can be merged into one. Instead of creating buyer persona at the marketing stage, an early endeavor to understand them at the time of product design will make things better.
From website content, marketing messages, and mission statements to brand values, every facet of a company and its communication must pivot on customer-centricity. Engaging today’s self-reliant audiences demands thoughtful content, well executed. Whether long-form or short, attention depends on relevance, compelling insights, and ideas that help the audience advance. Tenured writers who do thorough discovery, support content with data, and use flow and structure mean the content does the job by helping buyers and customers do theirs.
Context is different at each stage of the buyer-to-customer lifecycle. In-house talent constraints can limit what’s possible. Partnering with a content team skilled in a diversity of content formats, industry knowledge, and skillsets—like SEO—gives chemical manufacturers an advantage to differentiate their brand and meet their buyers and customers wherever they are in their relationship with them. This will help chemical manufacturers to halt defection and enjoy higher customer lifetime value and loyalty.