How can managers, whose empathy has been blunted by strategic power, see the world from the customers’ point of view? Most companies collect reams of monthly sales data and survey current customers’ satisfaction. These quantitative data reveal only those times when a customer is satisfied with a current product but mute on what would delight or surprise a customer or meet his or her deeper needs. Some companies attempt to discover this with focus groups, but this is the equivalent of scientists going to the zoo to study animal behaviour.
To empathise with customers’ unmet needs, managers must observe them in the wild, not the zoo. To better understand the needs of Mexico’s less affluent customers, CEMEX assembled a cross-functional team of high-potential managers who spent 10 hours each day for a year in an extremely poor neighbourhood in Guadalajara.
This intense observation provided many surprising insights. They noticed, for example, poorer consumers generally bought less expensive powdered cement in bags, rather than pricier ready-mixed concrete delivered by trucks. In these neighbourhoods, cement is a consumer product. Their observation led CEMEX to market powdered cement like powdered soap, through consumer advertising and sponsoring local football clubs.
More importantly, the team gleaned insight into the subtle emotional benefits of home extension that supplemented the functional benefits of more room. Home improvements not only added space, they learned, but also conferred an important psychological satisfaction by creating ‘patrimonio’ — something of enduring value that customers could pass on to their children and grandchildren. The insight that buildings represented more than utility inspired CEMEX to create a programme called ‘Patrimonio Hoy’ (legacy today) that appeals to consumers’ aspirations to create an enduring legacy that their children and grandchildren could enjoy.
To help customers realise their legacy, the CEMEX team had to understand obstacles that prevented consumers from building a legacy. Funding was one. They discovered that poor Mexicans raised capital for building by organising ‘tandas’, a lottery in which a collection of families contribute a set sum to a pool each week and one family wins the entire pot at the end of the week (no family can win more than once). Although these funds were intended for building, winnings were often diverted to alternate uses such as celebrating a wedding or birthday. Lack of building equipment and expertise also hindered construction. Although bagged cement represented a significant expenditure, the CEMEX team discovered that 40 per cent of all cement went bad, because customers lacked the tools or blueprints to complete their construction project.