The Customer Comes First
You may not be able to manage the relationship, but you should always strive to understand it
My friend Kevin lives in Los Angeles, where coffee shops are almost as plentiful as palm trees and out-of-work actors. When he is in the mood for a hearty breakfast, however, Kevin always heads over to a place called Jan’s. It’s not that the food there is significantly better than what you’d find at other coffee shops, he tells me. Nor is it particularly convenient now that he’s moved to a new place in Hollywood.
So why does he still number Jan’s among his regular haunts?
Mostly, it’s a waitress named Sue.
“She remembers that I drink decaf and like my water without ice,” he explains. “She always brings me extra napkins. And she always has a smile.”
It doesn’t seem like such a big deal, really. But I think we all have a favorite restaurant or tavern or coffee shop for pretty much the same reason. The people there know us. And because they do, we have become loyal customers whose business they can count on through good times and bad.
This, says Roland Rust, is the way all companies should be thinking.
“I think companies have spent too much time thinking about their products and their brands, and not enough time thinking about their customers,” explains Rust, who serves as chair of the Department of Marketing at the University of Maryland’s Robert H. Smith School of Business. “Really, they ought to be organized around customers, rather than around products and brands.”
According to Rust, this tendency to think primarily in terms of brand is an artifact of the past, when an advertising campaign mounted on three monolithic television networks could convince a large number of consumers to buy a product. The recent proliferation of media channels, however, has rendered this approach obsolete. The audience today is much too fragmented to be swayed by old-fashioned mass advertising techniques. Yet the same technology that has scattered the audience has created an unprecedented opportunity to establish a dialogue with it, enabling marketers to learn about the goods and services customers actually do want.
“The smart companies are all thinking about customers in terms of their long-term relationship with the company,” notes Rust. “It’s a matter of communicating with customers interactively. We do something. They react in a certain way. They communicate with us. We have various touch points with the customer. And you can take a look at that relationship in terms of how it unfolds over time.”
Companies have long understood the importance of these relationships in the business-to-business arena. But Lou Schachter, senior vice president at the Real Learning Company in Scottsdale, Ariz., believes that the art of building long-term, mutually beneficial relationships is now more important than ever. In an era where goods, services, and even full-blown “solutions” are increasingly viewed as commodities, any attempt to compete on price alone is doomed to failure.
“Companies that are looking for better margins need to do more [than that],” says Schachter. “And that means focusing on the business results that your customers want to achieve. You have to understand who their customers are, and why they buy from this organization, and what future goals the company has for those customers.”
Getting to know your customers as individuals is fairly easy in business-to-business situations. But even if it is a bit more complicated in consumer marketing, Rust believes it is essential to get over the mind-set that we are ultimately selling our products and services to an “average” consumer. That animal simply does not exist.
“What’s really important is taking a look at how the population of customers is different, taking a look at the heterogeneity of the group,” explains Rust. “It’s the old idea of if you have iced tea and hot tea and average it, you get lukewarm tea. And you think that’s the optimum tea. Well, it’s not. Half the people like hot and half the people like iced.”
You discover your customers’ preferences by using every channel at your disposal — be it surveys, focus groups, Internet chat rooms, or feedback from frontline employees. And once you have this information in hand, you should focus your marketing efforts on the narrowest niches that are economically feasible.
My friend Kevin assures me that lukewarm tea is not on the menu at Jan’s coffee shop. And as long as waitresses like Sue remain attentive to their customers’ desires, the tea will be served either hot or cold, with a smile and plenty of napkins on the side. As Kevin sees it, there is every reason to believe that he will be a regular customer for many years to come.
— Dayton Fandray
(Read@Work)
Mind Your Customers
Lou Schachter and co-author Richard Hodge articulate their argument for a new approach to business-to-business sales relationships in their book, The Mind of the Customer (McGraw-Hill, 2006). Sales professionals, they argue, are in a unique position to see the big picture that their customers are sometimes too busy to see themselves. “A really good sales rep,” says Schachter, “can help customers understand their own organization and how they can achieve results they didn’t even know were possible.”
Bill Stinnett builds on that same theme in Selling Results! (McGraw-Hill, 2007). Less theoretical than Schachter and Hodge, Stinnett sets out a complete system for increasing your own sales by helping customers achieve their business goals. Full of diagrams and checklists, the book is a useful guide to getting better results.
Although you might feel as if a lifetime has passed since 2001, Ray McKenzie’s The Relationship-Based Enterprise (Diane Publishing Co., 2001) remains a useful guide to customer relationship management and the importance of dialogue in every successful business relationship.
— D.F.
