One of the most fascinating and revealing aspects of business thinking today is the way so many different strategic management disciplines--ranging from information technology consultancy to operations planning and even management psychology--are all tending to reach the same conclusion, that the only way for a business to prosper in todays highly competitive marketplaces is through focusing passionately and devotedly on customers and their needs.
On the face of it, customers always were absolutely central to why an organisation was in business. The famous statement by the great hotelier Cesar Ritz (1850-1915) that the customer is king should in theory direct the activities of every business. In the past, though, businesses have too often only paid lip service to this creed.
Not any more. The customer is indeed king in todays markets and this is true whatever industrial or commercial sector you are operating within. Strive to win new customers through the attractiveness of what you are offering and make sure you keep them. Dont let yourself fall into the trap of being less interested in customers after youve won them then you were when you were wooing them. Treat your customers like a spouse whom you always love and dont let the honeymoon end.
1. Know your customer
This seems like simple advice, and it should be, but the trouble is that executives often get so caught up with their corporate hierarchies, personal remuneration packages and all the power struggles that go on inside most corporations that they forget that their main job should be to collaborate with colleagues over winning and looking after customers.
The problem that executives may become remote from customers and their needs is often worse the higher up a corporate hierarchy you go; not because chief executives and senior executives dont care about customers, but because senior management is often so preoccupied with operational issues that it forgets what the basic purpose of those operational issues really is. Furthermore, it hardly helps that people at the top of an organisation are often insulated from the truth by compliant and even adoring assistants who find it in their own interests to paint a rosy picture of how things are going.
Often the people at an organisation who really interact with customers are relatively junior. This being so, their advice and comments may not be given much attention, or even worse, may not be listened to at all. Do listen to it. You might find your junior staff furnish you with insights into your customers and their behaviour and agenda that surprises you.
2. Focus on the customers agenda, not yours
Dont do what so many organisations do, which is to become preoccupied with their own organisational issues and to treat customers as if they should be grateful for being customers.
Organisations are often very short-sighted in their ability to focus on the customers agenda. For example, large supermarket chains that offer numerous types of luxury items but whose bread is always sold out by mid-afternoon are not doing themselves or their customers any favours.
A classic example of not embodying the customer focus in operations was seen thirty years ago when banks first began to deploy automated teller machines (ATMs). Banks began by offering ATM cards only to their wealthiest and most solvent customers. If they had done some proper research into the matter--or had even spoken to a dozen of their less wealthy customers--they would have realised that the great thing about ATMS was that they extended bank hours for blue-collar workers who couldnt get into main street bank branches during banking hours. It was only when banks finally cottoned on to this point and made ATM cards available to blue-collar workers that the ATM industry exploded.
Mobile phones are another example. When they were first sold in the 1980s in the
3. Dont insult your customers by playing the numbers game
Have you ever received an automated telephone call? They tend to be quite cleverly done, using an actor who talks in a relaxed and casual voice so that for a few seconds you really do think its someone you know on the phone, or at least someone to whom you should be talking. But unfortunately, at least for the organisations that arrange these automated calls, the computer technology is not yet interactive.
I sometimes wonder whether even the organisations that arrange automated telephone calls seriously think this method of approaching customers can possibly be successful. The organisations are obviously playing the numbers game. They presume, one imagines, that out of every hundred or so calls that are made, a few people will bother listening to the automated message, and one or two might even buy something.
But is playing the numbers game a sign that you have any real interest in your customers or respect them? Of course it isnt. Instead, its a sign that you see customers as punters who are basically there to have money tickled from them.
Believe it or not, customers dont like being treated like this. Believe it or not, customers want to feel they are doing business with an organisation that cares about them. And incidentally, customers also want to be loyal and have a chance to show loyalty to an organisation that they do feel cares about them.
Back in the 1950s a Folkestone-based hotelier named Sidney De Haan wanted to fill his hotel during the winter months. He had the idea of offering low-priced holidays to retired people in the north of England who couldnt afford to go abroad and who didnt even get much of a chance to go down to the south coast. The strategy was successful, because he was giving customers what they wanted.
The organisation Sidney De Haan founded currently has every eighth over-50 person in the
In 2004 Saga was sold for more than 1 billion. Ultimately, the enormous success Saga has enjoyed derives from the sincerity of its customer proposition and from customers willingness to extend the organisation their loyalty because they felt it looked after them and cared about them.
4. Get real
Yes, you need to totally subscribe to the desire to know what your customers want and give it to them. Yes, you do need to care about your customers and think about them and what they want and how you are giving them what they want, but you do also need to get real.
The fact is that, sadly perhaps, one-to-one marketing does not work. Even if the technology to achieve this were good enough and you were able to segment your customers on an individual basis, the truth is that its very unlikely you can come up with enough significant variations in the customer proposition to justify the great expense and logistical difficulty of marketing (and delivering) to customers on an individual basis.
Experience suggests that, on the whole, about 10 to 15 customer groups are likely to be usefully segmented for effective marketing.
Businesses selling to other businesses, professional services firms and in fact any organisation with a smaller customer base will need to think about their customers as individual entities and market to them in that way.
5. Understand the difference between a quick sale and a customer relationship
This understanding is the test of an organisation that is sincere about looking after its customers. If you dont understand the difference between a quick sale and customer relationship then you need to learn it, and soon. Customers will spot you a mile off if all you want is a quick sale from them. Not only are they unlikely to come back to you if you do manage sell to them, theyre unlikely to buy from you in the first place.
6. Be prepared to rethink your business completely if what you are doing right now is not working
Recently, a large number of historically very successful
Unfortunately, just because a business has been successful historically does not mean it will be successful now. Still less does it mean that the business can assume that success is something to which it is entitled by a kind of natural process. A businesss customer mandate, like a reputation, can be damaged and even wiped out.
The secret of practicing this particular deadly skill is to be observant. Dont just know your customers: observe them. Think about them. What social and personal trends are influencing them? What aspects of their behaviour are relevant to your desire to look after them, and how is that behaviour changing? What social trends are impinging on your customers and affecting your marketplace?
Keep your finger on the pulse of what your customers are doing and be alive to their lifestyle changes. Things that worked twenty years ago may need to change if they are to work today. Even something that worked last year may not work now, or only with some serious rethinking.
7. Only deploy a customer relationship management (CRM) system when you really know what you want it to do
Your CRM system should be an embodiment of all your good intentions and good philosophy about customers; not a tool that forces you to do things in a way that doesnt really suit you. There is a very strong case for not implementing a CRM system until you are entirely happy with the way you are thinking about customers, looking after them, delivering to them and responding to changes in their needs. Your CRM system should be a way of putting your good intentions into practice, and you cant realistically implement it until you know what those good intentions actually are. CRM is an attitude, not a piece of technology.
Get the other six deadly skills of customer service right, and getting the seventh right will be a whole lot easier.
Kinna Amin is a management consultant with the business and information technology consultancy Charteris plc.