So says Warren Buffet who knows a bit about how to make a bob (or two). The crucial differences between price, value and cost as concepts are to me the holy grail of any successful business. Of course what he refers to is the vital issue of perception, in the minds of customers or buyers. Too few businesses, in my view, start out from the perspective of the customer and this is a criticism of busiensses large or small but not usually found in start ups. It is an unacceptable but not inevitable consequence of growth and the distance and complacency that can creep in if you allow yourself to become too removed from contact with your customers.
Get to Grips With Value
Whether you are starting out in business or trying to grow it, sooner rather than later you have to get to grips with value – and this is what your customers mean by it, not what it costs you to make it or even what you charge for it. The concept of value lies beneath the concept of branding. The reason we choose one product or service over another is because we have our own perception of what it means to us – something that is worth choosing and paying for over the alternatives. It may be fit, where jeans are concerned. It could be convenience; it could be the quality of experience; it can be a “simple” emotional attachment – it makes us feel in a particular way or evokes something inside us. These are all the hallmarks of an exceptional brand that conveys a clear proposition for its customers. Good brands add value and hence we are prepared to pay a premium for them. This week, I’m on about adding value through service and the experience.
Let’s talk about something more interesting for a moment – I know me! Only kidding, but since I don’t know your experience let’s use one of mine from yesterday.
mr wright and mr sowrong
I live close to a number of small independent shops here in Edinburgh. As far as I reasonably can I am keen to support them because the supermarkets are moving in in droves and I personally believe in variety, supporting the local economy and encouraging and maintaining specialist knowledge and skills. Of course the supermarkets have a place and are part of an overall mix and I can’t deny they are devilishly convenient for some types of goods. Sometimes you value convenience.
At the other extreme we have the aptly named Mr Wright, who has run a greengrocers for many years. He works extremely long hours (also convenient), knows all his customers by name, knows what they like, makes great suggestions, takes care over your order and ensures that what you put in your bag is at the right stage of ripeness and quality. There is chat and banter and often a queue as a result but what is a short wait when you get the equivalent of a big warm hug each time you are in? I don’t mean this literally, but if you can imagine the welcome you get from your dog when you get home at night, in the same way you know he’s pleased to see you. Waiting is acceptable because you know you will get in turn, your own great service, personal attention. You can buy exact quantities, in recyclable paper bags and reused carriers if you need them – so less waste.
I contrast this with my experience of the supermarkets’ over-packaged, over-sized bags of fruit and veg that has been frozen and stored until damaged, past its best and frequently ready to root or rot, after a day in the fruit bowl! In fairness, at our supermarket you can return it for a refund and a replacement (the value element here – no quibble returns policy) – but they won’t take on board pleas to reduce waste through smaller quantities, packaging etc. So while I might pay marginally less (and I’m not even sure that is the case) for my fruit and veg, Mr Wright wins hands down on all round value.
And now for something completely different![Carmenere Grape]( "Carmenere")
Right next door to Mr Wright and his grapes, is an independent wine shop. The contrast is phenomenal. I imagine that the majority of purchases in this shop amount to easily twice that of the greengrocers. However, the added value through service is lacking in the extreme! Even after a number of visits there is no apparent recognition, memory of previous purchases – or even that you have ever bought from there. That seems to me to be a little insulting or complacent in a local supplier where one would have thought that relationship building would work in developing repeat business, referrals and the like – but it obviously is a bit too much for the manager. So yesterday, I hint at an (unwarranted) educated palate by enquiring about a relatively unknown grape variety, the carmenere, from Chile. I also make it known that I had bought from them previously. Still nothing other than the disinterested retort of “we have one over here”. Now call me old fashioned, but if that wasn’t an invitation to up-sell me a bottle or two then what was? Zero relationship skills and a lasting bad taste in the mouth is what I experienced. So why frequent the place you may well ask? Well I simply don’t and I won’t. The thing is that the shop is, again, convenient hence they may get a purchase from time to time purely on that basis. Tragically they stock a nice variety beyond the supermarket standards and as people who like their wine, we should be shopping there as much as our wallets and livers can stand it. But they let themselves down on service.
Some businesses don’t deserve to succeed
It really sticks in my craw that customers are so undiscerning that they will patronise businesses that don’t add value. It is almost as annoying as the organisations that claim they have great customer loyalty due to satisfaction, when in fact what they have is a lot of inertia! When did you last change your bank account? Your energy supplier?
Good service is one absolutely free added value element that all businesses can provide IF THEY CHOOSE! And for me, this time it’s personal – or more accurately it was so impersonal, I have pledged to make the trek to the next nearest purveyor of wines in future rather than give another hard earned cent to this miserable merchant. And I am on a mission to be more conscious and aware of my choices and perceptions of value in future. It’s only fair to the good guys.
Being really ‘customer focussed’ has to be something that is part of the DNA of a business from its inception to its mega growth - simply “how they do things”. It should be pervasive in your dealings with any member of staff and go way beyond a statement in the brand values. It has to get to a point where customers actually notice a difference. And this sometimes means a fundamental shift in attitude for some staff.
Small BUsinesses Have The Advantage or should have
Research tells us that there is a strong correlation between employee satisfaction and customer satisfaction. If you love your job it shows in all that you do – your energy, your expressions, how you deal with challenges and suggestions. In a small business there aren’t many layers between the customer face and the back office so all these things are going to come straight at you. If you own and run a business you are its face! When you don’t have many customers, the few you have are important to you and you treat them respectfully, accordingly. As you grow and you take on staff, the trick is to ensure that they do too. I believe it is the dilution of this attitude of adding value, valuing the importance of customers and really understanding their contribution to the bottom line and growth prospects of the company, that is usually responsible for poor customer service. As soon as you allow people in that only treat it as a job, you’re doomed! As soon as you relinquish retaining an interest in your clients, your finished – maybe not today or next week, but sooner than you should be.
apparently Obvious Tips but really valuablE gems
I’m not normally a fan of those “top ten” type blogs – but they are all the rage and some people find value in cutting to the chase without my utterings and mutterings. So here is some of the benefit of years talking to organisations about customer focus.
- Recruit for attitude – can do, willingness, happy to serve, liking for people are way more important than skills which can be taught to anyone.
- Give a proper induction – take new employees into your confidence. Tell them all about your customers – who your first customers were, who buys most, who buys most often, what their preferences are, as much as you know about them. And encourage them to get to know their own customers – make it a point of pride for them to build knowledge and relationships. People sense when you care about them and your job – and we like it.
- Talk to staff about the importance of their role in the success of the organisation and explain to them how their role specifically impacts on it. Don’t differentiate between internal and external customers.
- Work with employees to work out good customer service processes - you know the kind, the ones that make it easy for you to carry out transactions with a business – enquiring, searching, paying, invoicing, returns or refunds, suggestions etc. The closer they are to the customer, the more they will observe about when you need to create a process to make things more efficient, or redesign one to make life easier for customers, and ultimately better for the business.
- Don’t be so prescriptive and focussed on consistency that you squeeze out any personality that your employees have in delivering the service. This means a bit of trust and empowerment at the front-line.
- If you are managing them, for goodness sake remember to acknowledge and praise people for handling things well. This is much quicker and will take you miles further than any amount of training and explanation of expected behaviours.
- Equally, if people are not treating your precious customers as you expect them to, be quick to give them that feedback. Don’t let them continue to behave in that way. Most people want to succeed, and do a good job. You are doing them a favour by telling them how they do that.
- And going back to 6, by reinforcing the good behaviour, and recognising it in small ways – awards, mentions, prizes, thank you’s, you ensure that people quickly understand the way you want things to be done with customers, around your business.
- Ask customers to give you feedback and then tell staff what they say. Don’t make it a stick to beat them with – be constructive, use it as a focus for where you may need to improve your service through refining how the work is done whether that be product, people, technology, partners, process or wherever the compliment or complaints arise.
- If you do all of this, then people will be in no doubt that customers are at the heart of your business whether they work for you or buy from you.
So endeth my first top ten tips. More useful and free content to follow on this subject, if you want it at our new website www.neontics.com
