Are your staff passionate about creating loyal customers for your business? Making a lasting impression…
Your Customer Will Only Really Remember How You Made Them Feel
We all want to know the answer, but we all fear the answers reality.
‘What do you do when a customer no longer sees the value you create or the uniqueness of your product or service?’
How do you respond to being forced to compete on price alone? The problem is commoditisation, and the answer sounds counterintuitive (but we’ll come to that later).
The commoditisation C curve chases us all.
When a market begins to mature, and new ideas and innovation take hold, standardisation and then, commoditisation begins to slowly appear.
But when a market becomes overly regulated, commoditisation is both inevitable and its arrival fast. Without an active business strategy in place to respond, it collapses the market and sees many of its unresponsive businesses forced to leave, and in some cases, overnight.
Commoditisation is usually artificially sped up when new government legislation sets fresh legal standards or minimum requirements.
This is the problem Australia’s 18,000 financial advisers are about to face in January 2019, when new government legislation cuts the commission income of Risk Insurance Advisers by approx 40%. It doesn’t take much to see the plight waiting over the horizon for all concerned.
This new legislated regime will undoubtedly have many unintended consequences and has triggered the rush towards commoditisation of financial advice. The sad reality is the majority of financial advisers are not prepared for the arrival of this natural market force – and neither are their customers, for the cost increases that will inevitably be passed through to them.
A counterintuitive solution.
So, this reality begs the question of all businesses in a maturing market where customers start focusing on price: What’s a business to do?
The answer often sounds counterintuitive, but here it is:
Build better customer relationships through better customer-facing systems and processes.
Admittedly the solution initially sounds counterintuitive because building a systemised customer relationships feels disingenuous and there’s usually an increased cost to doing so. But looking ahead, without systemisations you can’t scale your offering, and without embracing the cost to so do now, risks facing a crippling cost long term.
My experience is most Small Businesses facing commoditisation of their own markets simply do not respond with anywhere near the needed assertiveness, focus and commercial rigour.
What the solution looks like.
So where do you start when designing a better customer journey experience, as part of your commoditisation response?
Build better customer relationships through clever systems.
Your strongest customer facing response to the C curve is to build first-class processes for helping guide your customers in making the best decision based on a tangible measurement of your unique value. Thankfully, today most people now like to learn a new skill, as well as, buy the solution.
The opportunity awaits:
- Educated them to see you.
While Daniel Priestley reminds us, “Business owners are standing on a mountain of value they can’t see”, the uncomfortable reality is, the customer can’t see the mountain of value I’m standing on either. The result is I can’t charge a premium for it.
The customer has to be educated on how to see the value in our service. The opportunity awaits.
- Educate them on how to make better decisions about you.
To help ensure your customers see the bigger picture, you’ll need to create an effective decision-making process for them, and this is important, ensure your sales team are trained to help guide customers through it.
Providing this level of guidance is not common in today’s marketplace. The opportunity awaits.
- Never assume your customers know how to measure the value of what you offer.
Often customers don’t have an approach (or any method) to practically measure your value. The customer needs to understand (or at least appreciate) the longer term financial impact of your work.
Buying guides, checklists and pre-assessments are welcomed by most customers. The opportunity awaits.
- Reduce the need for customers to repeat call you.
Studies suggest as many as a third of all customer re-contacts are unnecessary; prompted only because the customer experienced a failed or unfulfilling previous interaction that left them needing an extra unanticipated solution.
These less-than-ideal customer experiences generate additional re-contact that absorb additional resources and margins. A better-designed experience upstream can eliminate the need for many of these customer re-contacts.
This will make your customers happier and your team less burdened with legacy issues to manage and spot fires to extinguish. The opportunity awaits.
Eliminate unnecessary servicing costs.
Great customer experiences can actually cost less to deliver because fundamentally a poorly designed or broken customer journey experience, undoubtedly creates more work and expense for a business. Every repeat incoming call, email, social share or letter increases you cost of overheads and ongoing customer maintenance.
If you can pre-empt such unnecessary customer re-contacts, you can better control your customer journey expenses.
What you remember is more important than what you forget.
No matter how hard you try to improve your business’s customer journey experience, the reality is your customers won’t remember much of it. In the end, it’s usually how much you cared and how you made them feel.
Focus on peak experiences, not so much the valleys.
I work in professional risk advice for Small Business owners and their families. The bane of my life seems to be the mountains of complex legal paperwork required. Now, while I can’t do much about these core valley type process, I can focus on the peaks.
- When my clients are contacted annually for feedback, they usually don’t remember in detail the paperwork, other than to say, “It was good to have me there to take care of it for them.”
- What they recall most is the sense of ease and control that comes after the process is completed and the feeling of security and power that comes from now having a professional advocate on call.
Getting a return on your customer experiences.
To generate a commercial return from a customer experience strategy, our customers need to be able to recall a positive memory for when a friend or family member asks, “What’s your experience with business XYZ?’”
- Their typical response is usually drawn from their recollection of the experience, which is different from the experience itself.
- We all have non-core aspects of our business (like paperwork) that neither improve or detract from the overall customer journey. What’s more important is to ensure there are sufficient steps of the customer journey experience to help create the positive and memorable peak memories.
What a customer experiences last, is usually what they recall first, and how you made them feel, always lasts.
So here’s the question for you and your business:
What do you do when your customer no longer recognises the value you create and wants you to compete on price alone?
Are you helping your customer make better decisions so they can more confidently understand what you can do for them, all within a process that’s purpose-built to help make their life easier and turn their complexities into simplicities?
That’s a service I would happily pay for.
“The opinions expressed by Smallville Contributors are their own, not those of www.smallville.com.au"
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