Do You Really Know Your Customers?

Of course you do! At least you think you do. Why wouldn't you? You've sold them your product or service, sometimes many, many times. You know their name, and you may even remember the details of their last purchase.

But knowing their names and knowing what they buy from you is just a start to truly knowing and truly understanding them. How satisfied are they? Why do they deal with you rather than deal with someone else? Why don't they deal with you more?

When business owners are asked if they have the answers to these questions, many would probably respond, "of course I do!!" And more times than not they do have answers--answers that may be more opinion than fact. It is easy for all of us to think we know the customer based on what employees have told us, what makes simple business sense, or what we would like to believe.

Perception versus Reality

Unfortunately, these may have little to do with what the customer really thinks. The customers' perceptions of a business are built upon a number of factors, including the product or service quality, the image of the firm, the before and after sale service, price, warranty and the list goes on. It's no wonder that the way customers really feel is quite different from how managers or employees' perceive they feel.

And what makes good business sense in a specific business or industry may have very little to do with what makes sense to the customer. And it shouldn't have to.

A recent discussion with a Bonita Springs-based business owner lead to story that illustrates just how different some customers think.

Mike Conley, founder and president of Conley Computer Stacking Systems, recalls an "off the wall" reason why one of his customers buys from him.

Mike had visited with a key client in California as a part of a regular customer care program. Part way through their meeting, Mike asked point blank, "Why do you do business with us?" Conley is recognized for providing some of the industries most stable, strong, flexible and functional computer racking solutions at very competitive prices, so one would anticipate the answer to be one of the obvious reasons.

His customer replied, "It's because your products come disassembled and individually packaged. Once the order arrives I can hide them throughout my stock room." It turned out that the purchaser was under heavy constraints by management to reduce inventory; however, his team needed the equipment. By having his order arrive in many individual cartons rather than one refrigerator-size box, he was able to hide them throughout the stockroom, out of sight from his manager, allowing him to service his teams needs right away.

Okay, maybe we can all learn a little more about our customers. But why should we?

Over the years, our team has been in contact with many businesses that face common challenges. These businesses have felt the effects of increased competition, watched profits dwindle and then realized the need for improvements. But they are not quite sure what steps need to be taken to turn things around.

It is quite simple. Look to the customer for the answers.

The "if we build it, they will come" approach worked quite well in the days of the producer-driven economy, but in today's competitive markets the customer is king. And in order to serve customers in such a way that they do all of their business with you and tell others about you, their current needs (requirements) must be met and their changing needs anticipated. They need to feel good--very good--each and every time they deal with you. Everything the business does must revolve around the customer.

There are no sacred cows. Even organizations that historically were the last ones to look to their customers first for answers are taking heed. Florida Gulf Coast University is an innovator among educational institutions for just that. Before developing their programs and hiring their professors, the School of Business facilitated several focus groups to understand firsthand what their customers wanted from their graduates. Business people locally and from across the country were brought together to find out what skills and knowledge the students would need to possess to allow them not only to effectively integrate into their new field but to become leaders of tomorrow.

What can customers tell us? They can give us the information to create a roadmap to marked improvements.

What is important to them? Are their expectations being met? Why do they do business with our business? What are our strengths? Our weaknesses? What would we have to do to earn more of their business? What other services can we provide to offer you more value? What good experiences have you had with us? What bad experiences?

It soon becomes apparent that this feedback can form a very clear picture of how your customers view you. You begin to see what it would take to increase customer retention and to increase your business with them. It also lends insight into how to attract new customers and further separate your business from the competition.

Your customers become the guides for directing your efforts to close the gap from where the business is to where it could be.

Next month we'll look at how a small local company faced with the challenge of two very different customer groups embarks on a mission to get to know its customers better. How they collect the information, what they do with it and the exciting benefits.

Rorie Wilson is the Director of Client Solutions for BPM International - a local firm that provides contemporary business solutions for growing organizations. They specialize in customer satisfaction, quality & process improvement consultation and implementation. For information, call (941) 495-3552.