Have you ever noticed the performance difference between two very similar businesses? One seems to be totally on top of it and the other you can tell is struggling. But they face the same market conditions and are in the same location and sales catchment.
So, why is it that one can totally dominate the other and achieve higher margins?
In the vast majority of situations, market leadership comes down to one very specific and fundamental belief and process. A business obsesses over its customers and not over its competitors. It puts its customer at the centre of everything it does and makes sure there is a finely tuned process in place to deliver optimal service.
The current economic outlook
The general consensus is that it will be challenging and the need to master customer experience is more critical than ever. When things get tight, the consumer is far more selective with their spending. So if you can’t deliver superior service, then you will lose out on sales. Right now, smart companies are reviewing their customer journeys and making sure it’s finely tuned. They have a point of difference in the way they think about customer experience.
The key is their mindset around service innovation. They approach the process very differently to most. They define innovation as ‘change that adds optimal customer value’. They ensure everything they do provides value to their customers, and if it doesn’t, they keep developing until they can prove it does.
This approach ensures the customer’s experience is front and centre and delivers true value that’s beyond a price tag.
Optimising your service offering
Optimising customer value and margin is directly proportional to the standards of service you deliver.
If you just deliver a standard of satisfaction, you will sell what the market needs and minimise average sale values.
If you obsess over your customers and deliver a superior service model directed to what the customer values, you will open the door to selling a whole range of things they want.
This opens up your ability to engage with them and build a reputation of a forward-thinking and value-driven supplier and this keeps you front of mind.
If you’re not remarkable with your service standards, then you’re not memorable and you quickly become invisible. Marinating market relevance is essential if you want to leverage repeat business and average sale values. For example, 100 customers averaging $1000 each year is more profitable the 200 customers averaging $500 each year.
Mastering the basics of service excellence and then expanding is safer than going full tilt to get a sale and not focus on margin or their future transactions.
Obsessing creates opportunity and higher margins
Obsessing over customers and not competitors has one very unique benefit that provides the highest margins and shortest sales cycles. It is rarely measured or understood why it happens and is rarely on any KPIs.
It’s the personal referrals supplied by appreciative customers and most importantly why they were given.
Think of your own behaviour. You will be careful about how you give referrals, especially for high-value products and services. The business must have earned your trust before you will put your personal reputation on the line. They must have gone beyond your expectations and delivered a unique experience.
The companies that you won’t risk your reputation for will be the ones that focus on themselves and their competitors and forget about the value they should be giving to you. They have to keep spending money to get you back with a special offer rather than relying upon a respected and trusted relationship with you.
Get your team obsessed
Obsessing over your customers will cause your team to think about how to improve and how to build security into your customer base.
A company that has mastered customer experience doesn’t need to worry about the competition, because the competition is already worrying about them. The competition is more worried about how many of their customers it is about to lose because they cannot match your service experience.
Investing in designing a unique customer journey and experience will pay massive dividends. When done correctly,l it can actually prove significant value on a balance sheet and also the value of a company’s brand equity. Having roadmap to train your team in service excellence is one of the highest paying dividends you can achieve with your team.
Different isn’t always better, but, better is always different.
Obsessing over customers and not over the competition will build you a powerful reputation of being better.