We know that the buyer recognises a need, searches for information to find which products or services will satisfy the need and then evaluates them to identify which to purchase.
This pre-purchase activity may only take a few seconds where a habitual need is being satisfied or it may take several years for a complex major purchase.
The process which a buyer undertakes up to the point of purchase is as much a part of the customer experience as the product use or service consumption following the purchase. Yet this part of the customer experience is often neglected by vendors.
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On too many occasions I have noted that vendors define satisfaction as the user being happy with the use of a product without recognising the journey which the customer undertakes to buy the product, use it and then dispose of it. It is almost as if the actual sale transaction of a product is the end game without recognising all the steps which the customer may have gone through to identify, evaluate, buy, take delivery, use, utilise supplements and dispose of it.
The customer experience and their evaluation of it relates to the entire process not a step part way through. If we don’t recognise the entire customer experience, how can we possibly achieve what is the real end game, a repeat purchase or a positive referral?
Business growth is always about the next sale and what influence you can bring to bear on it. While it is critical to have a positive experience with the new customer, few businesses can survive on one-off purchases. It is also difficult for any business to ignore the impact of current customer experiences on the decisions of future prospective customers.
How many times have you been in a situation where you have had a really bad shopping or dining experience in a tourist destination – often I guess. My reflection on these experiences is that these vendors see little value in providing an outstanding level of service because they do not expect to see you again. In my opinion, this is somewhat short-sighted because you will often relay your experience to others you meet on the trip or to the hotel staff, taxi driver and possibly everyone else you come into contact with.
Alternatively, some retailers and restaurants will go out of their way to offer a good experience. You might be so enthusiastic about those vendors or restaurants that you tell lots of people, many of whom are local. Because they will want to look good in the eyes of the tourists, they will be happy to recommend a place where the tourists can be assured of good service.
The vendor who fails to appreciate the impact of good service on future business is wasting a huge opportunity to enhance their business prospects.
It is generally accepted that you have to devote considerably more effort to sell to a new customer than to sell additional products or services to an existing customer. The same applies to referred customers, they require much less effort to bring to the point of a sale. Referrals have a marked impact on our sales productivity. Since referrals are directly related to the positive experience of prior customers – what we do now has a direct impact on the cost of doing business in the future.
The quality of the total customer experience is the key to increasing referral rates. That means ensuring that the pre-purchase experience is a positive one.
Tom McKaskill is a successful global serial entrepreneur, educator and author who is a world acknowledged authority on exit strategies and the former Richard Pratt Professor of Entrepreneurship, Australian Graduate School of Entrepreneurship, Swinburne University of Technology, Melbourne, Australia. A series of free eBooks for entrepreneurs and angel and VC investors can be found at his site here.