A while ago a company that I was involved with commissioned some external consultants to help us understand our customers better. These guys were specialists in their field and were impressive. The work they produced was of a high standard and it satisfied the mutually agreed scope of works. Unfortunately, the output only scratched the surface and didn’t tell us anything we didn’t already know. We needed deeper knowledge. It wasn’t their fault – it was ours – we had scoped the project wrong.
Disappointed, we decided to get back to basics to determine what we already knew and what we needed to know about our customers. Scratching our heads we concluded that there were only three groups that mattered to us:
· Our current customers – i.e. those that buy from us now
· Our past customers – i.e. those that used to buy from us but don’t anymore
· Our non-customers – i.e. those that have never bought from us
This simplified matters for us. We started by analysing our best and most important customers first. We asked them what they liked about us; what kept them coming back; what we could do better to satisfy them; and whether we had 100% of their business. This was very illuminating and we learn a couple of very important things we didn’t know before.
We then dug deeper into our customer list and asked a sample of our middle and lower tier customers the same questions. This is where it started to get interesting. A lot of the sample group were very open in giving us an assessment of us versus our competitors. Interestingly, two relatively small matters were major problems for this group. This was a complete surprise to us and we made it a priority to fix these issues. The customer response was fantastic!
We applied the same approach to our past customers. Using a combination of telephone and online methods we asked (a sample of) them why they had left us and what we would need to change to get their business back. The two issues listed above were the stated (and unprompted) reasons why over 50% of them had left us. Once we fixed these problems we started winning them back.
One of the things we learnt during this process was that we were spending a disproportionate amount of time focusing on the acquisition of new customers rather than improving our offer and maximising our potential with our existing customers. We also determined we should spend time winning back our past customers, especially those who had left us for reasons that no longer existed. By changing this around (and making sure we over-delivered on our customer promise) we were eventually rewarded with a pleasant surprise – a lot of business from new customers referred to us by our existing customers!
You can learn a lot about your business directly from your customers – this might include your relevance in the market-place and what your reputation is. If you find yourself second-guessing your customers and making assumptions about what you think they’re thinking and what’s important to them, then there’s a good chance you might be wrong. It’s relatively easy to find out – just ask them…