IT'S YOUR
CHOICE
"To be honest, I’m not prepared to be completely
customer driven,” he told me, his chin stuck out and his eyes flashing. “We
have some customers who cost us money and some who are more trouble to
do business with than they’re worth. Others we just plain don’t like. I certainly don’t
want to make retaining these customers my main priority.” He took another
sip of his coffee and loudly placed the mug on the table. “I’m certainly
not prepared to change the way I run my business just to make things
easier for them,” he
added. “No matter what you might say.” He glared at me, steeling himself
for the counter attack.
Although I think that being partly customer driven is like jumping just some
of the way off the diving board, this business owner wasn’t going to get an
argument from me. Contrary to what many people think, being customer driven
doesn’t mean doing business with everyone who crosses your threshold. In fact,
doing business with all and sundry is a mistake that customer focused companies
make; not customer driven ones.
Companies prepared to do business with anyone soon discover that approximately
2% of customers will try to cheat you. Since no one likes being robbed, these
companies sensibly take steps to protect themselves. The trouble is, no one
knows ahead of time just which customers are the dishonest ones and which are
genuine. Consequently, everyone gets treated as if they were going to cheat
the company and not surprisingly, this annoys the honest customers. As I said,
no one can predict for sure who the dishonest customers will be but you can
reduce the odds significantly by avoiding high-risk customers. That’s what
customer driven companies do.
Most companies are so eager for sales that they will do almost anything to
get the customer to buy, including reducing the price, offering rebates or
financing at very low rates. This discounting may result in a sale but is that
a profitable sale? Discounting is a dangerous activity because it damages margins,
destroys brands and reduces the trust customers have in their supplier. In
many cases, companies would be better off to walk away from the sale. Customer
driven companies know which customers are profitable and which are not. Guess
who they do business with?
What adds insult to injury is when the customer who has beaten you up on
price then turns out to be a very difficult customer to satisfy. You know the
type. They want everything done yesterday, preferably for free. They constantly
ring and ask for services beyond those agreed to, and then they complain about
the way those extras are delivered. When they do reluctantly agree to pay,
they take forever to settle their account. Customer driven companies try to
avoid doing business with these people.
Because customer focused companies never really think about the customer,
they don’t ask themselves, “Which customers do we want to do business with?” Consequently,
they end up talking to them all: the demanding, the cheap, the whingers and
the dishonest. This is always an expensive mistake.
Customer driven companies, on the other hand, don’t have that problem. They
know which customers they want to do business with and they seek those customers.
When they get their business, they aim to keep it.
“You mean I can fire some of my customers and still be customer driven?” he
asked with a laugh, after I’d explained this to him. He threw his head back
and drained the last of the coffee from his mug. “You might make a convert
out of me yet. That would be good for your business.” He pushed his chair back
from the table and started to stand up.
“No,” I smiled up at him. “That would be good for your business.”
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