Customers are NOT equal
Too often businesses make the mistake of viewing all customers as equal. A bad review is received from an irrational customer and the business goes into PANIC! mode, and calls in the PR guys. With the economy tough, any customer is a good customer – what absolute rubbish!
In this age of social media, review sites, blended in with rising levels of ‘anyone is able to offer their opinion’ (even the most irrational megalomaniac) it is increasingly easy to be distracted by the wrong customers making it harder to build respectful relationships with the right customers.
Unfortunately, the vast majority of businesses lack any point of clarity as to their value proposition and distinctiveness, or their target customers. Accordingly, sectors as diverse as banking, retail and professional services are more vanilla than any level of a ‘flavor for everyone.’
Advertising typically basically says “hey, look at us, look at us, look at us, we are the same as everyone else, but have discounted prices, better interest rates etc!” That is typically not differentiation, but desperation. “How can we attract more customers!? Ummm …. cheaper prices, reduce our margins and with this likely lower the quality of the product, service et cetera?”
Net promoter score is commonplace for many businesses, allowing benchmarking of propensity of customers to be promoters, as opposed to detractors when sharing word-of-mouth with friends and family. However, the best way to maximise NPS is to attract and build relationships with customers with identical needs and expectations, and minimise customers with mismatched expectations.
It is best for all involved if the business makes it crystal clear as to what they stand for, what makes them distinctive and to not necessarily speak to all potential customers but the right potential customers.
Statistical analysis techniques such as cluster analysis and other analysis of survey data allows for the market size of the right customers with aligned values and expectations. Product — market fit is critical to the success in any business. The right product, for the right market, with the right strategy.
And, the right customers are more likely to be satisfied with the experience, be promoters and share positive word-of-mouth (via social media and mouth to ear) to attract more of the right customers. Further to this, from our research, potential customers tend to largely ignore negative reviews of people unlike themselves (e.g. differing age, demographics etc) and rely more so on family, friends and others they trust ‘like them.’
In a solid business, the right customers stay, and the wrong customers go – which is just fine.