“Not sure how to respond to our competitor’s latest move. They just offered a extra year’s warranty on their product for free.” Miguel complained.
“For free?” I asked.
“Yes, we’ve battled our competitor hard for the past two years. We make a move, they counter. They make a move, we counter. Tit for tat. I’m not sure how to win this battle.”
“Have you thought about disconnecting your focus from your competitor to think more about your customer? As long as you focus on your competitor, you can only think like your competitor thinks. Focus on your customer.”
“No, you cannot have it your way, this is not Burger King,” read the sign on the door outside the phone bank in customer service. No customer would ever see this sign, but you can be sure it was heard in every voice on every call.
Many companies create a wonderful technical product or service, stick out a shingle and no one bites. They structure their services like a menu in a restaurant, so they can deliver consistent, reliable and predictable quality, but their customers remain few. So what’s the problem?
The problem is the direction of thinking. Sure it would be nice if customers would buy things exactly the way we wanted to sell them, but they don’t. This thinking is inside-out.
Think about your product or service from the outside-in. Examine every point of contact with your customer to see if it was designed for your convenience or for the customer’s benefit. Your underlying product or service may not change, but your customer might see a whole new you, from their perspective, outside-in. And take down that stupid sign. -TF
Why is your bank so adamant about pushing online banking?
Converted customers like it because it saves time, automatically keeps its own transaction record and at the end of the month, makes bank reconciliation a breeze.
On the surface, for the bank, it creates a lower incremental transaction cost.
- The customer replaces the data entry clerk at the bank.
- It moves the transaction from a historical posting to a real-time capture.
- With real time capture, it eliminates manual reconciliation procedures associated with manual (historical) posting.
- Scalability (growth) is no longer dependent on employee head count, it is now dependent only on computer and system capacity.
But, here is the real payback, and it has nothing to do with lowering transaction costs.
- It creates a tighter tangible bond between they customer and the bank.
- The technical setup of the account (the hassle of passwords & security) makes it more difficult to switch to another bank.
- If a customer defects, they have to start over and will lose their online history (of course they can print it to paper), but online users quickly adapt to a paperless identity. Online history will be gone.
- To break this tangible tie will require abandonment, and will create a strong sense of psychological loss.
What is your company doing to create strong emotional ties with your customer? -TF