Customer Service During Acquisitions
Sometimes customers get the short end of the stick during an acquisition. This is a short story from a recent experience I had.
Read MoreMarketing Consultant
Jeff provides cutting edge marketing services to clients in many areas, including strategy, data analysis, social media, troubleshooting, corporate training, and marketing research.
Sometimes customers get the short end of the stick during an acquisition. This is a short story from a recent experience I had.
Read MoreMarketing is all about differentiation. What can you do to stand out from the competition? There are many ways to do this. Some use low prices. Some use outstanding products. Others have amazing distribution competencies.
But in this increasingly digital, automated world we live in, customer service seems to be slipping. Consumers demand lower prices, and service tends to suffer as companies attempt to satisfy the price conscious consumer.
However, there is still room in this business environment for service. Particularly, outstanding service. The price war results in a sort of death spiral for margins. Yet companies who provide amazing service can stand out from their competition in a positive way, regardless of their relative price.
One area in which service can stand out is through providing a very personal touch. There are many activities that fall into this category, but the one I want to focus on is gratitude. Gratitude is a concept that seems to be overlooked. This concept is about more than just a simple ‘thank you.’ Sure, a simple thank you is nice, but most companies implore their employees to say this after a transaction. The concept of gratitude has permeated the business world, as evidenced by articles in well-known outlets such as Forbes and Inc.
If gratitude is so important, and many companies already do some version of it, how can you set yourself apart? It’s by expressing gratitude in a way that others don’t.
Recently, on a family vacation, we had a rock or something shatter our sunroof. We were in the middle of nowhere, and made the decision to continue on to our destination. Then from our destination, I called the nearest dealership, explained our situation, set up an appointment to have the sunroof replaced, and then had the service completed.
The day after, the service manager called, asking if I was satisfied with the service I received. A call like that is pretty standard procedure for a service organization.
However, shortly after returning home, we received a postcard from the dealership, thanking us for our business. I was floored. This was a very courteous gesture. They did not have to do this, obviously, but the fact that they did really impressed me. It is something I will never forget.
It’s a personal touch like this that can set your company apart from the competition. A little effort in this regard goes a long way. Expressing gratitude makes customers feel really good about their decision to use a certain firm. It also spawns word of mouth (which is what I’m doing here), and leads to repeat purchases.
So, think about how you can use gratitude and a personal touch to make an impression on customers. And how can you do it differently from others? Oh, and if you ever need a Honda serviced in Pueblo, Colorado, I highly recommend the Vidmar Motor Company.
Do you have formal goals that drive your marketing activities? If not, it is important to come up with some. Without goals, you don’t specific things to shoot for. Goals will allow you to focus, strive for something, and evaluate how you have done. Maybe you have heard of SMART goals. If not, check them out at the Houston Chronicle’s excellent small business resources page.
I am not going to go over them in much detail or define them, as you can refer to that page. But rather, I’m going to discuss the spirit of goals. They actually are a very valuable strategic tool to help you succeed.
The first point of goals is to provide yourself targets to shoot for. It’ll help you focus and gather the resources you need to attempt to achieve the goals. If you make others in the organization aware of the goals, they can help contribute to achieving them.
But the other major point of goals is probably more important: to allow you to evaluate your performance. If you don’t have goals, you don’t have a firm grasp of your performance. Sure, if your revenues exceed your expenses, that is good. But do you really know how you got there? And how can you improve the following year? It’s important to continuously monitor and assess your performance. Without goals, it’s hard to do so in a meaningful way.
So definitely put some goals together in the spirit of the SMART framework. And be sure to keep them modest. Attempting to reach for the stars is good in theory, but can be hard to achieve in the short term, which can sap motivation. Break up long term goals into more reasonable short term ones. One builds on the next and puts you on the path to full achievement.
Do you have questions? Please let me know.
The other day, we received a door tag advertisement from a roofing company. We had a bad hailstorm recently, and the roofers are out in full force vying for roofing business. What was interesting about this particular door tag was that, with purchase, they would give you a free gift: a Yeti cooler.
As a consumer, this might be considered a nice little gift; a nudge, if you will, to go with them for your roof repair or installation. However, it might raise a question about quality or reliability. If a company is trying to entice you with a gift, what does that say about their reputation? It could be construed as shifting the focus from their ability to install a quality roof to their ability to attract new customers.
You might be thinking, “well, isn’t attracting new customers a good thing?” Yes, of course. However, what is the cost of this strategy? In many industries, including roofing, word of mouth rules the day. Word spreads quickly among consumers about both good and bad experiences, companies, etc. So, if your customer acquisition strategy is more important than your ability to do quality work, your work is probably going to suffer and stimulate negative word of mouth.
Now, I’m not saying this particular roofing company does poor quality work. I don’t really know anything about them. They may be fantastic. However, on its face, it looks like their focus is doing whatever possible to get new business, which may be taking away from their perceived competence.
There is another problem with giving gifts in exchange for patronage: it’s not good for building a loyal customer base that leads to repeat business. Repeat business is generally great to have: it allows you to cut down on the time devoted to cold calling. Repeat customers are happy with you and are also more apt to tell others and spend more, etc. However, those who patronize you because of incentives are generally not going to be loyal. The next time a need arises for your product, they’re going to shop around to see who has the best incentive at that time. This leads to significant customer churn, which is problematic.
So, overall, it’s generally better to focus on providing good value to consumers, which includes a good product, solid customer service and support, empathy, and appreciation for their business. All these things help lead to loyalty, repeat business, and other benefits. I’m not saying you should NEVER give things away to attract customers. Rather, just be careful, as it is a double edged sword.
Do you include public relations as part of your marketing operations? If you don’t, you should.
So what do we mean by public relations? According to the Public Relations Society of America, “public relations is a strategic communication process that builds mutually beneficial relationships between organizations and their publics.” Sounds pretty vague, eh? I would agree.
Overall, the goal of public relations is to build goodwill with the public. In other words, show that you are more than just a seller of goods or services. You do this by publicizing “other activities” undertaken by the organization.
So what are some activities that fall under the guise of public relations? Here is a brief list:
Company donations: you donated to a charity? Let people know.
Charitable work: you volunteered time for a service project? Publicize it.
Promotions/hirings: someone has moved up or into the organization? Spread the word.
Sustainability: you are committed to “doing good” for the world around you? Inform the public.
Crisis management: something bad happened? Publicize your commitment to fixing the problem.
There are many other activities to promote via public relations. But no matter the activity, the ultimate goal is to get others to publicize for you. You can promote these activities heavily on social media and your website. You can also send out press releases to outlets who could possibly disseminate the information to their audiences. No matter the method you use, the generated attention is good for your business.
Recently I was in a local drugstore buying some cough drops. The kind I wanted had some sort of ingredient that is closely controlled by the law. When I took them to the counter, the cashier scanned them and then asked for my birthdate. Then we had this conversation:
Me: “What do you need my birthdate for?”
Cashier: “Because the system is asking for it.”
Me: “But why? What is the relevance to my birthdate to cough drops?”
Cashier: “I really don’t know. Something to do with an active ingredient.”
Me: “Oh, ok, no problem.”
I give her my birthdate. Then,
Me: “oh, is it like cigarettes in that you have to be a certain age?”
Cashier: “we don’t sell cigarettes.”
Me: “Nevermind.”
I completed my purchase and left, a little dumbfounded by our conversation. She couldn’t explain to me why she needed my birthdate, and when I tried to draw an analogy, she got lost.
Why am I positing this? Well, it’s because it’s important to understand that marketing is not performed solely by the marketing department. It should permeate the whole organization, and especially any employees who communicate directly with customers. When an exchange like above happens, it could lead customers to question the competence of the organization.
So, if you have front line employees, be sure that they are well versed in how to effectively communicate with customers. But this goes above and beyond being polite….they must also be knowledgeable on company policies, products, etc. Informed employees are a key marketing asset. If they aren’t informed, it doesn’t inspire much confidence in customers.
There are often times in both business and interpersonal interactions where someone makes a request of you. A customer asking for a refund or a discount are two examples. When these requests are made, we often respond with something like, “sorry, no, I can’t.” However, in most of those situations, we are not being truthful.
How are we not being truthful? Well, it’s because we say “I can’t” when we actually mean “I won’t.” We all do it from time to time. Why do we do it? Because it’s the easy way out. “I can’t” implies that there is some barrier in the way, thus making the request impossible. We use it in the hopes that it will shut down the requester. However, in how many instances is there actually a barrier preventing the honoring of the request? I would argue not many at all.
So, in these situations, consider using “I won’t.” It’s more truthful and less dismissive. Customers won’t necessarily be happy, but they’ll know you have standards. And that is not a bad thing.
In most industries, competition is fierce. Because of this, it is important to do things to stand out from the competition. Do you? Simply doing whatever everyone else is doing isn’t going to get you noticed, attract customers, or positively impact the bottom line.
True, it is important to adhere to industry standards in a lot of ways. If you’re a fast food chain, you need to have a drive thru lane like all your competitors. If you’re an apparel retailer, you need to have an e-commerce site like everyone else. These things are called points of parity.
However, where you really create value is through what are called points of difference. These things allow you to set yourself apart from the competition, get attention, and hopefully be successful. So, if your business is in a rut, think about what you can do that your competitors are not. If none of your rivals have a loyalty program, consider starting one. If nobody delivers, think about doing that. If everyone else sells the same products, try adding some new product lines that are unique and attention getting.
The point is…find a different reason for customers to want to come to you. Contests. Funny mascots. Different pricing schemes. Silly advertisements. The possibilities are endless. Just sit down and brainstorm what you could do that others do not. And ask your employees and customers. They may have some good insight that you did not think of.
Pricing is a big deal. It’s not just a simple markup situation, though that is a very common practice. When setting prices for your products, be they good or services, there are a few things to consider.
First of all, do not worry if you are not the lowest price option in the market. Many companies fret over not being the price leader. However, not being the lowest price has significant advantages. Higher prices signify higher perceived quality in consumers’ minds. Think about the outdoor apparel/gear company Patagonia. If you’ve ever priced their items, you know that their prices are sky high. However, this strategy works well for them. It is a signal to the market that they have good quality products. And you won’t find low quality products priced high because they will be “outed” by the market very quickly.
Secondly, and clearly related to the first point, consumers don’t necessarily shop around for the lowest price option. Some do, yes, but many do not. Provide a good product with good value, and you will do fine. Going after that lowest price may lead you to “leave money on the table” with customers. In other words, they might be willing to pay more than what you charge.
Third, higher prices, when coupled with higher unit margins, will allow you to better support your products through better service. This may be crucial to making a sale. Low priced companies tend to have minimal service, if any at all. So being able to provide some service support will work wonders in attracting and keeping business.
There are many other issues to be concerned about when it comes to pricing, including your competitors. Don’t take the practice for granted….it requires more thought that you might think.
How good is your social media presence? And what are your goals for social media? An obvious goal is to increase business. Duh. However, you should have a number of “upstream” goals that, over time, should lead to increased business. One such goal should be to increase social recommendations. According to Nielsen’s Global Trust in Advertising Report, consumers trust the recommendations of others compared to communications that come straight from the company itself. This doesn’t mean promoting your business online isn’t important….it is. But it should only be one part of what you do in this domain.
We get bombarded by all kinds of messages requesting us to “like” a company on Facebook, follow them on Twitter, review them on Yelp, etc. Though it may seem on its face a little silly, it is actually very valuable to build this base. Other consumers see this attention as a positive and it improves their perceptions of the company.
So, if you are not encouraging your customers and potential customers to do or say something positive for you, you are behind the curve. But all is not lost…it’s not too late to initiate a program to do just that.
Once upon a time, I worked for a business in which salespeople were paid bonuses for prospecting. In other words, they were incentivized to find brand new customers. This seems like a logical thing to do, as it allows you to grow your customer base. However, salespeople, like the rest of us, have only so many hours in the day for work. The result then is that a focus on prospecting leads to a lessened emphasis on existing customers.
Upon a very basic superficial analysis of our sales data, we suspected that this incentive program was flawed. So, we undertook a more detailed analysis of our customer sales history. What we discovered was that the average order size of repeat customers was more than double that of brand new customers. This was definitely an eye opener. And, this was before considering the fact that repeat customers purchased from the business multiple times, whereas a large number of new customers never returned.
Based on this, we completely flipped the incentive program to focus on repeat business. This led to increased order sizes, more repeat orders, increased commissions for salespeople, and more profitability for the company.
The point is to not neglect your existing customers. You already have them. They purchased from you for a reason. Give them reasons to come back. Focusing solely on new business is bad practice. While you need to attract new customers, definitely nurture those who already give you money.
If you use photos you find on the Internet in your social media posts, make doubly sure that you have permission to do so! If you do not, you could receive a bill in the mail for royalties, and that bill could be for thousands of dollars. That is a mistake that lots of people have made, and it can really sting! So just be careful.
However, there are some sites that are a repository of royalty free images. What you are looking for are images that are listed as (1) free for commercial use, and preferably (2) no attribution required. The ‘no attribution’ part just means that you don’t have to give them credit for using the image in a social media post.
There is a large number of sites to peruse for images. Below are a few:
https://pixabay.com/
https://www.pexels.com/royalty-free-images/
https://www.shutterstock.com/
Note that some of these sites also sell images, so if you’re looking for free ones, be sure you search the free sections.
Is your business active on social media? If it isn’t, it should be. But that’s for a different discussion. For those of you who are active, what activities to you undertake in social media?
It’s important to understand that social media in a business context is more than just a tool for advertising. Advertising is one-way communication. You send out a message in some form, you hope people see it and ultimately act upon it in some way.
However, social media is very much a two way communication tool. It is super easy to gather insights on what people are saying about you, and it provides you a platform to respond to comments.
So, if you are using social media solely as an advertising platform, you are doing it wrong. There are a number of activities you should undertake as part of your social media strategy that will help generate awareness, followers, and business.
Listen. Feedback from consumers is invaluable. Before social media, it was hard to hear what was being said about you. But not so much anymore! You should continually scan social media for any mentions to your business, good, bad, or neutral. That feedback could help you improve your operations, marketing, etc.
Respond. We as humans like interaction. This is no different in the social media space. When you see comments about your business, respond to them. Customers like to know that they are being heard. If someone makes a positive comment, thank them. If someone makes a negative comment, apologize for whatever the problem is, and work with them to try to fix the situation. However, if the negative comment is absolutely incorrect, don’t be afraid to defend yourself….politely.
Entertain. This one is a little weird, but let me explain. Some of the most popular business social media accounts out there belong to companies who bring it upon themselves to go beyond straight up trying to promote their products. They crack jokes, make random references, and respond in a humorous way to consumer or competitor social media posts. For a good example of this, check out the Twitter account of Wendy’s. The attention that Wendy’s attracts for its quirkiness is great for business.
This all sounds like a lot of work, doesn’t it? Well, that’s because it is. You’ll need to designate someone to be in charge of your accounts. You’ll also need to specify a plan of action, e.g. how often to check the accounts, when to respond, how to respond, etc. If you can figure out how to work this into your day to day operations, it’ll improve your presence in the social media world and likely help your bottom line.
Marketing is great, right? Of course it is. It can drive sales, increase awareness, and stimulate word of mouth, among other things. However, there is another benefit of marketing that people may not know: many marketing expenses are tax deductible. That’s right! You can write off your marketing expenses. So not only does it pay to do marketing to attract business, but it also affects your bottom line by reducing your taxable income.
So what is deductible? Basically, 100% of your advertising expenses, be it advertisements on TV, radio, billboards, social media, as well as any direct mail campaigns.
Are there any caveats? Well, yes. The expenses must be directly related to normal business activities. This means basically donations and sponsorships are not deductible.
For more information, contact a CPA professional or the IRS.
Source: https://www.irs.gov/publications/p535#en_US_2017_publink1000209178
Talk to your customers. Seems so simple and obvious. But, it may not be. When I say talk to them, what I mean is get feedback from them. What do you like? What don’t you like? What would you change if you were in charge? These are very broad, open ended questions that have endless possible answers. However, the feedback you could receive could be invaluable.
I worked for a company once where we regularly called and visited our customers to get feedback. We then used that feedback sometimes to change our marketing activities. This allowed us to be more successful at our jobs by tailoring what we did to our market.
If you value marketing, then you know that your business centers around your customers. Maybe they have an insight from the outside that you don’t have or simply cannot see. Ask questions. Get feedback.
When you get feedback, you don’t have to always use it. However, when you do use it, be sure to thank the customer for his or her insight. Maybe even provide them a gift as part of your thank you. It will make them feel good to know that you actually paid attention to what they had to say.
Do know however that a lot of feedback that you receive will be very contextual. In other words, it will be something that that one particular customer wants. You have to determine though if enough other customers want that same thing before going out and making whatever change it is. If that customer is the only one, then your changes will be done to make only one person happy. That is not an efficient use of resources.
In sum, ask questions. Many great marketing ideas have come from customers. Who knows, you might find some for your business.
Do you know who your competition is? I hope so. By keeping an eye on them, you can glean insights and learn new ways to go toe to toe with them. Sometimes they do little things that you don’t that might give them an edge. And if you can incorporate those little things, you can take that advantage away, allowing you to compete on other things.
However, getting back to the original question, do you know who your competition is? It is a very common mistake for businesses to cast a too narrow net in defining who their competitors are. This can lead to less than optimal outcomes for your company.
So, be sure to cast a very wide net in terms of defining your competitors. You have direct competitors, who are very easy to identify. Let’s take the example of a pizza parlor. Your most direct competitors are other pizza places. They compete with you for pizza customers. However, other restaurants are also competitors. Be sure to treat them as such. Just because a taco place doesn’t sell pizza doesn’t mean they aren’t a competitor. Customers could very well choose them over you. Supermarkets are also a competitor. People could choose to buy groceries and make dinner at home instead of going out to eat. Don’t forget about this.
Casting a wider net is more complicated, because you have many more competitors to have to understand and address, but the benefits of understanding them all will benefit you greatly. It will allow you to create a better set of marketing activities to attempt to attract positive attention and ultimately drive sales.
It seems like the biggest trend in small business these days is delivery. You can get almost anything delivered right to your door. Does providing delivery make sense for your company? Let’s talk this through.
First, if you are a service business, this obviously does not apply to you. Delivery is a little different than we-come-to-you service, e.g. dog grooming vans. I may address this in a different post.
For those of you who sell goods rather than services, ask yourself the following questions:
Do our customers want it? First and foremost, would consumers find value in having your products delivered? If the answer is yes, then you should probably consider doing it. Would it attract new customers? What are the customer ramifications if you don’t do it? Will they leave? Or never come in the first place? You need to answer these questions first.
Can we afford to do it? Delivery is not cheap. You have to pay someone to do it or have an employee step away from other duties to do it. You have to have a vehicle capable of delivering the products. You have to carry insurance on that vehicle. All of this costs $$$.
Can we afford to not do it? Quite simply, if our customers expect it, you should really really really consider it. If your competitors do it, you should probably do it. By doing it, you can take away a competitor’s advantage over you.
Are we okay with fewer customers in the store? A major advantage of people coming into a physical location is that they tend to browse and potentially buy more than they intended. This is great for business. If you have delivery, however, you lose this benefit. Are you okay with this?
There is the possibility of having delivery be a source of competitive advantage. Years ago I worked for an office supply retailer in a small town. Their major competitor was a big box store (that shall remain nameless) who sold office supplies. The management of our store decided to offer delivery within a predetermined geographic area. This service was very appealing, especially to business customers. The big box was not flexible enough to make the decision to offer delivery themselves. As a result, it ended up being a key strength of the small business that allowed it to compete against the big box.
In sum, the delivery craze is in full swing, and I don’t see it going away any time soon, if ever. I am not necessarily recommending that everyone join the wave. However, it needs to be considered, with a full weighing of both the pros and cons.
We hear all the time that it’s the little things that count. In business, this is absolutely true. There are so many little things you can do that will make a big difference with customers. And what’s great is that these things are free. Retailers, below are some little things you can do. You would think these things would be obvious, but sadly sometimes they are not.
Greet customers when they enter your store. Have you gone into some business and the employees failed to acknowledge your presence? I have many times, and it’s a major pet peeve. It is not hard to say ‘hello,’ ‘good morning,’ ‘welcome,’ or whatever. If you are currently busy, let them know that you’ll be right with them. Ignoring them does nothing.
Smile. This one should be obvious, but maybe it’s not. Smiling at customers gives them a sense of ease and warmth. This can only help their evaluation of your business and products.
Show them the way. If a customer has a question about where to find something in your store, don’t just tell them where it is. Instead, take them directly to it. This little extra effort can pay big dividends.
Take an interest. Your interaction with a customer should not start with ‘how may I help you.’ You should start with ‘how are you,’ ‘nice weather we’re having,’ or something else that shows you are out for more than just the sale. It humanizes the employee-customer encounter, puts customers at ease, and helps to build relationships.
Again, these things are very simple and free to do. Hopefully you already do them, but if not, try to incorporate them into your company’s culture. It’ll work wonders.
I was having a discussion with someone recently, and she said that she ran into a situation with a company. When she attempted to address the situation, an employee said, “it’s not my problem.”
I’m sure you already know what I’m about to say, but I’m going to say it anyway: “it’s not my problem” is quite possibly the worst thing you can say to a customer or potential customer. In what ways is this a terrible thing to say? Let’s examine:
It indicates a lack of concern for the customer.
It indicates a refusal to even discuss the matter.
It is very dismissive.
It opens you up to negative word of mouth via social media and personal interactions.
It is quite rude.
Even if the situation is not your problem, you need to find a better way to deal with it. Regardless of fault, you should apologize that things aren’t right. Then you should help them work through the issue as best you can. This doesn’t mean admitting fault (unless it was your fault). It means to go into relationship building mode and try to create something positive out of the whole ordeal. They are going to likely leave your business unhappy, but if you can reduce the level of unhappiness, it might save the relationship.
Instead of saying “it’s not my problem,” carefully explain what happened as you see it. By explaining your side, sometimes customers will see the error of their ways and own it. Of course, sometimes they won’t. In those situations, you can either choose to end the relationship or offer some sort of olive branch, either a refund, a discount, or some sort of incentive for future patronage.
But you don’t have to always give consumers what they want. Stand your ground when you feel it is necessary. You don’t want to become known as the place that is a pushover. Create some standards and stick to them. You’ll be better off in the end.
Do you have your marketing all planned out? If not, know that it is important to do so. Small businesses tend to do marketing in a haphazard way. Something sounds good, they think about it for a bit, and then do it. This can sometimes result in positive outcomes, but sometimes not.
It is best to develop a marketing plan that lays out everything you are going to do for a set period of time. Let’s say a year for illustrative purposes. Create a plan that discusses in detail what activities you’re going to do and when, and most importantly, why you are doing them. These activities should be created and carried out with a goal in mind.
Make sure that you are specific. Are you going to do a coupon campaign? If so, lay out all the details. Who are you sending it to, how many, how long will the campaign last, what will it cost, what do you hope to get out of it, and how are you going to measure it?
Thinking through all these details ahead of time will make the marketing process go so much more smoothly. And it will help you improve the effectiveness of your marketing over time.