MichaelMMM

The customer is king!
The answer is ?yes?, now what is the question!
? Yadda yadda yadda.

Whilst these sound great, they also have a fundamentally dangerous basis ? i.e. that every person who wants to do business with you should be invited to do so.

The fact is that some ?customers? should NOT be accommodated. To take them on may result in your losing focus of what your business is all about, and compromising important aspects of your business. It may also result in increased costs, and an inability to service those who really are your customers.

To adopt this ?You aren?t for us? approach requires:
? A clear understanding of the way you define what your business does, and how it does those things.
? The ?balls? to be resolute ? Yes, you may have to walk away from a deal (if necessary).
? The ability & willingness to constantly re-assess, and to determine whether a change in the ?what? & ?how? is necessary. Failure to re-assess on a continual basis illustrates an inability to recognise that the competitive and industry environments are constantly in a state of flux. A good decision today, may be a poor decision tomorrow in the light of changed circumstances.

Here are some examples in an actual business.

Background
? Digital Recall (www.digitalrecall.com.au) is a business that provides the worlds first free digital signage software.
? It also produces custom-made content for users at a ridiculously low price
? It targets smaller businesses worldwide that have a need for basic digital signage software that they will install themselves using their own off-the-shelf equipment.
? It is competing on ?low price?. In fact it?s basic software-offering is free (and it?s fully functional).

Limitations on ?How it does it?
? Software: Because it is free/ low cost, the software is somewhat limited in its ?features? than the expensive alternatives.
? Help Services: As this is fundamentally a DYI option, and because its free or very low cost, the type of ?assistance? offered by the Company to its users needs to be managed in order to ensure that it?s costs in responding to queries are not unduly ?driven? by users who are simply not putting in the time to follow the manuals & FAQ?s to do it for themselves.
? Advert Creation: The adverts it creates for customers are about 80% less expensive than from anyone else. As a result, the creation process needs to be largely a single instruction by the customer with the ability by Digital Recall to then ?get on an do it?.

Experience 1
? Situation: Customer requires software features which do not form part of the software.
? Question: Does the business:
o develop those features for this customer , or
o does it tell the customer ?I?m sorry, you require a system that has ?all the bells and whistles?. We aren?t for you. We can suggest product XYZ ?
? Issues to consider (amongst others):
o Cost (in time and $) of developing the features;
o General demand for those features by the businesses? target market (small businesses) and the prospect of that target market buying those features.
o Do you want to be in the ?high features? end of the market

Experience 2
? Situation: Customer requires extensive basic assistance in order to set up his digital signage system.
? Question: Does the business:
o Provide continuing detailed assistance to this customer? or
o Does the business advise the customer that ?his assistance-needs falls outside the businesses ability to provide it and that he employ the services of someone skilled in IT for assistance in order to use our low cost alternative?.
? Issues to consider (amongst others):
o Is the level of direction provided in the website, manuals etc reasonable to enable a reasonably skilled/ determined user to ?get on with it?

Experience 3
? Situation: Customer requires adverts made for it, but wants extensive input into the production process.
? Question: Does the business
o Allow this; or
o Does it advise customer that its production process will only allow an ?approval? process if a premium is charged; or
o Does it simply say ?Sorry ? we can only produce adverts according to the process which does not provide for approvals?

Any answer is only ?correct? at a specific time, and having regard to the way you want to ?define? the business and the resources available. Haphazardly changing what you offer or are prepared to do is confusing both to your customers and your staff.

Summary: The needs of some customers fall outside the scope of the business? product/ service definition. Failure to recognise that scope may result in the business finding itself offering products/ services that it never intended to do, with a cost (or benefit) that was not foreseen.
Caution & consideration is required.

Michael Marcus ? Business and Franchise Help
Saving Franchisees. Assisting Independent Business. BEFORE it?s too late!
The Franchisees Advocate Group - Australia
Business and Franchise Help - Australia

Mooper

Thanks for the article Michael,
Your stuff it always a great read.
Keep it up!

MichaelMMM

Thanks for the encouragement. Always nice to be appreciated.

Cheers!

yesterday

Michael..Keep it up, Very nice writing.