Become "OBSERVATION"Able to reward the "Right" Customer

What has happened to businesses today … why do so many people choose to “reward” the WRONG customer instead of rewarding the RIGHT customer? Let me define “incorrect” and “correct”. The “wrong” customer is the “new customer” that is acquired primarily through marketing and promotions. And the “right” customer is a “new customer” that your “existing customers” acquire. While I know this may sound a bit unusual at first or even surprising to you, if you think about it as both a business owner and a customer, I think you’ll see that it makes more sense than you initially thought.

I have talked about this for over 20 years in my speeches and why it makes so much sense. But when you change your mind about the best way to acquire new customers, everything in your business will change for the better. There is no doubt that all companies need new customers to survive and grow … the question is “how” should you get them. I don’t think the best way to attract new customers is through marketing and solicitation. I think this is a cancer in most organizations that corrodes everything over time and eventually causes serious problems within the company that can be difficult to overcome. However, it is still the dominant way of “acquiring” new customers.

I believe (along with many other successful companies) that there is a better answer to acquiring new customers and increasing your market position and profitability.

During the last weeks of last year I had this illustrated in various ways. Let me share two of these situations with you so that you can get a better idea of ​​what I am talking about regarding your own company. The first example is Comcast, the cable company. I know … it’s the company everyone complains about for one reason or another. Let me share with you one of the main reasons this happens.

I’ve been a Comcast customer since the 1990s, if you can believe that … I often have a hard time believing myself. My infamous “2-year contract” has expired and I am now paying retail fees for my “triple play” of cable, phone, and Internet. Of course, no one called or sent me a notice informing me that I would be leaving a plan and paying more money, mistake number one. Since I saw this happen, I called to find out if they had special offers, since they always have some kind of promotion, mistake number 2 (you don’t need promotions). I had the pleasure of speaking with the “retention specialist” who acknowledged that I was a 20 year old customer while looking at my account. As we talked, I was also searching the internet for offers, so I understood what was available.

As we talked, the retention specialist thanked me for being a customer for so long … a good thing to say to his longtime customers, a positive step. Then he told me what he could do for me and what offers he had available. Surprisingly (or not) these offers were higher than the ones I found on the internet. I asked him about the deals he had found and he gave me the phrase which is like nails running down the board to me, “Sorry, but those are ONLY AVAILABLE to NEW CUSTOMERS”, mistake number 3.

I then proceeded to ask what I always ask, “So what you’re telling me is that you care more about attracting a new customer than honoring your existing customers? Because you’re telling me that my best price is higher than I could get. if I was someone new to your services. Am I getting this correctly? “Unsurprisingly, he didn’t have a good answer to this question. She simply said, “All I can tell you is the prices I have available to offer you as an existing customer.” Mistake number 4.

I was immediately confirming one of my biggest frustrations, Comcast doesn’t really care about “existing” customers, only “new” customers … because they are rewarding “new” over “existing” ones. Since I’m in the business of helping companies become obsessed with customers … she was essentially telling me that Comcast is only obsessed with new customers, not existing ones. This is not being obsessed with the customer and is moving them further and further away from becoming a company capable of “OBSERVATIONS” … at least not in a positive way.

My second quick example came from iThemes, a company that I use for some plugins on my websites and blogs. They have great plugins and they help me do wonderful things in a reliable way … there is nothing wrong with their products or services. They charge me an annual subscription fee to use their plugins. I received my renewal notice and it was $ 100 per year. However, just a few weeks before my renewal I see an ad for a 40% discount on their services … sweet. As you can probably guess by now, after talking to them, they informed me that this discount “is only valid for NEW customers, not their EXISTING customers”. Mistake number one.

I asked them the same question I did with Comcast: “So what you’re telling me is that you care more about attracting a new customer than honoring your existing customers? Because you’re telling me that my best price is higher than I could possibly afford. get it if I was someone new to your services. Am I getting this correctly? “And once again, the same kind of response:” This is only our promotional offer for our new clients, not current clients. ” Mistake number 2 … they didn’t know how to answer because they are not obsessed with the customer. They, like Comcast (and thousands of other companies) focus on acquiring new customers through marketing and promotion, not because they are able to “WATCH.”

These were just two of the situations I ran into in just a few weeks! Companies willing to invest millions of dollars to acquire new customers but invest zero dollars to keep their existing customers. Does this make sense to you? It’s not for me. If you are a leader in the company, it might make a lot of sense because your goal is to attract new customers and increase your customer base by a certain percentage each year. But as a customer, it doesn’t make any sense when a company literally penalizes you for being an existing customer. STOP and think about that for a minute if you are a business leader … we look forward to it.

The argument is always the same, if we don’t spend money trying to acquire new clients, we cannot grow, so we must do something to get new clients. This is what the leadership team of most companies (usually your marketing group) is telling you. This is a FALSE THOUGHT.

Throwing away a lot of money on frequent, big promotions with incredible offers to attract new customers just doesn’t make sense today in a highly commodified world … you can’t win this game … at least not in the long run.

This is the wrong way to think about it. Let me share with you a different way of approaching this same topic … but with much greater success in the short (and long) term.

The goal is to get new customers … there is no discussion. The question is “how” to make this happen and NOT LOSE YOUR EXISTING CUSTOMERS. Many analysts tell us that “Loyalty and Retention” are at an all-time low today. What has happened to allow this to be the case? It goes back to the fundamental elements of the obsession with the customer … these core elements have been eroding over the last decade.

The goal should be to become capable of “WATCHING” … where your customers are so happy with you that they can’t wait to tell others about you! No one will disagree with wanting this result and no one will disagree that frequent, positive word of mouth is the most powerful form of sales and marketing … it always has been, always will be. The question is, “How does REMARK become capable of having your existing customers do your marketing for you?” That is the real question leaders should ask themselves today.

If your customers aren’t talking about you, spreading the word about how awesome you are, or telling others they need to buy from you, you’ve got a problem. But with every problem there is an opportunity. The opportunity is to go from “giving away money” (advertising, promotions, marketing) to “getting free customers” (having your existing customers (and others) do your marketing for you).

Think of a different solution … one where you can “WATCH”.

Using the examples I shared earlier, let’s reverse the situation. What if you reward your existing and loyal customers more than a new customer? What if you offered your biggest discounts or additional product / service benefits to your existing customers instead of your new customers? What if you did special things to help your existing customers throughout the year improve their lives or their businesses? What will your business look like next year and beyond?

The first thing you’ll notice is that your existing customers would be much more inclined to “comment” on you and your friends and colleagues about how well you take care of them as an existing customer. They would go out of their way to talk about you … they would be “doing your marketing for you.” When this happens, these “new” customers (through word of mouth) will want to be a part of it and reap the rewards that your other existing customers are getting. This would spread and grow day after day, month after month, year after year. In no time, he would have created “the most powerful marketing force on the planet … his customers.” What would your business be like if this happened?

This reverses the cycle described in the previous two examples. Now you would look different from all your competitors. Now you would be reaping the rewards of “zero cost marketing” because your customers are doing it for you … FREE!

It would allow your competitors to spend their money trying to attract all the new customers with cheap deals and promotions … spending money to get a lower return per customer. When you start to think differently about customer acquisition from your current customers (and others) rather than investing very expensive money (your profits) to attract new customers, you begin to see the world of customer acquisition very much. different. And here’s the kicker … a lot of the customers you’re attracting with all these cheap deals and promotions aren’t really the ideal customers you want anyway. They are the “deal hunters” and are not looking for a long-term relationship with your company.

They are the wrong customers!

Now you have eliminated the problem that I described in the previous two examples. Now he’s offering to help his current (loyal) customers improve their lives or their businesses … by turning them into advocates. This path leads to a high LTV (Customer Lifetime Value) … which says you will make higher profits from each customer than with the traditional acquisition method. You will see much more profit per customer and your customers will be happy to spend it with you because they know that you care about them and that they are important to you.

This is what it means for a company to become capable “REMARK” … to be obsessed with the customer so that their customers do their marketing for them. This is my passion … as a business owner and as a customer … trying to get so many companies to become obsessed with the customer and give me many reasons why I tell all my friends and colleagues that they need to buy from them.

What would that look like for your organization? Ready to change your path to become customer obsessed and able to become a capable “REMARK”? I would love to hear your story and what you think. If you think this is a better way to think and act, share it with your colleagues. As more leaders understand how powerful this is, all of us, as consumers, will also reap the rewards. It is a win-win.