“If you don’t know who your customer is, you don’t know what quality is” – Eric Ries
Seems pretty obvious and straightforward – know your customers if you want to succeed in your business. It is a cliché in marketing and public relations teams, whose business it is to understand the current, and prospective customer base of the company. With such understanding, it becomes a lot easier for a company to provide specific solutions and customized products. The purpose of every business is to fulfil the unmet needs of customers, and alleviate their problems and pain areas. When you make a concerted effort to know your customers, it would reflect in everything your company would do – its processes, policies, guidelines, and employees, all would reflect the company’s commitment to understanding the customers.
In today’s business world, companies have no choice but to become and remain focused on the customer. The emphasis is shifting from an internal focus to the main source of a company’s profits and success – its customers. This change of focus is the result of several factors, having a profound effect on how a company conducts business. With so much competition, globalization, saturation of domestic markets and segments, and most importantly the surge in the importance of the internet, companies cannot afford to keep an internal focus. Customers today are far too smart and demanding to settle for less than the best. Owing to technology, they have the power to compare prices, products, companies, and brands – choosing those that seem to fit their values and meet their needs the best. Additionally, they are increasingly prone to check online comments and reviews of other users before making a decision. It would make sense to know your customers if you expect to keep pace with their evolving needs, and changing preferences, lest they shift their attention to your nearest and fiercest competitor.
We know that attracting customers is a lot harder than retaining the current ones. The primary reason for this could be the inability to know your customers, which in turn makes it harder to differentiate your company from other players in the market. Anyone can create products and services, set up systems and business processes, however, unless the target customers find them useful and valuable, a company would not succeed. Today, conventional marketing methods are no longer sufficient to generate viable leads, and it is the customers who are empowered and do not hesitate to place their demands of budget, requirements, timelines, and expectations. When you know your customers, giving them exactly what they want becomes a lot easier.
Know your customers, is a term that goes beyond just the realm of business today. In order to attract new customers, retain the existing ones and create customer brand ambassadors, it is critical for a company to maximize the value it provides to each customer. The better you know your customers, the easier it would be for your company to demonstrate why it is the most appropriate ‘partner’, and how it can provide for the needs of the customers better than anyone else can in the market. The fact is there are several companies today vying for the business of the same set of customers. If you know your customers better than your competition does, it would be easier to outsmart the competition. As mentioned, knowing customers is not just about who they are, or what they buy, but more importantly understanding their current emotions, feelings, and wants in the current moment. Using this knowledge a company would be able to create high quality interactions and experiences for the customers, ensuring that each one is insightful, relevant, and personalized. Having such experiences consistently would naturally lead to an increase in customer satisfaction levels. Enhanced customer satisfaction sets the ‘ball rolling’ for more business, glowing testimonials, and valuable referrals.
Despite all the advantages of knowing customers, some businesses still do not know enough about their customers. They are unable to or neglect the analysis of market data, possibly because there is so much with which to contend, and can often seem overwhelming. Companies struggle with the information, which in turn leaves them befuddled and unable to understand who the customers are, what they want, how they expect to get it, and how fast they want the company to deliver. When you know your customers, these questions would be a lot easier to answer, and should be something that all companies seek to do. This need, to know the customers is why CRM systems are now being used increasingly – it is easier to collect, collate, update, store, and use customer data as and when required. This data can be shared across the business for all involved, in order to work cohesively and shape the overall customer experiences.
Another reason to know your customers is to increase profitability. Information about and from customers is called customer intelligence, and can help a company know the impact each business unit has on the customers. Understanding whether or not your business is helping customers and providing them with personalized experiences, would enable a company to make amends to ensure that customers get what they expect. The reason so many companies fail at meeting customer expectations is that they are constantly trying to catch up with customer demands. This would happen to your company if you do not know your customers, and only when customers express their dissatisfaction with your company, would you know where you failed. It makes more business sense to implement strategies and methods that enable your company to pre-empt their needs, and proactively serve customers, which would influence customers in a company’s favour.
When you know your customers, you would know why they buy from you, how they use the products, the experiences they have with the products, and what your company can do to enhance their experiences and satisfaction levels. A company that sincerely cares about knowing its customers, would not rest on laurels, but would continually search for ways to improve its product or services, find new products to meet the evolving needs of customers, and make every effort to keep the existing customers happy. Following these most basic principles would display a company’s ability and commitment to know its customers. Of course, the best way to know your customers is to speak with them directly and regularly. Customers are ‘goldmines’ of information, and if a company is truly interested in its customers, making the time and effort to speak face to face with them would be extremely worthwhile. As mentioned, customers are busy, and even if they do have something to say, they may not simply because of lack of time or easy options to do so.
As companies grow and prosper, the focus shifts from knowing the customers to assuming that the company already knows what they need, owing to many years of experience and a large existing customer base. Companies become entrenched and caught up with their internal processes such as reducing operational costs, and finding ways to increasing their profit margins. This is not a bad way to look at ones business, but neglecting the main reason for being in business is definitely a self-defeating approach. Customers soon begin to feel neglected, and experiences and products seem generalized and ‘mass made’ leading them to leave the company eventually, for one that would pay individualized attention. To know your customers is the first and most basic step in serving them well, and today service to customers is the top differentiator and unique selling proposition for companies with similar offerings. Does your company fare well in knowing its customers?