Lane J. Anderson
A couple of years ago, I undertook climbing one of Colorado’s fifty-four 14,000 foot peaks with my daughter. Although we thought we knew the correct route to the top from the guidance of a friend and a small map, we realized too late that we had taken a wrong turn or two. Only after hiking along a whole range of shorter peaks did we reach the summit. Once on top, we enjoyed some breath-taking scenery, and we had a very clear perspective to see a much easier path to the peak.
Reaching peak performance for a business is certainly harder than hiking a “fourteener”. During the past 20 years of creating and managing major brands for a Fortune 500 company, developing truly new businesses in a small professional partnership, working with a small team to build a fledgling new product into a multi-million dollar mass customization business and studying numerous other businesses has provided some perspective. The path to the peak in any business isn’t easy. However, identifying and finding prime prospects, communicating the right message to them at the right time, delivering the right product at the right price, and delighting them with superb customer service are essential climbing tools. Many of the elements of success come right down to some fundamental questions that lead to smart marketing. Here is a sampling of a few key ones:
- Reason for being:What problem am I solving or what need am I fulfilling for my customers better than any other product or service? It is surprising how many businesses attempt to market a product or service without ever talking to their prospective customers. It is critical to understand what they want and how well the product or service I want to sell delivers on that need. A few days ago I sat in a meeting discussing a service targeted for young adults. Only about 10% were responding while usage levels should have been closer to 50% from this group. This had been going on for years. There was considerable frustration that this service was so superb, yet few were responding. I discovered no one had bothered to ask the target consumer group why they weren’t “coming to the party”. Consumer research is important. Discover the need. Fulfill it better in some or all aspects than anyone else. Make sure you communicate that benefit clearly to your customers.
- Product or Service Quality:Would I be proud to own this product or use this service I am selling to my customers? Selling a customized product can be a complicated matter. Every product that goes out the door is unique. In a mass customization business, our company motto was: “Don’t ever let a product out the door that you wouldn’t be proud to own.” Expediency to meet deadlines and quotas or a demanding boss may tempt some employees to think it won’t matter this once to let an inferior product out the door or take some shortcuts to hurry this new client through the service. Not so. Many products have failed because of poor product quality. Many successful products or services are built on uncompromising quality. A few wise companies even put the inspector’s name in with the product. Remember that the brand name will always be on the product in any case. The company name will continue to be on the door the customers walk through. Make it stand for uncompromising quality. Do it right – the way you would want it done if you were buying the product or service.
- Pricing:If I were a customer, would I buy this product or service at this price? When establishing pricing for a product or service, at least four factors should be considered: 1) cost and economics (what does it cost to provide or manufacture, market, deliver and offer customer care for this product or service), 2) what are competitive prices for comparable products or services, 3) how much perceived or real value does this product or service have for consumers, and 4) what is the lifetime value of a customer? The price point established for the product or service should consider these four factors. It has to be worth it for the customer and the company needs to make a profit. This tension causes a critical balancing act. However, remember that ultimately the customer needs to feel that they are getting a good value – that it’s worth it. Although consumer research in this area is essential, it is also tricky to conduct since consumers will sometimes not express what they really feel in some research settings. A skilled marketer knows, for example, that reading body language in a focus group can be as important as what the consumer says. The correct pricing can also make the difference between success and failure. Put yourself in the consumer’s shoes. Make sure the price makes sense and cents.
- Channels:Would I want to be treated differently by the same company in different places I might buy the product or service? In the past, companies could often get away with different pricing policies or different promotions in different distribution channels. For example, a retail store could price a product differently than the catalog and hope the customers didn’t notice. Online brokerage services hoped services could be priced differently than through their live brokers. As information has become more readily available through the internet, consumers have become more demanding of consistency. Online chat groups communicate discrepancies within hours or minutes. Comparison shopping services online allow consumers to sort through options quickly. Although the retailer may feel they are totally justified in offering different pricing in different channels, customers often complain about inconsistencies unless there is clear logic for the difference. For example, offering super savings over the internet on clearance items might make sense while a different introductory price on the same item may not. Many companies have separate divisions for different channels. Smart companies are making those channels seamless for the customer. Some companies now facilitate return of catalog purchases at retail stores or allow online purchases to be picked up at a retail store. Be smart. Be consistent. Make it easy for the customer to shop seamlessly in different channels. They expect it. Increasingly, evidence is showing that properly managed multiple channels can create synergy.
- Customer Service:Am I treating this customer the way I would want to be treated? Many companies get so caught up in preserving the last penny on the bottom line, they forget that saving a few pennies on this unhappy customer today may cost many dollars of lifetime sales value in the future. A couple of years ago, my wife ran our vehicle with an expensive bicycle rack on top through a car wash. The sign in front of the car wash clearly stated that vehicles with bike racks should not go through the car wash. The car wash equipment ripped the rack off our vehicle and it was bent when the next car in line inadvertently ran over it. We were in the wrong without question. In spite of that, the manager of the car wash called me to apologize and offered to pay half of the cost to replace the rack or its parts. I was amazed. Since then, I am more loyal than ever to his business and have told numerous friends about my experience even two and three years later. In contrast, my daughter’s car came back from another car wash with a cracked windshield. The owner denied any wrongdoing. I could not prove it. I have not been back to his business in years. Be smart. Be fair. Build a relationship with your customers. Think about what they are worth to your business today and tomorrow. Treat them the way you would want to be treated.
Although the marketing landscape constantly changes with new channels, new products or services, and new marketing forces at work, certain fundamental principles remain constant. Allow your business to climb to the top with peak performance marketing.