Look Matters Blog
An article by Donald Cooper, MBA...
My wife and I typically spend three wonderful weeks every December at our country house in the Muskoka Lakes area, two hours north of Toronto. What I've discovered about most of the business people in that region is that they do nothing to proactively grow their businesses. They have, however, become quite proficient at whining about how lousy business is.
In just one day before Christmas I...
- bought a new power drill at a local Lumber Yard,
- shopped at a Gift Shop,
- browsed through the studio of an Artisan Potter,
- bought flowers at a Flower Shop,
- purchased a gift certificate at the local live performance Theatre...and,
- had lunch at a local chef-owned Restaurant.
The sad thing is that not one of those six businesses asked me if I'd like to be on their database so that they could proactively advise me about upcoming events, special offers or community happenings. Not one of them is building a database that will allow them to communicate, add value, build relationships, create loyal fans...and grow their business. Not only will this simple step add to your bottom line every year but, some day, when you want to sell out, your business with a large, active and loyal database will be worth a lot more than your business without one.
Depending on what business you’re in, here’s some of the customer information that you may wish to collect:
- name, address, email and phone number,
- name of family members or relevant family info,
- what they buy, when and how much they buy,
- how they prefer to pay,
- their likes, dislikes and special needs,
- their interests, values and concerns,
- special dates in their lives, or in their relationship with you,
- how long they’ve been a customer,
- past complaints or service problems.
As basic as this information is, many companies still don’t have it. The pizza place around the corner that they order a $12.00 pizza from, over the phone every couple of weeks, knows more about them than they know about some of their biggest and most valuable customers…and that makes no sense. It can all be done with a few hundred bucks worth of software.
Even more goofy are the thousands of businesses who do spend the money to create a customer database...and then do absolutely nothing with it. They have all of the expense and none of the benefit. I see it all the time.
But some businesses “get it”. Last Valentine’s Day my wife and I drove 120 miles and paid a lot of money to have Valentine’s dinner at the beautiful “Inn on the 20” in Niagara wine country, southwest of Toronto. Why did we do that? Because they asked us to.
We drove past 100s of very good restaurants that were much closer to home and probably less expensive because “Inn on the 20” served us wonderfully the last time we were there and then asked if we’d like to know about special gourmet dinners and culinary events that they offer from time to time.
We cheerfully gave them our email address and, magically, two weeks before Valentine’s Day a beautifully designed email arrived on my laptop describing their special Valentine’s dinner…just as I was starting to worry about how I was going to make this a special day.
I called their 1-800 number immediately, booked the dinner and was asked if we’d like accommodation in the Inn that evening and, perhaps, a couple’s massage the next day.
Now, here’s the bottom line on all of this. When we arrived at the Inn at 6:30, the dining room was packed with happy couples. This Inn is in the middle of nowhere, especially in the winter, and they filled the place because they built a customer database, created an extraordinary event and then they asked for the order over the internet, at virtually no cost to them. They were proactive…and they were making money.
We just had the built-in humidifier in our condo serviced by a company that was recommended by the manufacturer. When he finished the work, the very clever service guy used his cell phone to take photos of the unit and the label with the model and serial number on it. When he goes back to the office, he’ll create a database file for us and insert those photos into it along with a note about the work that he did and what work will likely be required on the next visit. Then, when we call for additional service in the future, he’ll simply look us up in the file and he’ll know what tools and parts to bring and how much time to schedule for the work.
He also creates an automatic “bring forward” for us in his database system so he can proactively call us when the next seasonal servicing is required. This is brilliant proactive marketing that creates customer ownership.
Important PS: Lots of business people tell me that their customers simply won't give up their name and personal contact info. That's a sure sign that your customers don't like, value or trust you. Clearly, you’ve failed to build a meaningful relationship with these folks, and that’s a huge problem.
If people believe that you will honestly send them valuable and interesting information, news, insights, reminders, updates and special offers of interest to them...and that you won't abuse the relationship or ‘sell’ their info to others, they'll gladly give you their contact info. So, if you can't build trust, you can't build a database. But then, without ‘trust’ you can't build anything.
I don’t want to make too much of an assumption here, but I am pretty sure it’s almost summer. While the deluge of rain that we’ve recently had seems to spoil our excitement, July 1 is just around the corner. I like to approach it like it is its own New Years Day: I will make the same cliché list of goals, but this time the warmer weather will hopefully encourage me to actually meet them!
One of the most difficult things in business is determining what price to sell your products or services for. In most cases, businesses base their prices on the cost of production, as they are unsure of the value they provide. For example, a jewelry maker may sell their jewelry at (x) times the price of silver. In another example, an accounting firm will figure out that they are paying a bookkeeper $25/hour, and thus bill out $75/hour as per the rule of thirds. If you aren’t familiar with the rule of thirds, it states that the revenues are made of three equal parts: cost of production, overhead and profit. No matter what multiple is used, businesses that do this are selling commodity instead of value.
Over the past 12 months we've had the chance to work on some pretty fun projects. This past weekend in Saskatoon, some of those projects were recognized at the 2014 Elevators Awards.
The Elevators are Saskatchewan's premier design awards, where the most compelling work in our province is showcased. And gosh darnit, we're pretty excited to announce we went home with some hardware!
The advertising industry is very competitive, and thanks to television shows like Mad Men, it can be perceived as sexy and exciting to a lot of people. In addition, like any occupation that society looks at with celebrity status, there is a pressure to perform day in and day out. Advertising agencies work is their calling card, and one of the best assets of someone’s work is their originality.
I want to tell you about the last conversation I had before leaving Italy. It was at the airport while paying for extra luggage, thanks to irresistible Italian fashion industry. The lady working at the counter asked me what it was like living in Canada, and I told her that if you are willing to work hard and obey the law, you can have a very good life.
The Commercialization stage of the New Product Development is where all of your hard works comes together. The usual steps are product launch, advertising and promotion, and distribution. During this phase we will heavily rely on the critical path analysis to ensure that the customers receive their product when promised.
An article by Donald Cooper, MBA...
Ultimately, customer ownership is all about creating, delivering and communicating compelling value. Customers demand value and every business promises it. But there’s a huge lack of clarity about what value really is.