Category: Small Business

This article initially appeared on the Channelprosmb website July 18, 2013.

Starting a successful small business is hard, but keeping it going for a number of years is even harder. In a world of instant communication and constantly improving efficiencies, even the best ideas are quickly copied, improved, and re-branded by competitors.

According to Jerry Fritz, director of management institute at the University of Wisconsin, while speaking to a group of business executives, “You’ll never have a product or price advantage again. They can be easily duplicated, but a strong customer service culture can’t be copied.”

What Is Customer Service?

Simply stated, good customer service is giving your customers what they want, when they want it. Although likeability is an important asset for any business, customer service is not just about being nice – it is understanding the needs and wants of potential customers and meeting their expectations.

Walmart, for example, provides excellent customer service because it targets those customers who are primarily interested in low prices and variety. The company understands its customers’ priorities – what is important, and what isn’t. As a consequence, Walmart stores aren’t especially attractive, the lighting is often harsh, and there is no sales help, but customers get low prices and lots of choice.

It is just as important, if not more so, for a small business to identify a specific customer demographic, understand their wants and needs, and deliver a product or services perfectly aligned with that understanding. Fortunately, technology levels the playing field so that small companies can compete on local, regional, national, and international levels with companies that are vastly larger.

Improving Customer Service in Your Business

Working hard is not enough to ensure success – you must work smart. As the often bombastic entrepreneur and “Shark Tank” venture capitalist Mark Cuban said, “The battle for our hearts, minds and money is a war being fought on new fronts every day.”

To win that battle and improve your company’s customer service, you must do the following:

1. Analyze, Analyze, Analyze

Every product and service should be designed to meet the needs of a specific theoretical customer. As results are achieved, data regarding actual customers can be collected and analyzed so that pre-conceived ideas or assumptions can be confirmed or disproved, and corrective action can be taken.

This approach – the use of customer analytics – can be used to segment customers based upon actual behaviors, track them as their needs change, and project how they are likely to behave in the future. Once the province of large companies, customer analytics software is widely available from companies like SAS, IBM, Birst, and PivotLink for small and mid-sized businesses.

2. Design Customer Service Jobs Properly

Most companies, small and large, fail to deliver consistent superior customer service because of poor system design. According to Harvard Business School Professor Frances Frei, coauthor of “Uncommon Service: How to win by Putting Customers at the Core of Your Business,” customer service jobs should be “designed for the employees you actually have, not the employees you wish you had.” And companies frequently fail to consider the customer’s role in the service equation. Technology allows many functions to be transferred easily from employee to customer with lower costs and more satisfaction of the customer.

For example, E la Carte’s Presto tablet allows customers to self-checkout without their credit card leaving their possession. It also cuts seven minutes off the average diner’s stay, an important factor where the number of table “turns” directly affect revenue and profits.

3. Communicate Clearly, Relevantly, and Often

The ubiquity of electronic and communication devices means that every company operates 24/7, 365 days per year. Websites, email, blogs, social media, customer forums, and chat are avenues to connect directly with customers efficiently and cost-effectively. Companies like Hubspot, Marketo, and SilverPop provide effective marketing solutions and training; software like Sales Cloud from Salesforce assists in managing and coordinating large and small sales efforts; and suppliers including Novo Solutions and Kayako facilitate customer service and help desk operations.

An online community, where customers answer each others’ questions, can be effective and less expensive than a fully staffed customer help unit. Customers often respond to each other faster than customer service reps can, and the answers customers give each other may be better than answers from company staff.

4. Observe and Innovate

Gordon Moore, co-founder and chairman of Intel, is credited with the principle that computer hardware performance doubles every two years. As a consequence, any competitive advantage gained from the use of any technology is temporary.

Patrick Cox, co-editor of investment research service Technology Profits Confidential, asserts, “There has been more technological improvement in the last 50 years than in the previous 5,000.” Furthermore, customers are notoriously fickle, constantly changing their habits, preferences, and needs. An astute business owner keeps his eye on his customers, as well as new technology.

5. Outsource Where Possible

In February 2010, an article on the Channelpro Network pointed out that companies, small and large, were shifting work previously done in-house to outside providers for a variety of reasons:

• To adapt quickly to sudden industry or marketplace changes
• To eliminate the costs of recruiting, hiring, firing, and training personnel
• To expand their options and flexibility in such areas as advertising and public relations
• To expand their expertise with access to specialized knowledge

Other advantages include lower fixed costs, particularly for those capabilities that are likely to soon become obsolete, and an independent perspective regarding the market, customers, technology, and competition. Small companies with limited budgets may find that outsourcing can allow them to provide better customer to their customers at a lower cost.

Final Thoughts

Superior customer service is a competitive advantage available to every small- and medium-sized business. Businesses fail not because their services and products are no longer needed , but because a competitor has discovered a way to deliver the same service less expensively, quicker, more conveniently, and better tailored to each customer’s individual requirements.

Technology is both a great disrupter and a great equalizer. Use it to your advantage and ensure your business remains relevant and desirable to your customers.

What other ways can you suggest to improve customer service?

This article first appeared on ezine.com on February 29, 2012.

In a world of instant communication, world-wide sourcing, and sophisticated marketing programs, the only sustainable competitive advantage is Customer Loyalty. Small business owners often overlook the obvious in pursuit of the difficult – it is far easier to retain a customer and get a new order than to find a new customer. Satisfied customers return again and again to the businesses they trust and often bring new prospects with them. A few good words of recommendation are more valuable in building a business than expensive sales campaigns and discount programs.

Consider your own experiences as a consumer. Where do you shop for groceries, medicines, or clothes? Where do you buy gas and get your vehicles serviced? If you’re like most people, you patronize a limited number of establishments with whom you are comfortable and trust, even though virtually everything you purchase can be bought from someone else for the same or lower prices.

Where do you fill drug prescriptions? A third of Americans shop at either a CVS or a Walgreens located within 5 miles of their homes. Often the two competitors are located across the street from each other. They carry the same goods and products and participate in the same health insurance plans. They are virtually identical in appearance and layout. Aside from periodic discounts on specific products, their prices are almost the same, varying by pennies if at all. But the odds are that you give most of your business to one or the other, rarely entering the doors of the other company’s store. Why? And why do your neighbors follow similar behaviour?

People purchase products and services from companies who continually meet or exceed their expectations, whatever they may be. Most people expect, at a minimum, that the products they purchase will work as advertised, the product will be available when they want or need it, and the price paid for that product is fair. They want convenience, consistency, and a lack of complication in the process. In short, they want to be comfortable that they are getting what they expect when they pay for a product or service, nothing more and nothing less. The business owner who understands this desire has an opportunity to create a extraordinary experience, exceeding basic expectations, and convert a skeptical buyer into an enthusiastic promoter of the business who repeatedly returns and brings his friends.

While attending college in the mid-1960s, I had the opportunity to work at one of Jack Brown’s One-Hour Martinizing Cleaners in Austin, Texas. The University of Texas at that time was one of the largest colleges in the United States, starting 15,000 new freshmen every year. Mr. Brown focused on those new freshmen, knowing that if he could get them as customers their first year, they would remain customers for their college term.

There are a lot of dry cleaners and laundries around every college campus. Clean, pressed clothes are important when you lead an active social life. Most freshmen, living away from home, send out their clothes for cleaning. At the same time, they are strangers in a strange place, knowing no one and feeling insecure about being on their own for the first time.

Mr. Brown understood their situation and recognized their loneliness, particularly the first semester. As a consequence, he had one rule for any employee who worked on the front counter – he expected every customer to be greeted by his first name by the customer’s third visit to the store. Imagine how that lonely freshman felt when he was greeted by a friendly voice calling him by his first name! No one else knew his name, not the teachers who handled classes of 50 students or more, the dining hall stewards or fast food counter people, not even the people in his dorm of 500 or more. He came to the cleaners with the expectation that his shirts would be washed at a reasonable price; he kept coming over the next 3 and ½ years because he found a friend who knew him by name, something he never expected from a local dry cleaner.

Being able to recall and use someone’s first name is not always the reason someone returns to a business, but it can’t hurt. Clean facilities and equipment, courteous employees, stocked shelves, quick deliveries or installations, listening and responding to your customer’s concerns are all part of the customer experience as well as other things.

To determine how you can make a fabulous impression in your business, you need to put yourself in a customer’s shoes. Try to review every aspect of a transaction from his viewpoint, no matter how small or trivial the point. How does your phone system work? Is it easy to get caught in a transfer Hell where talking to a real person is impossible? Are the features of your products or services easily understood? Is your billing excessively complicated for your purposes, not those of your customers? Do you follow up with a customer to see if the product is performing as promised? Think about it and write out your customers and answers for reflection and to find opportunities for improvement.

Ask a friend to go through a customer process with your company and get this thoughts. Better yet, call some recent customers and get their feedback on what they experienced. Don’t settle for vague answers! Ask specific questions about what they expected and what they got. Ask them for suggestions to improve your process before their next visit. Incidentally, calling a customer and asking him for his thoughts will make him feel important and that you care about him – a good outcome by itself.

Have you come to any conclusions about why you continue to visit the same stores? Do your customers feel about you the way you feel about those businesses? How can you improve the experience for your customers?