You've probably heard the acronym VIP, which is commonly defined as very important person. But to develop a more personalized kind of relationship, many benchmark companies have shifted the meaning of VIP to very individual person. To succeed in the marketplace, world-class organizations realize that they must understand their customers uniquely and completely and tailor their products and services to best fit the needs of their customers.
In this age of mass customization, this reality cannot be emphasized enough. Thriving in your marketplace comes as a result of truly understanding what motivates your customers and why they buy. Paco Underhill, an expert on retailing and author of the bestselling book Why We Buy, explains it this way: "Even the plainest truths can get lost in all the details....A phrase I find myself using over and over with clients is this: The obvious isn't always apparent."
Today, success requires the effective balance of sophisticated strategic thinking about the dynamics of your culture and brand and the tactical engagement of every employee in the quest to engage each and every unique customer on a personal, one-to-one level. This is what separates the experience customers might have with a world-class operation from an experience they might have with an average business. To this end, we offer a psychographic tool for bridging the gap from just knowing about your customers to actually understanding them - the Customer Compass. If you think about a magnetic compass, it has four directional points - north, south, east, and west. Likewise, the Customer Compass also has four directional points - which can be studied both strategically and tactically - to identify and respond to every customer's unique qualities:
- Needs. Beyond the most basic needs for food, water, and shelter, people express a variety of needs for products and services. Individuals have needs that are more relevant to them and are often hidden - but still drive their consumer purchasing decisions.
- Expectations. These are not about the perspectives and assumptions that you have of your customers. Instead, they target the preconceived notions that customers have of your industry, company, role, products, and services. Until you know what their expectations are, you cannot hope to exceed them.
- Styles. People respond to your products and services based on their individual styles or preferences. This point on the compass includes four key styles that affect how the customer interprets and values the service experience.
- Walk. Perhaps the most powerful opportunity for understanding others is to walk in their shoes. By considering the experiences of another person, you can learn how to direct your business choices toward what matters personally to that customer - and what, ultimately, results in a superior experience and a more profitable bottom line. When everyone in an organization uses the Customer Compass to understand its customers and then consistently responds accordingly, a tremendous and special connection is created - with not only its external customers but also its internal customers (employees). To see how this works, let's look at each of the four points in more detail.
Finding true north allows any navigator to accurately travel in whatever direction he needs to go. North is the most critical and consistent of all directional points. The same could be said of the first point of the Customer Compass - N, for needs. Of all the four points, understanding customers' needs is the most important. When referring to needs, we are not talking about the products or services for which customers are asking. These needs go much deeper than that - they're about what motivates them to want your product or service. For example, at a pharmacy, the obvious reason a customer is there is to have a prescription filled. But consider the deeper question of what are the circumstances surrounding the need for this prescription? At a delivery service, transacting a letter-mailing process is simple, but the meaning behind that letter (a love letter? a late, important bill payment?) may add an entirely new dimension to the experience. By considering these personally relevant aspects, anyone can do a better job of connecting with and serving a customer.
Certain common elements of the human condition span culture, race, gender, and any other method used to categorize the people of this world. The unified category of human being is a common denominator that can provide universally valuable insights. In the pursuit of better understanding human nature, experts from all fields of study have conducted research about people throughout history. In an effort to bring together the key findings from these previous investigations, we have assembled a targeted list of humanity's strongest and most fundamental motivators. Pondering these universal needs is the first step in really understanding your customers. They include the need to
- be heard and be understood
- belong and contribute
- feel stable and in control
- feel significant and special
- be successful and reach one's potential.
The goal is to consider these five needs so that you can learn to better understand your customers (both external and internal) and leverage this awareness to more personally serve them and exceed their expectations.
The second Customer Compass point is E, for expectations. Typically, when referring to customer expectations, the concern is about organizations' perspectives on and stereotypes about their customers. But world-class businesses take a completely different view of this issue. This real need focuses on the preconceived notions that customers have of you - your industry, your company, your role, and even you as an individual. Customers have differing expectations about different industries and businesses. For example, consider these sample experiences:
- Purchasing a timeshare
- Acquiring a used car
- Being sold a product or service by telemarketers
- Going on rides at a traveling carnival.
Generally speaking, the public's expectations of these experiences tend to be negative - even when a person hasn't personally done it. Now consider the expectations you might have of these sample experiences:
- Attending Yale or Harvard
- Purchasing a Mercedes-Benz
- Shopping at Tiffany's
- Staying at a Ritz-Carlton.
Though some might have a negative expectation about the costs of these experiences with elite products and services, polls usually show positive connotations for them.
In this vein, try an imaginary exercise: Suppose for a moment that you arrive at a beautiful Ritz-Carlton hotel. No one appears at the front desk, so you ring the bell. Out comes an employee in a wrinkled, dirty suit, smoking a cigarette. "Whadya want?" he mumbles. You inquire about checking in. He responds with "Hold your horses, can't you see I'm on the phone?" After loudly continuing his phone conversation about placing a bet on the next horse race, he turns to you and tries to sell you a more expensive room you didn't reserve.
Would you expect this experience to actually occur at a Ritz-Carlton? Probably not. It's completely out of alignment with their motto of "Ladies and Gentlemen serving Ladies and Gentlemen." Unfortunately, however, this type of negative experience is probably more associated with the stereotypical process of purchasing a used car. As painful as it is for sellers of used cars to hear, when people are surveyed to describe the typical experience of buying a used car, the vast majority share a story about a group of men lined up outside the dealership, dressed in plaid suits, smoking cigarettes, readying themselves to swoop down on you like a vulture and sell you a lemon.
There is one key thing to understanding your customers' expectations: You can't exceed their expectations until you really know what they are. This is why CarMax stands out so much from typical expectations about buying a used car. CarMax considered all the stereotypical negative expectations about its industry and then did the opposite, leveraging them to its advantage. Its showrooms are clean, bright, and spacious. It has an enormous selection of vehicles, which go through a 100-point inspection process to ensure that they aren't lemons. And its efforts to reverse expectations based on stereotypes also extend to its sales staff. They don't haggle over price with you. In fact, the final price is clearly displayed on each car, and you can either accept it or not. Overall, the CarMax buying process is designed to be hassle free, supportive, and simple. The staff is largely there to help you with information about each car and assist you with test driving the cars of your choice.
The third Customer Compass point is S, for styles. This refers to the individual and personal styles of how people respond to life around them. Recognizing that human beings are wonderfully diverse, it is helpful to identify the critically different styles in which people think and behave, and then adapt your products and services to their preferences. Pam Eyring, president of the renowned Protocol School of Washington, comments on the importance of dealing effectively with differences of style in the workplace: "International protocol, etiquette, and image involve a wide range of things, but at their foundation, they are about social intelligence. We are always a reflection of our company - and even our country. Success in any interaction requires a real understanding of ourselves and others, and the ability to take the appropriate action to achieve the best results - from the perspective of our guests."
To assess people's individual and personal styles, there are numerous psychological instruments and personal inventories on the market today. The social styles assessment is among the most respected and the easiest to apply in a pragmatic organizational environment. In this regard, Roger Reid and David Merrill developed an assessment instrument showcasing four social styles of individuals - analytical, driving, expressive, and amiable - that can be particularly useful for understanding the compass styles point. These four styles are based on two factors - assertiveness, the effort a person makes to influence the thinking and action of others; and responsiveness, the extent to which a person reacts readily to influence or stimulation by displaying his or her feelings. Knowing the four social styles helps us understand others and their Customer Compass.
The fourth point of the Customer Compass - W, for walk - focuses on a critical commitment that every world-class organization must demonstrate, at both the macro and micro levels. Here, "walk" means figuratively walking in the shoes of your customers - whether they are external customers or internal customers (employees). According to Kim Tudor, director of the Barbados National Initiative for Service Excellence, "There is a need for all levels of employees - including the CEO - to go through the process that the customer experiences from start to finish at least twice a year. This firsthand experience, coupled with ongoing feedback from customers, will help in truly understanding the customer." In explaining J. Willard Marriott's practice of managing by walking around, his son, Richard, said the following: "You cannot run a service business without walking around and seeing what's going on in the operation. You can't be in the office looking at the books all day and know what's really happening with your customers. My father would go out and talk to the customers, talk to the employees, and inspect the units. He believed that you can't expect what you don't inspect. If you ask somebody to do something and never go back to check and see if it's done, it might get done the first time, but it probably won't get done thereafter. You've got to get out there, check and make sure your associates follow through on their commitments, and let them know you will be checking. Then you must show appreciation to people for doing a good job. If they're not doing a good job, explain how to do the job properly and give them encouragement."
Note: This article is excerpted from Lead With Your Customer by Mark David Jones and J. Jeff Kober
Marriott, Richard E. 2003. Building a Family Legacy: The Marriott Story. Marriott Magazine, Winter, 4 - 7. http://marriottschool.byu.edu/the-marriott-story.pdf.
Reid, Roger H., and David W. Merrill. 1981. Personal Styles & Effective Performance. New York: CRC Press.
Tudor, Kim. 2009. Author interview with the director of the Barbados National Initiative forService Excellence. March.
Underhill, Paco. 2000. Why We Buy: The Science of Shopping. New York: Simon & Schuster.
Mark David Jones is chief operating officer of World Class Benchmarking. During the past two decades, he has been a consultant to dozens of Fortune 500 companies around the world. Jones's career at the Walt Disney Company spanned 26 years, working in a wide variety of leadership roles throughout operations, guest relations, and human resources - spearheading executive development and organizational change efforts. While serving as the senior consultant for the Disney Institute, Jones was in charge of leadership, creativity and innovation, and quality service initiatives. In recognition of his contribution to the Disney organization, Jones was nominated for the prestigious Partners in Excellence award - Disney's highest regarded corporate award.
J. Jeff Kober is chief executive officer of World Class Benchmarking. For more than 25 years, Kober has provided training and development solutions for workplaces around the world. A former leader of the Disney Institute, Kober collaborated across the entire Walt Disney World organization in establishing customer service and creativity programming. Since then he has become an online columnist on Disney benchmarking practices and creator of the "Disney at Work" app tour series for the iPhone. He is the author of The Wonderful World of Customer Service at Disney.
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