“The Customer is King” is a well-known and well-used term that stems from a universal view on how customer service should be approached. But is this universal approach still relevant in today’s modern world? Customers interact with a business in many different ways and are at different stages of the buying process – to treat all of them with the same level of high importance and value is costly and ineffective.
The data available to businesses allows those within marketing and business development to individually determine customer value and to prioritise customers that have the most potential value over others. In the example of eCommerce – a customer that frequently purchases items from a brand appears to have far more value than the irregular purchaser. However, dig beneath the surface and you may find the irregular purchaser buys a single expensive item that far exceeds the monetary value of the regular purchaser’s total amount.
In this scenario which customer has the most value? The customer who is a frequent purchaser or the single purchaser? This is where customer data and insight provides payback to the business as it enables highly targeted communication campaigns to engage with customers uniquely – treating each customer as an individual.
Where should you focus?
Building a Money Map will illustrate the customers that are truly King enabling the business to focus on these for future growth and retention. It will show you those customers that have potential for future growth and perhaps, with some targeted marketing and engagement, these customers will grow in value and status to the business. In addition a Money Map will also identify those customers that are currently sucking up time, effort and resource for little return. You can read more on our Money Mapping methodology here.
Identifying your customers, getting to know them, investing time and emotion into their needs and requirements is a big commitment. But as businesses grow and develop, some relationships with customers will deteriorate as their needs change and the needs of the business change – what happens then?
Author a letter to your customers to tell them they’re sacked! Not really! But seriously, you need to drop customers that are costing the business money or at the very least give them a different, automated, less resource-hungry process. You need to devote your time and effort on your high ROI prospects in order to be profitable.
It is a bold decision to release any customers, but it is worth considering the value these customers provide to the business. If you release these transient and transactional customers they will be free to suck up resource and cost from competitors and give them the headaches they used to give you – leaving you with extra time and resource to generate more success.
It sounds a bit brutal, but this is where knowledge is vital! If you have true visibility of which customers are costing you money rather than making you money, you’ll very quickly remove any emotional attachment to them. Without that knowledge you will simply be making emotional decisions rather than factual decisions based on data.
It might sound a little radical, so here is some further reading to allay any fears you might have:
- Sack 25% of your customers and create a bigger and better business
- The Customer is King attitude has had its day!
- Will you make a big difference to your company’s performance in 2015
In addition, download our white paper which explains how you can use customer information within analytics to truly ‘know your customers’.