With the dismal news we are receiving daily these days about the credit crisis and poor economic conditions, I found it fitting to include a timely lesson about customer buying behavior. There's one main reason why Circuit City filed for bankruptcy and Starbucks is shuttering hundreds of stores. The competition ate their lunch!
Customers will buy your products or services because you are fulfilling a need better than your customer believes someone else can fulfill that need. You need to make sure that you REALLY ARE better than your competition. For sooner or later, your customer will be solicited, and if they feel that someone else can give them more for less, then you're in big trouble. You're customer will usually not give you any advance notice. Your customer will not send you a letter of dismissal. Their sales will just disappear from your books.
Unless you are a monopoly or government agency, customers usually have the freedom of choice to spend their hard earned money wherever they choose. You have to make sure you continue to be their best choice EVERY DAY!
As an exercise, why not gather your team of people around for a cup of coffee and have them answer the following question: "Why do our customers buy from us?" Jot down the answers on a legal pad, make copies and have each one individually put the reasons in top to bottom priority. Then pose the same question to your customers for the next week as you are collecting their money and thanking them for their business. Write down their answers.
Then compare the results to those from your team of people. The results will set the agenda for the best meeting that you could have with your people to set the future marketing strategy for your company. Perhaps your customers don't buy from you for the reasons that you thought they did.
Large corporations spend millions of marketing dollars to get the answers to these simple questions. The answers are what must be focused on to obtain and keep your customers coming back. In a market economy, you cannot rest on your laurels. You have to be sensitive as to which way consumers make choices.
Consumers (of which you and I are one) are very fickle. People's tastes and preferences change many times on a whim. You have to be able to anticipate those changes. Make sure to keep an open communication with your customers, for they are a major tool in helping you to anticipate change.
What if, after surveying your customers, you find out that a majority of them come to you solely because you have the cheapest price? That's valuable information, for it tells you that all that's needed is for one of your competitors to offer a lower price and your customers are gone. While I am very loyal to those I purchase from, they had better be competitive in price as well.
As an example I am a very loyal Costco customer. They are my first choice to buy whatever I can from them. They have very good quality products at THE RIGHT PRICE. Well not all of the time. As an example this week I received a $25 coupon off of a $75 purchase from Staples via e-mail. While I would always buy my printer ink-cartridges from Costco, I couldn't refuse Staples's offer to save $25. I immediately purchased an $83 HP ink cartridge online with free next day shipping from Staples. I buy very little from Staples. I didn't even need the cartridge. But they presented a deal I couldn't refuse. I save thousands of dollars a year this way, yet remain loyal to Costco for most of my purchases.
You always need to show your customers that you offer more than just a cheap price. You have to show them all the other ways that you are more valuable than your competition. What if you find out that a majority of your customers love your easy return policy or your money-back guarantee? Or maybe they love getting a follow-up phone call? These are indications of the things that you are doing right, and that you should continue to do in the future. You need to try and figure out your customer's needs and wants and target them as individually as possible. Amazon is the BEST at this, thanks to the great technology they developed to target customers.
If you don't know how your customers think, then you're shooting in the dark. The companies that stay around for 50-100 years did so because they've always keep satisfying their customers. The future will reward those businesses that satisfy their customers by fulfilling their needs, rather than fulfilling the needs of the business. The above exercise will be well worth the effort if you really care about your future. Know your customers and make them happy buyers.