If the Customer Is Always RIGHT, You’ve Got the WRONG Strategy
Chew on this: As important as good customer service is, it’s often a crutch that represents a company’s failure to realize its best possible revenue strategy.
Make a list of every company you know that would say “we don’t care about customer service, it’s just not a focus of our business.”
Now, circle the companies (if there are any) that you believe will still be in business in two years.
Taking great care of customers and exceeding their expectations is an element, or more accurately a REQUIREMENT, of any strategy. But it is NOT a revenue strategy.
Now, make a second list, of all the companies that don’t deliver good customer service that you look forward to working with.
If there are any companies on that list, circle the ones you believe will still be in business in two years.
Now look at this list:
- Apple
- BMW
- Nordstrom
- Ritz Carlton
- Southwest Airlines
- Disney
- Amazon
- Add to this list your favorite:
- Chinese Restaurant _________________________
- Barber or Beauty Shop ______________________
- Place to get your car repaired ________________
Now, circle the companies on this list you believe will still be in business in two years.
Every one of the companies on this list has GREAT customer service, but they don’t get paid for customer service. They get paid for their total value to the market, of which customer service is just one element.
Building a “Revenue Generation” strategy requires work and discipline. It requires a team to have tough conversations and make hard decisions on these five key parts of a revenue strategy:
- What is your brand promise (the experience every client, partner and staff member has with your brand)?
- What is the problem you solve for your client that NO ONE ELSE solves?
- What is the niche or niches you will dominate?
- What is the “Ideal Client” for you in each niche?
- What is the offer or offers you will use to dominate the niche(s)?
Answer these five questions for your brand, and then do the same for each offer that’s part of your revenue strategy. Customer Service will always make your strategy better, but by itself, it does not make a strategy.
Customer Service is too often a crutch. For to many companies customer service is about making the customer happy. When used this way, customer service takes less planning than a real revenue strategy, which, if done correctly, would eliminate much of this type of customer service effort. A “make the customer happy” emphasis in Customer Service is usually a result of selling the wrong buyer the wrong stuff and needing to “fix it” later.
We need to get clear about the difference between Customer Service and Customer Support. Customer Support is an intentional part of the complete offer. It includes elements like taking the luggage to the room, a lifetime oil change, tracking a package, etc.
In a revenue strategy, supporting your customers (Customer Support) is a critical and intentional part of your market-dominating game plan.
Customer Service should be the part of Customer Support that addresses those situations outside of what is predictable, and these situations need to be addressed to maintain the integrity of the brand promise.
Customer Service is an important customer touch point for demonstrating the brand promise and expanding your knowledge of the customer and their business. Customer Service should deepen customer bonds and continually redefine the offer based on those learnings. This touch point will clarify the brand and the offer by saying yes or more importantly NO at the right time for the right reason — thereby telling the world who you are and what you stand for. It is your chance to demonstrate integrity.
The true role of Customer Service is a tactical element of the strategy for the brand and for each market offer in order to get the right experience for the “Ideal Customer.” Customer Service should not be fixing a problem for the wrong customer or for something that can be cured by improving the engagement process.
Take time up front to design a complete Revenue Strategy that includes Customer Support as an element that enhances your execution and profit. When that’s accomplished, Customer Service becomes one of your customer touch points, in which you and the ideal customer work together to solve today’s problems and to improve your revenue strategy for the future. And that’s the right time to say NO to requests that are out of integrity or not aligned with your brand promise.
Charlie,
My guess is we are close and working toward a common language.
Activity and strategy are of course important. If someone applies the science of “Revenue Generation” starting with completely developing and deploying the answers to the 5 Revenue Strategy questions below all those elements you appropriately point out MUST be include in the first, second and fifth questions.
1. What is your brand promise (the experience every client, partner and staff member has with your brand)?
2. What is the problem you solve for your client that NO ONE ELSE solves?
3. What is the niche or niches you will dominate?
4. What is the “Ideal Client” for you in each niche?
5. What is the offer or offers you will use to dominate the niche(s)?
It is hard to successfully complete three without referrals, retention and multiple purchases.
One of the customer service challenges is if we have the wrong customers, with the wrong expectations we make customer service expensive or very hard – so aligned deployment of the “Revenue Strategy” is critical and all of the 5 answers must be deployed in an aligned manner across all the tradition silos.
It is this cross organization approach that has developed a key set of metrics based on Revenue Resources Required. Every organization needs to track the Revenue Resources Required to produce today’s level of revenue and profits. Based on that we can track the difference based on intentional changes in customer service, marketing programs, sales process change, new products, etc. If we don’t look and measure across the organization we really don’t know the best overall investment based on revenue and profit produced from the various deployment options.
We call this “the leverage” produced by each option. Leverage is measured at the point where profitable revenue changes.
The revenue part of the business needs to do this to get the benefits manufacturing got for combining all the silos under a LEAN organizational model.
So I think we are saying the same thing – I just take longer.
Rick, thought provoking post. My take on this is that you are focusing on the activity and strategy of customer service, not the results obtained from it. We all know from Reichheld’s The Loyalty Effect and Harvard’s Service Profit Chain that the result of great customer experiences is retention, referrals and increased probability of multiple purchases. So great customer service/experiences not only support the revenue generating strategy, but also generate additional revenue from happy customer referrals to new prospects and from the ease of upselling more products/services to existing customers. And as Michael Treacy said so elegantly, “to grow you first have to stop shrinking!” Many of the new sales generated by the Revenue Generation Strategies just go to replacing what is being lost at the bottom of the funnel. So I believe creating a great customer experience is one, but not the only, strategy for Revenue Generation.