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THE IDEAL CUSTOMER RELATIONSHIP
By Steve Yastrow
Copyright © 2007
All right reserved.
Chapter One WHY WE?
The Essential Question
WHEN THINKING OF THEIR RELATIONSHIP WITH YOU ... HOW MANY OF YOUR CUSTOMERS THINK "WE" & HOW MANY OF YOUR CUSTOMERS THINK "US AND THEM"?
How do you want your customers to think about you and/or your organization? Do you want them to see you in the distance ... as "Them?" Or, do you want your customers to think of themselves and you as closely interrelated ... as "We?"
Consider the difference. All of your customers, whether they represent themselves as consumers or buy on behalf of a business, live rich, full, colorful lives. From the moment they wake up in the morning until they fall asleep at night, their thoughts are engaged in the business of life. Things to do, people to speak with, questions to be answered, decisions to be made. For most people life is enjoyable, for nearly everyone it is crowded. Your customers' brains are active all day, processing a series of thought-stories that capture the present, reflect on the past, and anticipate the future. They are continuously interrupted with too many sensory inputs, and they are constantly defending themselves against these interruptions; after all, the human brain is amazing, but it can handle only so much.
It is a privilege to enter this stream of consciousness and be noticed by your customer. Moreover, it is difficult to enter this stream of consciousness. Consider, also, that your customer himself is an actor in most of the thought-stories going on in his brain; every person is the center of his own universe. You have a much better chance of participating in those stories if he thinks of you as interrelated with him, as "We," than if he sees you in the distance, as "Them."
It is both possible and worthwhile to strive for this feeling of "We."
As an advisor to companies in varied industries, I've watched many customer-driven trends evolve over the years. I saw how discerning customers began to look well beyond the promises that companies make in their marketing campaigns and started to consider the entire set of experiences that they have with a company. This is a subject I explore in depth in my first book, Brand Harmony. Lately, I've seen that customers are looking not only beyond marketing promises when making purchase decisions, but also looking beyond the products themselves. Customers see products as relatively interchangeable. So what do customers see as different?
What I have learned through my experience is this: Relationships have become powerful differentiators. Customers can't tell if your product is better than your competitor's product, but they can tell if they have a better relationship with you than with your competitor.
If relationships are such powerful differentiators, what is the most productive, profitable, and sustainable customer relationship?
The We relationship.
In a We relationship, you each think less about what separates you and more about what intertwines you.
In contrast, if your customer's view of your relationship is not "We" but "Us & Them," he will focus more on what he can get from you-and on what he believes you get from him-and less on how you collaborate to reach your goals together.
YOU CAN CREATE WE RELATIONSHIPS
Although it is ultimately up to your customers to decide if they want to enter into a We relationship with you, there are many things you can do to invite them in. You cannot control your customers, but you can control many of the factors that encourage a We relationship. This is true in all business relationships, whether they are between individuals or groups.
This book is about creating We relationships with customers and enjoying the benefits of those relationships. This is within your reach. Now.
RELATIONSHIP: FROM "US & THEM" TO "WE"
The Frame of Reference Is the Relationship
Consider what most companies measure. They track product releases; they commemorate new store openings; they calculate revenues, profits, and number of transactions. But most companies do not measure the quality of the relationships they have with customers.
Now, consider what the customer is measuring. Think of a customer of a retail giant such as Macy's. He doesn't care about the amount of profit he's generating for the company. He doesn't care whether he is part of a high-priority target audience. What he does care about is how he is treated, whether they listen to him, whether they notice his wants and needs, whether they work with him or against him. In essence, he cares about the quality of the relationship he has with the company.
What would happen if companies focused on the same measure that customers are focused on, relationships?
My client and I are eating lunch in a hotel restaurant. He is a senior executive of the company that owns and manages this hotel. It is a beautiful restaurant, with a unique and diverse menu, overlooking a warm, inviting lobby that could win interior design awards. But the real success of this company is not in menus or lobbies, it is in the way they create relationships with customers. I say, "If I were your competitor, I could walk into this hotel and copy your interior design, menus, pricing, brochures. What I could not copy are the personal relationships you have with your customers. Duplicating those relationships would be impossible for me."
Competitors can copy much of what you do, but they cannot copy the rich, interesting, private relationships you have with customers. Establishing strong customer relationships is the best competitive strategy. They are unique to you and your customer, and make you look unique in the customer's eyes.
If you were to listen in on conversations going on in most companies, whether they are conversations in the marketing department, the boardroom, or among the operations team, you wouldn't hear much about relationships with individual customers. Even companies with formal efforts involving extensive Customer Relationship Management (CRM) systems most often use those systems to enhance discrete transactions, not to build long-term relationships. Those companies that do focus on building strong customer relationships, as a primary, daily company effort, are the exception, not the rule.
Why is the building of customer relationships such a low priority for so many companies?
Progress Has Led Us Astray
For thousands of years commerce was very low-tech, with every sale requiring significant human intervention and attention. Over the last 100 years, thousands of technological advances have helped companies increase their sales while reducing labor. From Henry Ford's Model T assembly line to network advertising, and on to the latest customer database management software, marketers and sellers have acquired new means to sell more products to more customers with less effort.
This progress created a boon for companies. It allowed them to get big while delegating the work of humans to less expensive, and frequently more productive, non-human tools. In much the same way that the hand-crafting of products evolved into mass manufacturing, the traditions of one-on-one selling that had been at the heart of commerce for 8,000 years evolved into mass advertising. It is no longer necessary to make every product by hand, and it is also no longer necessary to make every sale "by hand." Media outlets and computers can handle much of the messy work of customer interactions for businesses.
The result of this ability to delegate customer interactions-to computers, marketing communications, distributors, etc.-is that companies have found it convenient to hold customers at a distance. This would have meant sure bankruptcy in the past, but now many of our most powerful technologies have given companies an excuse to depersonalize their customer relationships.
Understand that I am not taking an anti-technology stance; I am not a technophobe. Remember that guy in the '80s who walked onto the airplane loaded like a techie-packhorse with his bag phone and enormous laptop? That was me. In the early '90s, to the chagrin of Hyatt Corporation's legal and IT departments, I took a chance and launched the first website for a major hotel company. I always bought the smallest (newest) cell phone and the fastest (newest) computer. I think it's great that technology affords us major conveniences like ATMs, booking travel online, and the electronic singing toothbrush.
However, I am observing that companies often use technology to avoid being close to their customers. Companies usually don't institute these technology-driven changes for the benefit of the customer-they do it for their own interests. There is nothing about an automated call-prompting system ("Please say or touch your 16-digit credit card number") that is good for customers.
The choice with technology and customers is clear. Will you use technology as a way to get closer to customers, or will you use it as a way to avoid customers?
An experience I had a few years ago highlights this kind of choice:
For years, I had two near-identical taxi choices for traveling between my house and Chicago's O'Hare Airport. I could call either American Taxi or 303 Taxi, and a cab would arrive in minutes to take me to or from the airport. They seemed so interchangeable that I would often call both of them at the same time from different phones and award the business to whoever answered the phone first.
Then, about ten years ago, both companies made investments in technologies that affected the customer experience. American Taxi invested in an automated telephone reservations service, requiring customers to press a series of buttons before talking to a reservations agent. I had to type "1" to distinguish that I was a passenger and not a package, "1" again to indicate that I was paying with cash or credit card as opposed to a corporate account, "1" again if I was at home or "2" if I was at the airport, and then I had to enter my 10-digit phone number. I'm sure this innovation reduced labor costs at their dispatch center, since I was now doing the data entry work previously done by their people.
The 303 Taxi company elected instead to make a technological investment inside their taxis; they implemented an automated dispatch service that sent assignments to a screen on each cab's dashboard. This had a noticeable impact on the customer experience, since the least pleasant part of riding with both companies had been listening to dispatchers shouting instructions to drivers. My rides were always punctuated with cries such as "Cab 73, why haven't you picked up your fare at Terminal 2 yet?" and "Cab 27, you haven't responded to me yet!" even though I was in cab 58. I had complained to both companies about this cacophony, and they both admitted to me that this was a common customer complaint. But suddenly, 303 cabs became quiet. American Taxi rides, however, were still an opportunity to listen to dispatchers scolding drivers.
Contrast the choices these two companies made. American Taxi invested in technology that made their processes more efficient. 303 invested in technology that made the cab ride more pleasant. (Their automated dispatch system may have also had the collateral benefit of being more efficient.) I immediately shifted all my business to 303.
Examples of using technology to support customer relationships are not uncommon. I'm sure you can think of many of them. But unfortunately, most companies choose the route American Taxi has taken. I was very frustrated this morning waiting on hold for a British Airways reservations agent. I tried to book a flight on their website, but I repeatedly got a strange error. So I called their 800 number and was forced to listen to interminably long, repeating, recorded raves about how great it is to book on ba.com, and that I'd be paying $20 per ticket extra for the pleasure of speaking to a real live person. They clearly look at their website as a way to reduce costs, not as a way to make my experience better.
I switched from a Dell computer to an Apple Macintosh computer for many reasons, but I remember very clearly the moment that helped me make the decision. When I was a Dell customer, I always considered a call to their tech support line a very unpleasant experience. I had to navigate a labyrinthine phone system, wait interminably on hold, and, if I ended up with the wrong support group, I had to go back into a long queue. One day while I was waiting on hold I remembered an article that described Dell's innovative inventory management system. Apparently, their system is so advanced that Dell is able to keep their entire spare parts inventory in an unimaginably small room. Suddenly, the irony struck me: Although they've created the most efficient inventory system in the world, reducing their costs for overhead and labor to the absolute minimum, I have to run a tiresome obstacle course every time I want help with the broken computer they sold me. It doesn't add up.
It doesn't have to be this way. Technology can be used to get closer to customers. If I want to talk to an Apple tech support person, I can go to apple.com and make a reservation with a "genius" (tech support rep) at my local Apple Store and know that he'll be waiting for me when I arrive.
Another excellent example of using technology to get closer to customers is the customized recommendations on Netflix, which are based on a member's past movie orders. Nearly half of a new film's budget can go to marketing, such as mass advertising and promotional efforts. Like most advertising, many of these messages are lost in the noise of daily life-they aren't noticed by their intended audience. However, the films that are advertised to me on Netflix are specially chosen for me, based on who I am. As Chris Anderson points out in The Long Tail, Netflix shows me my own personal billboard. Think of the difference. I see traditional movie advertising as trying to "sell" me something I might want, but I see Netflix as collaborating with me to help me find what I really want. They've made the advertising about me, not just about the movies they are trying to sell.
The Long Tail is chock full of examples of companies using technology to build stronger relationships with customers. As Anderson describes, lists of books that sell in a Barnes & Noble store or records that sell in a Tower Records store are not a true gauge of what people want to buy; they reflect only what people want to buy from the limited inventory available. Anderson demonstrates that when these inventory and shelf space constraints are taken away in an online environment, the top-selling hits make up a smaller portion of the sales. For example, he writes, the bottom 1.2 million books in sales rank account for only 1.7 percent of sales at Barnes & Noble stores, but a full 10 percent of online sales at their website. If given a broader choice, people find what they want, and they do not have to settle for what the stores keep in stock. Provide customers with a good technology tool-for example, a good website with great search capacity-and you will give your customers the experience they need.
Despite these positive examples, my experience shows that companies will more often make the wrong choice. The choices made by American Taxi, British Airways, and Dell are the rule, not the exception. As companies hide behind technology in the interest of efficiency, it is harder for customers to get personalized attention from sellers than it has ever been before.
Excerpted from we by Steve Yastrow Copyright © 2007 by Steve Yastrow. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.
Table of Contents
Why We? 1
The Essential Question 1
Think "We" 2
You Can Create We Relationships 3
Relationship: From "Us & Them" to "We" 4
Marketing Teaches Us the Wrong Things About Marketing 28
"I and Thou"-Seeing an Old Idea in a New Light 30
From Experience to Engagement 32
Encounters: The Building Blocks of We Relationships 37
Transactions vs. Encounters 37
At the Crossroads of We: The Three Elements of a We Encounter 41
Engagement in the Moment 42
The Encounter's Afterglow: The Feeling of "With" 120
From Encounter to Relationship: The Ongoing Conversation 123
A Relationship Forms from a Continuity of Encounters 124
Memory Is the Connection Between Encounters 125
The Rhythm of Encounter-Building Momentum in Your Relationship 134
The Mix of Moments-Milestones and Bridges 140
The Continuity of Encounters Becomes an Ongoing Conversation 147
The Continuity Develops: Revealing the Way We Complement Each Other 157
Complementary Understanding, Goals, Actions, Outcomes 160
Complementary Understanding: We Know Each Other in Relation to Ourselves 161
Complementary Goals: We Believe that What Is Good for One Is Good for the Other 170
Complementary Actions: We Do Things that Are Mutually Reinforcing 177
Complementary Outcomes: We Both Benefit from Each Other's Success 181
We Among Many: Relationships Between Organizations 187
Organizational Relationships Are Built from Individual Relationships 187
Ensure that Employees Understand How to Create We Relationships 190
Ensure that Employees Can Create We Relationships 194
Many of Them, Many of You 198
Conclusion: We-the Benefits Endure 201
Our Shared Future-What's Next Matters as Much as What Is 201