Last week when I talked about Time and Focus I was trying to extol the virtues of having a thoughtful view of how you build your business and make sure that you are working on the important things.
One of the most important – the penultimate component – of your business is the customer. And here we have to break down customers into three categories: Ideal Customers, Customers, and Poor Customers. We are all going to have Customers that are in each of those categories. Customers are sorted by how closely they match the natural customer base for your product and service. The natural customer base are those customers that should, given an objective evaluation, choose you instead of your competition. You will not win them all, but you should. This group of customers forms your core group.
The question is why is it important to classify the customers. Because you need to understand how much effort to put into satisfying each one and ensuring repeat business. This is not to say that you are going to go out of your way to not satisfy the Poor Customers. It means that you are going to go above and beyond to serve your Ideal Customers.
If you recall, the basic premise is that you do not have the resources including Time to do everything for everyone. So, how do you pick whom to serve with extraordinary care? Well, that is what this is about. The biggest issue is that people do not want to define anyone out as an Ideal Customer once they have landed them. The truth is that you will have Customers that have bought from you that probably shouldn’t. What do you do with those? There is nothing overtly to do. You should treat everyone with excellent service. But you need to assume that the next time they buy, that they will not be a buyer again.
So, that means this is a planning and execution exercise. Suppose a customer that probably should have gone elsewhere has a special request. Do you fulfill it? There is both the value of the request itself and the opportunity cost of not working with your ideal client. That means that you might say yes at a relatively high price. That is a polite way of saying no, without saying no.
What does this say about your Ideal Customer? Your business needs to be organized to serve those customers extremely well. That means the time that you do spend will serve these customers the best. All of this is about aligning the Time, Money and Focus of your business around your Ideal Customers. If you do this better than your competition then you will have a successful business.
The easiest way to do so is ask the following: Do I spend the bulk of my time with my top 10 – 20 customers? If you don’t answer that with a resounding yes, then you need to rethink your business execution!
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