- In Michigan’s tech sector, optimism shines through the clouds - December 1, 2022
- WJR Business Beat: U.S. News & World Report Ranking of Top U.S. Colleges (Episode 477) - September 15, 2022
- WJR Business Beat: The 4-Day Workweek Picks Up Steam (Episode 476) - September 14, 2022
With today’s cutthroat competition from big business, trying to compete on price can be a quick road to ruin for a startup company. But here’s a little secret you should know: contrary to common perception, customers will not go almost anywhere just to save a buck.
So if you want to avoid getting beat up on price, stop trying to compete on price alone. What your business needs to stand out is better customer service and satisfied customers. But don’t make it the simple “please and thank you” variety. Aim higher. Strive for fabulous, standout, outrageously great service toset your startup business apart from the crowd.
Will superior service trump price? Absolutely, says a dramatic new survey of over 100,000 small business and retail customers nationwide. According to a four-year study conducted by the Ohio-based market intelligence firm BIGresearch, most customers will put service ahead of price – if you give them the chance.
Entrenched “wisdom” may be wrong
BIGresearch asked tens of thousands of shoppers how they like to shop, what they look for in customer service and what it takes for them to buy. And according to T. Scott Gross, who turned the results into a new book called “When Customers Talk,” some of the most deeply entrenched “wisdom” about what customers want may simply be wrong.
For example, when researchers asked customers how far they’d be willing to drive for excellent service, 80 percent said they’d travel four or more miles, and nearly half said they would drive 10 miles or more for the right combination of price, quality and customer service.
“American shoppers are not the finicky, price-conscious bargain hunters they have been made out to be,” says Gross. “Consumers will pay for good service with both their cash and their time.”
Your job as startup entrepreneur is to deliver superior service that attracts and keeps customers day in and day out. Satisfied customers say they are
willing to drive a little further for great service, but you’d better make it worth their effort.
Just how many service slip ups does it take to send a customer packing? According to the BIGresearch survey, 17 percent will bolt after a single service faux-pas. Another 40 percent will jump ship after two instances of poor service, and 28 percent more are out the door after three. So for 85 percent of your customers, it’s three strikes and you’re out.
Fair enough. But what do buyers really want from you?
What keeps customers satisfied
- Knowledgeable and available staff: While a customer is making the buying decision, they want knowledgeable assistance, available when they want it . Customers place a high value on accurate information and want to be served by employees who know the product inside and out.
- Friendly people: Customers not only want product-savvy sales people, they want them to be friendly and courteous. Your staff should value each customer more than any individual sale.
- Good value: This is where price factors in. But customers surveyed see price as only one component of the bigger picture of “value” that includes the service, information and follow-up they also receive.
- Convenience: The service rule here is simple: make it easy! Says Gross, “Customers want merchandise that is well organized, attractively displayed and easy to find. That’s how today’s customers define convenience, and the easier you can make the shopping, the more money you will be lugging to the bank.”
- A fast finish: This final item is where too many businesses fall flat, right at the finish line. While customers are in the process of deciding to buy or
not, they are proceeding on your time. They want thoughtful help making the right decisions. But once the buying decision is made, get out of
their way because now you are working on their time, and they want to complete the transaction and be on their way as quickly as possible. At the cash register, there is no time for making additional suggestions.
Our Bottom Line
In the end, it may be your service – not your price – that dictates whether or not you secure customers for the long term. If you give people what they want, the way they want it and follow through with a fast finish when it comes time to pay up, you are much more likely to turn them into satisfied customers.
© 2005 BizBest Media Corp.