Common Sense About Customers and Profits
Success in business depends on customers buying what you have to sell.

By John Towler

Are you tired of the books and experts that offer the 10 best-kept secrets for making money? Increasing profits? Selling your products and services? The list goes on . . . None of the information is new, none of it is secret and it’s ludicrous to think that there are only seven, 10 or, for that matter, any other number of ideas that will solve your problems. It’s time for some common sense.

The bottom line is this: Success in business depends on customers buying what you have to sell.

It all comes down to customers—attracting and keeping them. Earnings come from customers, and the best way to increase your profits is to attract and retain profitable customers. Since most businesses already have customers, all they need to do is keep them. There’s nothing new, secretive or magical about this.

Understanding the Power of the Customer
The only things that have changed in today’s market are ever-increasing competition and customers who are more demanding. Although there’s very little you can do about what your competition does, you can do a lot about attracting and retaining profitable customers.

Today’s customers are more demanding, more informed and less loyal. They know what they want and how to find someone who will give it to them. And they’ll buy from anyone else who gives them a better deal regardless of who they’ve been working with before.

A recent example bears out the power of consumers to get companies to respond to their demands. Customers compelled the music industry to change how they did business.

The effect of Napster was to force every major music company to offer digital distribution. There are dozens of other cases in which customers are calling the shots.

The power of the consumer is just as pronounced when it comes to shopping competitively. People know where and how to look for the best bargains. Armed with the right hand-held technology, a shopper can scan the bar code of any item in any store and immediately go online to find who sells it for less.
    
Retaining Customers 101
Companies that want to survive must develop a different attitude about customers and create a process for meeting their demands. Such a plan entails more than being “customer driven” or “customer centered.” It’s definitely more than paying lip service. Firms have been doing those things for years with little to moderate success.
    Companies that want to succeed must do three things:
1.    Find out what their customers want.
2.    Find a way to give it to them.
3.    Hire employees capable of dealing with customers in a new way.
As you can see, there are no success “secrets” in any of these things. You just need to get organized and commit to doing them.

Discovering What Your Customers Want
How do you find out what your customers want?

You ask them!

You can’t assume that you know what they want and what is best for them. Find out from them. Don’t rely on some expert to tell you. Unless you are listening to your customers, you are talking to the wrong people.

Several methods of soliciting customer feedback are available. Some are better than others. Let’s look at a few of them.

Focus groups can be effective. However, they are costly, involve only small samples of your customers and take a great deal of time.

Telephone or onsite interviews are better, but there is a limit as to how many people you can contact. You also run the risk of annoying customers if you stop them at your location or telephone them at work or at home.   

Surveys are another option. They are less expensive, and you can contact all of your customers, your most important ones or a specific sample of them. Paper-and-pencil surveys can be effective, but they are old hat. Electronic surveys offered over the Internet are cheaper and faster, and customers can complete them at any time. Some companies have the software and expertise to design and administer surveys in-house; others outsource their needs.

Giving Your Customers What They Want
Once you know what your customers want, figure out how to give it to them. Most firms find that their own people have the answers and will work on the problem once you empower them to do so. A task force or special committee is often the best approach. Don’t forget to ask your customers whether the new process or approach is satisfactory.

Finding people with the right attitudes and skills to work with your customers comes down to two things:
1.    Retraining or replacing current employees who don’t match
2.    Hiring only those who have the qualifications

Remember, letting go of people can be difficult. Retraining them is the better option if they are willing to be retrained. Retraining may take time, but there are some excellent programs available. Don’t make the mistake of thinking that a two-day course will turn an employee who’s miserable to work with into a charming delight.

Hiring people who have the right skills and attitude to begin with is, of course, the most effective approach. Fortunately, there are some very good tests that enable you to screen new hires and measure the quality of the people you currently employ.

Any business can attract more customers, retain them and prosper. It simply depends on knowing what to do, how to do it and having the will and determination to get organized to make it happen. There are no magic solutions, no undiscovered secrets, just common sense.

Dr. Towler is a psychologist and senior partner of the management consulting firm Creative Organizational Design (www.creativeorgdesign.com). He may be reached at .