That’s Customer Focus © 2008 - 2011
Why Customer Focus Differentiates
By Ray Miller
Ray Miller is Managing Director of The Training Bank and author of That’s Customer Focus! and The Customer Focus Companion.
The Training Bank is a full service training and development firm which specializes in fully customizable Leadership, Customer Focus, Service Excellence, Management and Supervisory Development training.
Enhance your Customers’ Experience and sharpen your Customer Focus to differentiate your organization and build long-term loyalty and profitability.
If you need help, check out our book, That’s Customer Focus!: The Overworked and Under-appreciated Managers Guide to Creating a Customer-Focused Organization.
Everything you need know and do to create and implement your strategy is covered in this great book.
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Advances in technology, reductions in production time and access to global distribution mean that products and services can be duplicated and customized faster than ever before. And your customers know this!
Consumers have more choices than ever before. This creates an interesting challenge. How do you create value when customers today are not seeing much difference in the choices they are offered?
Customers tend to look at value from four perspectives:
the Price of the product or service,
the Quality of the product or service,
the degree of Innovation offered by the product and
the Service provided to customers.
The quality of products continues to improve universally and competitors have developed the ability to duplicate even the most complex of those products. Innovation attracts younger consumers but no sooner do we see one innovation, than someone else comes along and clones it plus adds a few more bells and whistles.
Consider the evolution of the flat screen LCD TV. A couple of years ago, few could afford such a luxury item. Now there are LCD TVs to fit a wide range of budgets. And in addition to the traditional manufacturers of televisions, it seems that any one who manufactures computers also has their own LCD TV.
Developing a competitive advantage based solely on product quality and/or innovation is very difficult. And sustaining it is very expensive. You will also find that there is more price parity today than ever before. Very few companies can compete for long using price as a differentiating factor. By shifting your emphasis to service quality, you will find the greatest room for differentiation.
For most companies, customer loyalty is the key to future profitability and growth. Corporate newsletters, national periodicals, and most executive speeches are peppered with a litany of examples demonstrating the relationship between customer loyalty and profitability. In almost every market we've learned that retained customers:
- Are less expensive to serve because they know their role in the process.
- Tend to lower marketing costs.
- Often purchase more over time.
- Are open to purchasing new and different products as they are offered.
Clearly, customers value service and whether they get good service or not, they expect it. If they don’t receive service at a level that meets their expectations, they will go elsewhere until they find it. Whether the economy is on the down swing or the upswing, no one can afford to lose customers.
Many companies still deliver lousy, inept, shoddy service and even more deliver only average service.
This creates a unique opportunity for those who dare to be different.
Simply stated:
Companies who differentiate themselves through their service have a distinct competitive advantage.
