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The Customer's Not Always Right

Francine Pickering Wednesday, 08 December 2010 Written by  Francine Pickering

Category People

I don’t want to pick an argument with fellow Expert and all-round good egg, Ray Holden, but I would take issue with the idea that the customer is always right – not every customer, not every time.

The reality is that some customers just aren’t right for you.

As Carl Benfield has found, some customers can be very demanding which is not a problem as long as providing this level of service is something you’re geared up for – and that the customer is ultimately paying for.

Amanda has also found that different types of customer behave differently and her research has led her to the sensible conclusion that different approaches are appropriate for each situation.  Even Mike Hunter is experiencing differences in client attitudes – some are happy to buy on the quality of service, some are quibbling over price.

So what’s the solution to this situation?  Simply, it’s to identify different types of customer or client and categorise them accordingly.

Your ’A’ Customers

These are the customers who are most valuable to you.  As well as well as purchasing higher value products and services, they:

•    Are easy to work with;
•    Don’t take up valuable time arguing over price;
•    Appreciate the quality of what you provide;
•    Will establish a long-term relationship with or and/or make repeat purchases, and
•    Will recommend you to others.

They deserve your full attention and a bespoke approach.

Your ‘B’ Customers

These are the your “bread and butter” customers.  They are all profitable but no single one is vital to your business success.  With these, a more standardised approach is beneficial.

Your ‘C’ Customers

These are the customers that provide you with the least profit and might even be unprofitable once you take into account the amount of time and energy they take up, or the amount you have spent bringing in their business for the little they spend.

With these customers, a common problem for new businesses is that the customer will assume that you will be grateful for any business and will indulge them in return for a testimonial (do you really want to attract more of the same?).  They’ll give you promises of more business to come (but they can’t afford you now so when will they be able to?), and may want to do some kind of deal (in which case, I’d suggest, it’s incumbent on them to prove their own credibility).  You can manage without these.

So, having weeded out your ‘C’ Customers, you can then clearly shape different offerings for your ‘As’ and ‘Bs’.  I’m currently working with a client who is doing just this and what’s also become apparent is the need to avoid the temptation to treat them similarly.  If a client is happy with your standardised approach, and that’s also what they’re happy to pay for, don’t turn them into unprofitable customers by letting “bespoke” service creep into the “standard” product.  Just remember that you’re providing an excellent product or service at the price they want to pay – it doesn’t have to cheapen your brand.

Different offerings will also need a different marketing mix for each so you’ll need to decide whether you really want to cater for both ‘As’ and ‘Bs’ at the same time once the resource implications of these differences are taken into account.  There’s no law that says you have to serve both, or that you can’t work with one now and develop your second strong further down the line.

Download a free guide to the marketing mix and find out how it can help your shape your products and services.

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