Best of ECT News


We the Customers

Over the last three weeks I have received an intensive course in what it means to be The Customer, and I really liked it.

During that time — not to mention the preceding six months — my wife and I have been trying to get our kitchen remodeled.

In our journey we have dealt with a broad range of contractors and retailers of everything from plumbing goods and appliances to stone, tile and paint, not to mention all of the take out shops we got to know while we couldn’t cook. The job is done now, more or less, and I thought it would be fun to recount what I think I learned that’s relevant to CRM. Here are my key findings.

Attitude and Technology

My most interesting and obvious finding is that CRM really is not about technology — though technology can help, it can’t instill customer-centric approaches to business. It is an attitude and a way of doing business, and you could see it in countless ways if you were around my house over the last few weeks.

Without exception, every contractor who came through the door brought a can-do attitude and a palpable desire to delight the customer, and frankly that floored me. There was none of the stereotypical indifference by tradesmen that has been drilled into us by the media. Also absent was the sitcom stupidity you expect from watching too many shows about “guys.” These guys were smart about a lot of things which, I suppose, you have to be if you want to be successful in almost any business.

Because the contractors worked for themselves, they held themselves to incredibly high standards. For instance, the tile guy set up his wet saw on the front lawn, and despite temperatures that were well below freezing — and ultimately froze his saw — he went outside to make cut after cut to perfect the junction of tiles on two walls so that they looked like perfect mirror images. You could tell he knew he had a reputation he wanted to live up to, and while he could have delivered a less perfect job, and I would have never known, he simply would not do it.

I have to say that I loved being a customer, and whether it was information, a change to the plans, or a product or service, whatever I wanted was made available to me. Of course, the key was the fact that I was willing to pay for what I wanted and in all cases we were always able to quickly agree on the deliverable and the cost.

Not Just About Price

It seems to me that agreeing on cost and deliverables is one of the biggest disconnects we currently have, and it degrades customer relationships.

It is certainly true that price negotiations have been a part of buying and selling since the earth cooled, but I think we may have gone too far in an almost exclusive focus on price in our dealings to the exclusion of things like quality, fit and long-term reliability. By focusing the discussion on shaving prices we have commoditized too much, and in the process cheapened products and services to the point that some are hardly worth buying anymore.

A case in point that has been in the news while my kitchen was being renovated is the airlines. Last week Spirit Airlines announced that in June it would begin charging for a whole slew of products and services that were once included in standard airfare. On the list was checked baggage (up to US$10) and soft drinks — a Coke will be a buck and I hope they let you keep the can.

Spirit isn’t alone, as you know food is now widely charged for and so are preferred seats. United charges extra for more leg room and Northwest is charging $15 for a regular aisle or emergency row seat.

Economics has dealt a blow to CRM through a relentless focus on efficiency — of finding the equilibrium point where all markets clear. That approach might have worked in Adam Smith’s day when most of what people consumed was made at home or bartered for, but it is at least unhelpful today and I think causes real damage to the relationship.

No one has to tell you what a hassle flying has become, and no amount of satisfaction surveys or other CRM-based approaches is likely to change that. In an economy that includes contractors delivering a service and big corporations trying to sell me something, the comparison is like night, and day and maybe that’s because the contractors know they have to stand behind their work.

Customer Comes First

I have often suggested that for enterprise CRM to succeed we need to instill in everyone the responsibility for making the customer happy. Before we can do that, though, we need to empower people to take the initiative on behalf of customers.

Not long ago I read about a hotel in Boston that exemplifies this idea. The hotel is part of a large chain, and I can’t recall which one it is, but the point is that everyone is empowered to take initiative on behalf of the customer down to the doormen who, according to the article I read, can spend up to $2,000 on behalf of the hotel to solve a customer issue, no questions asked.

When everyone is selling the same commoditized product, it is a good time to try something different. In the case of the airlines, low fares are important, but the granddaddy of low fares, Southwest, is also the champion of customer service. Is it any wonder they are also profitable where others seem to lose money no matter what?

Denis Pombriant runs the Beagle Research Group, a CRM market research firm and consultancy. Pombriant’s research concentrates on evolving product ideas and emerging companies in the sales, marketing and call center disciplines. His research is freely distributed through a blog and Web site. He is working on a book and can be reached at [email protected].

This story was originally published on March 14, 2007, and is brought to you today as part of our Best of ECT News series.

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