View profile

Weekly 3: Make your customers successful

Revue
 
Summary: Making your customers successful requires understanding their point of view. A prospective c
 

Idea Journal Weekly 3

November 8 · Issue #164 · View online
We combine 3 ideas to help you think differently and be more creative.

Summary: Making your customers successful requires understanding their point of view. A prospective customer’s first question when they see your product or service will be some version of “What’s in it for me?”
This Weekly 3 issue offers a few tips to help you answer that question.
(~4 min read)

#1. If *you're* struggling to define the benefits of your product or service, imagine how your prospective customers must feel
Author Zig Ziglar writes in his book Ziglar on Selling that the most effective salespeople sell benefits, not products.
When you’re presenting your solution to a prospective customer, you have to answer the question: What’s in it for them?
“Five inches of insulation mean nothing until you translate them into lower heating and air-conditioning costs.”
To help you stay focused on solving your customer’s problems, Ziglar recommends using the below features-functions-benefits template:
  • FeaturesWhat are the different aspects of your product or service?
  • FunctionsWhat does your product or service do?
  • Benefits: What are the advantages that someone gets from using your product or service?
To illustrate the point, Ziglar fills out the template with examples of features, functions, and benefits for the Ziglar on Selling book itself:
Features:
  • Over 300 pages
  • Summary pages with key points
  • Stories, one-liners, and analogies
Functions:
  • Plenty of information available
  • Allows for quick review of the material
  • Keeps your attention and increases understanding
Benefits:
  • Gives you practical and action-oriented examples
  • Convenient and easy to use
  • Improves your effectiveness
#2. Why are your customers "hiring" you?
Author and Harvard Business School professor Clayton Christensen writes in his book Competing Against Luck that most companies don’t know how to innovate because they’re asking the wrong question.
Don’t ask: How can I get people to buy my product?
Instead, Christensen recommends that you ask: What job are my customers hiring this product to do?
His “Jobs to Be Done” theory of innovation says that customers hire products or services to perform particular jobs. Some of those jobs might be small (e.g., pass the time while waiting in line), while others are more significant (e.g., find a more fulfilling career).  
Christensen tells the story of how he used the theory while advising McDonald’s. The company was looking for a way to increase its milkshake sales, and despite having tons of data on its customers and the market, it was struggling to do so.
Christensen and his colleagues spent most of their time asking McDonald’s customers what jobs they were hiring the milkshakes to do, and in the process they had two insights:
  1. Many people bought milkshakes to have for breakfast during their early-morning commute. They hired the milkshake instead of a bagel or a doughnut because it lasted longer, was easier to handle, and was more enjoyable during their otherwise “long and boring” drive.
  2. Another large set of customers hired milkshakes during the afternoon “to feel like a fun parent.” They saw a milkshake as a convenient way to reward their children – one that was both cheaper than an expensive toy, and less time-consuming than going to a movie.
Christensen and his team helped McDonald’s uncover more opportunities to increase sales by focusing on customers’ specific needs and circumstances, and the jobs they were hiring the milkshakes to do:
  • For the commuters, the company could make the milkshakes thicker; possibly add fruit; or even have pre-mixed milkshakes prepared to help the commuters save time in the morning.
  • For the parents, the company could create smaller cup sizes, so that the parents wouldn’t feel as guilty; or they could pair the milkshake with a small toy.
#3. Making your customers better off means having better customers
Innovation expert Michael Schrage writes in the Harvard Business Review that the ability to calculate what customers might be worth is alluring and powerful for managers and marketers alike.
For example, the metric customer lifetime value (CLV) brings quantitative rigor to assessing customer relationships. But as Schrage points out, CLV is limited because it doesn’t take into account what value means from the customer’s perspective.
Delighting customers and meeting their needs are important, but they’re not enough for a lifetime.
For Schrage, innovation must also be seen as an investment in the health and wealth of customers: “By investing in and enabling new customer capabilities, firms create new ways for customers to increase their lifetime value.”
Schrage recommends using a simple prompt to help you think through scenarios that will be mutually beneficial to both you and your customers: Our customers become more valuable when …
Here are some examples: 
Our customers become more valuable when … 
  • they reduce our costs
  • they make more informed choices about which products or services are best for them
  • we know more about their particular interests
  • they give us good ideas
  • they evangelize for us 
  • they try out our new products
  • it takes them less time and effort to find the right product or service
Quote of the week
“No one is eager for a core dump, but if you can remember my trouser size, or suggest a movie that all my friends loved, or sort out my insurance needs, then you are making me smarter. The rule is simple: Whoever has the smartest customers wins.”
- Author and technology expert Kevin Kelly in his book New Rules for the New Economy
Idea Journal
Idea Journal
Did you enjoy this issue?
If you don't want these updates anymore, please unsubscribe here.
If you were forwarded this newsletter and you like it, you can subscribe here.
Powered by Revue
New York, NY