Are Your Customers Coming Back?
I wrote an article recently in the local business paper entitled Courageous Leaders Excel While Others Play It Safe. It talked about the tendency to “hunker down” in a recession, rather than to make the changes needed to help put your company at the forefront when the economy rebounds.
But this raises an important question: When is it important to innovate? The two examples I gave were of industries (newspapers and construction) which are under significant pressure, both short-term and long-term. Perhaps you feel that customers’ needs for buying your footwear hasn’t changed that much, they’re just not buying a lot of shoes right now, right?
I’ll challenge that assumption.
Sure, your customers might be wearing their shoes for longer than they did before. That means that eventually they’ll come back and purchase some more. But in the meantime, maybe they’ve learned some important things:
-
Although it might be nice for me to have six pairs of shoes to pick from for every occasion, it’s not really necessary.
-
Some of those shoes may NEVER have to be replaced because I never wear them often enough to actually wear out.
-
I tried buying some of those cheaper shoes from another place. I wasn’t as happy with the experience I had, but the shoes themselves were actually OK. Maybe I’ll go back there again, especially if it saves me $40.
-
I thought it was nice to have fancy shoes to be with the fashion, but nobody noticed when I didn’t buy new ones.
These kinds of customer experiences signal potentially permanent shifts in buying behavior. Yes, I’ll need to get new shoes eventually. But what’s going to bring me back to your store? What do you have that’s special and attractive for me, the newly cost-conscious buyer?
If you figure that out, you can become one of the new leaders as the economy rebounds.
Carl Dierschow
Small Fish Business Coaching Fort Collins
www.smallfish.us
Unexpected Competition
I was giving some presentations this week around competitive analysis, and we had some great discussion around types of competitors that aren’t obvious. It’s easy to see the guy down the block who delivers a product very similar to yours. But it’s harder to recognize others which may be MUCH more important:
-
Someone who delivers something similar but in a much, much cheaper way. Why is it that they haven’t taken every one of your customers? Likely it’s because you have some differentiators which are quite valuable to your customers, even if the product itself is quite similar.
-
Likewise, there may be others who deliver something similar but are much, much more expensive. If it was all about features and price, they shouldn’t exist. But again, there’s going to be some differentiators they have which give value to certain people – even if you yourself might think it’s ridiculous.
-
An entirely different approach to solving the deeper need. If people want news, they can get it via newspaper, TV, Google, even Twitter. Really – even Twitter. You have to understand what draws people to each of these different media, even if you wouldn’t want to think of them as direct competitors.
-
Most serious, there are the two biggies: not addressing the need at all, and not recognizing the need. I have a need to have some work done on my house, but it’s so expensive that I’ve been putting it off. In that case, I recognize that I have a need, but I’m not taking any action, not spending money. Another example is how people find they use MP3 players. Most started into this because they just wanted a smaller radio or CD player, but now recognize that MP3 players can actually change the way you listen to music. That’s an unrecognized need, and often the source for true innovation.
I had a discussion with someone about the greeting card industry. It might be a good example, because there's lots of options:
-
Traditional greeting cards – the ones you buy in a store
-
E-cards, which often include interesting graphics and music
-
Physical cards you can order and have sent out in snail-mail, but with your own text inside
There’s some others that people don’t usually recognize:
-
Inaction – many in younger generations never send greeting cards at all
-
Different ways of addressing connections – using social media. I often see people send quick congratulations and best wishes over Facebook, which can be very effective for people who maintain their friendships in that environment.
If you’re looking at your competition, look further. Then look at the deeper customer need, and see how people are addressing that need. Or not.
Carl Dierschow
Small Fish Business Coaching Fort Collins
www.smallfish.us
Who's Running Your Business?
Are you running your business, or is the business running you?
That's not a flippant question; I'm absolutely serious. If your attention is entirely on handling what the business is handing you from hour to hour, then you're being a servant to it.
I understand why you're in this situation. The economy has been brutal for the last few years, perhaps you've had to lay off valuable employees.
You've done without necessities in the hope of surviving until the economic rebound takes hold. And you've pushed your long work hours to the limit, because at least that's something that doesn't have a direct monetary cost.
This carries a very real risk, though. Your precious attention has been drawn away from making the strategic tradeoffs, and instead been spent on doing what the business demanded of you. Serving your customers and keeping them happy is necessary, of course, but even more important is figuring out whether you're investing in what your customers are going to need tomorrow. And how your customers are changing.
Here's the critical point: Everybody has the same amount of time to spend. "Time management" is not really the right phrase, because you can't manage time. What you're managing is your attention, and your life is defined by where you spend that attention.
The core question is whether you're allocating your attention, your best thinking, to what's going to best serve your business and its customers in the future. Not full time, sure, or even a quarter of your time. But are you spending even an hour each week to focus on the deeper issues?
Carl Dierschow
Small Fish Business Coaching Ft. Collins
www.smallfish.us
