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Catering to customers can make or break many businesses

Leanne Hoagland-Smith. | Provided photo~Sun-Times Media

Leanne Hoagland-Smith. | Provided photo~Sun-Times Media

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One local small business manufacturer has the following acronym, CATER, hanging from the ceiling, taped to the walls and sitting on desks. This acronym stands for “Customers Are The Entire Reason.” The employees for this small business know that without customers this firm that conducts business nationally and internationally would not exist.

How many times do customers both external (buyers) and internal (employees) somehow become lost in the day to day grind of getting things done? They become objects and not the reason for business growth and ultimately business success.

Yes, being focused on customers is critical. No doubt about it.

To ignore unhappy customers especially in this age of social media through technology where a negative comment can go viral has prompted many small, mid-size to even Fortune 500 organizations to embrace social media even though it may be a reactive and reluctant engagement. Product review sites such as Yelp are now becoming part of the buyer’s decision-making process.

Just as a quick reminder, the cost to retain an existing customer depending upon the industry ranges from four to seven times the cost to acquire a new customer. Possibly the fellow who comes in for a cup of coffee and a breakfast special three days a week doesn’t seem really valuable when looking at his $5 daily bill of when compared to the family of four who may come in once or twice a month and spend $30. However, over the duration of that single customer’s life time value of possibly 10 to 20 years, the long term value quickly adds up.

More importantly, when we begin to fully appreciate how technology has changed the small to medium businesses (SMB), we just may begin to shift other paradigms around how to cater to our customers.

For example, in 2011 Gerhard Gschwandtner, CEO of “Selling Power,” suggested that 80 percent of the sales jobs in the USA will be gone by 2020. Regardless of how much of a decline in sales jobs if any (as this columnist is not going to argue with Gschwandtner), the paradigm shift will have to focus even more on retaining existing customers and increasing sales through personal referrals.

Another example is Jonathan Farrington, CEO of Top Sales World, who has redefined “commodity” as anything bought with a credit card. This redefinition will also impact how companies will cater to their customers.

For SMB firms, what will happen is marketing to the target audience and keeping customers will become far more important than selling to customers. Differentiation will be 100 percent about understanding that customers both external and internal are the entire reason for sustainable business growth. Keeping customers happy from that first contact to the actual buying transaction to that problem with the purchase or even their employment will definitely separate the few that will be successful from the many that will continue to have challenges.

P.S. Shout Out – Don Quijote Restuarante in Valparaiso and El Salto in Merrillville dish up great ethnic foods.



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