Matt Plughoff

It’s time to get serious about understanding your customers on a behavioral rather than transactional level. The big retailers, armed with algorithms that would make a derivative trader’s head spin, have the capability to predict our purchase patterns, lifestyle interests, habits, and financial positions. Small businesses don’t. But that shouldn’t stop us. In many ways the only way to put a stone squarely between the eyes of the Goliath is to have a deeper understanding of our customers and to utilize that understanding in order to sustain rich future relationships. In other words, know your customers like friends, treat them like friends, and they’ll reciprocate like friends. As Tony Hsieh writes in his outstanding book Delivering Happiness:

“We view the lifetime value of a customer to be a moving target that can increase if we can create more and more positive emotional associations with our brand through every interaction that a person has with us. Another common trap that many marketers fall into is focusing too much on trying to figure out how to generate a lot of buzz, when really they should be focused on building engagement and trust. I can tell you that my mom has zero buzz, but when she says something, I listen. To that end, most of our efforts on the customer service and customer experience side actually happen after we’ve already made the sale…”

So while the majority of service companies cannot replicate software driven “big data”mining they can ask five important questions that will thicken their value and improve their client friendships. I call them “The 5 C’s of Customer Service”for lack of a snazzier phrase.

Commerce

This is the basic information that a company typically acquires once a customer enters the sales cycle. Lead source, name, address, phone number, alternate phone number, email address, reason for the interest, special needs or requests, salesperson attached to the lead, whether or not the salesperson was referred and by whom, product sold, accessory or add-on items purchased, loyalty program participation, ticket price, financing information.

Accurate and detailed commerce data lays a foundation for future opportunities.

Connections

Today’s consumer is a networked economy in and of themselves. Research indicates that online research has reached a level of parity with a contractor’s recommendation. The importance of understanding a customer’s network is on par with understanding how they learn, share, and recommend products and services among their own digital community. Understanding a customer’s connections offers a snap-shot of how the customer is likely to co-create a business’brand. What networks do they rely on and share within? Will they or are they connected to a business via a social network, review site, photo-sharing or video platform? Are they active on rapidly growing networks such as Pinterest, Tumblr, Google+? Have they subscribed to a company’s YouTube channel? Are they active and influential on these networks? Does the customer have a Klout score?

In other words, networked customers are broadcasting their lives all the time. Learning how they choose to broadcast helps a business connect in ways that are meaningful and engaging to the networked consumer.

Character

What are your customers “in”to? If you walked in to my family’s bungalow you’d learn a lot in seconds. Books. Lots of books. Bikes. Paddleboards. Skateboards. A snoozing labrador. A kitten. It’s eclectic. Walk in to my mom’s house and it’s a different story. Spotlessly clean. Gourmet kitchen. Beautiful garden. My mom plays Candy Crush a lot. You get the picture. How we live is a reflection of our identity and our family identity. These observations allow a business to customize post-sale communication in personal terms rather than in boring or faceless terms.

Our economy is moving from mass-commoditization to mass-personalization. Successful retail organizations will improve their customer relationship and friendships by personalizing as many touch-points as possible.

Cross-Selling

Not everyone is going to buy something from you. Should this stop you from continually identifying cross-sale opportunities? I didn’t buy a Texas-style off-set smoker from Amazon (shame) but they sure used it as a way to promote their affordable remote-control digital thermometer. I might not invest in a new furnace but any salesperson with two functioning eyeballs will notice the opportunity for better filtration, perhaps insulation, and a duct cleaning. I might not buy those either, but ask my wife if she’s interested in a security system and she might say “yes.”And if she doesn’t say “yes”to the security system, I’m pretty sure she’d appreciate a lesson in energy-saving thermostats.

The brilliant team at Nest is putting on a clinic when it comes to cross-selling. They’re also pointing the way to a future in which a single-product service provider will evolve to either a full-home service company OR will establish strategic partnerships with other qualified businesses. In other words, customers are increasingly looking at their homes as integrated. Identifying cross-sell opportunities increases the likelihood that they’ll purchase something in the future.

Collaboration

There are two types of ultimate action in retailing. The first and most obvious ultimate action happens when a customer buys something. They spend money. The second type of ultimate action is that they actively refer and promote your business. They voluntarily help you grow. Nothing is stronger than peer-to-peer recommendations because of the intimacy. So the final “C”happens when the trust and consistency and unforgettable quality of the relationship emotionally compel a customer to open her world. This is organic. Most people don’t care all that much about a $50 gift card to Chili’s by way of an incentive. Fifty bucks worth of Potato Flappers and third-rate service may not be the reminder that they’re looking for.

Business-to-consumer sales is being replaced by H2H. Human-to-human. That’s the future in the service industry. Create and foster a friendship with your clients, get to know them authentically and on many levels. Help them. Serve them. Don’t forget about them. And be consistent. Nobody likes an inconsistent friend. Surprise them. As Mr. Hsieh says: “Deliver happiness.”Once there’s an indication that your customers are co-creating your brand and collaborating voluntarily the doors have opened all the way. At that moment the relationship is yours to win. Or lose. Your choice.

So does all of this mean that businesses need to start re-thinking the content in their databases, adding new categories, developing better information-accountability conversations, having systems in place to monitor and collect a growing data set? Does all of this mean that a business needs to regularly review the quality of customer data being acquired during the sales cycle? Does all of this mean that every single employee who has contact with a consumer be held highly accountable for developing world-class friendships? And ultimately, does this mean that businesses must re-focus their purpose on delighting customers in the short, medium, and long-term rather than simply extracting short-term gains?

Yes.