In Lesson Six of the Five Steps to Building a Successful Business, we introduced Step Two, the Customer Experience. The lesson started by making the rather obvious observation that customers have many options to satisfy any need or want. We then asked a question relatively few owners consider: If customers have so many options, why do customers repeatedly choose to purchase from one seller over others? There is a reason, and it illustrates the vast difference between WHAT – the product or service – you sell and WHY customers buy from you or someone else. This reason - the WHY – is called the Customer Experience. Remember:
Do not sell customers WHAT, When customers purchase WHY
Successful owners construct their businesses around their customers by creating an experience for those individuals. Sometimes the product is a large part of the Customer Experience, such as building a home, manufacturing a smartphone, or designing a specialized computer program.
For other businesses, such as property insurance, banking, and many personal and professional services, the actual product purchased is a small fraction of the Customer Experience.
If you watch television, you’ve likely experienced the Aflac Duck quacking “Aflac.” What about Flow, the over-the-top Progressive insurance agent aiming her space-age, name-your-price gun, or the memorable adventures of that smooth and suave Geico Gecko? Many find these characters more entertaining than many television programs, but what do they have to do with insurance? Very little, yet a lot. These characters differentiate brands selling nearly identical products - they help create a Customer Experience that is a significant driver of sales.
What about a nearly invisible service such as tax preparation? If you hire a preparer, how do you know they correctly prepared your return? Most normal people can’t from just looking at it. So, we use cues - some obvious, some extremely subtle to determine our level of confidence. We may consider reviews, referrals, and professional credentials. Our brains will also process stimuli gathered from websites, office décor, and cleanliness (even its odor). We consider the dress and demeanor of the preparer and office staff, newsletter, and other correspondence – even the quality of the paper and envelopes! Although we are not consciously aware of the entire process, every bit of this stimuli gets included in our level of trust and satisfaction. And, what do we call the summation of these evident and subtle cues? The Customer Experience!
If this seems like a level of consumer psychology beyond the small business realm, it is not. Sure, the layout of a retail chain, the color of a restaurant chain’s fixtures, saying “my pleasure” to customers, or the shade of the Guico Gecko’s tale may significantly impact corporate profits. But what does that have to do with your business? Everything. Long-term, it defines the difference between failure, struggle, or success.
Regardless of the Customer Experience’s role in your business, it is vital. As we shared in Lesson Six, an experience gets created whether you want it to or not. It is how customers are obtained (or not), how they are retained (or not), and why they refer your business to others (or not). Successful owners know this and go out of their way to create a Customer Experience that: 1) Obtains customers, and 2) Retains customers while 3) Generating referrals and 4) Profit!
This chapter introduces the steps used to create your Customer Experience. We will detail these steps later. It also will present the most crucial element of experience creation – The Value Statement.
Creating the Customer Experience
There are four basic steps to creating your Customer Experience:
Introducing the Value Statement
If you’ve attended a formal network meeting, you’ve likely experienced members spending a few seconds introducing themselves and their business. Members experienced in this process are sharing a version of their Value Statement. A promotional introduction called the Elevator Pitch (or speech) is another version. Both are succinct overviews of oneself or their business – brief statements of what you do and the value you add to others.
When utilizing the Five Steps to Building a Successful Business, the Value Statement serves a critical function. This function is two-fold and central to creating the Customer Experience:
The Value Statement is a seemingly simple, Mad Libs-like exercise. Here it is:
Your Business Does (What) for (Who)
To create a Value Statement, you start by completing the last part of the sentence first. “Who” in this sentence represents your customers – the individuals for whom the Customer Experience gets created. They are generally a subsection of those utilizing products or services similar to yours. Making these individuals happy is why your business exists.
Once you know who your customers are, you can determine what your business does for them. “What” represents the benefits provided to these individuals. These benefits are what your customers buy – they are why customers choose to purchase from you and not another business selling the same thing. It is also why they refer your business to others.
If you’re confused by all of these who, what’s & why’s, don’t worry. We will clarify everything over the following few lessons as you work on your Value Statement and Customer Experience. For now, what’s important is remembering that a Successful Business is an organization that makes (current) customers happy and gets new customers while generating a profit. The Customer Experience is essential to constructing such a business. It’s so important and often overlooked that we made it the second step of the Five Steps to Building a Successful Business.
This lesson comes from our course, The Five Steps to Building a Successful Business. The Five Steps teaches everything you need to know to construct a fantastic new business or transform a struggling business into one! Check it out!
All courses and articles are for informational purposes only and do not constitute tax advice. Taxes are complicated - do not act on course information without consulting a professional. Always refer to treasury regulation before making any tax decision. Read the full disclaimer.
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