This articles come from The Five Steps to Building a Successful Business course. This course is the product of working with small businesses for twenty-plus years and asking a simple question: Why do certain businesses succeed while so many struggle and ultimately fail? The Five Steps to Building a Successful Business will teach you how to successfully start and grow a business, or turn a struggling enterprise around. Check out more articles from the Five Steps series.
Before we dig into step number two of the Five Steps to Building a Successful Business, I have a few left-field questions to pose:
Think about it. Think deeply. What about your significant other or best friend? There are many fish in the sea, as the saying goes. How do two choose each other from a vast ocean of options? Why do they stick together through the ups and downs of life?
If you’re having a difficult time coming up with a specific answer, don’t worry. Poets and philosophers (not to mention psychiatrists and bio-chemists) have been pondering these questions since time immemorial. And, their progress to date? It’s best summarized by romance novelist Susan Elizabeth Phillips who writes, “There is no accounting for the mysteries of the human heart.”
Well, that settles that – meaningful, interpersonal relationships are complex. But what about business relationships? Why do we choose one business to cut our hair, fill our cavities, or prepare our tax returns? Why drive past four or five auto service centers to have our mechanic fix our brakes?
Think about your business relationships. To which businesses are your commitments merely transactional - price or convenience-driven? To which companies have you developed more committed relationships? Whom do you forego less expensive options to patronize? What businesses do you trust enough to forgive transgressions? Why do you go out of your way to actively refer certain sellers to others? Why?
Now, what about your business? Why should customers choose you out of a great sea of options? Why should they pay a premium for your product or service? Why put their reputation on the line to refer you to friends and colleagues?
There is an answer to these questions. It’s called: the Customer Experience.
The Customer Experience: The underlying premise of Step Two of the Five Steps to Building a Successful Business is this:
What is the Customer Experience? Trying to define the term experience, let alone the Customer Experience, is as complex and elusive as the mysterious human heart - and equally baffling to philosophers and neuroscientists. Fortunately, being a philosopher or neuroscientist is not a prerequisite for building a successful business. For our purposes in the Five Steps to Building a Successful Business, the most critical aspect of the Customer Experience is the vast difference between “what” a company sells and “why” customers purchase.
What vs. Why: To illustrate the difference between the product or service your business sells (or will sell) and the reason customers purchase that product or service, answer the following questions:
Take a look at the first question. You can answer without even thinking about it. Of course, you know the product or service you sell! But what you sell also is a thing; it’s a noun. Even if you sell a service, you are still selling a noun. Auto mechanics sell fixed cars. Housekeeper? Clean(er) houses. Dentists - clean teeth and a healthy smile.
Now, what about the second question? Why should a customer purchase that product or service from you? Notice how different this question is from the first. The word why is a motivator – a call to action. Why is the tipping point – it’s the reason customers forego all other sellers to buy from one seller – you!
In workshops, I often pose these questions using the following exercise. It seems a little over-the-top until you realize the many options a modern customer has to satisfy the same need or want. Here it is:
Picture a Main Street in heartland America. A paved two-way street separates a pair of greying sidewalks. Green street lamps with yellow bows dot each sidewalk. Due to a city ordinance, all storefronts are brick, glass, and nearly identical. Now imagine that every shop sells the same product as your business at the near-same price. When one owner lowers their fee, all others do the same.
Now answer this question: Why will customers repeatedly walk past your neighbors to purchase from your store?
When you finally arrive at one, your answer will be much more than your product or service alone. It will be detailed and focused on every aspect of your business that comes into contact with customers and those you want to become customers. This everything is your WHY, and this WHY is THE CUSTOMER EXPERIENCE.
DO NOT SELL WHAT WHEN CUSTOMERS PURCHASE WHY!
Experience Observations: Before we move on to the next lesson, let’s make a few observations about the Customer Experience.
The Customer Experience is essential to achieving business success. It’s the reason some businesses can charge more than others. It’s why they have loyal customers and why those customers go out of their way to refer their family, friends, and colleagues!
If you found this lesson helpful, please check out The Five Steps to Building a Successful Business. It teaches everything you need to construct a fantastic new business or transform an existing business into one!
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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