Here’s the big misconception…
Business managers already know what their customers want.
That’s usually not true, actually. Every human being your business talks to is unique. Each person makes purchasing decisions based on personal values and priorities.
What’s true is that most business managers are surprised when they learn the real reasons why customers buy from them.
Where companies get customer value wrong
Lots of companies attempt to differentiate themselves in ways that don’t really matter to customers.
In 2008, a small recycling company called Resource Recovery Corporation (RRC) was developing a growth strategy. Consider their story:
“When it came to size of the company, RRC executives felt that their small size was a significant advantage to them in the eyes of the customer…
However, when they explored the deeper meaning of “firm size” to customers, they were stunned. Instead of seeing RRC’s firm size as a strength, customers saw it as a weakness.”
Customers basically told them “we know you’re good and we love your cost model, but we don’t know if you are going to be around in five years.”
The small size of the company made customers think they might not be around long enough to compete with the big brands in recycling!
So, what did RRC do?
“RRC quickly responded to these concerns and, within a month, increased its sales at a level that represented 10% of the company’s annual sales… They had recently firmed up a variety of resource commitments and external partnerships and had asset investments and customer relationships that reflected a clear external commitment to the firm into the future…
[They] then developed a sales strategy that focused customer’s attention on the strength of these resource commitments and relationships, and returned to these customers.”
To summarize, they focused on maximizing the resources and relationships that showed their long-term potential. Then, they communicated those things to customers because that’s what mattered to them.
Here’s the challenge for you then…
Create value that actually matters to your customers.
Are there certain aspects of your business that you think set you apart from everyone else, but your customers actually see as a weakness? You can know if that’s the case by performing a simple little exercise: ask your customers why they choose you, and if the things you think set you apart actually matter to them.
The story of RRC comes from the book Grow by Focusing on What Matters by Joel E. Urbany and James H. Davis
Zac Garside is a marketing student at Utah State University, and the marketing manager at Power Selling Pros.
He loves big ideas… like, if a tree falls in the woods and no one is there to hear it, does it make any noise?