Any effort to design an effective company strategy starts with the person or company that actually pays you. Every business should have a deep understanding of their Perfect Customer Group.
The Perfect Customer is the one that Instantly Understands your Value Proposition and is willing to PAY you for it
The perfect customer will walk past your competitors (both figuratively and literally) in order to do business with you. They generally don’t fight pricing very hard (if at all) and they only peripherally consider your competitor offerings. Your ability to recognize and describe this customer keeps the company focused on why it is unique and is crucial to the design and implementation of strategy in an organization. We want employees to be able to recognize and listen carefully to these customers in order to continuously improve the competitive advantages of the company.
Perfect Customers:
• Are Brand Loyal (within some bound, these customers will purchase without significant consideration of competitor offerings – iPhone, Coca-Cola, McKinsey & McDonalds)
• Craft their business processes around your services / products (manufacturing systems, HR operations, payment operations, component specifications)
• Focus on their perception of the value of the business relationship (willingness to accommodate specification changes, loyalty during difficult times)
• Seek an approach from your company that differs from the rest of the competitors and will remain dependable
• Work with your company to improve YOUR product / service
The relationship between any particular customer and your company (whether that is B2B or B2C) will involve a stream of requests, complaints, special needs, etc. While companies go to great lengths to hold onto customers in general, any attempt to satisfy all or even most of them will create an organization that is scattered in its focus and inefficient in its efforts.
While growing a business is a core goal, management must decide how many changes are acceptable in the pursuit of growth while trying to hold onto that core customer group. Push the changes too far and you lose the perfect customer group.
What does this focus mean for Strategy Design and Implementation?
• Strategy is designed to align the resources & capabilities of the organization with the needs of customers. The deeper your understanding that customer group that aligns best with the organization the better that strategy will work.
• Employees must be able to recognize and respond to the Perfect Customer. Changes made to improve the relationship between this group and your company help refine your competitive advantages.
• Customer groups outside the Perfect Customer group are treated well by the organization, but we don’t make significant changes to our offering in order to cater to them. Doing so may eventually lead to the loss of the Perfect Customer group.
There are many takeaways from the National ICA Consumer study, but 4 of those form a group of key value drivers for operators that we will examine and craft into strategies at the Car Wash Show 2015.
• Only 7% recall receiving any type of online communication
• 60% think that washing at home is safer for the environment
• 75% think that the car wash is more convenient
• 72% was their car only a couple of times a year or less
Knowing the customer changes the level of interaction with customers and more importantly keeps everyone in the company focused. It is the starting point for
the development of strategy.
Dr. Bamford is the Managing Partner of Bamford Associates & an Adjunct Professor at the University of Notre Dame. He is the author of 5 textbooks in Strategy & Entrepreneurship as well as The Strategy Mindset - a book for executives and managers who want a practical, short book on designing and implementing strategy.