If you think your rental rates is the reason you are attracting or not attracting and maintaining customers, think again. Today’s customers are savvy and want much more from their relationship with your company than just a low cost.
Customers are looking for relationships that deliver unique value. Yes, they want your products to solve their problems, but they also seek a level of satisfaction that goes beyond the intrinsic value of what they paid for. By learning to tap into this deeper level of emotional satisfaction, your business with current customers will increase and you will uncover a steady stream of new customers.
You may have asked your customers if they were satisfied with their equipment rental or purchase from your company, but the true measure is whether your customers are actually coming back. In an average customer poll you may find that eight or nine out of 10 customers were satisfied. That sounds great, but studies show that only four or five of those customers actually rent or buy from you again.
Why? Rational satisfaction — they were not displeased and the product worked — is only part of the equation. Returning customers are those who are emotionally satisfied. Moreover, emotionally satisfied customers also are more likely to recommend your product or service to others.
Exceptional value is created when your customer perceives your product or service to be worth more to them than the price they pay. There are two components in any strategy for creating exceptional value with the customer. The first is how well you are communicating the unique value of your products and services as compared to alternative solutions in the marketplace. This is important and is likely to result in a high rational satisfaction. However, it takes emotional satisfaction to develop a loyal customer.
The second factor — building deeper, trust-based relationships — is the key to emotionally satisfied customers. This happens when your employees show your organization understands a customer’s needs, delivers more than is expected and helps them achieve their goals.
Exceptional value stems from exceptional employees. Your people are the “secret sauce” in your organization’s ability to deliver on its value promise. You have to hire and retain the right people to make it work. These employees are those who do not need management mandates to engage customers and adhere to company values. These employees are your customer’s problem solvers. They provide the discretionary effort and intellectual capital that can take your customers from satisfied to loyal.
Studies have shown that an increase of five percent in customers can add from 25 percent to more than 100 percent to your bottom line. Developing emotional satisfied customers who enjoy extrinsic value might seem like a pie in the sky ideal, but there are many real-world examples. Think about a Rolex watch and what you feel when you see one worn. Any watch can give you the time, but they aren’t a Rolex. What captivates us about a Rolex isn’t its function, it’s the prestige. A Rolex suggests more than your need to tell the time. It says that you appreciate the finer things. It shows that you have earned enough success to purchase one. It means you are knowledgeable about the value of the craftsmanship and precision it represents.
That is the connection you should seek to develop with your customers. You want to deliver more value than the functional benefits inherent in your product or service. You want your customers to experience the extrinsic value you bring to the relationship by being emotionally engaged throughout the buying process.
A recent USA Today poll showed that 72 percent of the respondents will pay more to use the services and products of a company they perceive to be ethical. An easy example of this for consumer products is the higher prices that consumers pay at eco-friendly stores like Whole Foods. For service-based businesses, think of the movement of customers away from the megabanks who charged hidden fees and left customers navigating though a labyrinth of automated phone systems to credit unions and community banks where a real person answers the phone with a sincere interest in your situation.
These are examples of how the perception of ethical business practices can make a difference. It reflects the impact of emotionally satisfied customers. People feel better about themselves when they believe they are dealing with an organization that cares about “doing the right thing.”
By optimizing the key performance drivers of value creation, you can successfully tap the emotional bonds of your customer relationships. This takes the right people, the right process, the right leadership and the right commitment. The investment your company makes in enabling and aligning your team with the skills, attitudes, beliefs and values that develop loyal customers will enrich your core business and provide new opportunities to gain customers and market share. Stay engaged and be ethical in your customer relationships and you will transform your business.
Walt Zeglinski is the CEO and chief client advocate for Integrity Solutions, Scottsdale, Ariz., a performance improvement company that helps its clients create value for their customers. He has worked with executive teams and frontline sales and service teams across most industries, including financial services, health care, technology, hospitality and manufacturing. He can be reached at 602-253-5700 or by e-mail at email@example.com. More information is available online at www.integritysolutions.com.