High turnover, high profits, high levels of repeat business - there are plenty of 'highs' associated with creating an addictive and successful business. We are in an age where customer loyalty can be considered an urban myth, a thing of the past. With the rise of competition in nearly every sector, all trying to compete for the same market that in many cases is growing at a slower rate than the competition itself and with more offerings than ever before, learning the key to customer loyalty can mean the difference between an owner making a wage and making serious profit.
Few business owners realise that we all experience highs all throughout the day; all of them related to activities that we take part in whether it be the more literal high's - from drinking coffee or smoking a cigarette - down to buying shoes or going to the gym, everything we do is done for a reason and most reasons come back to a feeling that we are looking to create within our own body and experience. Science has proven to us that a feeling - whether it is happiness, sadness, anger or ecstasy - is all a sequence of chemical reactions moving around our body effectively controlling how we feel moment to moment. All of these chemicals are as addictive as heroin itself if combined in the right order. So it is fair to say that if you can effectively induce an addictive chemical reaction from an experience in your business, there is the potential to create an addicted customer that keeps coming back and ignoring the competition time and again.
If businesses can identify what range of feelings their customers are really trying to get as a result of their product or service, it can go a long way when you incorporate a strategy to give them exactly what they want to feel consistently. No one gets a hair cut for the sake of spending $60 every month, we do it because we like the way it makes us look which in turn makes us feel better about ourselves and how we present every day.
Give them what they want and they will come back time and again and even bring their friends. Don't give it to them and they are your competition's next customer waiting to be stolen out from under you.
For most businesses the value is rarely in the initial or first transaction - the value is in the repeat business that comes from giving people exactly what they want. This is what marketers refer to as lifetime value; what you make from the customer over the life of the relationship. Most businesses treat their customers based on the transaction value paying little notice that this person could potentially spend, hundreds, thousands or even hundreds of thousands over a given period of loyal patronage.
Kerwin Rae, NSW Regional Director of Quantum Organization, says, "I once met a guy who spent over between $4,000 -$5,000 a year on coffee (he was an addict), drinking upwards of 5-8 coffees a day and another guy who spent $10,000-$15,000 a year on pizza. Do you know what your best customers are worth and if so do you treat them based on that worth? How many regular purchases do you make a day, week or month or year and if you add it up, how does that business treat you based on your total worth or a transaction value?"
The concept of 'addictive business' goes far beyond the need or even want for products and services and taps directly into the way people feel about these transactions. With $30 billion in credit card debt and a further $80 billion from other lines of credit currently buoying up the Australian economy, there's plenty for businesses to feel good about but what makes their customers feel good?
There are four principles governing addiction to a business. All customers have a desire and are unconsciously looking to be given or at least offered:
1. Certainty around how they will be treated and exactly what they will get.
Customers need to know that they can get what they want, when they want it without pain or transaction discomfort. In this context pain is meant both literally and figuratively - the 'pain' of inconvenience, aggravation or delay will leave your customers in the mood to defect.
2. Variety in their experience and your offering
It may seem like a paradox but in contradiction to the first point, customers also want their experience to vary from time to time. Even if they want to get the same product or service that they always get, they may want it to be delivered in a slightly different way or simply know that they can have it in a range of styles, shapes, colours and fashions - after all, 'variety is the spice of life!'
3. Significance as an individual
Customers, or in fact every person on the planet, wants to feel as though they are special or unique. When someone remembers your name, order or asks how your wife or kids are by name, how does it make you feel? Or what if you are complemented on your shoes, shirt, hair or smell? I know personally of many ladies who when not feeling 100% go and get their hair, nails or face done purely because they want to replace one feeling with another. There is an old saying that has been well forgotten 'The customer is always number one', always. Give customers that feeling and you will be well on your way to having them addicted to your experience.
4. Connection to something bigger than themselves
This desire comes from a primal level. Humans are by nature a herd mammal. Just look around you now and what do you see? All people on some level want to feel connected or feel liked or loved or even just to fit in. And when we don't, we experience rejection which is the killer of business all around the world. Every day I see businesses unknowingly rejecting their customers purely because they treat them like a number and not a significant person of value. Even by not returning a smile you are unwittingly rejecting a person's attempt to connect and giving them perhaps another reason to be poached by your competition.
Kerwin Rae is a Sydney-based sales and marketing expert. He is the NSW Regional Director of Quantum Organization, an international business consultancy. He is currently working with numerous well-known businesses to prepare them to float, franchise or sell. www.quantumorganization.com