If you run an established business, you know how many customers you have, but do you know if they are happy? It takes about five to ten times the amount of work to bring in a new customer to retain a current customer. Why do you spend so much time and attention focusing only on attracting new business when you know this? You need to be giving at least this much focus to satisfying your current customers. Satisfied customers are the best way to market your business because they are the ones who become your word-of-mouth army—they are your customer evangelists.
Yet we ignore them. Commercials, programs, and plans are almost all directed toward incentives for new customers. We make it hard for current customers to return things. We make them wait on phones for 20 minutes, ensuring that their business is important to us, so please stay on just a little longer, while we focus on the new customer on the other line. We put out the red carpet for recent sales and drag our feet to provide good service to the ones we already have.
Remember the hierarchy of buying, who was at the top? A current satisfied customer. This is where you are at your highest level of trust and your relationship's most vital point. Sadly, some companies let their customers fall off the top of the mountain.
We have a morning ritual that we know many of you share. Coffee around here is a bit like a religion. You choose your brand, you pick your favourite, and then you stick with it. In the Toronto area, Tim Hortons is the church of coffee. It is a part of the culture up here, part of the vocabulary. When you say you're going for coffee, you go to "Tim's" or you're going to go to "Hortons."
We're sure you have your own coffee chains in your area with the same kind of following. They become a part of our routine. This has to be the ultimate goal for a business, whether it is service- or product-based. You work to become a part of somebody's routine. If you can achieve this goal, it is worth a lot of money. The lifetime value of every person who spends $2 a day with your company is incredible. Think about that for a second—$2 a day equals more than $700 a year. Over 10 years, you're looking at more than $7 000 in revenue from one person. Companies have a vested interest in making sure you become a regular, and you should be working hard to make your lifelong clients out of your customers. Unfortunately, just like many personal relationships, when you become used to one another, you take each other for granted, and companies do this far too often with their loyal customers.
Tim Hortons had us. We were loyal as could be. But recently, we have done something we never thought we would do: We changed brands. Being a loyal Tim Hortons customer, almost every day, we would get our coffee from them. We didn't even think about it—that is just what we did. When any other coffee company came into the area, they were an afterthought. No way a new company was going to change our habits. Slowly something happened. We started noticing cracks in the armour of the habit. One misstep or one small issue will not lead to somebody changing a day-to-day habit, but when you begin to add up enough of those little things, you open the door to your competition. It is not usually severe customer service issues that drive people away.
So here is the story of the small things that led us away from Tim Hortons in Scott's own words.
First, the servers wouldn't stir my coffee. The coffee was inconsistent, a small thing, but one that I know my fellow coffee drinkers out there will understand. When you buy your coffee at the drive-through and start to drink it after you've pulled a mile or two away and found that it was not made or stirred correctly, the experience is hurtful. For people like me who take three sugars in their coffee 2 and order the same coffee every day, I really notice the difference when it isn't made correctly. Similarly, when there are mistakes in the order when I can taste cream instead of milk, customers will notice when there is sweetener instead of sugar. These are little things. Mistakes happen, of course, but when they start happening more and more, customers begin to wonder if this is how service will always be. Then customers start to doubt the quality of your service or product. This doubt creates a space where customers are open to trying something new.
We want you to picture the image of a gap. It starts as a tiny crack. Your loyal customer has always been happy with your product or service, and then slowly, small doubts add up, and cracks begin to form—until one day, the experience gap grows just big enough for one of your competitors to get through. The experience gap is the space between your customer's best experience with you and the worst. Ideally, this gap doesn't exist or is as small as possible.
Businesses need to make buying their products easy. This was another issue with Tim Hortons that led me away from being a loyal customer. Until recently, the company did not accept debit card payments, 3 so many of their customers cannot pay for their coffee and doughnuts with a bank card. This is rare today. As a matter of fact, the only reason I would ever take money out of the bank was to buy coffee from Hortons.
Now the extra inconvenience of taking out cash was okay when my coffee was perfect, but adding this to the frequency of mistakes in my order was getting to be too much. Add in some other things I put up within the name of my favourite coffee, such as the cumbersome lid that was impossible to open while driving, and the long wait times, and I was really open to the competition. I had been a loyal customer for 20 years. I figured that I have spent upward of $15 000 with the company over that time.
I was at that point where all of these small negative experiences had come together, the perfect storm point, and I was open to giving something else a try. It takes a lot for somebody to change anything, let alone a part of their daily routine. I didn't really do it consciously; it just happened. All that it was going to take for another company to earn me as a new customer was quality that matched what I was used to, and that gave me more convenience.
Enter McDonald's. I was already a McDonald's fan. The company didn't have to begin at the start with me or get me to buy into its brand. But I didn't buy coffee there. My first real job was working at McDonald's when I was 15. As far as I could see back then, the only people who bought coffee at McDonald's were senior citizens at 6 am. But now McDonald's was on a mission to prove that its coffee was worth buying on its own, a bold task considering the market already included heavy competition from Hortons and Starbucks.
A few years ago, I wouldn't have even thought of trying the McDonald's coffee, let alone switching over to it, but I had gotten to the breaking point as a customer. I was willing to at least try something different. Tim Hortons was taking my business for granted, but McDonald's was working for it. McDonald's had a promotion to launch its coffee, and it was giving out free coffee during a particular time, so this was going to be the time I would try it. Unfortunately, people's lineup to try the coffee when they found out it was free could have rivalled lineups for rides at Disney World, so I decided to hold off on giving it a try. A few weeks later, I finally went in and tried it.
Compared with Tim Hortons, McDonald's had the same, if not more, drive-through locations, just the kind of convenience a lazy man like myself was looking for. At this point, the quality was necessary—no matter how much comfort or customer service I got, at this point, if the product wasn't of the quality that I liked, I wouldn't switch to it. This is really important to note: Quality is always important! No matter how much marketing or UnMarketing you do, it doesn't make a difference if your product or service doesn't stand up. So I order the coffee and go to pay for it, and the server takes my bankcard! I can use my bank card to pay for the coffee—McDonald's earned one bonus point.
I get the coffee, and I see that the coffee cup is double-walled, meaning I don't have to put a sleeve on it! I don't have to ask for a second cup! McDonald's execs have spent some time thinking about their products and their customers and thought, "Hey, coffee is hot, people don't like to burn their hands," and come up with a double-walled solution cup. Genius. I went to open the cup in my car, and the lid was terrific. You can open it with one thumb, and it pops and locks open—no mess, no burned fingers, and another bonus point. The ease and convenience of the cup itself really improved my experience. The McDonald's location near my home also has a secret weapon. His name is David. At the Iroquois Shore Road location, in Oakville, Ontario, David is the guy you talk to in the morning in the drive-through. He's kind, considerate, and happy, but not the "in-your-face kind of happy" that makes you hate him in the morning. Heck, he even makes the add-on suggestion of a muffin a pleasant occurrence. It's gotten to the point that I will go out of my way in the morning to have David serve me. So I found excellent service and a great new product. I never would've even known if it hadn't been for the "dropping of the ball" from the place where I was loyal.
This is precisely what your company does not want. You do not want your longtime loyal customer to be dissatisfied too many times and now in the hands of the competition and very, very happy. I then tasted the coffee, and it was great. I get no reimbursement from McDonald's to say that I am not their affiliate. In all honesty, the coffee tasted great, even better than what I was used to. That did it. And now, I look for McDonald's when I'm wanting a morning coffee or on the road. I may be just one customer, but my lifetime value is $20 000 or $30 000. How many people will it take for Tim Hortons to realize that understanding the marketplace's needs and wants is essential all the time?
You need to know if your customers are happy, and if they aren't, you need to understand why and how you can change it. You need to know where you stand in the eyes of your customers. Are they happy, are they ecstatic, or are they just there holding on until someone better comes along? You do not want your brand to be in that zone with current customers, where the experience gap has left a space for the competition. You cannot be complacent or inattentive, leaving your hard-earned market ripe for the picking.
Now, because you are reading this, we know you're ready to think differently about how you treat your customers. You know that every point of contact is an opportunity to engage with your market—this is true for your current customers. If you want to find out where you stand with your customers, finding out is simple: ask them.
A simple thing you can do is what we call "Stop Start Continue." Use an online survey service, Survey Monkey, for example. You can send out a brief e-mail to your customer list. Ask customers these three simple questions: (1) "What should we stop doing?" (2) "What should we start doing?" and (3) "What do you think we should continue doing to ensure we not only meet but exceed your expectations?"
Business owners incorrectly think that their customers will say something if they are unhappy. But most people will not say anything at all; they just stop buying. The time to ask customers what you can do to improve their experience is not when they are angry and/or have already gone elsewhere, but when they are current customers with you. How many times have you gotten an e-mail from a place where you are an existing client asking you to tell the company what it can do to serve you better? We know it has not happened often to us, and we know that the feedback you get will surprise you.
We never go to McDonald's for coffee anymore. One of the issues we had with Tim Horton's, and later McDonald's was the lack of product consistency, depending on what country we were ordering in. We also needed coffee in airports, many airports, and Starbucks is found in just about everyone we've been too. Starbucks coffee is consistent in taste, easy to find almost everywhere, and its app is seamless for ordering. The app auto-reloads whenever it's running low and allows us to pay quickly from our phones. We can also order ahead and skip the line, which, while making us unpopular with those waiting, makes us feel super important in our own minds. And isn't that really what coffee happiness is all about.