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Focus on Key Customers

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Reuters recently ran a news story that caught my eye about how banks are coming up with all kinds of gimmicks to entice customers to come into a branch. The article led with, “Free Wi-Fi, discounted cappuccinos, artwork, and a dancing robot are among the features banks across the United States are touting to convince customers that even in an era of smartphones it is still worth it to visit a bank branch.” My first thought was that banks are making a serious mistake embracing this marketing approach.

 

Busy business people or individuals with a lot of money to deposit or who need significant loans are unlikely to be swayed by a dancing robot or free Wi-Fi. When I visit a bank branch I want an appointment and the ability to complete my requirements quickly.  I don't want to play with Wi-Fi while I'm waiting because I’d rather not wait.

In our businesses we need to understand which customers fit the traditional 80/20 rule.  Which 20% of our customers provide 80% of our income? We need to understand who the 20% are and market to them effectively, service them well and make certain each is pleased with everything we sell or provide.

Frequently I see businesses engaging too much effort in marketing to small customers. Every customer is entitled to good value and good service but that doesn’t mean that the same targeted advertising or sales effort influences every customer’s choice. In my view the bank would be better served by making sure they understood what the 20% of their customers wanted since they provide the lion’s share of income.  They should focus on these customers.

I do some marketing for a damage restoration business and spend time calling on insurance agents in a position to refer work. Some agents have eight or nine people in the office and some are one-person shops that work mostly off existing business. I understand that the insurance agent with nine busy people in the office may be in a position to refer 10 to 15 times more business than the single operator. While I still call the single operator and outline why they should utilize our services, I spend considerable time cultivating a relationship and potential future business with a 20% company that will provide 80% of our business. Besides, I can only spend so much time chasing small fish.  It’s harpooning the whale that pays off. 

John wrote, “Watch out that you do not lose what we have worked for, but that you may be rewarded fully.” (2 John 1:8, NIV) Diligent work should be focused work to make sure that we gain the full financial reward.  Part of this involves is focusing on key customers.

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