Why Understanding Your Customers is Important

Mark Ballett is an ecommerce expert with more than 25 years’ experience helping retailers to grow and evolve. He was Supply Director of Cable & Wireless, and CEO of several telecoms companies at the beginning of the internet era, played a leading role in an £80M broadband start up, as well as leading Norweb Telecom's growth from £10M to £100m turnover.

I am currently in the market for a lawn mower.

When I searched online for lawn mowers I found hundreds of pages for me to choose from. But there are many more suppliers than there are machines, so most of them are selling the same things. But I didn’t know what I wanted to buy and there is so much to choose from that I found the whole thing very confusing.

So, I looked for Reviews and Recommendations and Top Tens and Best Buys and still was not sure what to buy. I just wasn’t able to decide by looking online alone because there wasn’t enough information for me to choose in any logical way, as there just wasn’t enough information provided about things that mattered to me. Apart from anything else, I wanted to know what it would be like to sit on – yes, I need a ride-on mower – so I visited several dealers and asked their advice.

Even after that I wasn’t sure what to do. Did you know that you can get zero-turn mowers these days that spin on the spot? or, that if you are collecting grass just how big the machines are with a box on the back? or, how the turning circle varies from nothing to 30 cm to 60 cm or more? or, that if you buy it online the chances are you have assemble it yourself, or at least do the first service?

Oh, yes, then there is the question of price. It’s cheaper online right? No, not in my case, I have eventually zeroed in on a machine that is cheapest at a small agricultural machinery supplier not a mile away from my home. They will assemble, service, and delivery it to me and they will then collect it once a year and keep in in good condition. It is an unbeatable proposition for me.

What I found out from this is:

  • There are no single-point sources of trusted advice about buying a ride-on lawn mower
  • The apparently obvious statement that things are cheaper online these days is wrong in this case. The machine I have chosen will be much cheaper when additional costs are taken into consideration
  • It makes a lot of sense for a local business to be very competitive on purchase price for a product like this as it is likely to get many years higher margin service revenues from a happy local customer
  • It confirmed for me that one of the greatest advantages that any service-oriented business has is geography

It’s true, I’m not sure that many people would have spent as long buying a mower than I have but if I were the business in question trying to sell me a ride-on mower, I’d do the following:

  1. Make it very clear that I was a local source of free advice about which machine was best for me
  2. I’d offer a Best Price guarantee so that whichever model suited the customer best I’d be able to compete on price
  3. I’d also have some sort of long term service deal too

I live in the country so there aren’t many firms around me. As it happens, I didn’t even know that the company I am buying my new mower from existed until this week, and it is just one mile from my house. But I do now.

Customer Focus

We live in a  world where offers for products and services surround us like confetti at a wedding. So, choose a group of customers to whom you can offer an unbeatable proposition. To do that in your business you need to understand just who your customers are, what they want and which ones you have the potential to service best. In spite of what they often think, not many businesses know the answers to these questions and that is where customer data analysis comes in. Understanding your customers is the key to business success.