AFTERWORD
The End Is the Beginning
Shortly before his death in 1992, Sam Walton wrote Made in America: My Story, which described the early days and subsequent growth of the Wal-Mart empire. One of the sections that has always stuck with me can be found about two-thirds into the book, in a chapter fittingly called “Making the Customer Number One.” In it, both Walton and Don Soderquist (Wal-Mart’s COO at the time, and formerly the CEO of the Ben Franklin chain of five-and-dime stores, which went head-to-head with Wal-Mart in its early years) offer their opinions on how local businesses can compete with Wal-Mart. After more than twenty years, Walton’s advice is still extremely useful for any business:
It doesn’t make any sense to try to underprice Wal-Mart on something like toothpaste. That’s not what the customer is looking to a small store for anyway. Most independents are best off, I think, doing what I prided myself on doing for so many years as a storekeeper: getting out on the floor and meeting every one of the customers. Let them know how much you appreciate them, and ring that cash register yourself. That little personal touch is so important for an independent merchant because no matter how hard Wal-Mart tries to duplicate it—and we try awfully hard—we can’t really do it.1
Soderquist was a little more harsh:
If you’re a merchant with no competition, you can charge high prices, open late, close early, and shut down on Wednesday and Saturday afternoons. You can do exactly what you’ve always done and probably be just fine. But when competition comes along, don’t expect your customers to stick with you for old times’ sake.2
They were talking almost exclusively about content. Your content is an insufficient condition for the long-term success of your organization. Essentially, they were saying that when Wal-Mart rolls into town, you better be ready to compete on an entirely different level. It’s surprising to think that the guys running the cheapest place in town were willing to provide valid advice on how to compete with them. But heed their advice: Don’t just expect your customers to stick around with you for old times’ sake. This couldn’t be more true today, as suddenly competition is global and available 24/7.
Wal-Mart isn’t a very customer-centric organization. It is the very best at what it does, which is to offer the lowest price on an enormous selection of items through economies of scale and state-of-the-art logistics. What it does not do is segment its customer base, selectively target the customers most likely to produce high profits, set up automatic triggers to entice flagging customers back to its stores, create reactivation campaigns, nurture mini-communities around its content, or any number of other things that Wal-Mart could do to personalize its operations. Wal-Mart doesn’t have to, and it never will. But that doesn’t mean that you don’t.
The good news is that it’s never been simpler to set up the systems that I’ve discussed in this book. There is no excuse—even if you run a mom-and-pop operation—for not tracking some element of your customers’ behaviors, and using that information to communicate more efficiently with those who need it the most. There’s no excuse for you not to be building the structures of a community (regardless of your company’s type, industry, and size), or for you not to have a more definitive understanding of your customer archetypes (regardless of what your current customer profiles look like). There’s no excuse for you not to be constantly reaching out to your customers and looking for ways to increase their involvement and level of engagement with your organization.
That said, even if you decide to ignore much of the advice that I’ve offered in this book, please heed this one suggestion: Let the Three Cs sink into your psyche as the foundation of how you do business moving forward and how you communicate with your customers (and the rest of the world). If you do this, you will dramatically change your company and the future success of your organization. Truly!
Larger organizations can afford to set up ever-more sophisticated systems and collect more customer data, though in many ways the complexity can become a burden. As we’ve seen, it is easy to drown in data, and that makes it harder to determine appropriate tactics and strategies that will support your character, community, and content (and the larger role these concepts play). In many cases, the most profitable thing larger organizations can do is to ask simple questions from their teams and begin building from there. The salient challenge is for management to take a more active interest in keeping customers (beyond the lip service assertion of providing “wow service”) and to understand the factors that can and will enhance their ability to do so—mainly the Three Cs.
I’d be naive to think you’ve never before considered the concepts discussed in this book, and that’s not me. The Three Cs is simply a new way of thinking about how you take care of your existing business and market yourself, in a way that considers long-term relationships with customers as being the ultimate strategy. The Three Cs approach recognizes the actual value of your most valuable asset. It’s not just a cosmetic gloss of “customer focus.”
Even though many of you already know about the importance of customer lifetime value, and most of you have a good idea who your ideal customer is, far too often I meet with clients who neglect some of the most basic questions that I’ve asked you to ponder in this book. The CEOs and executives I meet know the importance of customer value, and know their loyalty programs could be more effective, and know they’re speaking to every customer in their database as if they’re speaking to one generic/average person. But deep down, they also know there’s a better way.
The hardest part after reading any business book is trying to figure out what to implement or change, without going crazy. I’ve tried to be pretty clear in this book that—while the tactics are important, and you can build a better loyalty program, for example—your greatest success might be simply taking to heart this one key concept: You need to rid yourself of the new customer addiction and focus more on your existing customers.
That’s it. Change your focus. Change your outlook. Recognize the value of who is already shopping at your company and don’t dwell on the swarm of customers a new promotion might bring you. Don’t miss the forest right before your very eyes, while anticipating what might be waiting for you on the other side. If you must dive right in, then take the Three Cs in stride. Look at your character and ask yourself, “Do we really know who we are, and are we actively portraying that character to our customers?”
Too many organizations try to change too much at once. There’s an old saying that “small hinges swing big doors.” We often forget to realize how the small changes in mindset or the way we conduct ourselves can often have the biggest impact. I don’t know about your business and what you’re really focused on, but you picked up this book for a reason. It leads me to believe you have a genuine interest in keeping the customers you have, and you want to maximize the potential of all your existing customers. Perhaps you recognize that your company is too focused on new customers. Maybe you simply need to focus more on conveying your corporate character. Whatever it is, might I suggest that you pick a single area to improve, work on it, and see what happens! And commit yourself to sticking with it. See just how big of a door you can swing with the smallest hinge.
Most of all, I hope you recognize that your single biggest asset in business is relying on you. Your customers are relying on you—not just for great content, but for something more. The paradigm, the way customers do business with our organizations, has forever changed, and we’re only just beginning to see what that means for our companies. There’s really no point in your company living an existence as a barren, deciduous, or wilting tree. Sure, when the tree is in bloom, it may look nice, but winters are too cold to be fooling around. Focus on becoming Evergreen and treating every customer as one of the most important leaves you’ve ever had.
In his famous speech, “Acres of Diamonds,” first published in 1890, Russell Conwell suggested that most people look everywhere for new opportunity, increased happiness, and new sources of business/customers, except the most obvious place—right in front of them, where they are most likely to find it.3 Too many companies are focused on finding greener pastures when many of them are already sitting on acres of diamonds.
The “new customer addiction” has become a problem of epidemic proportions, costing organizations billions of dollars and unfathomable quantities of time and energy. Each day there’s some new method, tool, or platform allowing us to poke, jab, or tweet, with the hopes that we might just poke someone in the eye hard enough to get his or her attention.
I hope that, after reading this book, your mindset has changed. Look inward. Recognize that you are most likely already sitting on all the customer value and profits you need; it’s just a matter of shifting your focus. Don’t throw away everything you have because of the possibility of success elsewhere. Don’t get sucked into the madness of the mythical and fabled mass of new customers. Instead, put in the (sometimes boring) work of actually being successful. Make it a goal to relentlessly exploit every opportunity that already exists within your organization. Promise yourself that you will harvest all the existing diamonds before you go looking for a new mine.
Writing this book has been a fun and exciting journey for me. I hope reading it has been the same for you. But more important, I wish you the greatest success in your own journey to become a world-class Evergreen organization.
Thanks for reading. E-mail me at [email protected]. Let me know how you are making out, and if I can be of help.