Carl Sewell - Customers for Life: How to Turn That One-Time Buyer Into a Lifetime Customer

A few things have changed since Paul and I first started working on Customers for Life in 1988. For example, today most companies understandto some degreethe need to provide good service. As their customers have made clear, they dont have any choice.

Customers today are better educated, have traveled more, and have been exposed to more things than ever before. As a result, they have an improved frame of reference. They know what French food should taste like. They recognize Italian tailoring. Theyve learned what truly makes a car worth the price.

Its no different when it comes to service. Todays customers have experienced better service, and they like it. Theyre getting used to it. Heck, theyre even insisting on it.

The result is that you can no longer say to your customers, Please choose between low prices and good service. Every single time you do, theyre going to respond, I want both.

Understanding the need to provide good service has unleashed a series of problems, but it has also created more opportunities. Lets talk about both.

First, the problems.

We have a tendency to promise too much. Because we want to provide good service for our customers, we often promise more than we can deliver. In many cases, firms are promising things beyond what anyone has seen or experienced. And then when they dont deliver, their customers are disappointedand rightfully so.

Its our own fault. Weve raised their expectations too high, so we cant blame our customers for being unhappy when we dont keep our word. It doesnt matter how sincere our intentions were; the fact remains that we let them down.

We need to set highbut realisticexpectations about the level of service we can provide. Then we have to deliver what we said we wouldand hopefully a little bit more. (Chapter 4 explains how we can accomplish that, and Chapter 14 revealsperhaps surprisinglythat the customer is not always right.)

You cant do just a little bit. About a decade ago, retailers started learning (the hard way) that the absolutely worst place to be was in the middle. If your prices were average, someone could undersell you. If your goods were okay, a competitor could offer superior quality. Folks that stayed in the middle got killed. (Just think of all the department-store chains that no longer exist.)

The same thing is beginning to happen with service. Just okay service wont cut it anymore. Stores like Wal-Mart and Home Depot offer remarkably good service, given what they charge, and companies that sell luxury goods certainly have not relaxed their standards.

When it comes to providing service, we have no choice. We either have to improve or close up shop. Because this idea is so importantand has such long-term consequences to youwe have added a new chapter to deal with it. See Chapter 10.

Our only source of competitive advantage is our people and the service they provide.

If these are some of todays problems, here are a few new opportunities.

Quality time. They said time would be the currency of the nineties. In the 21st century, it is even more true. Not only do customers expect better-quality products and better service, they also want to receive them faster and more easily.

In order to do everythingparenting, loving, working, exercising, vacationingwe need more time. Businesses who do it faster and better will succeed.

The importance of want to. We realize we only have one way to differentiate ourselves, and thats through our people. After all, every firm has access to the same sources of capital; product innovations can be copied overnight; and whatever cutting-edge technology we need is available right off the shelf. That leaves our people, and the service they provide, as our source of competitive advantage.

But its not enough to hire good, smart people. Yes, thats certainly important, so much so that we devote a significant part of this book (see Section Three) to it, but it is no longer enough.

When we interview people, we have to look for the want to types. Do they truly want to be in our business and, even more important, do they truly want to take care of our customers?

If they do, then business, in addition to becoming more profitable (see Chapters 38 and 40), becomes simplerand a lot more fun. What could be more enjoyable than spending time with smart people who share the same values? When I head off on Saturday mornings, my wife always teases me by saying, Youre not going to work, youre going to play. Shes right. I really enjoy working with so many great people. Its fun.

How we can get better. How can we create this kind of environment? Well, even though I went to Southern Methodist University, let me give the folks at the University of Texas a little bit of credit.

About twenty-five years ago they did a study to find out what made the one hundred most successful people in the state such high achievers. During their research, they were surprised by how little these people had in common. Some had been fine students at good schools, while others had barely gotten through high school. While a few came from wealthy homes, most did not. In fact, there was only one thing these successful people had in common. They had spent a lot of time with someone who had been successful. In other words, they had learned how to be successful.