Wednesday, January 31, 2007

The challenge that all businesses face

I just wrote a post, "The real challenge for Apple & OS X." In it I talk about how it isn't good enough for Apple to be just "better" than the new Windows version, Vista.

In order to just hold their own, Apple must be geometrically better than Windows offerings. This is no different than the scenario faced by many other businesses that do not hold the dominant position in their market. It's even the case for local businesses. If you are the new guy in town, just being "better" is not enough.

The question boils down to how do you show enough real value to a customer in order to convince them to give you a fair shot at their business. In the computer business, it is really hard, because staying where you are is often easier than doing something different. Change can be tough.

When I helped to sell email services, often the key differentiator was just being there when the customer called and being able to jump through whatever hoops needed to solve their problems. Most often that meant having enough well trained people to answers their questions and guide them through the initial sign-up procedures. Surprisingly we had a few people who thought Saturday or Sunday would be good days to switch email providers. That meant some Saturday afternoons doing coverage like I wrote about in "The Saturday afternoon technologist, electronic hair."

The real estate world which I've recently joined has long been accustomed to working Saturday and Sunday afternoon if necessary. If we aren't around to catch the customers when they walk into the door, someone else will be.

Even companies like Apple that are product focused really need to keep their customer facing side as effective as possible. Just having stores where people can meet with dedicated and knowledgeable Apple people has been a huge success for Apple. Still as it is with all large companies, finding the right person or the right answer can be challenging. When I was at Apple, at least once a month some poor lost soul would finally get routed to my desk after a month long decent into phone tree hell while looking for someone at Apple Federal.

The other key to responding to customers is actually listening to them. In the last three years I've had a fair amount of experience with real estate agents. I also been hauled to a large number of houses that the minute I saw them, I knew we were wasting our time and the time of real estate agents. The agents had not listened to me or they would have figured out that I wanted a house with some beach characteristics instead of a two story colonial.

I'm really curious to see how Apple does with the iPhone. Apple is of the belief that you have to tell customers what to buy instead of building products with the help of customers. That's one of the main reasons Apple products seem to be headed more towards a closed ecosystem. If you aren't trying to make your products work with your customers' stuff, my guess is that it won't.

In real estate we have to listen to our customers who often become our clients. Once they become clients, we have to put their interests before ours.

It's a totally different relationship than you find in the computer world. There companies buying products have been known to be stuck with equipment made obsolete by an announcement of new products. Sometimes it happens before the purchased products even make it to someone's desk.

Of course that doesn't make for happy customers.

It turns out that the best way to get another customer is to do a really good job for the one that you already have. Happy customers can be very effective sales people for a company

In Apple's case the customers have gone that one step further and in effect become tremendous evangelists for the company. Should Apple ever lose that army of Mac users, it would be very hard to continue to be successful.

I'm actually glad to be in a world where my success is measured by how successful I am in meeting the customer needs not just today but over time. If more companies measured their employees that way, we would see more companies responsive to customers and fewer ones who just throw their products over the wall with the hopes that someone will purchase them.

Incremental improvement to meet customer suggestions might not be the best way to define new product categories, but it is a great way to build customer loyalty even if you aren't the biggest player in town or the market.

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