You compare any two or more businesses that are successful and you’re bound to find a handful of similarities, but you will find only one that comes up every time. Every successful business knows its audience and targets that group every step of the way.
I see a lot of places these days trying to wear too many hats. I guess the thinking is that the more people they reach the more customers they’ll bring in. Really? Let me know how that’s working out for you.
Costco is a great example of a company that knows its audience. Its audience is shoppers—with a bit of pantry space—who are looking for a bargain. You know how many members Costco has? In 2010, the company had 58 million members around the globe. I doubt that number has gone down.
But you don’t have to be as big as Costco to use its approach. Your business has a product or a service that one specific group of people—more than any other—would benefit from. Don’t lose sight of that group just because you think casting a wider net somewhere else will bring in a better catch.
Catch the ones who want to be caught—the ones who are looking for what you’re providing. And once you’ve found them, remember what Sam Walton said: “There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.”
The following excerpt is from my new book, “Uncomplicate Business: All It Takes Is People, Time, and Money.” The book comes out in October 2015 and is available for preorder at HowardFarran.com.
Excerpt: Every successful business has an obvious client base, whether your vertical is in food, transportation, utilities, or health care. Dentistry has an obvious client base made up of people who want to keep up their oral health, improve their smiles, or get relief from tooth pain—whether they want a root canal and crown, or the low-cost option of extracting the tooth.
My first demographic decision had to do with the average median household income. If I wanted to focus on root canals, crowns, bleaching and tooth-colored fillings, I needed to target the upper half of the median household income. If I were going to focus on low-cost silver fillings, extractions, and dentures, I would focus on the lower half of the median household income. I chose to sell high-priced dentistry instead of low-priced dentistry, focusing on the upper half of median household incomes in my area of Ahwatukee, Arizona, where the median household income is around $80,000.
Once I knew the price I was targeting, I asked myself, “Who makes most appointments?” My team and I found that mothers make more than 80 percent of dental appointments. They not only make appointments for their children and themselves, they also typically make the appointments for their husbands.
So, we targeted all of our marketing efforts to Mom. We ran ads in the local newspaper that targeted Mom. We placed ads on shopping carts at the local grocery store. We sent out direct mail pieces focusing on Mom, meaning we promoted tooth-colored fillings in a kid-friendly environment.
As I mentioned, my practice is located in a busy plaza frequented by families, in contrast to the traditional dental office buried in some medical building off the main street where no one knows it exists.
Knowing that we’re target marketing to Mom, we also parked a nice, colorful merry-go-round in front of the practice, so Mom knows instantly that our practice is kid friendly.
And when Mom and the kids walk through the door, they’re greeted with a bulletin board featuring the “No Cavity Club” right next to a playroom in the waiting area, similar to the play areas in many McDonald’s restaurants.
As I have said, you can’t be all things to all people, especially in business. You simply cannot have the highest quality, the best service, and the lowest price; it is simply impossible! As a small-business owner, you can only focus on two of these three features. You have to determine who you are and what makes you unique. You have to determine which customer segment you want to serve. …
What your customers expect is what they experienced the last time they patronized your business. The way to raise customer satisfaction is to stop employee turnover and maintain consistency. If your customers expect a great product or service and get it from you every time, they won’t want to go anywhere else. …
Your customers are not just the people who buy your product. They are the people who will keep you in business—by teaching you the most about your business. If you want to reach your goals, you have to listen to your customers.
The most important thing to remember when you listen to your customers is that you have to take the bitter with the sweet. Nice compliments are fine, but they don’t tell you what you’re doing wrong, only what you’re doing right. They’re just an acknowledgement that someone thinks you’re doing a good job. Great. Pat yourself on the back. Feel all warm and fuzzy, and continue on. But I want to hear the bad stuff. I want to hear how we messed up or could have done better. Every company has room for massive improvement. It’s when you get complacent and only listen to the sweet things that you start resting on your laurels and become stagnant, preparing to get run over from behind.
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