OK, time for a quick test. If you were looking at this menu board, what would you expect to pay for a bottle of Piper Heidsick champagne?
This is a real picture of the menu board that my wife and I were faced with on a recent Friday evening (I have doctored it only to compensate for my poor photography skills). We decided to order a bottle of champagne to celebrate – maybe just celebrating the fact that it was Friday. By our read of this menu, the Heidsick was a great deal at just $33 per bottle. We were somewhat surprised when we got the bill and the bottle was priced at $65!
I said surprised, not shocked – I know this bottle is around $45 in our local wine shop, so $65 is a reasonable restaurant price, and $33 did seem like a steal. Nonetheless, I pointed it out to the restaurant. After paying our bill, I said to the owner “This is not a complaint, I know that $65 is about the market price for that bottle of champagne, and we probably would have ordered it anyway. But a reasonable person could look at your chalkboard and expect to pay $33, you might want to change that.” To my dismay, the response was basically a silent stare, and inexplicably when we went back to the restaurant two weeks later, the sign was unchanged!
Thinking about how this could happen, I realized that this is a problem for many of our clients as well – the difficulty of taking the customer’s perspective. In this case, the restauranteur knew (because she had done it) that the $33 referred to another bottle that they had erased when they ran out of it, and it wasn’t important that the champagne did not have a price because it was rarely ordered anyway and their cost fluctuated based on the availability to their supplier. She expected that anyone ordering champagne would either ask about the price, or didn’t care about the price. From the perspective of the person who runs a restaurant it was no big deal. Unfortunately, as a patron seeing the chalkboard for the first time, it is easy to reach a different conclusion and it matters.
When we talk to our clients about VOC, framing issues from the customer’s perspective is critical to understanding potential problems we could solve and the value they would place on solving them, but it is often difficult to get past our perspective. We have talked before about our client who makes garage door openers. Understandably, they think about garage door openers 45-plus hours per week and know model numbers, horsepower ratings, decibel levels and competitor strengths and weaknesses.
Contrast this with what they know about how homeowners think – you and I generally don’t think about our garage door opener at all until it breaks (which is only about once every 12 – 15 years) and then most of us are in the market for about one hour – we are not doing exhaustive research and weighing technical trade-offs, rather we are seeing who can get to our house most quickly and almost always buying what that technician happens to have on the truck. Any winning stratagem must work in this reality, not just be attractive to garage door opener experts.
So how do you avoid the trap of projecting your knowledge and biases onto your customers and focusing on what matters to you and not what matters to them? We’ve come up with four practical tips to help you keep the right perspective:
- Go out of your way to adopt your customer’s point of view. In this case, come out from behind the bar and look at the chalkboard as if it were the first time you were seeing it. For many of our clients this might mean leaving the comfort of your desk (or home office) and going out to the field – try reading the instructions and installing your product in a dark utility room in the basement of a half-finished building as opposed to doing it on your well-lit lab bench.
- Make sure you understand your customer’s process – observe the customer along their entire journey, from identifying the need to buying something to maintaining the product, or maybe even disposing of it at the end of its life. Where are their pain points and how might we address them through better search, documentation, support or maybe just better packaging?
- Develop an appreciation of your customer’s priorities – what are they trying to accomplish as a business and how does your offering fit in? Are you a large piece of their cost structure or a small piece? Does handling your offering consume a lot of their mental energy or is their business focused elsewhere. We have said it before, knowing what WE want is the easy part (buy more from us at higher prices), but facing the fact that the customer would prefer to buy less at lower prices, or maybe not buy from us at all can be difficult.
- Lastly, and perhaps most importantly, understand how your customers make a profit. Like much of what we talk about, one of the central elements of good B2B marketing is an objective view of customer value. How important is the problem you solve for them? What is your differential value in solving that problem relative to their switching cost? It is not enough to list all the attributes or even benefits that we think a customer would like, our goal is to understand how they make trade-offs. A customer may, in fact, want lighter weight, smaller size, longer battery life and lower cost – but if they can’t have all four at once, how do they decide? If we can’t answer that, our job is not finished.
As should be clear, doing this right requires interacting with customers beyond a typical sales call to gain insight into how they think and why they make the choices they do. This may not be a habit, and it may even seem uncomfortable at first, but there is no substitute for direct observation.
In one dramatic example of this, we worked with a company that made components for building control systems. They identified that they had been losing share in multi-story office building and couldn’t understand why. When their engineers tested the competitors’ products alongside their own – component by component our client’s were more robust, easier to use and about the same price. So, what was behind the share loss?
When they visited a job site, the answer was almost instantly clear. Our client packaged their products in a way that made sense in their factory – all the thermostats in one box, all the smoke detectors in another box, etc. What this meant was that when contractors were ready to install the controls on one floor of the building, they needed to open all the boxes to pull the necessary products. The remaining parts were left in open boxes which needed to be pulled together again when the next floor was ready, assuming no parts had ‘disappeared’ from the open boxes laying around the job site.
In contrast, their competitor took the time to package products by floor – one box containing all the devices needed for a single floor of the building was delivered as needed. Armed with this understanding, our client was able to copy the competitor’s practice and stem the market share loss. Over time, they did even better, finding opportunities to prewire components saving on-site labor and automating calibration steps using smart-phone based tools – none of which would have been on their product roadmap had they not committed to direct observation.
Taking the customer’s perspective may require stepping out of your comfort zone and you may not always like what you see. But there is no better way to understand your customers’ context and decision-making process and how you can impact it.
Oh, the restaurant… we may go back eventually (you’ll notice I did not mention their name). The food is very good and the service is otherwise excellent, but I have to admit the complete inability to see things from my perspective leaves a sour taste in my mouth (despite the delicious champagne) – not how you want your customers to feel, regardless of your business.