Chapter 11

Everything You Need to Know about Succeeding with Customers (in about an Hour)

The customer . . . can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.

—Sam Walton

MORE THAN ANY OTHER WORDS HANDED down by our founding fathers, there’s one simple household saying, coined in America, that has changed the course of history and made our country the colossus of capitalism. It repositioned the ancient status quo that the elites and aristocrats were the only holders of power. It said that the vast, unwashed public that makes up the markets matters, that what’s in other people’s heads matters. Their free decisions on what to buy will decide who among us becomes the next barons and billionaires. The paradigm shifted from “we” on the inside to “they” on the outside. This magical phrase is:

The customer is always right.

It isn’t in the Declaration of Independence or the U.S. Constitution, but it should have been. It’s credited to one of the 19th-century entrepreneurs of retail like Marshall Field of Chicago or R. H. Macy, but no one knows for sure who first said. What we do know is that it’s a MAP—a Master Aligning Principle that instantly sets the mission straight for any entrepreneur in any society where people are free to choose.

The customer is always right.

Well . . . almost.

TODAY THE SAYING NEEDS A TWEAK

The Internet age has disrupted a great many things, even the customer’s privilege of always being right. Innovation is simply moving too fast for the customer to keep up. Humans demand trust, and trust takes time.

So while your new product may be technically superior, customers may continue to be wrong about it and not try it. Why? Because they’ve been burned by too many of your competitors’ false claims before. It makes them suspicious until they see others happily using your product and decide they’re ready to trust it. It means that this customer isn’t right—until you teach her.

Your product may be so new, customers don’t know they need it because they don’t imagine it exists. Take the iPod and other famous Apple game changers. Steve Jobs and company took a risk and created a need the customer didn’t know they had. Again, you have to show these customers and convince them. This is called sales.

So, here is the tweak the saying needs to be up to date, and you should need it 100 percent:

The customer may not always be right, but the customer always decides.

As the entrepreneur, you will have to take the risk. You will have to pursue the dream. You will have to build your team and develop the prototype and hold off the doubters.

But only customers will decide whether you’re going to have a business. And you can’t order them to do it. They must volunteer.

At this point it’s worth defining . . .

WHAT’S A CUSTOMER?

A customer is someone who makes your business her number one choice to fill a need, is willing to give up money in return for your filling it, and does this again and again.

To be a customer, a person must:

For your business to be a living, going concern, you must be able to attract and hold onto repeat customers. You must be recommendable by those happy customers to other potential customers.

Any business can open its doors, make false advertising claims, and get people to take a flyer once and never come back. Unless you cross the magic threshold—getting customers to buy you again after a trial—your enterprise will be nothing more than a fire that is quickly going out.

SUCCEEDING WITH CUSTOMERS

To succeed, you have to convert unattached civilians with no prior relationship into customers who will try, be satisfied, trust, choose, and repeat. To do this, you must execute on all the mechanical requirements. You need at least an MVP—a minimally workable prototype of a product that fills a customer’s need. The product must provide a difference that is superlative, important, believable, measurable, and own-able—(a.k.a. a Dominant Selling Idea). In short, you need to execute on every element of the UnStoppable Six to succeed with customers.

But recognizing the psychology of customers is critical, too, because we’re talking about emotions, loyalty, trust, fear, biases, anxiety, and perceptions, after all—the most commonsense psychology there is. Generations of entrepreneurs have learned it from trial and error, but mostly from the will to get it right because they knew that only their customers would grant them success. That’s exactly how the founders of Rackspace learned it.

CUSTOMER PSYCHOLOGY

Nobody cares what you know until they know that you care.

—Famous Racker saying

All customers have needs, wants, fears, and pains like you and every other human you know. So don’t be surprised at how simple the following direction is: the more you take away what customers don’t want and give them what they do want, the more you will succeed with them. Here are the known issues no successful business must ever ignore:

All Customers Hate Risk. Take It Away.

If you think because you are an entrepreneur and business owner you are the only one who takes risk and needs to mitigate it, you haven’t been listening. Put yourself in your customers’ shoes even for a second and you’ll see they’re sailing on a sea of risk, just like you are. They take a risk every time they try a new product like yours—a risk that it won’t work, that they’ll be humiliated, that they’ll lose time and money or the respect of their peers—or even get fired. The risk causes anxiety and pain in all prospects.

You job is to take that risk away.

Think I’m exaggerating the risks that customers face? Think again. Even though a particular purchase may seem relatively small, in your customer’s world at the moment of decision, it can seem huge. A young woman who makes $400 a week in wages and decides to try a new shampoo not only risks throwing away her $16.95 but risks having a bad hair day for her hot date that night. For her, a bottle of shampoo is mission-critical.

The manager of a tech start-up choosing a cloud hosting company is just as concerned. If the company site goes down, if the customer support sucks, if there are hidden costs and fees, the start-up can lose its business before it has the chance to switch cloud vendors.

As a branding consultant, I knew and appreciated that when a customer finally picked my firm over all the others, often committing a major amount of their budget and only having one shot to get the solution right before a big deadline. Their jobs were on the line if we screwed up. My team knew we had a big personal responsibility as well as a professional one to those folks, and we acted that way.

So if you want to succeed with customers, find specific, actionable ways to take away the buyer’s risk. This is why the smart sellers who invented modern retail created the money-back guarantee. That’s why performing as promised counts so much. It’s also why reputation and customer referrals matter to every business. They eliminate the perception of risk and evaporate the buyer’s anxiety.

All Customers Have Pain. Take It Away.

A famous ad man of the Mad Men era was asked by a young social media marketer, “What is your philosophy of advertising that has made you so successful?” The ad man replied, “People have a headache. They want it to go away.”

This is why performing as well or even better than the customer expects you to is an all-essential ingredient of success. People love whoever it is that solves a problem or fills a real need. Put all your energy and focus on understanding the exact nature and depth of your customer’s problem, then on fixing it in a way that’s obvious and true. Do it time after time and you will build trust, a base of repeat customers, and the referrals they bring.

All Customers Want You to Make Their Life Better. Do It.

Taking away the pain of a headache, the embarrassment of frizzy hair, or a difficult, costly production bottleneck makes a customer’s life better. So does bringing them a new pleasure or delight, like putting 10,000 songs in the palm of their hand with an iPod or delivering a really wonderful, relaxing Caribbean cruise.

In fact, this is the ultimate answer to the eternal business question: “Why do I need it? Why does the world need you to be in business at all?”

The answer is to make lives better by making people happier, healthier, smarter, more free of pain and fear, sexier, and more appealing. It doesn’t have to be a big thing—remember the 1 percent rule—just a better thing.

This again, is about performance. This is what you must be number one in. Make sure it’s obvious to the eye and consistent to the touch.

All Customers Want to Feel That Their Problem Is Your Problem

Customers are obsessed with one set of problems in the world—their own—and they have an absolute right to be that way. And they expect you to share their obsession. They don’t simply want you to make them feel important, they want to feel like they’re your one and only—kind of like a jealous boyfriend or girlfriend.

Don’t underestimate this dynamic. You must show customers you care about the little things and the big things, the things that say you’re listening and making them your highest priority. This eases their anxiety and generates trust. Action is always what counts, but the right words and attention matter, too. Just don’t ever skimp on the action.

All Customers Want It Easier

You product needs to be easy to buy, easy to install, easy to understand, easy to afford, easy to use, easier than your competition’s, and easier than the customer expected. It’s a universal law that easy beats hard and simple beats complicated. Your customer’s world is encumbered enough by the tangle of modern life and business. No one ever lost a customer for making it too easy.

Great salespeople have known this for centuries. That’s why you’ll see them taking away all the obstacles that get in the way of purchase. A customer may be sold on your solution, but if there are too many forms to fill out, too many hoops to jump through, too long a wait for delivery, or too many options to choose from, they’ll give up in frustration and seldom come back. On the other hand, if all your competitors make them jump through hoops that you can streamline into one-stop shopping and one-click ordering, you’ll win the business on that difference alone (providing of course that your product performance is up to par).

All Customers Want It Faster—But Not Too Fast. Doing It Right Matters Most.

A successful entrepreneur once said, “Speed is never wasted.” Amen. There has never been a customer who had a problem that didn’t want it fixed fast. If you are in a customer-service–oriented business, fast is always your friend. Just be careful not to be so fast that the job isn’t done right or the product won’t perform. Over time, you’ll learn that “doing it right the first time” is most important to most customers. So faster is always better—as long as you fully perform.

All Customers Want Proof. Make Sure They See It.

This one is critical for getting prospective customers to give you that first order, and for longtime customers to stay loyal to you and your brand. Unfortunately, “you’re only as good as your last performance” is a fact of life for most businesses that aren’t monopolies or public utilities. Customer loyalty only goes so far. When you go to your favorite restaurant, you expect to get a great meal with minor variance. After all, that meal is still pretty expensive for most folks. A loyal customer will cut you some slack when you fall down once, maybe twice. But that’s about it. Budgets and time are too precious in today’s world. If you fail to perform, they may still like you but they can’t afford to stay with you.

Here’s one of my all-time favorite proof stories:

Once the founders of Rackspace decided they were going to become the world’s number one customer support company in a category that offered none, and in a market made cynical by too many false claims, they had to prove it. They came up with signature language to flag their position (Fanatical Support), but then they needed signature deeds and behavior to make it tangible as well.

So they changed their system so that any support call would always be picked up by a human being, never a recording. They staffed up so calls could be answered on the first ring and every customer could be assigned a dedicated team. They made sure all Rackers knew they were empowered to do whatever it took to solve a customer problem—that no one would ever be reprimanded for going the extra mile and using extra resources, as long as it was to serve the customer. Then they even challenged their own people to test it and believe it for themselves.

Graham Weston recounts what happened next: “One of our early salespeople was trying to close what would’ve been by far our biggest customer ever—the order would’ve been for 22 servers. Unheard of. The salesperson got on the phone and said to the prospect, ‘You say support is important? Well, we’re going to give you Fanatical Support. Here’s what that means. When you have a problem, our team will be there with you until it’s fixed—24/7, 365 days a year. That means, if you call us up at 2 AM on Christmas Eve with a question about Linux, our team will be there, just like if you called right now. Go ahead and test us—we’re serious.’

“Sure enough, the prospect actually called back at 2 AM on Christmas Eve. They got a Racker on one ring. They asked a Linux question. The Racker said brightly, ‘Sure, let’s get right on that. I’m going to bring some other members of my team on the line, Lorenzo and Debbie, who have more Linux expertise than me and can answer it for you.’

“The prospect said, ‘Thanks, Merry Christmas,’ hung up the phone, and ordered 22 servers.

“We said it, we proved it. We succeeded with that customer.”

More important, they made sure they were prepared to do the same thing for thousands of other customers—and to do it over and over again, proving their performance unceasingly.

We think that’s a pretty good definition of UnStoppable.

THE MOST IMPORTANT PRINCIPLE OF ALL: WEAR YOUR VALUES ON YOUR SLEEVE

The psychology behind your customers’ feelings about you depends entirely on the psychology of your own people—your teammates, partners, associates, every stakeholder who serves them; the ones who want to believe they are valued members of a winning team on an inspiring mission. If they believe their mission is to succeed with customers above all else, they will do everything in their power to help their team accomplish it. When they believe, they make customers believe. It’s one closed circuit. Customers want to believe they can trust you to solve a problem and enhance an opportunity. Actions prove it.

Your people work the same way. Values need to be articulated clearly, simply, and repeatably with a few words. Then, only the actions of leaders walking the walk will prove your priorities and make them real.

For Rackspace to become the Fanatical Support company, company leaders had to allow their simple values to become real with Rackers. If they said no one would be reprimanded for doing the right thing for a customer, they had to mean it. If they said they were going to answer the phone on one ring, they had to invest the resources and incur the extra cost to do it. They had to live their values and their mission inside to make it real to the people who would bring it to life on the outside.

“Character is what you do when nobody else is looking,” but people are always looking to see that we mean what we say. Your values are paramount because they always are in any culture that puts customers first.

What’s Measured Is What Matters—The Net Promoter Score®

Finally, if something matters in a company or a culture, and you want to prove that it does, then you must measure it, for two reasons:

Nothing mattered more to Rackspace than their mission to be the best service organization in the business—and for the market to know it, too. They knew this reputation only counted in other people’s heads, not their own, so they needed a way to measure it. And after a few years of searching, they discovered the Net Promoter Score (NPS)—a system of measuring customer happiness first introduced by Fred Reichheld in 2003 in a Harvard Business Review article titled “The One Number You Need to Grow.”1 They’ve used it as a key customer retention asset worldwide, ever since.

The NPS says that the ultimate measure of how you’re doing with customers can be answered by a single question after using your product: “Would you recommend us to a friend?” One could say that this question is the single most important and powerful question in customer loyalty. If the answer is yes, you’ve not only succeeded with that customer, but with the others she’ll inevitably urge to try your product. It’s more important today than ever in our digital word-of-mouth age where customers can promote you or dis you with a touch of the screen.

Graham Weston reports, “The NPS was revolutionary for us because it was so simple and it actually worked with our people and customers.” It rates whether a customer would recommend you on a low-to-high scale of 1–10, and it doesn’t allow cheating. Customers who pick a score from 1 to 6 are actually called “detractors.” They are unhappy with their experience and they will broadcast it to others. Those who pick 7 to 8 are “passive,” neither here nor there. Only customers who score you as a 9 to 10 on whether they’d recommend you are your promoters. They are delighted with your service. They will actively tell others because people love to tell their friends and colleagues about experiences they love—almost as much as they complain when an experience is bad. Either way, they will do it.

Because the test is so simple—unlike those 25-minute surveys the airlines ask you to take after they’ve already kept you on hold for an hour—a high percentage of people will stop what they’re doing to answer you. And once you’ve broken the ice and gotten permission to ask this simple question, they’ll give you an additional golden opportunity.

You get to ask them, “Why?”

The “verbatims” you get are worth their weight in gold. You add up all the scores and get one numerical value that you can track to see how you’re doing over time.

By now, you should see a basic UnStoppable theme at work in the Net Promoter Score. NPS is not 100 percent perfect, but it represents one of the best aspects of the UnStoppable doctrine: simple, consolidated truth. It’s another MAP—one magic question that automatically lines up a series of critical answers in the right sequence and guides you in the right direction with a single ask.

Think about it: to answer 9 to 10 on the recommend-to-a-friend scale, the customer has to trust you, be willing to buy again from you, think you’re worth the price, imply that you’re a number one choice, and have a positive enough emotional impression of your people and product that she’s willing to tell other people what she respects about you.

It also helps you avoid the “too much data makes you dumber” trap. As we’ve seen, the biggest mistake in research, often attempted by Optimizers for efficiency reasons, is to ask too many questions on too many subjects when they get the chance to talk to a customer. The questions start to contaminate one another, the respondents and clients get confused, and the research yields a mishmash of nothing. Less is more when it comes to meaningful customer research.

Instead, ask a much smaller number of much more important questions. The NPS asks just one (“Would you recommend us to a friend or colleague?”), and only one more (“Why?”) if granted permission.

The NPS has allowed Rackspace to measure how they’re succeeding with our customers—to pat themselves on the back when they improve and smack themselves on the backside when they don’t. Some legendary customer-centric organization in other industries use it as well, including Zappos.com (the online shoe seller) and Nordstrom.

The Psychology of Your Customers

We talked about what all customers and team members want in order for you to succeed with them. Now there is only one group left to mention: your customers, the ones in your category, your geography, your affinity group.

You find out the deepest details about what they need, want, like, and don’t like, and how they want to be treated, sold, and serviced, by doing one thing: asking them.

You must go outside and talk to them. This is the simplest, most important advice you can take from The UnStoppables. Your customers want to be listened to and cared for. If they believe you do these things, they’ll give you the keys to succeeding with them.

Those are the keys that count.

1 Frederick F. Reichheld, “The One Number You Need to Grow,” Harvard Business Review, December 2003, http://hbr.org/2003/12/the-one-number-you-need-to-grow/ar/1.