Customer Competitor metrix

Think about purchasers of your product or service.  Not Your customer but all the customers of your product being service by you, by your competitors or not being serviced by anyone.  In the simplest terms, all of these customers will be considering a combination of four factors: Price, Product, Place and Promotion.  You and each of your competitors will have relative strengths in the combination of those factors.  One a grid, write product, price, pace and promotion across the top.  Down the side, list you and all of your competitors as well as list unsatisfied.  In the grid, you can then rank how each of you are succeeding in each of the 4 P’s.  Are you where you want to be?  For example, if your unique selling proposition is mid-level price with superior quality and features at somewhat remote locations to keep the cost down, is that where you rank on the grid?  On each feature, you should be, at least, where your unique selling proposition has placed you.  Perhaps better.  Then again, if your rank is better than planned, you may want to either reconsider your plan or adjust your marketing to return to plan  For example, if your unique selling proposition is to be mid-priced and you are ranking as a low priced provider, your business may profit by raising prices.

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Top Five Tips To Effective Surveys

  • 1.) Have a specific objective
  • 2.) Do your homework
  • 3.) Survey your target customers
  • 4.) Run a sample test
  • 5.) Be open to the survey results

Have a specific objective

Clear and concise objectives lead to straight forward unambiguous surveys.  Evaluate all questions against the objective.  If a question does not fit the objective, it doesn’t belong in the survey.

Do your homework

Before you do a survey, understand all that is already known.  Have past surveys addressed similar objectives?  What does other data already available tell you?

Survey your target customers

Survey the segment of people you want to learn about.  If you are offering a service to renters, home owner opinions will not help you.  They may even lead you astray.  In certain situations, it may be helpful to see how your target customers’ opinions vary from the population in general.  If that is your situation, survey a larger population but be sure to be able to segment your target customers in the analysis.

Run a sample test

It is impossible to foresee exactly how people will respond to every question.  The best way to see if their responses are helpful is to run a small test or two.  First have a small group of your internal team take the survey to work out any obvious kinks.  Then run your survey through a small section of your target audience.  Perhaps 10% of your list or even just 100 people.

Be open to the survey results

It is easy to try to use the survey results to support your predetermined position.  Don’t.  Be open.  Listen to your respondents.  Analyze their responses without judgement.

How do you know what your customers what?

Understanding what the customers want is incredibly important to running a successful business.  It allows you to invest in areas the customer values (and would be willing to pay for) while cutting investment in items/features that the customer doesn’t value (and would NOT be interested in paying for).  So how do you know what the customer wants?

While there are many ways and I encourage you to use several of them, one of the basic methods is to look at the data you already have.  If you are able to track purchases at the customer level, you have an incredible amount of power in understanding customer behavior at your fingertips.  One great way to understand different segments of your business is to create a Customer Preference to Purchase chart.  Group your customers based on their average purchase frequency and average purchase value.  Then for each group, list where the top 50% of sales are coming from (or profit if you have widely varying margins).  Group your products/services at different levels to see what differences come up.  I created one for a made-up burger joint below.  Basically, both the average customer (box in the middle) and the high value customers (box on top right) are burger and fries customers.  The high frequency but low average purchase customers (bottom right) basically just stop in for coffee in the morning.  Note that at this level I didn’t separate out my single patty from the double or triple patty.  Drilling down to that level may help important depending on what you are trying to accomplish.

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Another useful way to populate the boxes is to look at how this segment differs from the norm.  It can be as simple as comparing the percent of business a given product category does for your customer segment vs. what it does in total.  For example, dessert may be 20% of the high frequency/high purchase value but only 5% of your total business.  This means that high frequency/high purchase value customers are four times as likely to buy a dessert.

What’s your yardstick?

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Many businesses analyze project results backwards.  Typically, a manager will put together a project proposal that has to go through some financial approval process.  The project will run.  Then the manager will work with an analyst to see what happened.  They will look for the good news to report to their supervisors.  For example, if sales didn’t increase, the manager and analyst may look at sales per customer or number of customers. If not either of those, perhaps units increased.  Now with new media, they may report back on Facebook likes or pins on Pinterest.

To guide the creation of projects, the organization should have an overall yardstick or two.  For example, one of my favorites is “provide a positive and lasting change to sales trend.”  Another great yardstick is, “increase acquisition of new customers.”  By having a couple of significant yardsticks, managers will know that they need to create projects to address the key yardsticks.  Projects that don’t aim to accomplish the key yardsticks are not likely to be approved.  A project to increase customer acquisition may not be approved in a company with an overall yardstick of “increase life value of existing customers” but it may be ideal for a company with an overall yardstick of “increase acquisition of new customers.”  These overall yardsticks may be combined with a few secondary objectives, e.g. “increase presence on social networks” or “increase percent of sales from products produced in company’s factory.” 

When a project goes through the financial approval process specific thresholds on each yardstick need to be assigned.  For example, “provided a positive and lasting change to sales trend” might have two thresholds set on a given project, 3% increase over trend target and 6% increase over trend as a stretch goal.  Once the project is run, the first paragraph of the analyst’s report should include measurement to thresholds on the overall yardsticks.  If the project exceeded the target on the overall yardstick, the project worked.  If it did not exceed the target, then it did not work.  The manager can still report on positive secondary results as learnings for future projects but whether or not the project succeeded in delivering the primary goal (the overall yardstick) is clear.