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- Almost three out of four Americans work in service.
- A service does not exist when you buy it.
- You cannot see, touch or try out a haircut before you buy it.
- You usually know when a product fails - it stops working. How do
you know when the service fails?
- Services cannot be warranted because the outcome is so often not
measurable.
- Service acts and processes cannot be easily
routinized.
We usually don't take product failures personally.
However, services are
usually provided by people we have met and we blame them when our
expectations are not met. Services are often bought because they are needed, while products
are bought because they are wanted. Often when selling products the support services makes or breaks it.
This is what adds the value.
Better reality in your service will make marketing
easier, cheaper and more profitable. Fix your service before you start
advertising. Too often service sucks. The average person thinks he is above average. Sixty percent of
students said they were in the top 10% in getting along with others.
Ninety-four percent of University professors say they are doing a
better job than their average colleague. Most men think they are good
looking. Assume your service is bad. It can't hurt and it will
force you to improve it. How can McDonald's deliver spotless rest rooms and world-class
French fries in 50 seconds for 79 cents? Forget the excuses - do it.
Who sets your standards: the industry, your ego or your clients?
Our expectations have been raised by McDonald's, Walt Disney and
Federal Express. Develop new benchmarks of service quality.
- The Butterfly effect: Tiny efforts huge results - Tiny Cause - Huge
Effect.
- Hire the right people.
- When you make mistakes, how you treat the customer is critical.
Write an ad for your service. If, after a week, the ad is weak, stop
working on the ad and start working on your service.
Delta was the best airline. American developed Sabre
electronic reservations. Travel agents found it easier to book through
American. Delta's heart was Customer Service but it didn't have the
"brains" to support it.
Don't just think better, think differently.
Is this viable anymore? Is this what the world wants? Have we added
capabilities or skills that suggest we should enlarge our scope? Should
we develop or acquire related skills and capabilities? Should we narrow
our scope and leverage our specialized skills?
Stage one is product driven. Give the customer the basic model
- The
Model T.
Stage two is Market Driven. Offer the desired product - the fully
loaded Lincoln.
Stage three is going beyond client's expectations and expressed
needs: heated car seats, consoles that tilt towards the driver (Lexus
quality).
Surveying
- Even your best friends won't tell you. Have a third party do your
surveys.
- Your customers appreciate the survey. They'll see you are trying
to improve (see page 25)
- Written surveys can be ambiguous, e.g., How do you define quality.
Beckwith recommends doing it by phone. His concern about Focus Groups
is that the dominant people will prevail. You are selling individuals;
talk to individuals. A voice conveys feelings that words can hide.
- Never ask "What don't you like?" You are asking
someone to admit they made a bad decision.
Marketing is not a department; it is your business.
Everyone in your company is responsible for marketing your company.
Seeing the real scope of your business is hard. Ask for help. You
are in a tunnel, talking about yourself. You need to know about your
customers and prospects.
Don't open a shop unless you know how to smile.
Every act is a marketing act. Make every employee a marketing
person.
WHAT ARE YOU GOOD AT? In planning your marketing, don't just think
of your business. Think of your skills. Your strength might be outside
your industry (particularly if your industry is mature).
Find out what clients are really buying. McDonald's is
selling an experience. Burger King's better flame broiled burger did not win
over the customers.
THIS IS (FOR ME) THE MOST IMPORTANT SECTION IN THE BOOK:
Most companies in Expert Services (Professionals) think their
clients are buying expertise. Most of your prospects cannot evaluate
your expertise. They can't identify a good tax return or a great
diagnosis. They can tell if the relationship is good. Clients
know if they feel valued.
Your professional expertise is assumed - you are selling a
relationship.
Before you try to satisfy "the client," understand and
satisfy the person.
Who are your competitors? They include the customer who does nothing
or does it himself. Your client has four options:
Use you, Use someone else, Do it themselves, Do nothing. Your biggest competitor can be your prospects. Go where others aren't. Who can you serve that
is not being served?
Every service company should have a director of technology. A lack
of technology will hamper you. Your competitors will leap ahead if
they have better technology. "Have we carefully considered
innovative ways that new technology can be used to improve our service
and grow our business?"
Study every point at which your company makes contact with a
prospect. Your receptionist, business card, office, brochure, sales
call. What are you doing to make a PHENOMENAL IMPRESSION at every
point?" Does your client feel respected, amazed, impressed,
delighted? Study each point of contact. Then improve each one -
significantly.
School teaches us that technical competence ensure success. In large part, service marketing is a popularity contest.
Your competence, your excellence, your talent - just pay the entry
fee. Be professional - but more importantly
- be personable.
Planning - The 18 Fallacies
1. Forecasting the future is impossible.
- The baby boom was supposed to create unemployment in the '60s.
- Women were not supposed to enter the workforce. Still there were
plenty of jobs.
- Labour force grew 40%; number of jobs grew 50%
- Many people would work from home; not as many as expected.
- VCRs were going to kill the movie business. Look at the new
theaters.
- TV was going to kill books. Don't tell Chapters. Books get
promoted on talk shows, etc.
- Smoking. No one should, but they do. Healthy eating - we should but
so, why are so many fast food and steak houses doing so well?
- Plan for several possible futures (outcomes?).
2. How do you know what you want?
- Accept the limitations of planning.
- Don't value planning for its results. It's the process
that counts.
- Don't plan your future; plan your people.
3. Tactics are more important than strategy. Do something,
correct it and go again.
4. The better mousetrap? NO! Marginal strategies executed
passionately almost always outperform brilliant strategies
executed marginally.
5. Today's good ideas will almost always beat out tomorrow's
better one. Do it now. Don't wait.
6. Act like a shark - keep moving.
7. Think dumb. Smart ideas often develop from dumb ones.
8. The research shows . . . planning is not a precise science.
Mistrust "facts". Planning is an imprecise act.
9. Beware of focus groups. They focus on today. Planning is for
tomorrow.
10. Beware of what you think you remember.
11. Have a healthy mistrust of what experience has taught you.
12. The Fallacy of Confidence
- Our customers buy on price.
- Telemarketing does not work with this audience.
- Our clients won't pay for higher quality, even if we could
achieve it.
- Opinions become "facts". Maybe others are right and you
are wrong!
13. Perfection
-
Very good
-
Good
-
Best
-
Not good
-
Truly god-awful
- Being best can be too complicated - Aiming for perfection can be
stifling.
14. Failure is failure. Start failing and you can start
succeeding. Fix as you go.
15. Expertise: Don't look to experts for all your answers.
There are no answers, only informed opinions.
16. Authority: The bosses have authority. The people with the
good ideas often don't. The bosses have much to lose. They
protect their positions. Listen to others.
17. Common sense can be a shield, not a sword. For inspiring
results, you need inspiration.
18. The Fallacy of Fate - You gotta believe. "We tried that. It didn't work." TRY IT (OR A VARIATION)
AGAIN.
HOW PROSPECTS THINK
- Why do people buy what they buy?
- Why use American Express credit card? No logical reason why there
are 25 Million in the US.
- Choosing the familiar. Familiarity breeds business. Spread your
word however you can.
- The Recency Effect. Follow up brilliantly. Have a well thought out
follow up approach.
- Choosing "Good Enough."
- Forget looking like a superior choice.
- Make yourself an excellent choice.
- Eliminate anything that might
make you a bad choice.
THE ANCHORING PRINCIPLE
People do not simply form impressions - they become anchored to them.
What anchors have your prospects already attached to you? Can you
overcome them? Identify and polish your anchors.
Last Impressions Last
- Each impression you make will - temporarily, at least - be your
last. Make it strong.
- Risky Business
- Hungry in a strange town? You are likely to choose a food chain you
know rather than risk some local spot. Customers like to minimize
their risk.
- Eliminate the prospect's fear. Try Risk Reversal
- Show your warts: Rather than hide your weaknesses, admit them.
- Tell the truth. Even if it hurts, it will help.
BUSINESS IS IN THE DETAILS (In my opinion this is critically
important).
- The more alike two services are, the more important the
differences.
- Prospects look for differences. Accentuate the trivial.
- Remember: The more similar the services, the more important
the differences.
Positioning &
Focus - The more you say the less people hear.
Fanatical Focus: Positioning
- You must position yourself in the prospect's mind
- Your position should be singular: one simple message
- Your position must set you apart from your competitors
- You must sacrifice. You cannot be all things to all people;
you must focus on one thing
Stand for one distinctive thing that will give
you a competitive advantage
- The fear of positioning: To stand for one thing you must sacrifice
the others.
- SAS created EuroClass for business travelers. By charging more for this, they were able to charge less for
tourist travel.
- Regular US law firms wouldn't handle M&A (mergers &
acquisitions). New firms did this. One became the largest law firm in
the US. The result was that clients said if they could do M&A they
could do anything!
In your service, what's the hardest task? Position yourself as
the expert at this task, and you will have lesser logic in your court.
HALO EFFECTS: People
associate. We tend to think that
attractive people are smarter, friendlier, more honest and more
reliable than less attractive ones. We associate one positive thing
with many other good things. We assume poor people lack initiative and intelligence, are less
trustworthy and less concerned with cleanliness and appearance. We
associate one negative thing (poverty) with other negatives. Say one thing and you will become associated with many.
NO TWO SERVICES ARE THE SAME: Every service is different.
Creating and communicating differences is central to effective
marketing. Everything can be made different: ketchup, flour, pickles, sugar,
salt, gasoline. Because service is people, it is easier to be
different: passion, energy and optimism. If you cannot see the differences in your service, look harder.
Position is a passive noun, not an active verb. We want to position ourselves as the market leader. We can't. No
company can position itself as anything. Your position is a place.
Someone (your customers) put you there. All you can do is influence
the prospect. Take your position and turn it to your advantage. Avis -
We're Number Two - We Try Harder. Don't start by positioning your service. Instead, leverage the
position you have.
CREATING YOUR POSITIONING STATEMENT
A positioning statement states how you
wish to be perceived:
- Who: Who are you?
- What: What business are you in?
- For whom: What people do you service?
- What need: What are the special needs of
the people you serve?
- Against whom: With whom are you competing
- What's different: What makes you
different from those competitors?
- So: What's the benefit? What unique
benefit does a client derive from your service?
Have seven good answers to these seven questions
|
Who |
Bloomingdale's |
|
What |
Fashion-focused department stores |
|
For whom |
For trend conscious, upper-middle-class
shoppers |
|
What need |
Looking for high end products |
|
Against whom |
Unlike other department stores |
|
What difference |
Bloomingdale's provides unique merchandise in a
theatrical setting |
|
So |
Makes shopping entertaining |
|
Generic Sample |
|
Who |
John Doe Inc. |
|
What |
Small service company |
|
For whom |
To serve smaller clients, who want pretty good
quality but do not want to pay for the services of a larger
company |
|
What need |
Looking for reliable service |
|
Against whom |
Unlike its bigger and better-known competitors |
|
What difference |
Smaller, owner operated, lower overhead, faster
response time |
|
So |
We meet your needs faster and at a lower price |
Narrow the gap between your position and your positioning
statement. Get prospects to move from how they see you to how you want them
to see you. Will people believe your positioning statement? Canadian Tire has gone against the rules. It positioned itself for
tires but now does a wide range of products. If the gap between our position and your positioning
statement is too big, your customers won't make the leap. Keep your
steps small. An over ambitious Positioning Statement can be your long term goals. Choose a position that will reposition your competitors, then move a
step back toward the middle to cinch the sale. In positioning don't try to hide your small size. Make it work by
stressing its advantages, such as responsiveness and individual
attention.
- Focus: Neiman Marcus: "Stuff to die for!"
- Wal-Mart "good stuff so damn cheap you won't believe
it".
- If your prospects cannot define your position, you don't have one.
No matter how skilled you are, you must focus
your
skills.
PRICING
- Pricing often defies logic. How does American Express do so well
when it is so expensive? Logical pricing might not work for you.
- If no one complains about the price it is too low. If almost
everyone complains it is too high.
- Ten percent will always complain about the price. You should expect
to get about 20% complaining if your price is right.
A little resistance to your pricing is a good thing
Pricing your service in the middle tells your customers you aren't
that great. You are saying that you are middle of the road in price and
service - a busy and not great place to be.
THE LOW-COST TRAP
- Low cost retailers usually don't survive.
- It is a relatively easy market for competitors to enter.
- Have to deal ruthlessly with suppliers.
- Hard to motivate employees.
- There is nothing unique about pricing.
- There is always someone out there who will be lower than you.
- Beware of rock bottom.
VALUE IS NOT A POSITION
Value is not a competitive position. It is what every service
promises (implicit or explicit). If good value is the first thing you communicate, you
won't be effective. If good value is your best position, improve your
service.
Give your service a name not a monogram. No IBM, HRAI, etc. Don't get funny with your name. Stand out - don't be generic. Make sure your name doesn't get
confused with others. Never choose a name that describes something that everyone expects
from the service. The name will be generic, forgettable and
meaningless. A company called Creative
Design does not have a very creative name. Likewise Quality Cleaners. The mind remembers names that are unique, sensory, creative and
outstanding. John Jones is an ordinary guy. How about Michel Germain or Faith
Popcorn? Be distinctive - and sound it. The name is often the first impression. How much valuable
information per inch does your name imply?
IN SERVICE MARKETING ALMOST NOTHING BEATS A BRAND.
Store and generic brands have 7% of the market. Name brands have 93%. A brand is a warranty in itself.
A brand is a guarantee that the warranty won't even be needed.
A service is a promise, and building a brand builds
your promise. The most desirable service is the one that keeps its promise. Likely
a brand. Preach integrity. A brand will have three effects on your sales:
-
Someone hears a good story but may forget the
company or brand name and therefore cannot pass it on. Word of mouth
for a branded service spreads easier.
-
Prospects feel more comfortable with a brand. You get a higher
closure rate on prospects. You are making it easier for them to buy.
-
To justify buying a generic product, you have to do a lot more
"due diligence". Nobody ever got fired for buying IBM.
Make selling easier, faster and cheaper. Build a brand. Never underestimate the value of your brand or the
difficulty in creating a new one. Leaving a well established company to go on your own means you have
to create the new brand. A brand is money. If you are building your own brand choose an unconfusable name.
Building your brand doesn't take millions it takes imagination.
Communicating
We trust products more than services. We can kick the tires. Make the service visible, and make the prospect comfortable.
YOUR GREATEST COMPETITOR IS INDIFFERENCE. People are interested in themselves. Tell them what's in it for
them. They don't care about your great company. Say one thing - saying many things usually creates confusion. The prospect says "Give me one good reason . . . "
After you say one thing, repeat it, I said "repeat it." One story beats a dozen adjectives. Attack your first weakness; the stereotype the prospect has about
you. Do dentists cause pain? Is so, that's what they need to address. Create
the evidence of your service quality. Then communicate it. No tricks. Skip silly or unprofessional ideas.
PROSPECTS DO NOT BUY HOW GOOD YOU ARE AT WHAT YOU DO. They buy how
good you are at who you are. People deal with you because the feel comfortable with you. Convey
that you are "positively good." It is better to say too
little than too much. Watch what you show - lobby, clothes, business card, etc. Make sure
people see who you are. Make the invisible visible. There is no correlation between the orangeness of an orange and its
flavour. Growers pick oranges when they are green. They never get any
riper or juicier. The oranges are coloured artificially. Seeing is believing, so check your peel.
-
Restaurants are in the entertainment business not the food business.
People go for the experience.
-
Watch - and perfect the visual clues you send
-
Repeat yourself visually. It makes you look more
organized and easier to remember
-
Give your marketing a human face: People deal with
people
-
If you are selling something complex - simplify it
with a metaphor.
-
Words are the weapon. Active, powerful, fresh words can do more than
describe reality.
-
Sometimes, it's all in how you say it.
-
Don't use clichés.
-
Don't talk unless you can improve the silence - get to the point
or you will never get to the close.
-
Tell people in a single compelling sentence why they should buy from
you.
-
In your words and pictures make yourself vivid.
-
You cannot bore someone into buying your products.
-
Get publicity.
-
Advertise, that's part of publicity.
-
Anything can be made to sound interesting - look harder.
-
Devote half your time to creating the reply form when doing a direct
mail program.
-
Make your services easy to buy.
-
Don't sell your service. Sell your prospect
-
Find out what they want; what they need and who they are. Talk about
the prospect.
-
Be passionate about what you are doing.
-
Mission statements are not for marketing materials. If your mission
statement isn't producing - fire it.
-
Sell happiness or the hope of it! Sell hope.
Relationships
-
Watch your relationship balance sheet - assume it is worse than you
think and fix it
-
Don't raise expectations you cannot meet
-
To manage satisfaction, you must carefully manage your customer's
expectations
-
You cannot thank your client too much. Send more thank you notes
-
It is much easier to fail in a service than to succeed.
Relationships are often not very deep. Trust takes time
-
Advertise your successes. Show your client what you have done. If
you do better than expected tell them. Make sure the client knows
-
With a product the item is there to remind you how pleased you are
with it. Not so with a service. You forget you got it. Will you
remember for the next time you need the service? Out of sight out of
mind!
Quick Fixes
-
Sweat the smallest stuff. How good is your phone manner?
-
Be fast. Then get faster Say P.M. Deliver A.M.
-
Make every client happy every day. Put this note by your phone.
-
To fix your messengers, fix your message.
-
Make the message effective.
-
Selling a service involves personal risks - risk yourself.
-
Get out there. Let opportunity hit you.
Summing Up
You must get all your ducks in a row. Marketing is only one of them.
Hotels wrap glasses in cellophane to show how clean everything is.
Review the summary for other books and information.
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