For instance, a customer says he wants framing material that consists of half-inch-thick titanium. He knows that you only provide quarter-inch-thick framing material. If you question him on why he needs a half-inch and not a quarter-inch thickness, suspicions may arise that you are placing your own interests (keeping the sale alive) over his interests. However, if you know his goal is to prevent rusting, you could then ask him how he thinks half-inch-thick titanium helps him prevent rust. Once you know the answer, you can determine whether the size difference achieves his goal, or just ends up adding costs as a diluting feature.
General Categories of Customer Goals
For examples of general corporate categories and specific customer goals, see Exhibit 3-1. (To create more categories and goals that are specific to your business, you can download Market Profile templates from www.measuremax.com.)
Broad Goal Categories
Specific Customer Goals
Administrative
Maximize organizational resources
Ensure compliance with laws and codes
Ensure longevity of organization
Customer Service
Improve customer satisfaction
Improve corporate image
Finances
Improve cash flow
Increase return on investment (ROI)
Improve shareholder value
Increase profits
Competitiveness
Increase market share
Develop new products and services
Maximize engineering, manufacturing, marketing, and selling resources
Open up new markets
Manage growth and change
Operations
Improve reliability
Increase efficiency and productivity
Improve work environment
Reduce operating expenses
Increase safety
Exhibit 3-1: Examples of general corporate categories and specific customer goals.
From Vendor to Supplier to Partner
When you focus on customers’ needs, you are a vendor. Like a vending machine, you display your products and wait for customers to buy from you. You leave it up to customers with a commodity mentality to choose which goodie they want most. The customers’ purchasing decisions are driven by availability of product and price. It is difficult to sell value as a vendor.
When you are a supplier, you concentrate on helping middle-management customers to achieve short-term, measurable goals with the products you supply. Short-term goals usually involve issues that have an immediate effect on only their department, such as improving operations or reducing administrative expenses. You have moved ahead of vendors on the value chain. You also have the opportunity to be compensated for the value your products generate. However, as customers better understand their short-term goals, it becomes easier for them to start picking their products. You now risk becoming a vendor again.
When you help senior-management customers to achieve their long-term business goals, you become a partner. These goals center on Column 2 measurable benefits, such as improving market share, increasing stock price, and reducing employee turnover. You then help customers recognize how your products help them to achieve short-term goals that are consistent with their long-term objectives. Now the Column 1 value of your relationship and the cost of change become greater barriers to customers who consider competitors to be mere vendors and suppliers.
Market Segments and Customers’ Goals
When you understand the concept of market segments, you understand the goals that customers want to achieve. Market segments are groups of customers with similar goals that respond to the same offers in the same ways. Their goals are predictable. When you can predict their goals, you can duplicate your sales successes. The market segments sharing goals that your unique strengths or strongest features can achieve are your best sales opportunities. They place the highest value on your greatest strengths. How far you segment a market depends on the point at which customers’ goals match up to the unique strengths of your products and your company.
Example
Salesperson Judy Wright sells laundry services to hospitals, but not just any hospitals. She knows that large hospitals and publicly funded hospitals do not make good prospects.
The former have their own laundry facilities when they have more than three hundred beds, while the latter always bid out laundry services solely on lowest prices. She realizes that hospitals are not a market segment because they have many varying factors. Instead, she classifies private hospitals with fewer than three hundred beds as a high-opportunity market segment.
The more specific the market classification, the better the chances that your target market segments respond to the same offer, the same way. Obviously, do not classify market segments to the point where their size is minuscule (niche markets) unless your profit margins on those sales are huge.
The concept of market segments further highlights the differences between goals and needs (pain). Businesses set up their organizational structure to concentrate on different market segments. Almost any company these days has groups of employees who cater to specific groups of customers with similar goals. It would not make sense for this type of structure to exist if customers bought primarily for subjective or emotional reasons (pain, needs).
Organizational Characteristics Affect Customers’ Goals
Even taking into account styles, attitudes, and personalities, customers’ goals are not as arbitrary as one would imagine. Two factors influence what goals customers seek and the market segments they belong to: the characteristics of their organizations and their positions. Using these two factors helps you to suggest goals that customers can relate to when you initially contact them. Your knowledge of their goals helps to solidify your status as a customer expert.
Note Sources of information can range from Google on the Internet, www.ceo.com, annual reports, company homepages, Wall Street Journal Interactive, local newspapers, tradeshows, industry publications, other departments in the company, other noncompeting salespeople who sell to the same account, and so forth. Siebel ebusiness has an excellent booklet, called “Information Sources Handouts,” which provides numerous ways to gather data.
In addition, a company’s sales brochures tell you how it is trying to sell value or position its offerings. How a company sells value is often how it measures value. For example, if the company sells reliability to its customers, it is going to seek solutions that improve reliability for them. (For example, FedEx guarantees delivery to its customers and looks for business partners that sell solutions that do the same). Also, try to obtain the sales literature of the company’s competitors to see whether you can offer solutions that help it to offset its competitors’ strengths or exploit their weaknesses.
Organizational characteristics are the primary attributes that influence the way companies view themselves. They are the undisputed traits customers readily identify about themselves. These traits help establish the goals customers want to achieve. Here are a few examples:
The product or service the company is selling. Does the company sell a mass-produced product or does it focus on niches? The primary goal of many car manufacturers is to standardize components. Their huge economies of scale motivate them to have as many models as possible share common components, which keeps their inventory and design costs down. If you sell products that standardize components, you know they “should” interest car manufacturers.
Note The word should emphasizes that you start with customers’ potential goals. Chapter 4 examines the nine circumstances of a sales opportunity that determine the customers’ actual goals, as well as their ability (and yours) to achieve them.
The degree of contact that occurs between the company’s employees and its customers. Is the company isolated from the end users of its product or does it have daily contact? One of a credit card company’s main goals is to improve customer services. Its daily contact with customers means its fortunes directly tie into how well it excels at customer service. If you sell products that improve customer services, you know they should interest credit card companies.
The operating profile of the organization. Does the company operate on an eight-hour day, five days a week or around the clock? A main goal of a convenience store that operates on a twenty-four/seven basis is to improve security. If you sell products that improve security, you know they should interest around-the-clock convenience stores.
The human and dollar costs of interrupted service. Is the company’s operation of a critical nature or low urgency? One of a hospital’s main goals is to minimize downtime. Lives are at stake if the electrical or mechanical system fails. If you sell products that minimize downtime, you know they should interest hospitals.
The image the company is cultivating. Is it high technology or low technology? Is the company viewed as a leader or a follower? One of a sporting goods company’s main goals is to maintain a youthful and healthy image. If you sell products that project a youthful and healthy image, you know they should interest sporting goods companies.
The company’s business climate. Is it in a high-profit, fast-growing industry or a low-profit, declining business? One of a cutting-edge computer company’s goals is managing growth and change. If you sell products dedicated to managing growth and change, you know they should interest computer companies.
The company’s tolerance for risk. Is it willing to take chances or avoid risks? One of an insurance company’s goals is to improve safety. If you sell products that improve employee or policyholder safety, you know they should interest insurance companies.