The business environment is changing and if you have been in business for more than 5 or 10 years, you, like everyone else, are making less profit for more effort. It’s been slow and insidious. Think about small business owners 20, 30 and 40 years ago. They built our communities, made a great living and got weekends off. Not so much anymore.
This isn’t rocket science. What Zig Ziglar said years ago is still true: You will get all you want in life if you help enough other people get what they want. What do people want? They want their problems solved and they are willing to pay for it. It’s not that we don’t have enough customers, it’s that we are trying to be all things to all people.
We have been seduced out of our profits with these 3 myths:
3.Thinking everyone is your customer
Every time I ask a business owner what they need, they invariably say they need more customers. Your instinct like everyone else’s is to look for more customers when you want to increase revenue. By the time you have been in business 5 years, you have attracted all the easy customers you are going to get with what you offer. It will cost you more to get more customers.
You know the customers who drain your energy and your profits because they are hard to please. They are not your customers. You know other customers who bring a smile when you see them. Treat them like gold and delight them.The thing is, you probably have enough customers if you focus on the great ones and drop the others.
2.Not focusing – trying to be everything for everyone means being nothing for no one.
The more focused you are the better you are able to deliver your solution, the more delighted your customers will be and the more you can charge. You will make more profit if you focus on making a smaller number of customers very happy.
Focusing means you develop more skill, you gather the best tools and you get a great reputation. The bigger your reputation, the wider your customer base becomes. How far would you travel for the best hair dresser and how many other hair dressers would you pass by on the way there?
1.Thinking better value means a lower price
Another instinct is to lower price to attract more customers. Lower prices attract bargain shoppers who will come to you for price and leave you for price. More revenue doesn’t mean more profit if you are selling more units for the same revenue.
Lowering your price will give you less ability to make the experience better. Research shows that people are willing to pay more for a better solution. The price/value spiral is either increasing or decreasing. The more value you give, the more you can charge and the more value you can give. Or, the less you charge, the less value you can give and the less you can charge. You choose.
Your great customers want your best service and they will pay you well for it. Think about it. What are you willing to pay more for and what service would you like for that? Think about eating out. What are your expectations when you pay a little vs when you pay a lot? Which place would you rather own?
To grow your profits and make your business easier you need to make your great customers very happy. Do you know who your great customers are? How they found you? Why they chose you and what delights them?
The 3 levers you have in your business to make change are: experience, environment and value exchange. Create an experience your customers want, make your environment work for you and design a generous value exchange. Learn about events and exactly how we can work together