How to Survive and Thrive when Change Is Constant
In our times, when the speed of change appears to be either hair-raising or exhilarating, depending on your native ability to deal with it, small business owners need new survival skills. Bruce Kasanoff and Michael Hinshaw, authors of Smart Customers (Stupid Companies): Why Only Intelligent Companies Will Thrive—and How to Be One of Them,[1] have lots to say about customers, empowered by new technologies, forcing businesses to change.
Citing such data as a Motorola Solutions survey showing that 55 percent of retailers say shoppers are better connected to information such as price comparisons than store associates are,[2] the authors say companies that do business the same old way, instead of using technology to serve customers better, will not survive. Whether your company is B2B or traditional retail or e-commerce, your environment is changing. How can small businesses use smart technology to stay ahead of customers? We put that question to Kasanoff in an interview.
Survival Skill #1: Responsiveness
“Radically higher customer expectations” mean responsiveness is more important than ever. Small businesses have to be just as fast to get information out and to get products into shoppers’ hands as a company with thousands of employees. “I don’t think that as a small business you can ever really close today,” said Kasanoff.
Using a plug-in or a third-party app, he said, business owners can ensure that customers can “order from you while you’re technically closed, or can check on the status of an order or check if [an item] is in stock.” One inexpensive app that gives you these abilities is My Cyber Twin,[3] chosen by PC Magazine as one of the best small business apps for 2012. In addition to mitigating customer frustration, assigning a bot with artificial intelligence to chat with customers gives you insight into what customers are thinking. And according to the My Cyber Twin website, 95 percent of the audience thought they were talking to a human.
Survival Skill #2: Ability to Change
“Everybody has to think like a startup,” said Kasanoff. No one can feel safe from losing customers to companies that are more nimble and connected to their customers. He suggests that in this environment where your customers are armed with smartphones, you keep your company relevant by answering two questions: How do I serve my customers better? What can I do today that I couldn’t do last year?
Perhaps you could remember information for a customer, adding a Wish List function to your website, or even doing it with a pen and a notebook. Make note of an item that a customer admires and wants, but not at the current price. Make note of a price at which the customer would be happy to buy the product. Then, at a future date, if you happen to have that item still in inventory, you can contact the customer and make the sale at the lower price.
“Let’s think about the implications of that: a) I teach you that if you tell me what you want there’s a pretty good chance you can get it, and b) I can run a sale without ever running a sale. So I don’t have to publicly discount my stock which cuts my profit margin… and at the end of the season when I have stuff left over I can convert my inventory to cash so I’m protecting my profit margins and I’m delighting my customers at the same time,” Kasanoff said.
Big Change: Customers in Control
The balance of power is shifting from sellers to consumers, with huge implications for every B2C company, but for e-commerce companies in particular. The way online sellers have traditionally worked to target customers more precisely is by tracking them, collecting data on what they search for, how long they stay on particular web pages, and so on. Kasanoff describes his own recent experience going to the Warby Parker eyewear site, where he didn’t buy anything, but for a week after that, everywhere he went online, a Warby Parker ad popped up.
“That’s the dying gasp of the old way of marketing,” he said. Companies are tracking people online... saying, ‘Buy something,’ ‘Do something,’ as opposed to, When I need something, I’ll tell an intermediary who will broadcast out I need a faucet for $95.”
Intermediary sites of the sort he’s thinking of are more fully described in an article by Doc Searls that ran in The Wall Street Journal.[4] Searls writes that the change is under way for consumers to be able to shop with what he calls Personal RFPs or Intentcasts, but in the article he places the working product in a future 10 years off. Kasanoff says we are “probably six or 12 months away” from seeing intermediaries who will take the customer’s order requirements and then feed the details to companies who will bid to fulfill the order. Here’s a graphic that Kasanoff put together about the dynamics of the idea.[5]
Know Your Customers Well
To be ready for a change this dramatic—turning the entire buying-selling model we know upside down—you need to have a trusting relationship with you customers. And for that, you need to know exactly what your customer wants (perhaps his or her wish list). Every time you talk to a customer, learn something, Kasanoff advises.
“You can’t compete on price, you have to compete based on doing different things for different people, and therefore building trust with customers such that they’re willing to tell you things that your competitors don’t know. It’s really the only way that you’ll survive the next couple of years.”
Every time you talk to a customer, learn one or two things and “make a record of that so you have enough to call the customer in a month and offer to help them,” he said. In Kasanoff’s company, the method is called drip irrigation. It’s an apt name for a tool used for growing thriving relationships.
[1] Why Only Intelligent Companies Will Thrive—and How to Be One of Them [2] 55 Percent of Retailers Cite Shoppers As Connected to Information [3] My Cyber Twin [4] The Customer as a God [5] The Emergence of Wish Lists
