What do your customers value? A survey of HDAW attendees said availability/delivery of a product was the top thing, followed by the product knowledge of your sales staff, and third by customer service/ease of doing business.
Being customer-focused helps win the pricing battle. (Photo by Jim Park)
Price was number five on the list.
"Every survey I've ever been part of, price was four or five on the list," said Harry J. Howard, CEO of How2Consultants, which provides business consulting to the industry. "But it's the first place sales people tend to go when they're faced with objection - unfortunately."
You need a balance between price and value, Howard said. A big part of value is customer service. And everyone, Howard said, is responsible for customer service - not just management, not just the counter people. Even the building maintenance guy, because a poorly maintained facility affects the customers' view of customer service.
"There are two types of companies," Howard said. There are those who focus solely on themselves, on cutting costs, earning profits. The second type is customer-focused, and balances profits and customer service goals. They know their internal and external customer needs because they do research to understand those needs. It is part of their culture.
"The minute you arrive at that facility, you understand they are very much customer-focused."
First impressions are extremely important, Howard said.
When you meet someone face to face, body language makes up 55 percent of that impression. Tone of voice makes up 38 percent. The words you choose are only 7 percent.
Body language consists of things like maintaining eye contact, facial expressions, body posture, hand gestures, touching, and physical distance. On tone of voice, you're looking at things like volume, matching the pacing of the customer's speech, and intensity and emotion. The words themselves should be pleasant and calming. Avoid profanity and slang, as well as the excessive use of acronyms.
Over the phone, tone of voice makes up 86 percent, words about 14 percent. Here you need to pay attention to things like answering the phone promptly and avoiding annoying things like putting callers on hold as soon as you answer or having employees with poor message-taking skills. People should always end the call by thanking the caller.
Voice mail is a great tool, if used properly. But make sure messages are changed regularly so customers have an expectation of when they'll get a call back. If you have a menu tree, don't have more than four options. Provide the 0 option for someone to get a live person. And most important, return those calls promptly.
The first impression also includes the appearance of the business itself - how easy it is to find, neatness, cleanliness, well lit - as well as personal appearance - grooming, uniforms, etc. You never really get a second chance to make that first impression.
Customers respond positively to a smile, Howard said. It's an innate response, we're all born with it. Can a customer hear a smile over the phone? Absolutely. "You know you're connecting with a customer when you smile," he said. "A smile relaxes you, you seem more open."
How do you measure customer service? In the survey of HDAW attendees, most said customer service is monitored by management observation, with no real formal process of measuring customer service. About 20 percent said they never monitor customer service. "There's a real opportunity to measure customer service in a variety of ways," Howard said.
One of those is through mystery/secret shopping, where an anonymous third party "shops" your company and gives you a report.
Last year, Howard mystery-shopped four distributor locations in one area and found widely varying degrees of customer service.
"I was very surprised by who I thought would give me the best customer service and who actually did," he said.
The best service he found was at the hardest-to-find distributor, a small hole in the wall operator, but they made up for a lot of those disadvantages with great customer service.
The distributor with the largest store, Howard said, had the worst service. He spent 22 minutes doing figure eights around the gondolas, and none of the four counterpersons acknowledged him - even when he purposely dropped a tail light on the floor. Two of them were talking about the recent Kentucky Derby. The other two had a paper spread out on the counter, looking for a used car for one of their sons.
It was only when Howard walked up to the counter and stood there with his arms crossed that someone finally asked how they could help him.
Invest in Training
There's a big opportunity among distributors to improve their customer service training. In the survey of HDAW attendees, nearly 50 percent never trained employees on customer service. About 25 percent said they hold it very few months; the rest did it once a year or with new hires only.
"But this can be a price differentiator for you if you really focus on it," Howard said.
One of the things to train on is how to deal with customer complaints.
"The first thing you do is let them vent, and give them your complete attention," Howard said. Nod your head frequently. Don't take their complaint personally, and avoid what Howard called "negative filter name calling." In other words, don't stand there thinking, "Man, what a jerk," he said. "It will dramatically change how you interact with that customer."
Similarly, there's a right way and a wrong way to say "no" to a customer.
Maybe you're out of stock, or it's against company policies and procedures, or it's just not possible. So what should you do? Focus on what you can do, not just what you can't.
"What they're looking for is a fair solution," Howard said. "Ask the customer what they want. Most times what they want is actually less than what you're willing to give, and by asking them first, you let them feel like they have some control of the situation."
In survey after survey about customer service, Howard said, the following facts hold true:
* Customers will pay 10 percent or more for the same product or service when they get great customer service.
* When they get great customer service, they'll tell nine to 12 more people about it.
* If they get poor service, they'll tell at least 20 other people. (Not counting mass e-mails, blog posts, Internet forums and the like)
* If a customer's complaint is handled quickly and pleasantly, 82 percent of those people will buy from you in the future.
* If you don't remedy the situation quickly, 91 percent will never return.
"Quality in my mind is what differentiates you from your competitors - the quality of your products, the quality of your service, the quality of your people. Customers will pay more for higher quality."
From the May/June 2009 issue of Heavy Duty Aftermarket Journal.