Don’t presume your customers are loyal
There is a common misconception amongst large companies that the customers from whom they get steady orders are loyal. There are many reasons why a customer may stay with a particular supplier; from price sensitivity or contract cycles to geography or simply that there is no other supplier. With a large customer base it is easy to confuse customers who are loyal with those who are trapped. Beware the silent majority; do you really know what influences your customer’s buying decisions?
A customer’s true nature is shown when a viable alternative enters the market. In the case where customers have been trapped they will happily move to the alternative supplier. A history of bad service has not only given customers a reason to leave, but has given any new competitors plenty of marketing content to aim at the customers who have remained. Without detailed customer insight your strategic options are limited. All too often the only tactical action is to slash prices and there can be only one low cost leader.
Whilst best practice dictates starting a program early and getting customer feedback into the business, it is never too late to start listening to customers. The key is to use the insight to drive changes and make the company more customer-focused.