In today’s world where markets are saturated and there’s not much differentiating, different products from different companies. The relationship that you have between yourself and your customers can have a huge impact on your success.
In this video, we’re going to be discussing the importance of defining your customer relationship. Also, we’ve given you some examples that you can use in your business.
Hi, my name is Aidan and I run a company called Proper Video. In our Business Model Canvas Series, we are joined by an amazing business coach called Paul Aisthorpe from a company called Scale-Ability.
I have personally been mentored by Paul and whilst with him, he helped me work through something called a Business Model Canvas. The Business Model Canvas is a one-page business plan developed by an organization called Strategyzer. It helped me so much that I’ve now interviewed Paul about each building block of the Business Model Canvas hoping that you will gain just as much value from it as I did.
So let’s jump in.
Thanks Paul. So in this video we’re going to start talking about customer relationships which we’ve touched slightly on previous videos. I’m just going to ask you to explain what we mean by customer relationships first.
Ok, thanks Aidan. I think the customer relationship part of the business model canvas is really important because it sort of links into lots of other things, as you’ve already highlighted. How would you define the customer relationship you have with your clients or potential clients in the future as well? What does it look like? Do you want it to be, and it sort of links into your values as well, doesn’t it?
The values of your business. And I know your business it’s on a very personal approach, so it’s a very one-to-one, face-to-face relationship. And it’s not transactional, it’s not offline. Whilst it’s an offline relationship that you want in terms of the websites you have and the marketing. But essentially when people want to do business with you, it’s a very personal relationship that you want to have. And there’s a value to that, that brings. Understanding relationships is really important.
So to move on from there, Paul. Can you give me some examples of how different businesses would have different relationships with their customers and clients?
Absolutely and I think about the business, the consumer and the online retailers such as Amazon for example. And what you might call a very transactional relationship to define it. Where you click on a product you’re buying. And for many years, that’s how it was. But even organizations like Amazon are looking at that part of the business model canvas and saying, “what do we want our relationship to be with our customers and why?” Well, the why perhaps is because they can add more value. If you start to have… And now we see on Amazon things like and we’ve probably seen this for quite awhile now where they make suggestions about products. So it becomes an educational thing about added value. They’re making suggestions for you. There are the chat boxes, they want to have a conversation with you online. So it’s more conversational now. It’s more helpful, it’s more supportive. These are all words that we can use to describe the customer relationship. So once we’re able to understand what we want that to be, for online retailers then they can start to think about that technology advancements that they need to invest in to build that relationship because it’s not easy to build an educational, supportive, conversational relationships through a website, is it? Unless you invest in them.
That’s it and I think you see that trend of like chat bots and things like that. A lot of companies are putting those on the website. And it’s about being responsive and being there ready for when the customer wants to interact. That’s when they want to be there really. And so we’ve talked about online retails and transactional sort of customer relationship. So, obviously an accountant, let’s take an accountant for an example, their relationship with their customer will be much different. Obviously you need a lot of trust in your accountant to actually do it properly and make sure that having your VAT filed on time and things like that. We know all about your finances. So for a service-based business like an accountants, how they would define their relationships with their customers?
It’s a great example accountants. Because if you think about the changes that’s happened in their industry over the last few years and technology and how that changed it. They’ve had a look at their customer relationship because years ago the relationship was once a year. I need to file my annual accounts. You might send your expenses for bookkeeping elements of the service. But you know it tends to be fairly ad hoc, quite transactional as well. I produce your accounts you pay me a fee. So nowadays what accountants have done, accounting firms done, they’ve become more, in terms of their relationship with their clients, more about advice, about support, more regular contact. In terms of how you pay them, you pay them on a more frequent basis quite often as well. Again which lends itself to a more ongoing relationship rather than a once-a-year relationship. So these are all words of describing what your relationship is sort of like. So when all the technology came on, onboard or into the marketplace, where businesses smaller businesses particularly, could handle a lot of that accountancy and bookkeeping. Not need their accountants, what did the accountants do? Than to look at their relationship? What do we want? How can we bring value through developing a different type of relationship? So a lot of them now are offering advice and support that way.
So we’ve touched on some examples. So I’ll use myself as an example, when I was going through this process with you and building on the blocks. We went through the customer journey, and you had me write down exactly what touch points I had. And so from the moment that that particular client engaged with me through any online marketing, referral marketing, whatever, as soon as they’ve contacted me, you had me write down every single step through to completion and then hopefully getting back. It’s sort of like being loyal customers, and retaining them. So can you give me, can you run me through that process that you did with me.
Yes, absolutely. And again, you’ve described it really well is every single point of contact that your client comes into your business with, and every single stage, every touchpoint, to use that word, we defined what we want the relationship to look like. And really what we mean by that is, how do we want the customer to think and feel when they actually come into contact with your business at that point? So basically, what we did basically through our process mapping way, we started from right, okay, they visit your website, how do you want them to think and feel? So we could find that. So they make an inquiry? How do we want them to think and feel? What happens when they meet you face to face? What happens with a proposal? What happens with, the delivery of the service? And then what happens with the financial aspects of the transaction, the invoice? How do we want them to think and feel? And then beyond that, that ongoing relationship, how do you want them to think and feel? And how you want to keep in touch with them? So that’s really important about defining that relationship all the way through, not just from when you’re delivering that service, but all the bits around it.
[End of Interview]
So now we have it. I hope that’s given you some insight into why understanding your customer relationships is important. And given you some clear examples and guidance on how to define yours. Join us on the next video where we’re going to be talking about key partners. If you’d like to learn more or speak to either Paul or myself, there’s a link in the description. Thank you.
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