Dividing Our Customers Into Three Groups
Where should you focus your efforts?
For contractors and companies who provide exterior services there are three categories of customers that require services. Understanding these groups and the differences may help you to determine where you should focus your efforts. As we consider the three categories one item to keep in mind is your business model and how it relates to each. These three categories are broken down to Tire Kickers, Occasion and Event Shoppers, and Maintainers.
This group is most often motivated by an offer, discounts, and coupons. Society has “trained” consumers to not purchase many goods and services without a “deal” of some sort. Very often the offer is what puts the idea of the need in their mind. Because of this group characteristic you will likely have an increased spending in your marketing budget to create traffic and spending. This group may decide to see what the price is with no concept of the value of the service or goods. This group will very often ask “Is this your best price?” or “If I go with you how much can you take off this price?” This is even if it was a discount or offer that motivated them to call they will ask for a deeper discount. A large portion of this group will never see the value in a service or product even if they were to make a purchase. These folks may believe that landscaping is “just cutting grass”, restoring a deck is just “pressure washing it and sealing it”, or go to a fast food or restaurant and make a comment like “it’s a hamburger, how hard can it be.” This group will still have a need for the service but, the effort in selling the service or goods will be greater with less profit margin to close the sale. This group will often want to be the “general contractor” or “be in charge” and want to know all the details in how the service will be completed and want to be part of that process. They will want to hire someone who specializes in a service yet will want to tell them how to accomplish the work. Most people hire a contractor or company to perform work that they cannot do or do not have the time for, thus the need for someone who performs these tasks every day for a living. There is a group that will have a favorite place to get a steak, hamburger, sandwich or something else no matter the cost because of brand loyalty and the value in getting a great meal every time. There are others that are not motivated in this way and this group will only eat where they have a coupon, have a “free” offer like a buffet, or a BOGO (Buy One, Get One) offer. While there is an economic factor to this group, it is not exclusive to this group. There are people who are homeowners or decision makers for larger companies that are in this group. We see it every day when we drive down the road and notice how nicely maintained a business property is in comparison to others where flower beds and landscaping is not as maintained or manicured. This distinguishes who considers curb appeal as a priority. The group that does not seem to have a focus will fall into this category or possibly into the “Occasion or Event Shoppers.”
OCCASION OR EVENT SHOPPERS
This group can also be part of either of the other groups and prioritize needs around events or occasions that arise. For the commercial customer this usually involves an inspection, a visit from upper management or an owner, a planned event like a fundraiser or open house, customer appreciation days, etc. where putting on your best image is the priority. For a residential customer this can involve a wedding, graduation, holiday party or event, or any type of milestone or celebration type event that is a “one and done” occurrence. It is possible that you will be able to move this group to the “Maintainers” depending on the quality performed and the sale of the maintenance service prior to beginning the work or an offer of “rewards” for repeat business. If there is a perceived value to future business based off a pleasant experience or a quality product then moving these folks to the “Maintainers” group can be very beneficial because this group will become great references, give great testimonials, and unpaid sales people for your product or service. This is because they were sold on you, your company, and a pleasant overall experience with your product or service. There is a percentage that leans toward the “Tire Kickers” though and just don’t have the same vision or perceived value that other will have. The “Tire Kickers” that are forced into this category will still overspend here. If it is a commercial setting they want to keep their job and impress upper management so overspending on the budget or taking funds from another area at this time becomes a necessity. For a homeowner, they want to impress family, friends, and others so they feel a “pressure” to overspend more than they normally would for the result. The key in this category is identifying who the customer is in this category and whether to concentrate efforts to moving them to a “Maintainer” or realize they are actually a “Tire Kicker” and too much effort is just a waste of time and energy.
This group takes little convincing on the need for goods or services. These people will buy a product or service when and as needed, they do not want “once in a while” services. They want everything looking good and in working order at all times. They want the latest in convenience and fads. This group is made up of many successful companies and individuals but, there is a percentage that realize a maintenance program or brand loyalty can be cheaper and less aggravating in the long run. These are easy to manage folks who are looking for results and quality as a priority. Don’t mistake this group as spendthrifts though as they became successful or have this mindset of thinking for a reason. They will do their homework and make smart decisions based on results, value, price, and the whole picture. Once you have established a relationship with this group these are the best customers and the accountability is on you to keep them. Delivering what was promised is usually all that is asked. These folks do not necessarily like to be bothered being called for references or give reviews. The best time to get a testimonial from this group is after the initial service is provided or after a visit to maintain or service the account. This group actually adds value to the brand because you have contracts or steady, repeat customers that are most company’s main asset. Targeting this group may decrease your marketing budget because you are not always going after the new sale or dependent on coupons or offers.
When providing goods and services for these groups it is essential to determine where your target customer is in these groups. This should determine a strategy for continued business and help you to decide what your business model is. Even though you can buy jewelry at Kohl’s or Walmart does not mean that it is the same customer who will make a purchase at Saks Fifth
Avenue or Tiffany’s. Knowing which groups you are targeting helps you make a business plan. If you want lower prices and want to make profits on volume you will fail trying to work the same business plan you would implement to the ‘Maintainers” as they will not view you on the same level as those they are likely to hire or do business with. Conversely, trying to provide quality repeat business to “Tire Kickers” will also lead to failure because even if you need the business you will be less profitable offering your quality goods or services at discounted pricing. After a time your customers will expect this quality result of cheaper pricing and raising prices at a later time usually pushes them away. There is not a lot of brand loyalty in the “Tire Kickers” group. You have now created a real problem for your goods and services that usually leads to failure. Target your customers, devise a business plan with goals that represent the business model you desire and work that plan. Do not deviate from the plan, you cannot be the company for everyone!