Costumers are people, current situation (1)

Customers want the best product at the best price for them and want to be treated well in the process of buying and owning that product. In a market where competitive product and price offerings exist, customers will choose the business that best treats them like a ‘‘human being’’. An emerging body of evidence verifies the intuitive notion that a customer’s decision to buy is based more on how human his or her interactions are and less on subtle product and price differentiation. The latest research reveals that up to 70% of a customer’s decision to buy is based on interactions and only 30% based on product attributes. It is the ‘‘human touch’’ that stands out in the mind and memory of the customer.

Although many businesses advertise they treat customers as ‘‘relationships’’, ironically less than 10% of their resources are invested in how human they treat their customers. Over 80% of customer initiatives are focused on how to ‘‘sell the customer better’’ through matching products to customers rather than investing more resources in ‘‘treating customers better’’. The resources applied to ‘‘selling the customer better’’ for specific customer initiatives have little impact on a customer’s future decision to buy during subsequent campaigns whereas resources applied to ‘‘treating the customer better’’ have a strong annuity effect on successive campaigns. Resources invested in ‘‘selling the customer better’’ have little or no impact on the customer’s future buying decisions whereas resources applied to ‘‘treating the customer better’’ have a significant influence on future buying decisions. Matching customers with products only addresses 30% of the factors influencing a customer’s decision to buy in the competitive market. This 30% best indicates which product the customer will buy. It fails to provide an adequate framework to influence where the customer will buy it. Sales and marketing efforts based on this attribute approach often create equal demand for the product among competitors.

This is the common downfall of most Customer Relationship Management (CRM) initiatives.

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Source : Costumers are People, The Human touch. John Mckean 2002