Here is the single biggest and most valuable business growth lesson I ever learned. When I was a kid working in my parents Mom & Pop candy and newspaper store my father once told me “Son, you have to treat all customers equally” then he paused and added “but some customers are just more equal than others”.

Customers Really Matter.

My Father was a very smart man and he knew intuitively that in order to grow his business he had to make sure that he looked after his best customers first. He knew that all his customers were important, but the top 20% of his customers delivered a much higher return. In hindsight we know that Dad was actually conducting his own form of what today we call, CRM or Customer Relationship Management. If my Dad had heard of this expression CRM, knowing him, he would probably have called CRM Customers Really Matter. But as part of his CRM he also figured out that to be the very best that he could be, he had to be forward-thinking and aware of making the numbers.

Information is power

When his best customers had the time, he would chat with them and ask all sorts of questions, when was their birthday, when was their wives birthdays, how old were their children, how many grandchildren did they have etc? He would then be armed with all sorts of information that he could leverage in future and make a serious difference. I realize he was conducting a basic form of CRM but it worked, he got the numbers right. My parents ended up buying a second Mom & Pop store and adding a couple of Post Offices as well. They did great. They were not multi-millionaires, but they did provide a nice standard of living for our family.

Fire some of your customers now!

If you take only one lesson from the world of Customer Relationship Management, take this simple one: find out who your best customers are. Then when you have found them, make sure that you look after them better than the rest of your customers. Conversely, some of your customers are costing you money to do business with and you should fire them without mercy. Send them to your competitors. They are wasting your time. To see how valuable this lesson can be, take a look at my white paper on CRM. What do your best customers want today? Since customers are living breathing human beings they have evolving needs so make it your business to keep up with them. Again focusing on your top 20% you need to turn your CRM into a continuous process so it remains relevant and forward-facing.

The Japanese have figured this one out too: the fourth part of their standard thinking is called Kaizen. Kaizen focuses on Continuous Process Improvement, to make processes visible, repeatable and measurable. Observe how Toyota use Kaizen to recover their mojo.

Different demographics, different dreams!

Harley made a mistake with CRM; they thought they understood their customers. Well they did, but they got stuck on an ageing customer demographic. For decades the primary HOG rider was easily recognizable to dealers: black leather, tight black T-shirt and so on. But Harley’s customer base began to include more women and young guys who just a few years ago were riding skateboards in the skate park. Focusing on a dinosaur customer base is not a forward-facing strategy. The numbers will show you when you’re getting CRM right.

Copyright Jack Sims 2010