Which Customers Deserve You?


We hear the same thing constantly from exasperated hiring managers: “There are no people out there who want to work.” While I may disagree with the absoluteness of the statement, I completely understand the frustration that produced it. We are in a difficult hiring situation, no question. There are many sides of this to explore but what does this mean with respect to your customers, and, as the title of this article suggests, do your customers deserve you?

You’ve probably heard of the rule of thumb that says it is best to replace 10% of your customers every year. Of course, replacing 10% is not the same as adding 10%. If you simply add 10%, you are keeping all of your customers and adding new ones. If you want to grow by 10%, you’re all set (assuming all customers are equal). 

However, if you replace 10% of your customers every year, you need to add an equal number of new customers just to get back to where you were. If you want to grow by 10%, you now need to add double the number of new customers. This may not have been so difficult when there wasn’t a labor issue, but that type of growth is tough to handle today. 

So the question then is, does the 10% replacement rule apply or is it better to keep all customers and only focus on new customers? What do you think? 

What if you were to evaluate all of your customers and identify those that didn’t really fit your ideal customer template? This could be 50% of your customers or more. What if you took the approach of focusing your primary efforts on your ideal customers with your limited resources and then embarked on a replacement plan for the rest of your customers? 

In other words, because you have limited capacity, you could say that your ideal customers are most deserving, while the remaining customers are, in a way, less deserving. It’s not that these misfit customers are bad people or anything like that. Perhaps at one time, they were your ideal customer. But your business has grown and they no longer fit your business model. 

If you don’t know this, every Fortune 500 company does this already. This is not a novel idea. When you call your big insurance company or internet provider, they know if you’re an ideal customer or not before they even answer the phone or hop on a chat with you. Ideal customers are serviced vastly differently than the rest. Does this make logical sense or is this a bad idea? What do you think? 

Let’s play this out. You have an open crew on Friday. You have 10 customers who have been begging to get their project done. All customers are important to you because you know them all personally and you care about them. Five of the ten are older customers you’ve had for many years. They are probably “break-even” customers at this point but they have been loyal and sometimes bring you referrals. Two of the ten are new, ideal customers who you pursued with a serious sales effort for the last three years and this is your first year with them. The other three are good margin customers that you want to hold onto for a long time. Who deserves the open time slot Friday?

Take this thought process to the next level and think about your business as a whole. Which customers deserve to have you as a service provider? Keep in mind you only have so much capacity and there are better-fit customers out there to be had. 

Now go forth. 

Tags: hiring , Customers ,