Time to check in with your customers

   Bridget Behe

Now is a good time to reconnect with your customers and see how your products performed this year. Fall provides a great opportunity to make an effort to spend some time with them.
 
Customers are not all the same, so you should consider key groups of customers. If you have point-of-sale software (retailers) or sales figures for the wholesale business, you can group customers by dollars they spent with you from highest to lowest. Here are five categories, identified by sales and profitability, but you can create more: champions, solid, emerging, switchers and lost.

Champions
Champions are a core customer group who think very highly of you and your company and spend a considerable amount of their budget with you. They are highly likely to recommend your business. They are the key group for generating your profits because they aren’t as price sensitive, aren’t as likely to shop around, and buy from you because you care about them and the relationship you’ve created with them. A business would be thrilled to have 10 percent of their customers as champions.

Solid customers
Solid customers, like the champions, spend a significant portion of their budget with you, but aren’t totally loyal and have another business they buy from. Again, like the champions, they generate a great deal of your profits and won’t shop around much. Solid customers usually comprise about 15 percent of your company’s sales.

Emerging customers
Emerging customers have bought from you a few times and have the potential to spend more with your company. There may be some customer loyalty here, but they deal with a few businesses, so they could be emerging customers for more than one business.
 
Emerging customers can become solid customers. You can make money off them if you can convert them to solid customers. They comprise about half of your clientele.

Switchers
Switchers are bargain shoppers. They are looking for the deal and can comprise 20-30 percent of your customer base if your value proposition weighs heavily on price. They won’t make you much money because their focus is price over quality or convenience.

The lost
The lost are hopefully your smallest category, comprising less than 5 percent of your customer base. They were customers last year but left you for some reason.

Seeking customer feedback
Depending on your marketing budget, you may consider hosting meetings with core customer groups. Pick a weekday and allow at least two weeks to plan the event. You can mail or email invitations, but request an RSVP by phone or email four days prior to the scheduled session.
 
Invite a small group of people and make the offer enticing. If you invite 15 people expect eight to 10 to show up. A group larger than 10 people is too large.
 
Offer them a free product or a substantial discount coupon. Begin on the half hour (i.e., 5:30 p.m. for a small community or 6:30 if you’re in a larger metro-area). Provide the participants with food that doesn’t require much preparation or doesn’t have to be kept warm or cold or take a lot to clean up. If they are fed, they are more likely to provide you with feedback.
 
Prepare your questions and ask three to five questions per group. At the top of the hour, begin the questions.
 
Have two or three key employees sit in on the sessions. At least one should take notes. Consider making an audio recording of the discussion for an accurate record of what was said.
 
Be sure to end on time. Give the participants a thank-you gift, gift certificate or coupon. It shows that you value their input.

What, who to ask
Narrow the field of questions to about five, and prioritize them from most to least important. You want the most important at the top of the list.
 
Start off with a fun topic like what worked best for the customers or what was the best thing your company did for them this year? I encourage you to look for problems and where things went wrong. These may be things you can rectify or fix, but they may be outside your control.
 
Ask the champions what didn’t meet their expectations this year or perhaps what they saw at other places that they want to purchase next year. You might also ask them about other places they find unique products or plants. Ask the solid customers similar questions.
 
If your budget is tight, consider inviting the emerging customer group first. Ask them what surprised them and what disappointed them the most in their gardens this year. Ask them what they bought or tried for the first time this year and how it performed. Their answers might show you how you can be the on-line or in-person expert to provide information.
 
Ask them about unique products they found at other places and how they learned about them. You want to explore what they saw and admired at other places so you can consider whether you need to change some merchandising to make a product more visible or add a new product to your mix.
 
What was their biggest challenge or problem this year? If you can fix those problems, you’ll be a hero to them and perhaps convert an inconsistent and moderately profitable customer into a more consistent and profitable one.
 
Switchers should be asked similar questions, but focus on why they are shopping around. They may be avid gardeners looking for the new plants or they may simply be price shopping.
 
Lastly, consider a focus group with the lost. Find out why they bought products from you in years past and not this year. A telephone call may enable you to determine if something was done incorrectly or it may have been a budget consideration on their part. If you can find out where they took their business, you might get some insight into how to win them back. If they previously had been a champion or solid customer, it might be worth the effort. 
 

Bridget Behe is professor, Michigan State University, Department of Horticulture, (517) 355-5191; behe@msu.edu.