- You MUST understand what your customers value, not what you value. Oftentimes, they are very different things.
- You MUST understand all aspects of your offering, not just the obvious. For example, the obvious offering of a restaurant is the food. Patrons also value the service, flexibility, décor, parking, dress code, cleanliness, consistency, reputation and variety, to mention a few.
- You MUST understand that every customer will value something different from other customers. Joe will value the food, but Mary will value the ambiance. And they seldom value the same aspects that you value.
I am a picky eater; I tend to frequent restaurants with menus that have items and preparations that I like. In addition, I prefer restaurants that are flexible, and I’ve walked out of more than one after hearing “Sorry, no substitutions.” My wife, not so much. She has a very brave palate and is always willing to experiment with the new and unusual. So imagine our delight when we found a restaurant in the Stockbridge, MA area many years ago that had a menu that appealed to both of us. The restaurant was very successful and always crowded. We appreciated the reasonable cost, the dependable quality of the food, and the reliable service. The place was a home run for us and for the other residents and visitors to the Berkshires. A few years went by and for reasons that are unknown to me, the owner hired a new chef who promptly – and completely – changed the menu. For some people this would be an adventure. However, to my wife and me – and judging by the decline in customers – this was business suicide. I know we are not returning when my wife tells me that she has trouble finding something to order. Gone were our favorite dishes. Gone were the selections that catered to the bland eater and the daring. Worse, they instituted a “no substitutions” policy. We kept checking the restaurant’s website hoping that the owner and chef would come to their senses and revise the menu. No such luck. As you can probably guess, the restaurant closed within a few months of this change. In business, there are thousands of examples like this. A successful business sells a product, then ostensibly to entice another customer base, creates a product that is not of value to the targeted new customer and worse, alienates the long time patrons. Ultimately, the business fails. So, what is the lesson here? As a business owner, you MUST understand three things about your offering: