This month’s focus: A customer’s perspective of your “market cap.” is a double-edged sword.
All businesses want to appeal to as broad of a customer base as possible. Solo practitioners want to appear as if they’re a global conglomerate. Global conglomerates want to appear as if they are nibble enough to compete with the solo practitioner. And so it goes back and forth.
The issue many times is neither side truly understands how they are viewed in their customers eyes. All they can visualize is what “they believe” instead of what is actually true via the customers eyes and perspective. The opinion held by most Boards, CEO’s, entrepreneurs, etc. many times is diametrically opposed to what the customer actually believes. So much so, that the consequences resulting between the two can have consequences far more reaching than just a “market impression.”
Case Study: Early in my career I purchased for all intents and purposes would be considered a small business. After the initial purpose I began to seek other ventures to incorporate into the fold. With this I decided to create an umbrella styled entity or company where I would keep the original trademarked names and list or treat it as a subsidiary of my overall corporate structure. i.e., My Newest Acquisition™: A subsidiary of My Corporation Inc. All pretty basic stuff.
Then during the savings and loan crisis of the 90’s like everyone else I found myself in the middle of the financial morass. Businesses were closing left and right. Getting customers to pay within terms (or at least adhere to some semblance of terms) was becoming more and more problematic with every passing day. So much so that one of the business I had leased out which I owned went belly up; leaving me stuck with back rent, utility bills and more right at the worst of times. I was scrambling trying to make ends meet. It wasn’t until I needed to visit a customer who was in the rears as to try to collect did I get an eye-opening about perception vs reality via the customers eyes.
As I sat in this customers office and explained the need to resolve the issue (at least to where it was workable) the customer abruptly cut me off during the talks in mid-sentence and stated, “Look, I’m just a small guy, with a small business. This company you work for “My Corporation Inc. Obviously they’re large enough to handle this loss. I’m probably not even a speck on their balance sheet in respect to their size. Do me a favor, go back and tell them: I just don’t have the money and they’ll have to wait! Trust me – it won’t really matter to them.” I was dumb founded.
You see what I didn’t tell you at the outset was on my business cards it stated “My Newest Acquisition™ – a subsidiary of My Corporation Inc. That was on my business card with my name – no title. (I eschew titles or the need for alphabet soup after a name) All this customer ever knew was “My Newest Acquisition™.” I never professed I was the actual owner, in my own dire straights, trying to collect what I now knew to be “blood from a stone.” It was a lesson in “how you’re really viewed” that was worth the money lost in retrospect. For I was never able to collect from this person in the end.
To this day I still eschew the whole “Title” or “alphabet soup” on business cards and stationery. Usually these suffixes or “ego badges” do nothing more than just cloud discussions. Sometimes it’s far easier, as well as instructive to be nothing more than an employee. (which technically is true) Because understanding what your customer really believes about who you are, and what your company truly represents maybe a costly undertaking. But the insight you’ll garner for all future endeavors – is priceless.
© 2015 Mark St.Cyr
Profiting At The Bottom Line™ is a monthly memo, which is pithy, powerful, and to the point. It focuses on innovative techniques and or ideas that you can put to work immediately in your daily or business life.