Current economic woes a potential boon for small business

We could be on the verge of great times for entrepreneurial businesses who focus on their customers. The current economic climate will drive customers to search for value.

Anyone can make money in boom times because free-spending is rife. But in the tough times we all become value conscious and we exercise more choice. Value is not necessarily simply the lowest price.

Big businesses are rarely customer centric (particularly in Australia) or customer friendly. By dint of their sheer size they have generally become ensnared in a net of bureaucratic systems and processes which drives further wedges between them and their customers. They are unwieldy and this makes them slow to change (at least in the right way). Their typical response to tough times is to cut costs and, generally, the first to suffer when corporate costs are cut are employees and customers.

This was reported by Kelly Burke in yesterday's The Sydney Morning Herald (21 Nov 2008):

"HOUR-LONG phone queues, multiple transfers, hollow promises of people getting back to you....and the automated voice telling you your call is important. Soaring complaints over customer service from telecommunications companies have prompted the Federal Government to crack down....."

Apparently for the first time in its 17 year history the level of complaints to the telecommunication's industry ombudsman about customer service has outstripped complaints about billing or payments. There has been a 61% increase in complaints over the previous year.

Our Aussie telcos have never been famous for their consumer-facing behaviour and trying to turn around a culture of disdain for customers is a gruelling task in a massive telco at the best of times (always assuming you have a desire to do so). But what happens when you are tightening your belt? Jobs go, indulgences are stripped out of the system, and efficiencies are introduced. In the case of telcos this can look like fewer call centres, more frazzled call centre staff, more IVR automation and so on.

In other words - a tougher time for customers.

If we didn't have to deal with them we wouldn't. And why do we have to? Because there is no real choice - they are all as bad as each other and we are left to pick the best from a bad bunch .

Big businesses are slow to move (because they are big); they are complacent (because they know there is no real choice for their customers); and they are risk averse (because they are subject to public scrutiny and because frequently their top brass are more focused on their careers than the business). This is generally true and not just for telcos.

So, in an economic environment where we are all going to be less likely to throw money around willy-nilly; more choosy about whether we do business (we might go without) and who we do business with; and more careful to extract every ounce of value from every transaction, is it big businesses who are going to quickly rise to the occasion and respond with something different and valuable for us? Not on your Nelly!

This leaves the door wide open for smart, small business operators to create solutions and it won't just be about creating a lower priced offering.

For example, sticking with the telco case, what if I created a re-seller of wholesale telecommunications services, called "FriendlyTel" where the customer promise ran something along these lines:

• We will provide a full suite of telco services for you - voice, data and mobile - bundled on one bill;
• We can't be the cheapest but we will always be the best;
• You can always talk to a real person - we will never have an automated voice system;
• The person you talk to will recognise you as a real person too and will always be empowered to resolve your issue without reference to a team leader or supervisor;
• We will do what we say we are going to do;
• If we loose you while we are talking to you, we will always call you straight back;
• If we can't figure out how to fix your problem we will tell you straight and keep working on it until we can figure it out, then we'll get back to you and let you know how we are going to get it sorted;
• We will always talk plain English to you and will never patronise you;
• We will provide a hassle free telco solution which you will never have to worry about;
• We won't ever have an offshore call centre;
• We will listen to what you have to say with empathy and understanding;

Oh, and by the way, we can only limit our offering to 5,000 customers because anymore than that and our service standards will drop and we'll be too big.

Could an existing big business telco offer this service? Of course, but it is so improbable as to be completely unlikely and if they did, it certainly wouldn't be a new offering they would launch in the face of a recession. But, an entrepreneurial, customer centric, people oriented business could pretty easily provide something like this. And what premium would you pay to be among the 5,000 customers - 20% more than you are currently paying? Possibly 40% or 50% more. It would still look like great value.

Of course you don't have to create an entirely new business like FriendlyTel. If you are already in business just roll up your sleeves and dive into re-engineering your current customer experience to make it as delightful and valuable for them as it can be. Eliminate every potential point of annoyance or frustration; make it real and personable; provide choice; allow them to deal with you in the way they prefer rather than the way you would prefer; make integrity a hallmark of every interaction; make it fun; equip them with stories to tell their friends.

Do these things and, in these tough times when people are more careful about how they spend their money, your customers will choose to spend their money with you. And not with some faceless corporation who doesn't give a toss about them and who can't possibly do what you do anyway because they are fat, lazy and on a cost-cutting drive.