Understanding the Difference between a Customer and a Guest Can Make or Break Your Business
It takes a legendary service organization to discern the difference between a customer and a guest. And trust me, not many companies get it.
I was dragging my suitcase, briefcase, and a six-pack of Diet Coke into a Marriott Hotel in West Palm Beach, Florida about 10:30 one August night. As I approached the front desk with an enthusiastic, “Hi, I’m Tom McQueen,” the clerk raised his eyes from the newspaper he was reading and said, “Checkin’ in?” Relishing the opportunity to have a little fun in response to his ridiculous question, I said, “No, I’m here for the hockey game.” Without blinking an eye, the clerk then asked me, “Can we keep the same credit card on file that you used to make your reservation, and how many keys would you like for your room?”
He wasn’t even listening to me, merely moving his lips to the next line in his script. Needless to say, I won’t be staying there again.
Oh, the pretenders talk a good game about how “the customer is #1” and how “we love our customers like family,” but the tragic truth is that talk is cheap, and most businesses today are outrageously clueless when it comes to translating the real language of loyalty.
Only when corporate leadership understands the dynamic difference between a customer and a guest can long-term loyalty and profitability in our contemporary marketplace be achieved.
Primarily, when we think of a customer today, the word transaction comes to mind. A customer buys groceries at the grocery store. Customers pay bills, make appointments for service, and get coupons in the mail for discounts to their favorite restaurants. After their transaction is complete, they might get a survey to fill out so that the business can understand their level of satisfaction with the product or service they recently purchased or experienced. If customer’s transactions don’t measure up to their expectations, they’ll quickly take their business elsewhere. On the other hand, most companies never bother to survey their customers because, quite frankly, they don’t really care about anyone’s opinion, good or bad.
When we think of a guest, however, what we perceive primarily is a relationship. And the relationship that characterizes a guest coming to your place of business is founded first upon trust and respect rather than money or merchandise. You can’t buy trust and respect with a coupon or a flyer that discounts your automobile, television, or meal. Guests are too savvy and sophisticated today to be duped by sales gimmicks, bait-and-switch techniques, and downright unethical manipulation.
Another fundamental difference between a customer and a guest is that while a customer may need to get his or her automobile repaired at your dealership, a guest wants to come to you for help. And no one can put a price tag on what that difference between a need and a want is worth to your bottom line.
Statistics from consumer research groups around the country indicate that people who want to do business with you because of your trust and respect profile are 77% more likely to develop a long-term relationship with your business than those who merely need your product or service. Show me a CEO who isn’t interested in that type of loyalty.
Also, we often hear the term “conquest” used today when businesses target a group of people that they want to expose to their product or service. I don’t know about you but “conquest” creates visions in my head of being attacked on a showroom floor by a crazed salesperson who cuffs me, blindfolds me, and drags me into an office until I sign on the bottom line. But, thankfully, that salesperson does offer me a bottle of water on the house.
I asked the General Manager of an automobile dealership in the southeastern United States what he allocated annually for advertising and marketing. When he told me that he spent $1.5 million, I inquired as to what his sales closing ratio and retention numbers were. “Honestly,” he said, “we conquest 20% of the consumers we target and we retain 33% of those after one year.” Excuse me? You spend $1.5 million annually to get one out of five potential consumers in your door to buy a car, and then you lose two-thirds of them after one year? Don’t let those numbers shock you. It’s more the rule of thumb than the exception, especially in the automotive business.
What’s wrong with that picture is the fact that businesses waste hundreds of thousands of dollars on marketing and advertising each year and then they don’t know how to behave when people actually show up at their door.
Companies that want to be successful today have to cross over the chasm that separates customer conquest and acquisition from guest invitation and investment. Let me ask you a question: Do you genuinely care about the people who come to your house because they saw the sign on the corner or in the newspaper for your Saturday garage sale? No, I didn’t think so. But when you’ve cleaned your home, prepared a nice dinner for your invited guests, thought about how you would serve and entertain them, and then welcomed them with a handshake, a hug, or a smile, that’s a different feeling, isn’t it?
Truthfully, it’s no different in business. Most of us know when we’re being “sold” as opposed to businesses that communicate to us by their appearance and their behavior that they value our presence and that they’re willing to satisfy our wants today and in the future.
What’s problematic is the warped thinking that a customer is perceived as an expense in the corporate minds of most companies. And because businesses are customarily conditioned to “cut expenses,” what they mistakenly do is diminish the experience of the potential consumers after they’ve spent thousands of marketing and advertising dollars to get them there in the first place.
Let me give you an actual example of what it means to “diminish the experience” of a potentially long-term consumer and then another example of how to invest in the guest experience to achieve the type of loyalty that results in a more permanent relationship.
A friend of mine, Terry, visits a periodontist for gum surgery. The receptionist does a wonderful job arranging the appointment and confirming that Terry has the pre-surgery medication, instructions, and is at ease about the procedure. When he arrives at the office he’s greeted by the dental assistant who reviews what will happen for the balance of the appointment, answers any of Terry’s questions, and makes him as comfortable as possible. The doctor’s engaging personality makes him feel confident and the procedure is completed without incident.
However, as Terry is preparing to leave, he’s detained by the office manager who indicates that she’s not been able to verify his insurance coverage and implies that he may have been at fault in providing her with inaccurate information. Everything gets resolved after a couple of weeks but what Terry remembers is the unpleasant encounter he had with that office manager who wanted to talk to him after his gum was just cut open and sewed back together again. As a result, his experience as a first-time guest at the periodontist’s office was diminished, despite the care and compassion of the balance of the staff.
In another instance, a Mom drove her luxury SUV into a dealership with her 3 year old son for an emergency tire repair. As the service consultant approached the vehicle and sought the opinion of his technician, both of them noticed that the woman’s son was crying and upset because he left his favorite teddy bear at home.
When the tire was repaired and the woman and her son were escorted to their vehicle, Mom was shocked to see that someone had placed a brand new teddy bear on the rear car seat. Needless to say, her son had the biggest grin on his face as he hopped into the vehicle and embraced his new friend.
Now what kind of impact do you think that a $10 investment in a teddy bear had upon the mother of that little boy from a guest experience perspective?
For those who trivialize the importance of how we employ language to communicate with modern-day consumers, “customer” seems to be a good enough description for a person who purchases our goods and services.
However, embracing the powerful difference between a customer and a quest is a non-negotiable requisite for knowledgeable leaders whose mission is to behaviorally apply the language of loyalty, and to engage an invited group of potential consumers that have expressed an interest in developing a long-term relationship with their business.