Today, I thought it would be fitting to talk about the tag, VIP “Very Important Person”. We see the term at events, shows, in restaurants, retail stores – even when the term is not expressly used, it exists.
For most businesses the term is a way to segment their customer base and separate between those “high value” and “low value customers”. It always amuses me when I see the term pop up, time and time again.
The importance of VIP
Being a customer centric person at heart, from a young age, I have always adopted the philosophy that everyone walking through the door is a VIP. After all, each customer that is walking through the door has made a conscious decision to spend his or her hard earned money in your business.
Of course there are data analytics that assist with uncovering the common characteristics of the ‘best customer’ (usually he or she who brings the most monetary value will top the list).
I am also an advocate of businesses looking after their most loyal customers. Unfortunately, in today’s society, a customer’s value is still often tagged to how much a business perceives that customer is able to pay.
How much is that customer worth?
Simple examples of the ‘snap judgment’ can be taken from the hospitality and retail sectors. Frontline staff are often judging their clients right from the get go, assessing factors such as attire, age, right through to ethnicity, to form a view as to how much that customer is worth to them. How much will this person spend? Will they tip? Should I focus my attention on someone who might spend more?
These are all questions which frontline staff will form when people walk through the door, and which define the customer’s experience in your business. The question must be asked – is this really how we should let a customer-centric business run?
Put yourself in the customer’s shoes when assessing VIP status
My older sister for example, worked in hospitality for the greater part of her adult life. She knew her food, spent a bomb out at dinner but also looked very, very young. Her age was a killer.
No matter where she dined, snap judgments were made by frontline staff – she would be frustrated to no end with bad service, abrupt waiters, people assuming she wanted to pay with loyalty card discounts – all based on her looking young (and the assumption that she therefore did not have the money to spend).
She told me, that notwithstanding, that she was a firm believer in tipping, that eventually she just gave up, only tipping when she got good service.
Instead of making snap judgments based on arbitrary factors, perhaps we need to re-adjust our thinking, and businesses should put themselves in the customer’s shoes when assessing VIP status.
Who values your business more?
An example I use with my staff to demonstrate this is as follows:
Customer (A) walks in neatly dressed with his family. He has saved up all year to bring his family out for a special dinner. Though he has been saving up, he still has a budget and avoids the expensive things on the menu.
Customer (B) is a travelling businessperson, out for dinner with friends and spends up big – what does it matter, the things will be expensed to the company. Wait-staff in the above situation would likely be more attentive to the latter party, at the expense of the former.
If we put ourselves into the customer’s shoes, who values your business more? The person who has consciously saved all year to go to your business, or the person who is spending, not based on what he values in your business, but rather because someone else is picking up the tab?
If effort to dine was a criteria for assessing VIP status for each of patrons A and B to dine at your restaurant, I would suggest that Customer A wins the battle. Yes, Customer B is likely to tip more, yes his or her spend for the night will likely be more. But what about the other value Customer A can add?
We all know that business success is built on reputation and word of mouth – a great night out after Customer A has worked so hard to get there in the first place, is likely to be a topic of conversation for months, if not years. I am sure Customer B will be grateful too, and may do exactly the same thing – so why not treat Customers A and B the same way?
Being customer centric in 2015
I think being customer centric in 2015 will require businesses to take a deep breath and re-assess what being customer focussed means. We should put ourselves in their shoes – ultimately, that’s the best way to understand how customers see your business.
VIPs are important because they perceive themselves to be important – everyone has their own reasons for believing they are VIP, and businesses would do well to remember that. Just a little food for thought…