For those in B2B businesses, have you ever thought about sending out an invoice and putting a line at the bottom for a tip?  If you did that, how hard do you think your customers would laugh at the idea?

B2B businesses would never do that, yet are more likely to provide appreciable service levels than too many (maybe most) B2C companies.

B2C companies have, in our view, often substituted investment in “branding” for investment in service levels.  They are often tip-reliant despite low to medium service levels in many instances.  They rely on low-wage employees to deliver service in the hope of a tip from a happy customer.  Too many of these companies seem to have the mindset that “the company doesn’t benefit from tips, only the employee benefits from the tip.”  And as a result, they don’t see the benefit in investing in better service. 

B2C have such a wealth of information on consumers captured from their point of sale (POS) systems.  Yes, these are the systems that automatically generate a tip request way before any service is actually provided.  While capturing valuable data, too often, that data helps their company at the expense of their customer.

The amount of data generated from POS systems on each purchase can be staggering.  What is often not clear is how much of that data is used to determine whether the customer is pleased or not.  One store POS machine asks” how did we do on a 1 to 9 scale.”  On each store visit I am literally told to press “9” by the cashier!   Meaningful feedback?  I think not.

The trend for many B2C businesses is to employ as few employees as possible.  As a customer, if you have a question, need support, or want something outside the ordinary, it’s hard to find an employee who can help.

By contrast, B2B companies often know a great deal about their top customers so they can quickly respond and address issues or questions. The really successful companies track metrics by customer (at least the top buyers) and compare specific performance to companywide levels.  For example, some may say that their order accuracy company-wide is 94.5%, but top Customer A, yours is 98.7%.  Or if lower, they explain why.

We call these CRIs—customer relevant indicators.  Metrics that mean something to the customer.  Many B2C companies have too few of these.

We worked with a distributor of chemicals who learned that their buyers most valued on time delivery and order accuracy.  This company started tracking those two data points, and made it a goal to operationally excel at them, eventually exceeding 97% for both metrics.  This was a better performance than competitors, and as a result, they shifted their core marketing and sales messaging to tout their performance on these two attributes.  The result was exponential growth.

All businesses have access to data.  If the ethic behind collecting and analyzing that data is interested in only reducing costs no matter what, then service will be lost.  Which means the customer is the loser.  If the ethic guiding data collection and analysis values the customer experience, then data tracking and decision making will reflect that ethic.

More often, B2B does the right thing and never asks for a tip. In many instances, B2C might take a lesson. B2C might think about how to use data relevant to customer values.

May, 2023

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