Selling isn’t about making sales — it’s about engaging customers, entering into a conversation with them, and letting them respond when they’re ready to buy. That’s called marketing, and marketing makes sales. In this article, John Graham uses Krispy Kreme Donuts as an example of how a company finds ways to create excitement and build customer loyalty.
Plenty of companies still can’t seem to get the message that customers have changed. They cling to the notion that the goal is to get through someone’s door and come away with an order.
Outmoded? To be sure.
Even with prices cut to the bone and beyond sales of computer equipment are dismal. Of course manufacturers can sell more cars if they load up the incentives. Take them off, and sales drop.
But life’s different elsewhere. Take Krispy Kreme donuts. As the company invades Yankee territory from its Deep South base, first-hand reports are amazingly consistent. 'I waited for two hours to get those donuts,' customers say with pride, suggesting that standing in long lines for donuts is something of a badge of honor. And no one ever comes away from a Krispy Kreme shop with less than a dozen.
Who’d think that donuts could make prized gifts? I remember the day a co-worker returned from a vacation in the South. Before coming back, she called to say that she was bringing a box of Krispy Kremes with her. Since there were no Krispy Kreme stores in the state, this was truly a special event. She beamed when she presented her precious gift.
Krispy Kreme is the Coors beer story all over again. Even to this day, some of the Coors legacy lingers long after it became readily available outside of Colorado. For years, there was no greater gift than a six-pack of Coors.
Anyone who thinks selling is about making sales really doesn’t get it. It isn’t what’s inside a Krispy Kreme donut that creates the demand. It’s what’s inside the customer’s head that makes Krispy Kreme Krispy Kreme.
Whether the 'secret yeast-raised recipe from France' is so all-fired wonderful makes no difference: customers think those donuts are the greatest, almost heavenly inspired. Don’t laugh; even a donut can have a cult following.
That’s marketing and that’s what makes sales. Krispy Kreme, Harley-Davidson, Maytag, and Apple have discovered the benefits of engaging their customers. They don’t scream their deals in ads, bang on doors, send barrages of (instantly deleted) e-mails, telemarket people to death, offer gimmicky discounts, or use other antediluvian tactics that Neanderthal-like sales executives continue to employ.
ENGAGE THE CUSTOMER
Engaging the customer isn’t even on the same screen. So, what’s it all about? For starters, it involves a process of entering into a conversation with them, letting them know what you’re doing, why you’re doing it, and then making it possible for them to respond when they’re ready.
Krispy Kreme does this. Just go to the company’s Web site. Read the history and notice the collectibles that are for sale. That’s part of the conversation. And it’s why sending out endless e-mail solicitations not only turns people off, but angers them. On the other hand, e-mails from customers and prospects that ask questions, describe problem situations, and ask for your suggestions can become valued communications. Conversation turns people on. That’s engagement.
Companies like Krispy Kreme, Apple, and others work at figuring out new ways to create the excitement that builds customer pride. They refuse to be dull. San Francisco’s MacWorld Expos draw 60,000 true believers from all over the globe. Millions of others follow the event on their computers. Is it necessary to remind anyone that Macintosh computers and Apple products cost more than their PC counterparts?
If anyone says, 'Yeah, but Apple only has 5% of the market,' the answer, of course, is 'think different.'
Restoration Hardware has built its success by engaging customers in conversation. Watch what goes on inside any of the company’s stores. People move slowly, looking at items, talking about them, and touching them. Particularly men who refuse to be dragged to a mall! There’s no 'grab-and-go' Wal-Mart rush at Restoration Hardware.
What the customer learns, feels, and experiences leads to the purchase. Restoration Hardware isn’t about nostalgia as such, although this might be the way it appears. It’s about helping customers become part of something warm, comfortable, perhaps even bigger than themselves.
Restoration Hardware customers are quick to talk about their experiences. It’s engagement and it’s powerful in attracting customers. If you notice, companies like Restoration Hardware and Harley-Davidson never talk about customer loyalty. They have it.
GET SMART ABOUT MARKETING
In contrast, there’s bankrupt United Air Lines. Far from being alone in the world of financially strapped carriers, United has come up with a proposition that’s raising some eyebrows. The company is investing $50 million in an ad campaign.
Why would a bankrupt business deliberately go out and spend all that money running ads? Is this a prudent way to use limited resources, particularly when employees are being laid off? On the surface, the plan sounds almost irresponsible.
According to a USA Today (1/3/03) story, United’s advertising plan makes sense to the counsel of the committee representing unsecured creditors. 'They require loyal customers and need to keep up with the competition, which is always advertising,' he said.
In fact, you could make a good case for spending more than $50 million. But at least this might be a good start if — and that 'if' is important — the advertising helps differentiate United by specifically aligning itself with the values of those who fly.
While doing this, the airline also needs to reassure business and pleasure flyers that it’ll be there to serve them. Should doubts develop, the customers will disappear — and competitors are busy working to take customers away from United.
The advertising story isn’t about 'warm and fuzzy.' What counts is getting on the same wavelength as those who fly by identifying what they don’t like about other airlines and answering these concerns clearly and directly.
This hasn’t been the way airlines have promoted themselves, however. They decided what would help them: reducing the space between the rows of seats until legroom all but disappeared and the seat back in front of you was literally 'in your face.' American Airlines addressed this issue and took out a row or two to widen the space so that flying American is exceptionally comfortable, a fact that helps sets it apart from the competition.
According to reports, United’s ads will focus on the future and won’t mention bankruptcy.
DO WHAT THE CUSTOMER WANTS
What do Krispy Kreme and United Airlines have in common? A lot. Krispy Kreme is faces severe competition, just like United. But unlike the airlines, Krispy Kreme doesn’t cut its prices to promote 'cheap donuts.' And they haven’t done everything possible to alienate their customers. The airlines, on the other hand, have focused on angering their customers by:
- Using deliberate 'stratospheric pricing' for business travel.
- Using Saturday night stopovers as the criteria for lower fares.
- Eliminating food service and substituting tiny bags of tasteless sticks.
- Pushing the seating rows closer and closer together.
- Making the seats narrower.
- Making it difficult (read: impossible) to get accurate information when flights are delayed.
Even the stilted little speeches before taking off and landing are all the same. 'Thank you for flying [insert name of airline]. We know you have many choices.' And then there are those deadly words that every airline uses: 'Let us be the first to welcome you to [whatever the final destination might be].'
For example, it sure would be refreshing to hear the flight attendant say, 'Hey folks, we’re here. Let’s give the pilots a round of applause for doing a great job. We know it was a long flight and we’re going to get you off this plane quickly so you can get home. Sally, Mike, and I had fun serving you. How did we do? You were just great. Thanks for coming with us and we hope to see you again soon.'
Why not have a little fun with the passengers? This doesn’t mean being less businesslike. Why not make us laugh? We’d not only remember you, but we’d tell everyone what a great time we had on your airline. It not only makes sense but it’s good marketing.
And while we’re at it, why not get rid of all those 1950s pilots’ uniforms? Think different. How about a leather flight jacket and white silk scarf (retro to be sure), or maybe a cowboy outfit for airlines serving the West.
If there’s a member of the flight crew who can carry a tune, have a little sing-along. In other words, lighten up and make us feel we’re going on an adventure instead of the usual 'cattle car' approach. Customers might even feel a little excitement and help others over a fear of flying.
Of course, there will be those who say, 'We can’t do that. That’s just plain quirky.' Is it so crazy? It might help if Buick took the lemon out of its mouth long enough to suggest in its advertising that its Rendezvous is a silly looking vehicle. And although it might look a bit nutty, Rendezvous owners just smile smugly because the car is so comfortable, well-built, and fun to drive.
All of this can be summed up in a few words:
- Differentiation determines a company’s destiny with customers.
- What customers value is all that counts.
- You can never do enough to help customers believe in you.
- Interacting with customers brings them over to your side.
All of which is to say, 'It’s a Krispy Kreme world.'