This column talks often about how to run a business better. It covers hiring and recruiting topics. But I don’t think I’ve focused an entire column on the customer. Think for a minute about your customer. Who hires your company and why?
I bring this up for two reasons, and the first feeds into the second.
The Relationship between Price and Customer
Most people think that price — and price alone — determines how much of a product or service you sell. It seems intuitive: Everyone knows the phrase “priced to move.” But that fails to tell the whole story. Price also determines who buys your good or service. Why is that important?
Let me illustrate. Think about that dive bar you used to go to (or still do, who am I to judge?). The one where every step you take either sticks a little or crunches peanut shells. It has $1 drafts some nights, and once in a while a fight breaks out. The restrooms? Forget it.
Now, contrast that with a trendy, “hipster” bar in the suburbs with $17 cocktails. The wait staff have ties and the place is showroom clean. You don’t feel like the filth in the restroom follows you out.
Setting aside what you think of the kind of people your mind might have conjured in this illustration, which would you rather have for a customer? I know I’d rather have someone who doesn’t balk at buying a couple $17 drinks (plus tip) paying my invoices.
Drilling contractors, of course, have a variety of customers — many not individuals at all, but rather prime contractors and government entities. I’d suggest the same rule applies: Set your price to get the customer you want.
Solve the Bigger Drilling Problems
But, you say, we bid for those jobs: lowest price rules. Yes, in a way. That brings me to my second reason to really flesh out the customer in your mind. Wherever your business sits now, you need to solve higher-level problems to grow. Higher-level problems come with higher-dollar-value payouts. Think about particularly difficult or high-risk projects. That type of problem only gets solved when someone comes along with enough resources and says, this is important and it’s important right now. At that point, you want your company to solve it (and be among the few who can). Those higher-level, risky projects often come with their own challenges: more or different equipment, stringent safety protocols, higher insurance thresholds. Plenty of contractors can’t jump through all the hoops. The ones who do can often command higher, more dependable prices. Be the one who can jump through. Be the one who solves $10,000 problems or even $100,000 problems, not $1,000 ones.
Set yourself apart. Equip your company to solve the higher-level problems and it will pay off. When you answer the phone or put in a bid, you can do so with confidence. You know the customer on the other end has run through or skipped over the $1,000 and $10,000 contractors. They have a $100,000 problem, and your company is just the one to solve it. That’s why they called.
What do you think? Have you put much thought into who your ideal customer is? Is that a customer with small-dollar problems? Did you know some customers associate a higher price with a quality product? Send an email to email@example.com.
Stay safe out there, drillers.
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