National Clothesline

Running out of customers is worse than running out of gas. You can always get gas even if the price is high. Finding a consistent flow of customers is a far more daunting and often frustrating task.

Every sector of the economy is coming to understand a fundamental reality. We are coming face-to-face with one idea that’s abhorrent to the American business psyche. That idea is “limitations.” We don’t like to think there are any boundaries, particularly when it comes to customers.

But think about what’s happening:

• Car sales are essentially flat, as are life insurance sales.

• The savings rate is below zero for the first time since 1933.

• Government and business sponsored retirement and healthcare programs are on their way to extinction.

• Home sales have depended on financing gimmicks that have allowed just about anyone who breathes to buy a house.

• The home improvement explosion had been financed by rising home values. Now they’re being financed by “no payments until 2008” or beyond, as are giant TVs and other home appliances.

• Movie attendance declines steadily.

• Millions of Americans are driving vehicles with price tags equal to or greater than their annual incomes.

• Insurance agencies and other businesses grow mostly by taking customers away from each other or acquiring competitors.

• The proliferation of communication channels make it difficult to achieve brand identity.

• “Free” and “discount” are the operative words today.

• And perhaps the most accurate barometer of all is the growth of Wal-Mart as it meets the needs of the financially strapped middle and working classes.

Reading a list such as this can be dangerous for anyone who is easily depressed.

Ironically, this has to do with reality, “doom and gloom.” It’s about the reality found in the news columns of The Wall Street Journal, rather than the upbeat, go-get ’em, nothing-can-stop-us, ego-stroking and pathetically pretentious full-page, full-color ads that pay the newspaper’s bills. The latter points to caution, while the former fosters denial.

The problem rests with continuing to use a post-World War II mindset that was based on monumental pent-up demand, something that’s missing today. That’s the reality.

The frustration is felt everywhere in business. Nothing seems to work even as well as it did a few years ago. Everything from advertising and telemarketing to cold calls and trying to get through the door is dysfunctional. All the gimmicks fail and the “All I need is 20 minutes of your time” mantra of today’s salespeople seems pathetic compared to the time when the welcome mat was out everywhere.

There is another side to this coin that’s facilitated by the Internet and epitomized in the iPod. In fact, it appears that the iPod’s genius may be more cultural than technological. It plays to the growing “stay out of my space” mentality that affects the way we drive, get through the supermarket, listen to music, watch TV shows, do our banking, and make just about any purchase.

Consumers are saying, “I want what I want the way I want it when I want it.” In effect, “I make the rules.”

The iPod is the delivery channel of this dominant outlook. Whatever you want, your iPod will get it for you. That’s the message.

With the downloading of the first song, the floodgates were opened wide and there was no turning back. TV shows, movies, podcasts and more were available on your iPod so you could see and hear what you wanted when you wanted to see and hear it.

As everyone who shops on the Internet knows, there is only one customer — you. The iPod pushes that envelope further than ever. In doing so, it inscribes forever the message, “I’m the only one who counts. Do it my way or die.”

A February 2005 Yankelovich Marketing Receptivity Study revealed that 69 percent of customers are interested in products that permit blocking, skipping or opting out of marketing. It’s the “get out of my face” mentality.

The copier salesperson called with an offer to reduce the cost of current equipment and supplies, recognizing that the current lease arrangement would be ending in the not too distant future. “I would like to show you how we can save you money,” said the salesperson.

“That’s not necessary, just tell me where I can review it on your website.”

The owner was interested, but not receptive. That’s where it stands today.

What it means for businesses

What are businesses to do with this “customer of one” reality? How are they to connect with the customer without wasting time and money?

1. Erase the past from your mind. For example, the effectiveness of the once powerhouse “Yellow Pages” has been declining in the face of Internet search capabilities. Yet, many businesses have continued to dutifully buy ad space. But as Brian LaPointe, president of Federal Heating and Engineering, Co., Inc., of Winchester, MA, says, “One of our major equipment dealers notified us that the manufacturer is no longer supporting co-op Yellow Pages advertising.”

It’s dangerous to cling to what worked yesterday.

2. Stand up to stand out. Far too often, companies talk a good line, but they’re actually risk averse, always playing it safe, not wanting to really put themselves on the line.

The president of a commercial printing company in Pennsylvania made a point of describing how the company delivers on time. It’s extensive in-house capabilities give it the ability to meet tight deadlines that others are unable achieve due to dependence on outside suppliers.

Since on-time delivery is important to printing customers, the consultant recommended that on-time delivery become a cornerstone of the company’s branding: “Your job is free if we don’t deliver on-time.” The guarantee would be accompanied by an appropriate disclaimer. Yet, the president backed away.

If something is crucial to attracting and holding customers, then step up and figure how to deliver on what the customer wants.

3. More frequent contacts count. A survey of an insurance organization’s customers re-vealed that frequent contact reaps positive results. In fact, it plays an important role in shaping how customers feel about such other factors as price and service. Those clients who received the most contacts by the insurance agency also indicated their loyalty by having the highest scores for renewing their insurance with the agency.

Whether it’s regular visits, receiving helpful information or asking their opinion, systematic contacts have a positive impact.

4. Be there all the time. Too many companies play the game of “marketing roulette.” With one bullet in the chamber, they keep pulling the trigger until a shot is fired.

It’s not surprising that the line waiting to buy the highest-priced advertising is for the Super Bowl. It’s almost the story of “desperate advertisers” since this annual extravaganza delivers the single largest number of viewers. As it becomes more difficult to reach people, look for the Super Bowl annual advertising ante to keep going up.

Reaching people today calls for a comprehensive and diversified strategy that aims at reaching a host of sliver-thin niches with a variety of activities and includes everything from e-mail, web ads, fostering buzz, direct mail, public relations, events, media advertising and community relations programs.

The goal is to engage customers all the time in a multitude of ways to build the brand. Anything less is ineffective because the customers we take away from someone else would themselves go elsewhere in the future. Breaking that pattern means being there all the time.

We need to change our thinking and recognize that an endless supply of customers has come to an end. The only way to attract and maintain customers today is one at a time.