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The Real Reason Most Customers Don’t Choose You
Most small and midsize companies that are struggling do not know why their customers choose their competitors instead of them. What they miss? There are THREE pillars of customer decision-making. Mastering these pillars will help you become „the one“ for your customers.
The Premise
Did you know that two-thirds of all companies satisfy their customers? Focusing on customer needs is not enough to develop compelling solutions and inspire customers. Why? Because most customer needs are well known, and most companies satisfy them.
Three Pillars of Decision Making
To become the one for their customers, a company needs to understand the interplay of customer needs, wants, and constraints.
Needs
Needs are about solving problems. They work in two ways:
- First, needs arise from problems customers must solve for their well-being. „I’m hungry, I need to eat.“
- Second, needs represent the minimum requirements a solution must meet. „Whatever I eat must be edible, safe, and actually satisfy my hunger.“
Wants
Wants are different – they’re not vital, but they’re what customers long for. Wants are driven by a customer’s worldview and emotional desires – such as comfort, status, health or pleasure. What customers want is constantly changing based on cultural trends, what they believe is valuable and, most importantly, what they have learned is generally possible.
Think about coffee. The need for caffeine at 3 a.m. remains constant, but how customers want that coffee evolves – from small to large, black to flavored, cheap to organic, home-brewed to drive-through. Staying current on changing customer values, cultural shifts and the exprience standard helps you create value beyond basic needs.
Constraints
Constraints are what prevent purchases. Most companies think only about financial limitations, but that’s just the beginning. Constraints can include:
- Personal habits
- limited availability
- Lack of confidence
- preconceived beliefs
- Logistical challenges
- knowledge gaps
All these barriers can prevent customers from choosing a company, regardless of how well it addresses their needs and wants.
The „No, Because…“ Collection
A „No, Because…“ Collection is a simple log of why prospects say no to your offerings or those of your competitors – giving you critical insights on new value creation opportunities
When a potential customer decides not to purchase, record their specific reason: „No, because it’s too expensive“ or „No, because it doesn’t integrate with our current system.“
Categorize each reason as a need issue, a want issue or a constraint issue. For example:
- „No, because it doesn’t solve our specific problem“ (need)
- „No, because we prefer something more modern-looking“ (want)
- „No, because we can’t implement it within our timeframe“ (constraint)
After collecting insights from a couple of prospects patterns will quickly emerge showing which pillar needs the most attention.
Another approach to this is to take your competitor’s most popular offering and analyze it through the three-pillar lens. Identify:
- One need they’re not fully meet
- One want they’re ignoring
- One constraint they’re not addressing
