I write about how Local Service Business owners can build an engaging Utopian World for their customers to inhabit using Endless-Value-Journeys, a strategy that emphasizes delighting dream customers, fostering deep connections and cultivating lifelong relationships. This paradigm shift moves us from reacting to one-off transactional customers to inviting them into our world where our focus is on Lifetime Customer Value. Welcome to the art of building a Purpose Driven Expert business.

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Part 2: The Velvet Rope - Dream Customers Only

Have you ever seen those movie premieres where there is a red carpet, and a velvet rope to ensure only the people who are invited are allowed in?

To a lesser extent you see them outside exclusive clubs or restaurants too, with people standing in line to gain access.

What goes through your head when you see something like that?

I'm guessing you think "I want to be able to go in", am I right?

If yes, then that is human psychology at work, you see we all want what we can't have...

This is the first concept I want you to grasp when transforming to version 2.0 of your business, remember this is 'your world' and you get to choose who you want to work with.

You want your dream customers to want to feel like they are missing out, and they want to get in.

And it starts by going from being Reactive to being Proactive.

I'll let that sit for moment...

I want you go from reacting to every call you receive or everyone who comes into your store to being very selective in who you allow into your world.

I bet there are some customers or experiences that immediately come to mind when I mention the words 'nightmare customer'.

I also bet that there are particular customers who come to mind when I say 'dream customer' who you had a great experience in serving, am I right?

I know it's the case for me...

And once I made the decision that I'm creating my world where only dream customers reside, my business got infinitely better.

This reminds me of a story I heard several years ago... it went like this...

A father said to his daughter, “You have graduated with honors, here is a car I bought many years ago. It is pretty old now".

"But before I give it to you, take it to the used car lot downtown and tell them I want to sell it and see how much they offer you for it.”

The daughter went to the used car lot, returned to her father and said, “They offered me $1,000 because they said it looks pretty worn out.”

“Okay,” the father said.  “Now take it to the pawn shop.”  

The daughter went to the pawn shop, returned to her father and said, ”The pawn shop offered only $100 because it is an old car.”

“I see,” the father said.  “Now go to the car club and show them the car.  Come back and tell me what they say."

The daughter then took the car to the club, returned and told her father, "Some people in the club offered me $100,000 for it because it’s a Nissan Skyline R34. They said it's an iconic car and sought by many collectors.”

The father listened for a moment and then spoke.  

“The right place values you the right way,” he said.  

"If you are not valued, do not be angry, it only means you are in the wrong place. Those who know your value are those who appreciate you.  Never stay in a place where no one sees your value.”

Dream customers appreciate your value.

There is a principle I have learned over the years that can be attributed to this...

  • Principle of Focus: A foundational concept in business strategy that argues for the concentration of resources on core strengths and most valuable customers to maximize competitive advantage. Focusing on dream customers aligns business operations with its strategic strengths, enhancing effectiveness and differentiation.

There is another piece by Kevin Kelly, called 1000 True Fans first written in 2008 that has had a major impact on my business strategy (I only became aware of it in 2012 for full transparency), you can also watch an interview that Tim Ferriss had with Kevin below about the 1000 True Fans concept.

So now that you have the principles behind the strategy, let's explore how can you put this into place...

First you start by getting a piece of paper and put a line vertically down the centre (or an excel spreadsheet with 2 columns).

Label the first column Dream and the 2nd Nightmare, then from your experience start listing all of the attributes that each customer possesses.

List what you'd like to see as well, remember this is your world you are creating.

When I did this exercise, I had to be brutal on drawing the distinctions between each column, see the lists below which although aren't exhaustive but will give you an idea of what I did to make it concrete in my mind who I wanted to work with.

Only when you have your lists made out can you think about the strategy and tactics that can attract your dream customers whilst at the same time repelling your nightmare customers.

Take the time to complete your lists, you won't regret it...

Again, to give you an example, I made a point of not using door to door canvassers who wanted to target 'council authority neighboorhoods' that had a higher sign up rate (more commission for them), but lower quality customers who cancel quickly and don't value our service as they only rent their property (less long term revenue and profit for me).

This was tough for me as I grew up on one of those estates, and the people are generally nice people at the core, but they generally don't have a lot of surplus disposable income and they have to prioritise they expenses.

And our service was low down the list of necessities.

I also focused on only attracting customers online who were searching for our service (already interested) over interruption marketing of cold calling on doors.

I also changed our revenue model and introduced a 'Direct Debit only policy' (automated payment system where people pay up front before they receive the service) over a 'pay cash' policy where we'd have to try and collect payment after they'd received the service.

The growth was slower, but it was more sustainable, this was huge for us and allowed us to go from strength to strength.

Let me tell you another story to help solidify this for...

I used to hate Christmas, and the reason was that no matter how much I saved and planned to have a great Christmas and buy our children the gifts they wanted, there would always be something that would happen to eat in to the savings I'd made.

Call it Murphy's Law, call it whatever...

But something would freeze, something would break, a staff member would do something, and each time I'd be scrambling for cash and have to say to my wife "Sorry love, we can't buy everything we planned, I'm going to have to dip into that Christmas fund"...

It was awful, until we changed to Direct Debit only.

I'd resisted it for years saying to myself "Everyone prefers to pay cash", it simply wasn't true...

I remember being at one of my lowest points, the takings for the week were abysmal, the bills were stacking and it all got too much...

I remember while visiting my mum, she could see the strain I was under, she took me upstairs into the bedroom out of sight of the rest of the family.

She asked me what was wrong, and it was like a wave sweeping over me...

I broke down and was sitting on the corner of the bed sobbing uncontrollably, I spluttered out amid the snot and tears running into my mouth "There's not enough money coming in mum, I need more customers"...

And then in a low, comforting tone she replied "No son, you just need the ones you've got to pay you on time".

Wow, how could such wisdom come from someone who'd never owned or run a business.

I was concentrating on the 'front end' of 'get more customers' to make it better because I thought 'this is the way it is', but I had it all backward.

Have you got something that you've been telling yourself that simply isn't true?

When I made the decision to only take direct debit as payment and asked customers to transfer over, it looked like on face value we'd lost 40% of our customers...

The reality was, they were the customers who weren't paying me anyway.

Our overhead went down on the 40%, and any new customers were only given the option of DD.

We went from always scrambling to make payroll, to having surplus funds in the bank, to being able to pay for breakages or any other eventuality...

The emotional security blanket this gave us was amazing...

And that's what I want for you in your world...

Don't forget to create your Dream and Nightmare lists... it's transformational

Next, I want you to go from being reactive to being proactive...

Continue to Part 3: A Lifetime of Value

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