Perceived value: service is in the eye of the beholder

Perceived value: service is in the eye of the beholder – New Dimensions

Mike Butts

During every step of a transaction with your yard, your customers are measuring the difference between how they expect to be treated and how they perceive they are being treated–a perception of service that then becomes your business reality. The truth is that service is much more than a tangible sum of products and support functions. It’s not a one-plus-one-equals-two equation because you can’t disregard the psychological denominator, which is how your customers feel about their experiences when buying from your organization.

This is a frightening thought, isn’t it? But it’s absolutely true. Each and every customer you do business with constantly is grading and re-grading the level of service you provide. Moreover, they base their future purchasing decisions on their most recent encounters with your employees.

In the many conversations I’ve had with builders and contractors across the country, I consistently hear one theme repeated passionately over and over again: “We need quality product, delivered when and where it’s needed, and it better be backed up by support from our chosen provider.” Unfortunately, these areas are where dealers most often fail to deliver on the service promise, and it can foster a negative emotional experience for customers.

In addition, the total package you deliver not only impacts builders, it also reaches down to the home buyers they sell to and stretches back to your internal operations. In two of the classes that I teach, “Selling Value, Not Price,” and “The Yard Management Program,” one of the most important issues discussed is the communication between the major factions within the yard: sales and operations. The very best salesperson in the world would be totally ineffective without somebody in the yard bunking and delivering that promised load.

No doubt, value-added service is linked intrinsically to support functions and product availability. For example, if you fail to deliver the right load at the promised time, you could potentially back up an entire project by a day or more due to rescheduling subs and other suppliers. That’s real money that the customer will not recoup on that job. But it doesn’t end there. When there is a breakdown in the customer service process, it often is not communicated properly to builders, which makes them feel neglected. That, in turn, can come back to bite you when they are ready to consider making another purchase.

To avoid getting the cold shoulder from once-hot customers, more and more progressive dealers are recognizing that they must focus most of their energy and resources on delivering the very best service possible to their customers. It is absolutely the No. 1 priority. Period.

How do you do this? First and foremost, survey customers to determine the level of service they perceive they are getting. I have conducted a number of contractor focus groups for dealers who wanted to know the real truth–not their reps’ interpretations of how builders view the company. They don’t always like what is uncovered, but they recognize that it’s better to have the information and proactively address any problems, rather than to sit around and wonder why customers are walking out the door and never coming back.

Mike Butts is the vice president of the Michigan Lumber and Building Materials Association. 517.394.5225. E-mail:

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