Common Sense in Selling Services

An industry veteran pointed to areas in which every company in the business could do better. The good news is that with room to improve, any service provider can become first class.

by Alex Goldman ISP-Planet Managing Editor [November 3, 2005]

He's been in the business long enough that when he speaks, he knows most of his audience on a first name basis.

Elliot Noss, president and CEO of Toronto, Canada-based TuCows, opened his ISPCON session Love Technology? Use it to Win Customers with a deceptively simple observation.

"Services lose with problems; goods win with features," Noss noted. "When you've just had a haircut, how often to you talk about the scissors the barber used? When you have a plumbing problem and it gets fixed, and you recommend a plumber, what did they do for you? They showed up on time and fixed the problem. So don't keep customers on hold, and don't make customers feel bad."

He pointed out that massive public businesses have been built from this simple insight. People want services to work; they don't need to know how they work.

The founder of Intuit, maker of QuickBooks, he noted, built software for small business owners who didn't know accounting. "We sell tech services presuming that the buyers have tech knowledge. How do we explain DNS to a potential hosting buyer? With a pop-up window on the website?"

While webhosts and service providers do advertise, Noss said, even those who advertise still get most of their customers through word of mouth.

Technical support
Noss pointed out that if a customer has a problem and calls, that's a good thing: it's better than a customer having a problem and switching service providers. "You may track time spent on calls, and all the other benchmarks, but think of tech support as a service, not as a cost center."

Noss urged ISP owners to think about a career path for their own tech support staff. "I try hardest to keep personnel in positions that touch customers," he said. At TuCows, he said, support staff can move up out of tech support.

"In order to help customers, we need to know them," Noss said. "I'm not saying that we do this better at TuCows; I'm saying that I preach it internally."

What customers want
Customers want plenty, of course. "Customers want to know: how to podcast, use e-mail, share photos . . . and what is a folder! There are never enough hours in a day, so what should you be doing? You should find out what customers want."

"Don't do unnecessary technology. Of course we sell a lot of this stuff. We sell billing, e-mail, anti-spam, self-publishing, and more, but we sell it because we believe that people shouldn't be doing it. Do you add value to your business if you're constantly tweaking SpamAssassin?"

So, get to know your customers. "Time spent on cost reduction is by definition a limited gain game. Time spent on customers has network effects and adds exponentially to value. There's a old saying, 'you can never save your way to growth,' and it's true."

Therefore, track what's really important, because what gets measured gets done. "If people in your organization know you're watching it, it will improve. Know why customers renew, how often, and what needs to be improved. If a customer leaves TuCows, I want to know why."

Noss told a story from World War II to illustrate that it's important to know what your data means. The Royal Air Force (RAF) was losing the Battle of Britain. As bombers flew regular raids, British fighter planes were losing to the Germans. A professor offered to study the problem and recommend where to add armor. He examined hundreds of airplanes after missions and reported where the planes had been shot. He then recommended that the planes be armored in all the areas that were undamaged in his reports. The military establishment were baffled until they understood that the airplanes that had not returned were the ones that had been shot in the areas in which the professor was recommending extra armor.

• If you don't know why your customers are leaving, you cannot fix the problem.
• If you only listen to praise from customers, you will never even know about a problem.

In theory, all of this is common sense. In reality, it's a full time job for the head of a company.

—End