Your business’s health depends on keeping customers and attracting new ones. But as new technology hits the market, the economy changes (hello, global pandemic), or your customers’ expectations change, how do you ensure that your business stays current?
At Neat, we’ve faced the challenge of evolving with our customers more than once. And luckily, we’ve learned a thing or two about how to go through the process. Even if you’re not a SaaS company like us, the lessons on staying relevant can still apply to your small business.
We’ll tell you how we faced a new digital environment, revamped our product to meet customer needs, and reassessed who our target customer was.
Monitor changes in your business environment
Change is inevitable for the small business, and it can sometimes hit hard. Consider the global pandemic. Eighty-seven percent of small business owners say their businesses were hurt from COVID-19. But change can be spurred by other, lesser catalysts, such as your customers abandoning one social channel for another or a new competitor entering your market. These changes can slowly damage your business.
While you can’t always fully prepare for economic fluctuations, there are ways to monitor changes in the business landscape, so your business can update processes or even your product or service as needed. Sitting idle and not evolving can result in customers switching to a competitor that better meets their expectations.
To evaluate your business environment, use a framework such as a PESTEL Analysis, Porter’s Five Forces, or a SWOT analysis. These frameworks help your business answer the question, “What if _______ happens?” to determine how you’ll respond.
To build a framework like PESTEL, leadership and team members alike should keep their fingers on the pulse of current events and trends. Have conversations with your team about new technology, government affairs, competitors, and how these certain changes might impact your business. Also, once you’ve looked at your analysis framework, talk about ways you can quickly reinvent your product or service (and stay ahead of the competition). Completing these frameworks on a regular basis (e.g., once a quarter) can help your company anticipate and plan for changes BEFORE they hit.
At Neat, we realized we needed to change because we monitored the business environment constantly and had already begun revamping our product. We found that customers needed digital, cloud-based solutions to manage their expenses and bookkeeping online, as well as gain insights from the data — something we knew we could offer at Neat.
We began in a “hard copy” business environment. Customers needed our desktop software and scanners for organizing business documents like receipts or bill statements. Over time, though, the world became digital, and paper was used less and less. Our original product no longer matched the business environment.
Hint: While you’re monitoring the external business environment, make sure you’re tracking how your business is doing internally. With Neat’s software, you can view your business’s spending habits and financial health in real-time.
Solve customer pain points better than the competition
Customer pain points (aka problems that customers struggle with) might relatively stay the same, but the way customers want their pain points patched up is constantly changing. Their pain points often require new solutions or improvements to your small business offerings.
Think of the pain point that a phone book once solved. People needed to look up contacts. They still need to look up contacts, but they can complete the same function, and do so faster, on their smartphone. The phone book is now irrelevant. To wit, solving a pain point isn’t enough. You have to be able to solve it better than the competition.
Before you can improve your product or service, you should have a good understanding of what your customers’ pain points actually are — whether they be finance, productivity, or process pain points. And what better place to source this information than through the customers themselves? The customer knows what they want from your product or service. And normally, as we’ve discovered, they’re willing to share what their problems are.
Read customer opinions in online reviews. Send out short surveys to your email list. Have sales reps and customer service reps ask questions during calls. Post to social media channels. ASK the customer what problems they’re struggling with. Seventy-seven percent of consumers view brands more favorably if they seek out and accept customer feedback. On top of that, customer-centric companies are 60% more profitable than companies that aren’t customer-centric.
Use this information to identify customer pain points and update your product or service accordingly. Maybe you find that customers are frustrated that they can’t find FAQs easily on your website, so you add a new landing page. Or maybe you’re like us and discover that your product or service needs revamping to solve customer pain points.
Through intentional customer interviews, surveys, and conversations, we found an opportunity to optimize the value of the cloud-based product we had already rolled out in 2012. Customers used our product to organize and manage expense documentation but were also asking for ways to pull insights from their expense data.
During these conversations, we also saw that small business owners were struggling big time with a related business operation — small business bookkeeping. We took the product we already had and turned it into a revolutionary automated bookkeeping solution, simplifying a complex process and solving a major pain point for small business owners.
Reassess who your target customer actually is and how you communicate with them
You might find, like we did, that your customer base can change slightly as you update your product or service or new customers come on the scene. As a result, you’ll need to reassess who your customer is and how you communicate the value of your product or service.
Revisit target customer personas. Your target persona is a fictional representation of your small business’s perfect customer. In a target persona, you write down your ideal customer’s needs, buying process, and pain points. If you don’t have target customer personas, take a look at your current top customers and what they have in common (e.g., age, type of business, location, spending patterns). Create personas based on this information.
Once you know your target customer, ensure that these customers understand what you’re offering and the value that it brings. This step isn’t about sharing a list of features. Brainstorm what benefits the customers will receive from using your product or service. At Neat, some of our benefits are that we strip down the bookkeeping process into three simple steps and help the small business owner be prepared for tax season.
Share information about your updated product or service with your target customer through blog articles, social media posts, email announcements, and sales rep/customer service conversations.
At Neat, we’ve taken a similar approach to reassessing our target customer, as well as communicating the value that our product offers. When Neat was founded in 2002, our target customers were road warriors, like sales reps who needed to scan and organize receipts on the go. But as we continued to update our product and honed its small business bookkeeping abilities, we determined that we needed to focus more on the small business owner.
Our goal is to continue to support our customers who use our scanners, while also welcoming small business owners who embrace the software. As such, it’s been challenging to educate all customers about the services that Neat now offers (and what we’ve moved away from). We’ve met the communication challenges head-on by sharing blog posts, product launch emails, and social media announcements about the brand-new world of small business bookkeeping we’re building at Neat.
Evolve your business with confidence
As our CEO Garrett Baird says, “Successful entrepreneurs are the ones that don’t do things the old-fashioned ways. They disrupt the status quo and improve processes.” That should be the core mindset as you evolve with your customers. Evolving is necessary to remain relevant in your industry, as we’ve discovered at Neat. And by taking the right steps and being transparent with your customers, your small business can remain relevant, no matter what changes are thrown your way.
Not sure how your business is doing? Use Neat to easily complete small bookkeeping tasks and check the overall financial health of your company.