Right in this lesson where we're talking about relationships, that's the relationships that you have with your customer. And just like the relationships that you have with your, your friends and family, it's important to know the right way to have these and the amount of time and attention that you put into them. So we have a number of questions that help you get started figuring out what are the best kinds of relationships that you need to have with your customers. So for each segment that you're looking at, you need to ask yourself, what is the relationship that this segment expects? Does it expect a very high touch relationship? Is it expect a very low touch relationship?

Does the industry or market that you're in demand a particular type of relationship? Or contrary Do you want to break the mold and do something very different to the rest of the industry, remembering There's often a good or a bad reason why a particular sector or industry has particular types of relationships with its customers. If you've got an existing startup, it's worth thinking about the types of relationships that you already have in place. These may be what customers want, they may not be what customers wants and that that tension can often lead to good thoughts or thinking about what sort of relationship you do need. But then you also need to think about how expensive it is to maintain a relationship. If you look at a high end jewelry shop in a mall.

They have very expensive, very sophisticated salespeople a who are trained to work well with a high net worth individuals who come into the shop. That is variable very expensive type of relationship day is the space of They show up and the positioning and all the inventory also all contribute to the cost of maintaining, maintaining that close one to one relationship. On the other hand, I knew get business models where there is absolutely no personal relationships think oh by a service like Skype where you sign up automatically you get charged automatically. And you have as a user, you have no contact with a real person, even if something goes wrong. Support is all completely outsourced to the to the community. So you also need to think about what are the implications of particular kinds of relationship to the rest of a business model.

If you're designing your business so that people that the whole thing is aimed at a very, very low cost market. You then it is difficult to say how you can support a very high touch relationship because that goes against the rest of the business model. There may be a good reason for it. On the other hand, many existing businesses have have done well by changing the relationship between the different groups of customers and suppliers are in a two sided market between sets of customers. So for example, Google changed the the type of relationship that advertisers had with the customers and also about how advertisers bought adverts before Google came along with it. It's automated auctions.

Advertisers had to go and find somewhere to advertise. Yep, there was then a random negotiation to create the advert to get it placed very much in the old newspaper style, the way that Google's changed the relationship, that whole ad buying process has changed. So when you're thinking about how what type of type of relationship that you want to have with your customers, there are three things that you need to bear in mind. There are going to have a significant impact. There's acquisition, retention, and then upselling. And basically, when it comes down to it, you have the least amount of relationship possible the lowest cost relationship possible with your customers commensurate with your ability to use that relationship to acquire customers to retain customers or to sell them more goods.

So for example, going back to the the jewelry examples I Tiffany's that they had a prime spot in a retail mall. Yep. You only want to invest in those close sorts of personal relationships with the customers. If they you're able to generate more revenue more profit as a result of having that retail out, but with sorry, with the with the salesperson that if you can do sell to the same customers in the same way without needing to have those detailed relationships, why bother? Similarly, if you're going after a particular segment, say you're selling custom dresses You may be able to sell custom ball gowns simply online through a very important mating process. However, the segment made it may demand a great, a much greater level of personal contact from you.

Again, one of the things that many services discover is that people buy from people they don't buy value, they don't buy products, they don't buy services, they buy the relationship that they are having with you. So consultants, service, many other service providers, teachers, educators need to have a clear personal relationship. And that allows for many, many ongoing and recurrent sales. Also, the subscription businesses and you see this with many internet marketers where a lot of their business is built around. Brand around themselves, rather than about the quality of the product that they are selling people buy from Seth Godin, for example, because they trust what he says on marketing. They don't buy fundamentally because of the, what he says about marketing.

It's the is the trust. And so having these ongoing relationships is very, very important for customer retention. And again, for upsell. But Chris, if you've got a strong relationship that engender trust, is then a lot of easier to sell many other products and services. So thinking about who you're selling to, what you're selling to them, why you're selling it to them, very much helps you to understand the nature of the relationship that you need to have with your customers. So there are no number of different ways that you can have relationships with your with your customers.

And I'll go through these quickly now. So you have personal assistance. This is very much the traditional retail approach where you have somebody there to help you solve a problem or to or to help send you send you goods. Then you have dedicated personal assistance, where you will have perhaps a named contacts who will be there to help you and account manager it's quite common in b2b sales. If you have a stockbroker or traditional stockbroker, or years ago when you had personal bankers, those were often also dedicated personal service nowadays generally only apply to high net worth individuals. Again, there's an increased cost by from personal service to dedicated personnel.

And then the next thing you can have automated customer service, where the customer service is provided by chat bots or FA Q's on a website through Help Help documents instructions, where there's no requirement or very little requirement for that customer service rep to actually be involved. And often that's paired with another type of relationship, which is a word of a community. And you see this a lot with some of the Microsoft products where and the Google products were, because they have a user base of hundreds of millions of people. The cost of providing support is very, very large. And so what he's done, I think he might be case is they have a number of Mbps Microsoft most valuable professionals that they that used to see the community with information. And then allow consumers to go to the community boards, ask questions and encourage people to support other users.

And that then gives a rich if not always entirely satisfactory customer service experience. But for a company that is like Google that is offering free services, search, Gmail, etc. to the vast user base, it is a very effective way of delivering on its value proposition at low cost. And then finally, another form is of CO creation, where you're working together with the community to build something a lot a lot better. So when you're looking at relationships and trying to figure out the relationships that you want to have with your customers, you need to start thinking very much about the best way to do it. And the way I tend to do it is you look at the rest of the business model and say, okay, where are my costs?

And that gives you a little bit of an idea of your of your cost baseline. And then you think about, okay, what do my customer segments expect? Then you can think, okay, if they expect 24 hour customer service with somebody that they can pick up and know by name on the phone, then I can start pricing. I know my customer myself, I can then start to see is this going to work for the business model or not? And that's a fairly standard way of doing it. Another approach is to ask Go out, look at your competitors and think what is the customer relationship that they have with with it with their customers?

Is this something that I can do better? So if you're doing high end diamond sales, is it possible to turn it into something totally automated? Yeah. Oh, you split up the the process so that you have a very high touch initial sales processor to get the customers customer acquisition. And then you have a much more automated back end. There are multiple different ways of addressing this and is working in what is going to be the best way to get that ROI on the investment that you make into into customer service.

So to sum up, we've talked a little bit now about relationships and how they fit into the business model. Canvas now has been around The minutes thinking about each segment and what sort of relationship each of the expects, and then how much is that kind of cost? Is that a better way that you can do it? Right then reach out to me any questions that you've got, we'll try and get it all sorted for you.