Harnessing "Marquee Customers"

They spend more, stick around longer, provide feedback, and get the word out. How do you build a business that uses these special customers?

by Promise Phelon

It seems obvious but it bears repeating: Listening to customers and incorporating their suggestions into your organization can and does improve the bottom line, as evidenced by a growing number of businesses benefiting from the practice.

Rob Salmon, executive vice-president of field operations at the California-based storage firm Network Appliance (NTAP), credits input from customers for helping his company break the one billion dollar mark in annual revenue for the first time in 2001. Today, it exceeds $2 billion.

"Even as a startup and throughout our evolution, every part of NetApp has been relentlessly focused on our customers' successes. Listening to those customers is step one—and we are sure to always ask either what problem we can help them solve and/or what opportunity we can help them address. We're also sure to ask what they like—and even what they don't," says Salmon.

Good for Business

Salmon is not alone in pushing the idea that listening to customers is key to increasing your revenue. David G. Thomson, author of Blueprint to a Billion: 7 Essentials to Achieve Exponential Growth (Wiley, December, 2005) coined the phrase "marquee customers" to describe customers who are avid promoters of a business' product or service.

Marquee customers, according to Thomson, are one of the "essentials" for fueling the exponential growth of large companies like Microsoft (MSFT), 3M (MMM), eBay (EBAY), and Starbucks (SBUX).

Marquee customers drive revenue because they spend more than regular customers. They also tend to stick around longer, provide valuable feedback, and act as lighthouse references to spread the word to others about the positive qualities of your product or service.

Here are three ideas to help get you started harnessing the power of marquee customers for your small company.

1. Copy what works. The great news for you is that big business has already spent millions and millions figuring what works and what doesn't, which means you win when you emulate the programs, procedures, and processes they use to grow marquee customers. California-based Mercado Software is one firm you might want to emulate. "A key driver of our recent growth is our customer advocacy program and its single objective—to increase customer delight," says CEO Corey Leibow.

Mercado also ties team compensation to its "customer delight index" and to customer willingness to refer. Leibow adds that today the company pulls customers in as "co-innovators" by encouraging them to share their ideas and needs. "We want our customers to put their fingerprints on our strategy and to direct Mercado's three-year plan," he says.

Their efforts are working; Mercado saw revenues grow by 300% in the past two years and projects 350% this year.

2. Establish a marquee-customer culture by teaching your employees how to affect and create value for customers. For example, a restaurant wins kudos and respect when the wait staff—or even better, the manager—asks if everything is okay, and then does something about it if the answer is no.

That means something. It makes customers feel as if the business cares. And it makes customers want to tell others about the business and return. Add a series of customer experience-type questions to your employees' customer-contact repertoire and give them the authority (and budget) to make things better when a customer reports that things haven't gone so well.