The story of bicycles and differentiation ideas
Let’s take a look at Zane’s Cycles, the largest bicycle retailer in Connecticut, and see how they achieved success by adopting a customer-centric approach. In a highly competitive business environment, Chris Zane’s sales volume has continued to grow steadily by 25% every year.
Zane’s Cycles
How did Zane’s create such a strong difference? The answer lies in its “Lifetime Warranty” policy. Every bicycle purchased from Zane’s Cycles comes with free repair and maintenance services at any time throughout its lifetime. Zane’s Cycles’ warranty policy clearly states:
Zane’s will provide maintenance and repair services throughout the lifetime of every bicycle purchased from Zane’s.
When necessary, Zane’s will extend the warranty period for the lifetime of any accessories or components purchased from Zane’s that are defective or improperly assembled.
Zane’s will extend the warranty period for the lifetime of any accessories or components purchased from Zane’s that are defective or improperly assembled.
You might think Chris made a mistake because, after all, cycling enthusiasts will ride many miles, and their bicycles will certainly experience significant wear and tear. Chris’s competitors all believed he was crazy.
However, Chris’s “crazy” idea was a profitable one. His technical team always assembles bicycles with maximum precision because they understand that they will be responsible for maintaining those bicycles throughout their entire lifetime.
Moreover, the lifetime warranty policy helps retain the best customers. These are people who love cycling and need a reliable place for regular bicycle maintenance. In addition, every time customers return for maintenance, Zane’s Cycles has an opportunity to introduce new bicycle accessories and products displayed in the store.
The key achievement of Zane’s is that customers recognize how different Zane’s is compared with other bicycle retailers, and they respond to this difference with loyalty by becoming long-term customers.
Key lessons learned
Use services as a competitive advantage. If customers want the moon, you need to give them the entire universe.
Always build barriers. Carefully monitor the services your competitors – both large and small – are offering, and be ready to strengthen your own sales programs.
Hire employees who value customers, respect the products they create, and always strive for the best quality. Understand who your customers are so you can hire salespeople who truly understand them.
Calculate the true cost of the services you provide. You need to know how much it costs to become a leader in customer service.
Take care of your biggest customers. The 80/20 rule applies to small businesses just as much as large corporations: 20% of your customers generate around 80% of your profits, so why treat them the same as customers who only occasionally walk through your door?
Observe how customers use your products and listen to their feedback.
Build a customer community.