The key to business success lies in fostering strong customer relationships by providing simple solutions to genuine problems, building trust and acting on their feedback, according to Naomi Simson.
The founder of RedBalloon and star of Channel 10’s Shark Tank said when her business was in its infancy the only way she could grow was to focus her attention on delivering great customer outcomes.
“I realised I couldn’t do it on my own, so how could I engage customers to be the voice of my brand?”
“There was no money to promote the business. The only thing I could do was to build relationships, one by one,” she said.
Naomi founded RedBalloon in 2001 after leaving her high-flying corporate role having worked for organisations such as Apple, KPMG and Ansett Airlines.
She launched the online ‘experience’ gift retailer in the aftermath of the dot-com stock market crash and notched up just 300 sales in her first year, but is now nearing 4 million customers.
Speaking at a recent Bankwest Connect Event, Naomi said building relationships with customers was more important than ever, particularly as many companies continue to over promise and under deliver.
“What customers want now is authenticity and transparency, they just want to have a decent relationship with you,” she said.
“Our reputation is everything.”
“What is your reputation, how do people talk about you, are you what you say you are, do you live by your values, can people count on you?,” she asked the 150-strong audience of business owners.
A part of building strong relationships with customers, according to Naomi, is to always listen to them.
In the early days of RedBalloon, Naomi said she personally called every single customer to ensure they had a great experience and to take any feedback about how to make it better for the next customer.
And while the business has grown too big for her to do that today, the company still gives all customers a chance to provide feedback, and uses technology to identify trends in what people are saying.
“Innovation comes from listening to customers,” she said.
She uses this customer-centric approach in her role on Shark Tank, a reality TV show where budding entrepreneurs pitch their business ideas with the aim of securing her financial backing.
“The thing I look for most is how do they talk about the customer,” Naomi said.
She said sometimes entrepreneurs and business owners become lost in solving a problem, rather than applying it to the customer.
“Sometimes we innovate for innovation’s sake. But sometimes you just have to let basic logic take its course. And sometimes, we can overcomplicate the answers that we are coming up with, versus simplifying them,” she said.
And while there is always the threat of new competitors and, more recently, the impacts of digital disruption, Naomi believes strong relationships with customers are the best defence for businesses.
“The protection from disruption comes from relationships,” she said, adding that her customers were loyal because the company has a relationship with them, rather than just a simple transaction.
“Ultimately, all business is based on trust.
“I believe my protection from disruption is through relationships, that people trust us to do what we said we were going to do.”
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