What are the needs of external customers

External Customer is a type of customer who does not have any direct relationship with the company but buys and consumes the produced products and services. External customer is what is commonly referred to as a ‘customer' in general. They purchase a company’s products or services but are not employee or partner or vendor or part of the organization in any other way. Some common examples can be a people who go to a retail store to buy groceries, visitors buying tickets at monuments or parks, the guests that stay in hotels, the diners that eat in restaurants.

External customers are often contrasted with internal customers who are customers of the company and are also a part of the organization like the employees of the company.

In this article:

• Importance of External Customer
• Example of External Customer

Importance of External Customer

External customers are essential to any business as they provide a revenue stream, make repeat purchases and refer your products to other people. Or alternately, they may also dissuade others from becoming customers of the company.

When a company normally defines a customer base, mostly it is being referred to the external customer. External customers in terms of scale would provide more value to a company typically. Internal customers also play an important role in the success of a business. For example. if a salesperson does not work well with customer service representative, it may result in a poor level of service.

If a company manufactures a product or provides a service, it is mostly designed and positioned for the external customer whereas means, tools, software, training and other similar aspects are which are designed to enable the business are for the internal customers mostly the employees, partners and stakeholders.

Example of External Customer

Consider the case of Starbucks Coffee. It has both internal and external customers. The internal customers will be the people that work within the business of Starbucks like the Board of Directors of the company, the supervisors and team members that serve coffee. External customers will be the everyday public that come in and buy coffee.

Another example can be a software application for ecommerce. Internal Customers are the employees who use the same to list products and pricing and external customers are the ones who use the portal to order and buy products.

Hence, this concludes the definition of External Customer along with its overview.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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Early yesterday morning, I used the time I had waiting for an inter-island flight to purge old documents from the hard drive of my laptop. I came across a lesson plan I had done with my retail team a few years back on customer service, detailing what we noticed to be the six basic needs of guests visiting our stores. I found the lesson plan was definitely worth keeping, a terrific review on service basics. It was also a reality check, that when it comes to customer service we tend to make things much more difficult than they have to be. Bells and whistles lose their sheen when the basics aren’t covered well first.

This list may read pretty basic to you too. However can you imagine how thrilled we’d all be if this was the customer service we always received?

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The Six Basic Needs of Customers

1. Friendliness
Friendliness is the most basic of all customers needs, usually associated with being greeted graciously and with warmth. We all want to be acknowledged and welcomed by someone who sincerely is glad to see us. A customer shouldn’t feel they are an intrusion on the service provider’s work day!

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2. Understanding and empathy
Customers need to feel that the service person understands and appreciates their circumstances and feelings without criticism or judgment. Customers have simple expectations that we who serve them can put ourselves in their shoes, understanding what it is they came to us for in the first place.

3. Fairness
We all need to feel we are being treated fairly. Customers get very annoyed and defensive when they feel they are subject to any class distinctions. No one wants to be treated as if they fall into a certain category, left wondering if “the grass is greener on the other side” and if they only received second best.

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4. Control
Control represents the customers’ need to feel they have an impact on the way things turn out. Our ability to meet this need for them comes from our own willingness to say “yes” much more than we say “no.” Customers don’t care about policies and rules; they want to deal with us in all our reasonableness.

5. Options and alternatives
Customers need to feel that other avenues are available to getting what they want accomplished. They realize that they may be charting virgin territory, and they depend on us to be “in the know” and provide them with the “inside scoop.” They get pretty upset when they feel they have spun their wheels getting something done, and we knew all along a better way, but never made the suggestion.

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6. Information
“Tell me, show me – everything!” Customers need to be educated and informed about our products and services, and they don’t want us leaving anything out! They don’t want to waste precious time doing homework on their own – they look to us to be their walking, talking, information central.

Rosa Say is the author of Managing with Aloha, Bringing Hawaii’s Universal Values to the Art of Business and the Talking Story blog. She is also the founder and head coach of Say Leadership Coaching, a company dedicated to bringing nobility to the working arts of management and leadership.

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Rosa’s Previous Thursday Column was: 7 Steps for Resolving Customer Complaints.

When we think back to some of the great products we’ve all seen over the years, I’m sure many of us will have wondered how the ideas for these were first devised. And while many of us may have experienced a brainwave of our own at some time or another, these ideas are only any good if they’re able to meet a customer need that’s not already being met. So, what do we mean by customer needs exactly?

What are customer needs?

Customer needs refer to a customer’s motives for purchasing a product, brand or service, or alternatively the attributes of a product, brand or service that tempt them to buy. And it’s these customer needs that every business or organisation is striving to identify.

Types of customer needs

When it comes to customer needs, there are two main types to consider; internal and external:

Internal customer needs

When we are referring to internal customers, we’re essentially talking about the stakeholders that work within your organisation, namely your employees.

The needs of this internal audience group are reliant on the assistance they receive from other individuals or departments to complete their work.

For example, a marketing department typically has to liaise with then complete collateral for various departments within a company. These departments are essentially the marketing team’s own internal customers, and they need to provide a good service if they are to keep these audiences happy and retain their own jobs.

External customer needs

In contrast, your external customers are those people and businesses that pay for your products and services and not directly connected to your organisation.

Unlike internal customers that have no choice about who they have to work alongside, external customers have both a choice and influence over who they choose to liaise with and ultimately buy from.

For example, let’s say you were a support provider of IT services. Given the freedom an external customer has over partnering with you. Unless you’re consistently delivering timely, high-quality support, they may decide to take their business elsewhere.

That’s why it’s essential that you’re able to identify and best meet the needs of your customers.

Why is it important to understand customer needs?

The customer is at the heart of every successful business. So, the better you know and understand your customer needs, the more they’re likely to buy from you, the longer they will stay with you and the more successful you’ll be in attracting new customers.

By contrast, the less capable you are in meeting their needs, the more likely they’ll be to leave you for a competitor business.

How to identify customer needs

There are three key ways to better pinpoint the needs of your customers namely customer needs analysis, customer needs surveys and voice of the customer programs.

Customer needs analysis

Customer needs analysis is all about trying to identify the customer’s primary requirements for a product or service. Besides improving their understanding of customer requirements, customer needs analysis can help those running it to better identify their position in the overall market.

Armed with this information, manufacturers and providers will be better able to ensure that their product or service offers the benefits, attributes and features needed to provide the customer with value.

Customer needs surveys

For the best results customer needs analysis needs to be carried out by running customer needs surveys. These surveys can also help manufacturers and providers to better identify how well they stack up in terms of meeting their target customers’ needs.

Any survey should ask questions about your brand and competitors, as well as the customers’ product awareness and brand attitudes in general.

Questions can include:

• Questions about positive and negative word associations with your brand
• Questions where customers are asked to group your brand in with similar and/or competing brands
• Questions where brands are compared and sorted according to their preferences for usage

To get more detailed customer feedback with regards to how customers feel about their experiences with your brand and what you can improve, you might want to run further customer surveys with them. In addition, more specialist surveys can help you decide on the best direction to take next.

For example, if you were to run a product survey, you could test different concepts with customers to better understand what they liked and disliked, to improve your next product launch.

Voice of the Customer programs

Research methods and techniques are improving all the time. And today market leading organisations are employing voice of the customer programmes to gain a deeper understanding of their customers’ needs and requirements. This is also extremely valuable for those operating in highly competitive or crowded marketplaces, where customer experience (CX) is the key to driving greater sales.

The idea behind these programs, is that by running voice of the customer surveys throughout the customer journey, organisations will be better able to understand what matters most to customers and the exact actions they need to take to improve satisfaction, loyalty and maximise profitability.

From NPS surveys to CES and CSAT surveys. To maximise the success of your voice of the customer programs, it’s also vital to include these key CX metrics, to measure how your customers feel and be able to identify the exact improvements you need to make.

Anticipating customer needs

If you’re able to meet your customers’ needs, you’ll have a lot more satisfied customers. However, if they’re to keep returning to your business and stay with you for the long term, you’ll need to anticipate their future, as well as their existing needs.

This is where the benefit of surveys and more specialised ones such as product surveys comes in, as well as any additional sources of data you can uncover. A good example of this is the ongoing comments that you can glean from customer tickets to your customer service and support desk teams.

Ultimately, as long as you’re continually surveying your customers and collecting their data, you’ll be able to see and respond to developing patterns, making you even better at anticipating and meeting their future needs.