Business Advice From History: Henry Ford On Being Customer-Centric

History’s brightest minds are chock full of wisdom. Many of which can be adapted as modern day business strategies. Today we're unveiling our newest blog series, Business Advice From History. Every Tuesday, we're going to share a quote from an iconic historical figure, and then discuss how it can impact modern day business strategies. Without further ado, this weeks quote:

“Any customer can have a car painted any color that he wants so long as it is black.” —Henry Ford

Henry Ford is one of the 20th Century’s iconic businessmen. Several of Ford’s methods, most notably the assembly line, are still universally regarded as the best way to mass produce affordable products.

While Ford was without question the best at manufacturing affordable luxuries for the general public, he lacked the fundamental understanding of customer centric business strategies. The quote above about the Model T suggests that having multiple colors available would cost his company more money, and therefore wasn't an option. Even if customers wished to have a Model T in another color, Ford ignored that request because it didn’t benefit his business.

Fast forward a century to the modern day, trends suggest that customer loyalty is the safest way to ensure your company regularly reports increasing sales. According to Business Automation Specialists, by reducing customer turnover by as little as 5%, your profits can increase anywhere between 25-125%! The probability of a customer making a purchase from your business is 60-70% if they’ve visited you before, this probability plummets to 5-20% if they’re visiting for the first time. Returning customers on average spend 67% more than first time customers. Bottom line, the quality of a customer is greater than the quantity of visitors.

Suppose Henry Ford was a car salesman in the 21st Century. Say a customer was on the fence about buying a brand new Ford Truck, the only issue is he doesn’t like the color options, how do you think Ford’s “any color so long as it is black” response would be received? Not well! Customers in the 21st Century have much more purchasing power than when Ford was in his prime. With tons of competitors selling similar products (and most likely in more colors) the customer will take his business to the Toyota dealership across the street where they will happily accommodate him.

Studies indicate that 91% of customers will not conduct business with you again if they are unhappy, so you’ve only got one chance to make a lasting relationship! Like the information we shared with you today? Be sure to check back every Tuesday for more Business Advice From History!

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