When the next greatest thing is lined up to replace the thing you just bought, it would seem that brands based on service and particularly good, or compelling customer service have a sustainable competitive advantage over those that offer product-based features that can be copied or improved upon.
So what about those "service" businesses that have a low cost of entry (whether price, or emotional) and arguably offer very similar products and services as the next guy? How do they sustain customer commitment when they don't constantly release the newest greatest version? These businesses occupy a space that is service-based for sure, but if not careful, the "product" they offer can be thought to be very much the same as one down the street at the next place. Here's what I mean ...
While it would be tough to get most of us to change hair stylists (high emotional price of entry) what about nail salons or coffee shops? Sure they offer products of course, but their business model is based on offering a certain customer service. I have my favorite nail place now (those who know me from previous lives are laughing out loud hysterically now), and when I've been rushed for time and not near my nail place, I've gone to another, thinking, what could the difference really be right? Same deal with coffee places - I have my favorite weekend Starbucks. There are two others within a one mile radius, and on those occasions when it's just been more convenient to go to one of them, it's just not the same.
So what is it about these largely commoditized service businesses that makes the difference? It's the memory of previous interactions and exchanges we've shared that creates a common knowledge. It's that the women at the nail salon know I am from Canada and ask about when my next trip home will be, then proceed to tell me the latest about their cousins who live there, or the road trip they once took up to Vancouver from San Diego, 20 hours long. It's the woman at my Starbucks who remembers my drink and when I divert from it, asks me why and weaves it into a fun conversation with a vibe all her own.
It's connection. I will drive for that. I will put off my nails for a week rather than take a risk, on what truly is a low cost item, that my experience won't be what I want. Customer service, and a true, authentic, meaningful connection to the customer can turn even commoditized purchases into competitive advantage.