Turning Gold into Platinum ( Gold Platinum )

Customer alchemy is the art of turning less profitable customers into more profitable customers. It can take place at any tier along the Customer Pyramid, but is more difficult at some levels than at others. For example, it is very difficult to move Lead customers up to Gold or Platinum tiers, and it is often necessary to "get the Lead out" rather than try to move those customers up. If the decision is made to keep Lead customers, the strategies used are typically different than those used at other tiers. 

Turning Gold into Platinum

The most important requirement for turning Gold customers into Platinum customers is to fully understand them and their individual needs. With an industrial or business-to-business firm and a dedicated sales force, this need is often met because the salesperson knows the business well enough to stay constantly in touch with the client and to anticipate his or her needs. This customer intimacy, when effective, allows the company to move the customer to a higher tier because the firm can develop offerings that satisfy the client's needs, identify existing ways to serve the client better, and communicate in the right way at the right times to clients.

When a company has a larger number of customers, the process of turning Gold into Platinum may seem more daunting but still involves the same basic foundation: building information profiles of customers that form the basis for becoming a full-service provider of whatever the firm can offer. Building these profiles may involve collecting and consolidating existing information about the customer's history with the firm, including usage and customer satisfaction information. Alternatively, profiles may involve conducting very individualized customer research such as personal interviews or customer expectation sessions. Only when company fully understands its Gold customers can it design strategies to turn them into Platinum customers.

The following strategies are recommended for turning Gold customers into Platinum customers. 

Become a Full-Service Provider

Home Depot, the U.S. hardware giant, has a strategy for making its good (Gold) customers into great (Platinum) customers. The highly successful hardware superstore, which sells to virtually all levels in the Customer Pyramid, has a new strategy for two groups of high potential customers--traditional customers who want to make major home renovations and housing professionals such as managers of apartment and condominium complexes and hotel chains. Together, these groups spend about $216 billion every year and Home Depot wants customers to spend all of it in its stores by becoming a full-service provider, offering everything these customers could possibly need to do their jobs. 

The cornerstone of its strategy is the creation of Expo Design Centers. The design centers not only show off the expanded line of physical products the company offers but configure the products into finished and polished showrooms. Rather than just having row upon row of nails, hammers, and tile, the store is creating a showplace for upscale renovation, including complete kitchens with state-of-the-art appliances, finished baths, and antiques.(n14) Expo is a one-stop-shopping location for major renovations, which usually require homeowners to assemble a group of contractors and designers, then make separate trips to buy tiles, materials, drapes, appliances, and the like. All of these are now available at an Expo, making it unnecessary for a member of their target segments to buy from any other store to do their renovations. Industry-certified designers and project managers oversee the entire project from beginning to end, making even general contractors expendable. With this strategy, Gold customers become Platinum customers, getting everything they want from their full-service supplier, Home Depot.