Class is one of those words that has a large number of meanings depending on how it is used. Thefreedictionary.com defines class as: "1. A set, collection, group, or configuration containing members regarded as having certain attributes or traits in common; a kind or category. 2. A division based on quality, rank, or grade. 3. A rank or position of society." There is also the notion of class as in cultural characteristics for an individual, or business, of having elegance, gracefulness, and gentility.
In business one naturally identifies different groups of potential customers. Ceboa, for example, primarily targets, what we call the independent business professional. This leads to a natural classification by profession, such as attorney, real estate agent, construction contractor, architect, consultant and so on. The value of classification is that a business, such as Ceboa, can identify the common characteristics and needs of a specific group and then tailor the product or service to meet those needs and characteristics. This is a good thing to due since a better understanding of your customer leads to better products and services which leads to happy customers.
Where the definition and use of class in business can get into trouble is with the potential for placing rank or value on one group relative to another. Many businesses rank customers differently, which ultimately has a negative affect on that businesses brand. Airlines are a good example of class and ranking of customers by value with their first class, business class, and economy class services. The problem is not that customers pay for additional services, such as a better airplane seat and a better meal. It is that customer's are treated differently. Part of the problems that the airline industry has, in my opinion, is that the industry forgot that all customers are important and squandered the value of their individual brands by not treating customers with the same care. Airlines and airline travel are almost universally viewed negatively. Southwest Airlines, and similar carriers, fare better in brand perception because they treat all customers the same.
In my article "Are You a Luxury Brand?" I postulate that a business can't be both a luxury brand and a commodity brand. In the early days of the industry automobile manufacturers partially solved the problem that the airline industry has by defining different brands and keeping them somewhat separate. Unfortunately, for the automobile industry this practice broke down and today they have much the same brand problem that the airlines have. At one time General Motors had distinct car divisions. Luxury was Cadillac and the "every man's" car was the Chevrolet. When you bought a Chevrolet, you knew what you were buying, a basic product. If you wanted luxury, you bought Cadillac. They were separate and distinct and sold in separate dealerships with no intermingling.
The airline industry never did this. It should have created a luxury, first class, airline brand and an economy brand with each separate and in different terminals, if possible. Both could be owned by the same parent company. But, the problem was the close intermingling of differing classes of consumers in a mixed class flight. Frustrated economy class consumers, seeing the difference in treatment from check-in through baggage claim viewed the brand experience as poor and influenced other travelers with their travel experiences thereby impacting the overall brand value.
Car manufacturers started the down ward spiral when luxury and everyday vehicles within one manufacturer started to have very similar designs and when luxury started to cheapen parts and components. A similar negative impact on a brand occurred when manufacturers with a well known brand starting building vehicles outside of the basic brand concept. For example, when a well known sports car manufacturer started making a SUV under the same sports car brand. It confused the brand message which didn't make sense from a branding perspective.
So here's the idea. Do you classify your customers into different groups and does that create unequal levels of treatment for your customers? If so, examine how these customers view your brand. Do customers that are treated differently feel slighted? If so, you probably have a brand problem building that you may not be aware of.
One quick way to check is to ask you customers. In my article, '"How am I Doing", Have You Asked Your Customer?' , it provides a suggesting for getting feedback from your customer. The key here is to understand early if there is a perception problem on the part of your customer.
I don't believe that a successful business can have different classes of customer that are treated differently. Ultimately this leads to brand clashes in which the lowest common denominator, that is the customers treated with less care, will define the brand and overwrite the brand perception of better treated customers. This happened in the airline and automobile industries.
Treat your customer's the same, and at the same level of quality and care. If you want to have a luxury and a non luxury brand, separate the company into two distinct entities with different locations, branding, marketing, and target customers. There are some hotel corporations that have done this effectively where they have distinct brands ranging from luxury to economy, and alternate styles, such as residence-like hotels. The separate brands are in separate locations with different names and different styles.
The key is to maintain your brand perception in your customer's mind, as described in the article "You Are Your Brand" . Putting your brand in a situation where confused brand messages occur, such as mixing luxury and economy in the same setting, will obscure and diminish your brand and impact your business and profitability.
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Business Time and Long Term Thinking
