Internal customer is a term used for employees of a company to emphasize the need to motivate the employees to accept and adopt ways of behaving which are in the overall interest of company as well as the employees. It is suggested that a company can perform better by marketing or selling to its employees the company's culture and doing ways of business, just as it markets its products to customer, sometimes called external customers to differentiate them from internal customers.
The concept of internal customer is useful in any type of business. However, is much more useful and more widely practiced in companies engaged in service business.
The concept of internal customers as used in service marketing practices gives rise to three different types of marketing gives rise to three different, but interlinked, types of marketing that every company must undertake. These are:
- External Marketing
- Internal Marketing
- Interactive Marketing
External marketing refers to the traditional marketing by the company directed towards external customers. Internal marketing refers to the efforts of the company aimed at internal customers, or employees, to motivate them to provide good quality service to customers. Interactive marketing refers to the behaviour of the employees during their interaction with the external customers.
The internal customers, interact with the external customers mostly during the process of delivering service to them. The internal customers contribute to the company's success by help in marketing to the external customers during such interaction. They do this in several different ways described below.
- They provide good service to the customer, and thereby increase the chances of repeat business.
- They may actually participate in the marketing or selling process. For example, a waiter in a restaurant can have substantial influence on the quantity and choice of orders placed by customers.
- The service provider, that is, the internal customers themselves are a part of the total service experience of the external customer, and thus a part of the product delivered. This is the reason why so many advertisements of airlines focus on their air hostesses and other flight staff.
- The internal customers can actually try to sell the services of the company.
An external customer is someone who uses your company's products or services but is not part of your organization. If you own a retail store, for example, an external customer is an individual who enters your store and buys merchandise. An internal customer is any member of your organization who relies on assistance from another to fulfill her job duties, such as a sales representative who needs assistance from a customer service representative to place an order.
External customers are essential to the success of any business, as they provide the revenue stream through their purchases that the enterprise needs to survive. Satisfied external customers often make repeat purchases as well as refer your business to other people they know. A customer who suffers through a negative experience with a business, such as being treated rudely by an employee, can also hinder a business by dissuading others from patronizing it.
While internal customers may not necessarily purchase the products or services offered by their employer, the internal customer relationship also plays a key role in the business's success. In the sales example, the salesperson who does not work well with customer service may have greater difficulty placing orders or obtaining answers to his external clients' questions, resulting in a poor level of service. Strained internal relationships can also adversely affect company morale.