Trade offs. We’re asked to evaluate and make trade offs everyday. Particularly when it comes to things that are hard. Building a web site. Creating advertising. Starting a new public relations campaign. Delighting the customer. All hard tasks, all made harder by the constant need to make trade offs. How willing are you to trade quality for cost, or time for cost, or user experience for profit? These questions are posed every day and answered differently by people depending on the situation and the costs of the trade off.
The million dollar question is how many times can you trade things that benefit you over things that benefit the customer before you lose? If you automatically opt someone in to email marketing upon registration you’ve traded a faster list build for the trust of the customer. If you build in aggressive upsell offers in your sales funnel you’ve traded a larger order size over customer goodwill and usability. If you use an auto-attendant on your phones you’re trading cost for customer aggravation. In each one you’re making a bet that the cost savings outweigh the damage you do to your customer relationship.
Trade offs are like playing chicken with your customers. Who will blink first in a race down to the mimimally acceptable transaction?
What a sad and dangerous way to engage with customers. Playing chicken, seeing how much they’ll tolerate before walking away for good is never the way to building a successful, long-term relationship. It’s why you don’t see great companies doing it. You may see profitable companies doing it. But you don’t see companies and brands that people love doing it. Why? Because people don’t want to invest money and time in to an adversarial relationship; they want a beneficial relationship. One that helps them. No one wants to look over their shoulder constantly to make sure they’re not going to get jumped.
Bigger companies, quasi-monopolies and government can get away with it-simply because we have no alternative. A cable provider can treat you like crap, so can a telco, because switching costs are high and choices are limited. In those environments the trade offs are easy to make. Trade 200 customer service reps’ salaries by keeping people on hold 5 minutes longer? Easy. Cap Internet bandwidth and add another pricing tier to penalize your most active customers? Easy.
But small companies don’t have the luxury of making those trade offs. Why? Because people can and will go elsewhere. It’s hard to vote with your wallet when you only have one cable provider in your area. It’s a lot easier to vote with your wallet by choosing one of a dozen companies providing the service you need on the Web.
Additionally, small companies don’t have the advertising budget to gain the traction they need with the mass audience. They need strong word of mouth to grow their business. They can’t treat their customers poorly or ding their pool of goodwill repeatedly during the sale process because only bad things can happen:
- They’ll get one sale but the customer will never return, looking for a better service in the future
- The customer will abandon the sale process and try someone else
- The customer will buy but not tell anyone
- The customer will buy but tell anyone who will listen not to buy
- The customer will not buy and tell anyone who will listen not to even bother
All of those outcomes can spell death to a small company trying to build a reputation. The world is too small and too connected today for small companies to make repeated trade offs at the customer’s expense.
In reality trade offs must be made. There are development limitations and cash limitations that make it impossible to meet every expectation right off the bat. But this simply makes the trade offs that you do have control of even more important. Because people will put up with and understand that as a new company you need to make trade offs in some areas. In others, people aren’t as forgiving.
So if you rely on word of mouth, if you rely on reputation to grow your business, think long and hard the next time you look to trade something for the time, respect, effort or goodwill of the customer. Because the next trade you make could be the one that causes your customer (and their friends) to walk for good.