The customer is always right, right? Anyone who has spent more than five minutes in business knows this to be absolutely untrue. In fact, the customer can be irrational, demanding, and even infuriating. What, then, drives businesses to swallow their pride and operate within an adage of “the customer is always right?” Is this philosophy really necessary? In short, yes. Reputation matters, and your business’ reputation is always on the line.
Among the many things I attempt to convey to my public relations students, there exists one maxim that I believe is most applicable. It is simply this: “All organizations, without exception, exist and persist solely on the basis of public goodwill.” This is a simplistic way of expressing the fact that in a free society and a free-market system, the power of consumer choice cannot be understated. A long-term boycott of any entity, whether educational, manufacturing, retail, etc., will bring an organization to its knees. Even governments are not immune to this truth. Though more complicated than, say, frustration over a mis-topped hamburger from the local burger joint, there are parallels. Too many mis-topped burgers will eventually shut down the burger stand. Similarly, political revolutions tend to occur when the number of slighted citizens outweighs those who are satisfied with the status quo.
As I tell my students, no organization is immune to this threat. This truism becomes more observable by the day, as social media and instant information-sharing make it possible for a single disgruntled customer to wreak havoc on an organization’s reputation. Think, for instance, of the recent demonstrated power of Yelp.com, which allowed people who have never been to a restaurant to rate it poorly (or highly) simply on the basis of that restaurant’s political stance. More often than not, the poor ratings won out, and the reputation suffered.
The understanding of rhetorical ethos helps explain how reputation influences public perception. Ethos, in this sense, refers to credibility. Ethos is an intangible element that exists at the cornerstone of persuasive theory. There are two important business applications of ethos. First, ethos is such a powerful entity that it impacts the perception of a message more than the content of the message itself. In other words, a poorly constructed message from a respected source has a more positive effect than a good message from a disrespected source. Secondly, ethos is much easier to maintain than rebuild. These two truths should be at the heart of business practices. There are many examples of companies that have either recognized the power and importance of ethos or ignored it completely.
Long ago, I read a magazine piece about the phenomenal success of a large retailer. In the article, the CEO noted the corporate policy of allowing returns on almost anything, for almost any reason. His rationale was simple: A customer may want to return a $50 item for very suspicious reasons. But that same customer would spend, on average, $1,200 over the course of the year on other merchandise at the store. His company would gladly eat $50 if it means not losing the $1,200 in future sales.
Accepting the return helped create a positive reputation for the company, which translated directly to greater sales. In essence, this CEO had learned that the improved perception, credibility, or ethos of the company was ultimately more important to the financial bottom line than the principle of refusing to accept illegitimate returns.
Contrast this philosophy with some recent occurrences with cable and internet provider Comcast. Comcast has developed a notorious reputation for poor customer service, so much so that the expectation has become almost self-perpetuating. In 2014, a Comcast customer tried to cancel his service and was repeatedly, rudely questioned by the customer service representative on the phone. The customer recorded the call, posted it online, and it went viral. At the time of this writing, this conversation has been played more than six million times. Consequently, that single customer experience now represents the Comcast brand in the minds of millions. Not surprisingly, as of early 2016, Comcast was the seventh most-hated brand in the U.S. and had the third lowest score on American Consumer Satisfaction Index.
Many other examples exist of organizations who go out of their way to deliver a positive customer experience and develop ethos, and are then rewarded through increased profits. The corporate policies of online shoe (and now clothing) retailer Zappos.com come to mind. Zappos’ return policy is such that as long as items are in their original condition, customers have up to one year to send items back. The company also pays for shipping both ways. Presumably, what Zappos loses in increased costs it more than makes up for in customer loyalty. This shows the financial effectiveness of a good reputation.
Good business practices extend far beyond return policies and customer service calls. Every organization should strive to develop and maintain goodwill. Businesses must constantly be on alert. They need to think about how their policies impact customers’ perceptions. This truth manifests itself in a thousand little ways. Do you have a minimum purchase before you allow use of a credit card? Do you forbid the use of restrooms without a purchase? Do you have a strict return policy? Is your rewards program complicated and full of exclusions? Is your signage imposing and accusatory? Are your sale terms unclear? Are your shelves adequately stocked with sale items? Is your fine print misleading? Are your open hours inconvenient for potential customers? These seemingly little items may have a big impact on your organization’s reputation.
While tensions and disagreements with customers are inevitable, businesses need to ask if victory is worth the cost. Is an ideological, principled stance worth the potential lost business? In rare instances, for those truly terrible customers or expensive concessions, the answer might be “yes.” But for the vast majority of circumstances, the answer is very clearly “no.” The goodwill earned from conceding a point will likely do more good than harm.
At 212 Media Studios, our mission is to help your business succeed by making sure the image you present to your customers is as refined and purposeful as possible.
As an organization, we strive to maximize our own effectiveness. We pride ourselves in demonstrating a high level of customer service. We listen, understand, and respond to your business’ needs. We also value integrity and are willing to speak the hard truths born from our extensive experience in the world of marketing. We tell you what works and what doesn’t, and we will not take a job we don’t believe can be successful.
If you are struggling to understand the current status of your company’s reputation or worried about how you may be perceived, get in touch with us. Let us help you maximize your reputation and strengthen your ethos. In the process, we will demonstrate why we’ve earned a reputation of honesty, work ethic, creativity, and effective marketing solutions.