Here’s How To Lose Your Best Customers

Some companies do very stupid things in the way of “rules” on a daily basis.  We can show what we think of what them  by not patronizing them.

Certain airlines are perfect examples.

I would have thought that by now companies, especially hotels,  would know about basic things like trust and empowerment, but I am wrong.

A quick way to explain empowerment is letting employees make decisions about certain aspects of work that affect them without having to ask their boss  for permission or get an exception to the rules.

The empowerment movement has been around for more than thirty years.  Here’s an example of how it works. When I lived in California, I lost my weekly calendar in July.  I went to the Broadway in West Covina to get a new calendar.  I had the chutzpah to ask for a 50% discount on the calendar since the year was half over.

The sales clerk looked me straight in the face, and said, “sure, no problem”, and gave me the discount. That’s empowerment.

Flash forward to the  4 star hotel where I stayed in June 2012. They’ve done a lot to keep me from coming back here, but I’ll mention just two. [Just as a point of reference, I am a new customer at this hotel, I’ve paid full rate and I have stayed on the executive floor which costs extra and has benefits like the executive lounge. I don’t say this to brag. Just let let you know that I haven’t stayed for free.]

When I got off the elevator yesterday morning it was pouring rain and I had to walk to my appointment a few hundred yards away.  I asked to borrow an umbrella and was led to the bellman, who took out some paper for me to sign even before he gave me the umbrella.  He told me I had to sign for the umbrella and I would have to pay about $20 USD if I lost it.

I signed it but I was a bit surprised.  Couldn’t they just write down my name and room number?  Couldn’t they just trust me to bring back the umbrella?  I guess not.

My total bill at the hotel would turn out to be about 100 times the cost of the umbrella, about $2000 USD.

Did I look like the kind of person who might steal the umbrella. I might lose it, but so what?

Whoever then used the umbrella would be advertising the name of the hotel since it was emblazoned on the fabric.The umbrella is a low cost item anyway.  Getting a good customer is another matter.

How much does it cost to get a customer?  And keep a customer?  More than twenty bucks.  I didn’t like the feeling of distrust. There are signs all over the lobby bragging about the customer service and truthfully the hotel is not bad.  It just seemed they made a lot of stupid decisions about customer service. I don’t blame the bellman or the concierges, but they are not blameless.  Powerless perhaps.

The hotel has customer loyalty programs that must cost them a fortune but if they let the bellman just give out the umbrellas and even let him “lose” a few of them, that would be generate more customer value than the entire customer loyalty program. [Of course, one of the bellman’s performance measures is no doubt number of umbrellas retained.]

Save an umbrella; lose a customer.  It hardly seems worth it.

As I write this, my check out date  is today at the same hotel and since my ride to the airport won’t come until after check out time, I was given “late check out”.  I figured I could wait in the executive lounge where I had hung out for my entire stay and the concierge agreed.

But, she warned me, “you can’t have any drink or food”.  If you do, we’ll have to charge you about $30 USD.

What? I’ve stayed here for ten days, I’ve spent $2,000 bucks and now I can’t even get a free beer or a piece of cheese without paying an additional charge?

I know some people will say, “a rule’s a rule” and  “what if we did this for everybody?”

I say the hell with the rule when it doesn’t make sense and I will say, “they should do it for everybody.”  The Conrad Hotel in Singapore where I have stayed on many occasions, always allows it, and that’s why I keep on going back there.

In any case, I thought I would just say ok, but then I was stewing about it and asked to see the manager.  I explained the situation and he told me ok, I wouldn’t have to pay for the drink and nibbles.  But he didn’t look happy about it.  [I thought he might say something like, “just this once.” but he didn’t]

Why would a hotel have a policy like this that  alienates their best customers, the ones that stay up on the lounge floor?  To maximize profit?  If that’s the case, it’s a misguided policy.

I’m a businessman. [My gallery website here]. I want my clients to be super satisfied, and we bend over backwards to attract the customers and take care of them. It’s true in the gallery business and in my speaking business.

If I ran the hotel where I stayed, I would make sure that every customer left satisfied and I would empower my employees to do the same.

Do you know why the Ritz Carlton and Starbucks are so great? Because they make every point of customer contact perfect.  That’s right. Perfect. That’s why I talk a lot about them in my classes and my talks to other companies.

How about your company? How about you?

Every company can be as good as the Ritz.  It’s not that hard.  Really.

It means putting the customer first, not only in words but in actions too.  It means having the rules focus on serving the customer. And thinking of the bigger picture.  Not just of maximizing revenues today but developing clients for the long term

Are you “valuing the umbrella” and forgetting about the customer?

Want to be a great company with great customer service?  Start “valuing the customer “and “forgetting about the umbrella.”

Want to know where to begin?  Sorry, it’s not with any customer service program or six sigma or Quality Circles.

It’s with something much more basic.

Trust.  Trusting employees. Trusting customers. Trusting yourself.

I’m serious.

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  1. vitavin32 says:

    Particularly like the umbrella story. After all it’s all about trust, giving it away and people will gladly return. It’s simple fact of happiness as well as business. Exceptions may happen as not everyone gonna be nice but this actually makes it even worth trying because we know how valuable honest people are.

    Thanks for another nice article.

  2. bobtobin says:

    You got it right. Thanks for your comment. B