Here are 4 questions to ask yourself when it comes to your relationship with your customers:
1. Are your most profitable customers those who have the most reason to be dissatisfied with you?
2. Do you have rules that you want customers to break because doing so generates profits?
3. Do you make it difficult for customers to understand or abide by your rules, and do you actually help customers break them?
4. DO you depend on contracts to prevent customers from defecting?
If you answered “yes” to any of the four questions, your company may be engaged in what an article, “Companies And The Customers Who Hate Them” in the Harvard Business Review calls “adversarial value-extracting strategies.”
Not only do company-centric methods anger consumers, but it also makes your customer base vulnerable to new, customer-centric companies. That’s when you risk having your customers hate you. Witness the disruptive effects of Netflix, ING Direct, and Virgin Mobile. Not only do these company-centric methods anger consumers, but it also makes your customer base vulnerable to new, customer-centric companies. Witness the disruptive effects of Netflix, ING Direct, and Virgin Mobile.
It costs 10 times as much to get a new customer as it does to retain an old one. So why not shave a few mil from that bloated ad budget and spend it on making your customer base happier? Your bottom line will thank you.