Guess What? Your Customer Does Matter

So this weeks blog post comes with a recent experience.  I booked a trip on Booking.com and made sure to make every reservation refundable as I knew my trip was subject to change.  Sure enough, I ended up having to change one of my five reservations.

Upon visiting the site I was unable to cancel the reservation.  When I contacted them, the reply was that it was non-refundable, but they would see what they could do.

To make a long story short, after having to follow up several times over a month, and getting no real answer, I finally got the response that is summed up by "It is not our problem."

I have had to run my own customer service, managed customer service teams and know the damage that can be done by a customer that is not taken care of.  I had thousands of dollars in bookings on the site and that was treated with a "sorry for your frustration, good luck."

Here is where companies always seem to make a huge mistake.  Now if they were to get my trip refunded, let's say it costs them the entire $800 for the reservation.

Now, I don't know their fees, but what will it cost them when I never book on their site again, and I make sure everyone I know stays away from their site.

You NEED to take care of your customer.  There are times when you want to strangle the person on the other end of your emails.  Complaints can seem unreasonable, refunds hurt, but nothing can hurt your company more than bad public relations.  The moment you have people walking around talking about what a scam you are, and not to trust your brand, you are losing WAY more money than a few customer issues here and there.

Regardless of being motivated by profit, you need to look at the long term affects on your company.  Are you in this to see a big number this week, or this year?

This may be redundant to a lot of you.  I once heard the number used in the restaurant industry is for every one bad experience, 205 people hear about it.

Imagine that! and this was before social media and the power a voice has now.  All it takes is one person with enough frustration to want to spread the word and it can crush even a large brand.



Above is a tweet promoted by an individual that was not compensated for lost luggage.  He spent $1000 to promote this tweet and it got the attention of the world.  News stations, websites, bloggers, influencers all spoke about him around the world.

Do you think British Airways should have just handled his situation and been done with it?

The power of your customer is larger than it has ever been.  Everyone has a huge voice now and it is your job to make sure they do not use it against your brand, even if you may not feel they are always in the right.

Building a Brand versus Getting Direct Response

Marketing has become extremely easy to track.  Measuring your ROI from your marketing spend, especially online, is available to everyone.  I have seen this cause a shift in the way people market.  Most brands I speak with are looking for their CPA.  How much do they spend, and how many customers or how much revenue does that bring in?

The issue is, the long term goal of brand building is suffering more and more.  Here, I will outline the benefits and tactics of building a brand versus driving direct response.

Brand Building

Building a brand is the backbone of any long term, consumer facing business.  What is the lifestyle around your products?  Why do I want to give your company money? The most important questions consumers ask and the only way to answer is with a strong brand.

If you want to:

• Build long-term customer engagement
• Bring in evangelists
• Create a long-lasting company
• Increase long term revenue
• Engage your customers on an emotional level

Then you need to focus on building a brand identity.

The issues with focusing on building a brand are:

• Lower immediate ROI
• Higher risk (with the results being more long-term, you are generally going to spend more money before seeing results)
• Hard to track response

Direct Response Marketing

Direct Response is marketing done to make the the largest immediate ROI.  It is extremely tempting for companies to focus on these marketing channels because they can see the affect to their bottom line immediately.

If you want:

• To increase revenue in the short-term
• Show immediate growth
• Closely gauge your financials and ROI
• Lower your risk

then direct response is the way to go.

The issues are:

• The long term benefits of direct response are much less
• Customers are generally driven to purchase your product, but are less emotionally engaged, which means less likely to return or share
• Does not create an identity for your brand, which hinders long term customer engagement

Conclusion

When deciding whether to build a brand or get direct response, make sure you understand the value of both.  Most companies can benefit from a mix, but if you are in it to create a long lasting product and company, do not sacrifice building your identity, for your immediate returns.

For any questions or comments, please feel free to email erik@hawkemedia.com