Why do companies really care about your happiness? (It’s not a trick question)

Tanata/Shutterstock
Tanata/Shutterstock
Memo to corporate America: Your customers are not walking dollar bills.

You don’t have to be a consumer advocate to know that. Just attend a random corporate event and you’ll see that companies don’t always see their customers the way they should.

The meeting I attended for a major transportation company — that shall remain nameless — was impressive. C-level execs in their Italian suits showed off some brand-new products that wowed everyone in attendance. But whenever they talked about the customer, and particularly customer satisfaction, it was in a detached, almost clinical way.

“Happy customers spend more,” the CEO told me. “So we want happy customers.”

But the new products were being rolled out with a single goal in mind — to encourage customers to buy more. Often, these were unnecessary impulse buys. Other times, they were purchases of convenience that, with just a little advance planning, they could have avoided. But it quickly became clear to me that none of the products were meant to make consumers truly “happy.” This company just wanted them to spend more.

Of course, there’s a proven link between customer satisfaction and profitability, as studies have shown.

But here’s the problem: It’s too easy to simply drop the “customer satisfaction” from the corporate credo. If you have a virtual monopoly, like airlines, cable companies and wireless providers, then why not? And then we, the customers, are reduced to walking dollar bills — and nothing more.

Shouldn’t it be the other way around? Shouldn’t companies want happy customers, first and foremost? They may not always turn a profit, but they ought to always care that their products or services work well. Sadly, my own experience in advocating for customers suggests their relentless focus on profits above everything else means we’ve become little more than potential revenue opportunities.

So what should you do about it?

Look for deeds, not words. Companies will talk about customer “satisfaction,” but you have to understand the context in which they mean it. It’s often used in the same way cattle are kept calm before they’re slaughtered. They don’t really care about your holistic well-being or even your long-term satisfaction with a product. It’s important to know that among most corporations, a drive for short-term earnings means you’re not really a person, but a profit opportunity. So ignore the rhetoric about how the customer is priority number-one, and focus on what they actually do for you.

Walk a mile in an employee’s shoes. Employees are often evaluated based on how many products they can sell, not how pleased their customers are. That’s an unfortunate reality, but it’s one you have to understand if you want to have the best experience. In other words, the person on the other side of the counter isn’t thinking about how happy a product will make you, but how much of a bonus the transaction will generate. Knowing that there’s a hidden system of incentives and kickbacks behind the scenes will not change the system, but it will turn you into a more skeptical consumer. Rightfully so.

Ask what they mean. Given the fact that corporate-speak can be so misleading, it’s more important than ever to ask if you’re confused. If you’re not “happy” with a product, what are your rights to a refund or a replacement? Better yet, get the promise in writing, so that you (and if necessary, your attorney) knows exactly what a company means when it says it’s concerned with customer satisfaction. It’s almost as if corporate America is speaking a different language and needs a translator. The only way to be certain of what the company means is to get everything in writing.

Even well-respected and successful companies don’t mean what we think they mean when they say “customer service.” It’s better to pay attention to what they actually do, instead of say, and to gain a basic understanding of how the system works. If there’s something you don’t understand, ask for a clarification. It sure beats being surprised by bad service. Or by none at all.

What does corporate America care more about?

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Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at . Got a question or comment? You can post it on the new forum.

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  • Carver Clark Farrow

    My philosophy. Only patronize those establishments that stand behind their products, i.e. good return/cancellation policies. Alas, in travel its much harder, especially with airlines. But its doable with car and hotels.

    Hotels

    Be wary of hotels with draconian cancellation policies. There are probably 10 other hotels nearby with better cancellation policies. Also avoid nonrefundable rates unless the chance of changing your plans in infinitesimal. I usually book nonrefundable rates from the lobby of the hotel itself.

    Cars

    Certain car rental companies seem to draw more than their fair share of complaints. Also, some off brand companies have really strict rules.

  • MarkKelling

    It’s not only the customer who suffer with the current corporate drive for squeezing the last possible penny of short term profit from the operation so that the corporate stock will go up in the market. The employees suffer as well through policies that keep them at the lowest pay possible with benefits being whittled down every year or their cost going up faster than pay rates in the name of staying within the norm of current corporate offerings. No company wants to be at the top when it comes to pay and benefits (except when it comes to the C-level), they just want to be at a level where the employees they have end up staying because they know they won’t get anything anywhere else that makes it worth while leaving and starting over. This results in employees who do the absolute minimum so that they don’t get a bad annual review or get fired.

    How does this translate into caring about the customers? If the employee has no real incentive to do more than what is minimally required to keep their minimum wage job with minimum benefits, then the situations faced that are not normal within their job description will not be handled in a manner to create a happy customer. The results are the frustrations we hear about and read about on this very site. Things that could easily be handled quickly resulting in a happy customer willing to do business again with the company end up taking weeks if not months of correspondence until someone gives up. Either the customer or the company will finally decide that continuing the discussions are pointless. When the customer refuses to give up, the companies end up doing something that is just barely enough to make the customer happy enough to not push any further – but only after bad publicity.

    What is the solution to the problem? I’m sure there are many, but all of them would result is less short term profit. And no company is willing to go that route (unless they already have) because then the stock holders won’t be happy and the CEOs won’t get the multi-milllion dollar bonuses that the rest of us can only dream about.

  • sirwired

    Corporations are not gratuitously evil; usually if customer-hostile attitudes are profitable, it is because customers are in fact far less concerned with customer service than they reveal in opinion surveys. How else could one explain even the existence of business like Spirit? They treat their customers like dirt, are unashamed of it, and are quite profitable. Why do people shop at Wal-Mart? It ain’t for the service vs. the Mom ‘n Pop stores they replaced.

    A company treating customers to service they are clearly not willing to pay for is a recipe for bankruptcy.

  • Trudi

    When I go to the airport and see the employees smiling with one another, with passengers, and generally happy, I feel better about that airline. When I go to a hotel where the desk staff is smiling and make me feel like I’m welcome to their home, I feel better about that hotel. When I rent a car and the staff is helpful, and happy, I feel better about that company. Most of the customer perks offered by travel corporations are easily accomplished, but keeping their employees committed to making customers feel welcome takes more. I’ve seen that in retail, when employees are treated harshly they in turn con’t care about the customers at all. Customer service shows on the faces of the employees, and corporations don’t know those people at all. I don’t think corporate cares about the people who work for them or the people who use their ‘products’, but as long as the employees seem happy with their job, I’ll continue to use THAT particular airline, car rental, hotel, grocer, gas station, and so on….

  • jerryatric

    Companies are ruled by shareholders, not customers. Add to that fact CEO’s & directors of these large companies have to answer directly to & please the shareholders by making bigger profits.
    Some company execs. try to formulate a balance, most could care less about their clients & cater to profitability. Until some group comes up with a way to single out a company in a trade ( E.G. a car rental company) & boycott it for say a 4 month period & then attack another, then maybe these companies would get the message. Unless the consumer can exert more influence as a group, nothing will change.
    Each group of companies continue to merge & expand at the cost to consumers.

  • NoraG

    This is one of many reasons why I am trying to do more and more business with my local small businesses. If they don’t take care of their customers, they go out of business. I like being greeted with a smile, and having my questions answered cheerfully and correctly. If they are nice to me, I let my friends know, too.

  • Kasiar001

    Who are the 3 who voted yes I wonder.

  • Joe_D_Messina

    I’d add one: Do good research so you are choosing the right service for what you are seeking. Chris gets quite a few letters that boil down to people being disappointed that a square peg didn’t fit the round hole they wanted to fill. In those cases it is often more that the business wasn’t ever set up to provide the experience the traveler wanted than that the business did something wrong. That means not booking onto a party boat if you want a great family cruise, not going with the cheapest rate you could find if hotel amenities are really important to you, and avoiding opaque sites unless you are very easy to please.

  • Miami510

    The key to changing the way corporations view us as profit centers and judge their employees by sales, rather than satisfaction is for people to link the two:

    John Avarice, CEO
    Number Ten Airline, Corp.

    Dear Sir,

    I’m enclosing my boarding passes showing my recent trip flying with your competition. I can think of no other way to get your attention directed to the surly treatment by your employees about which I previously wrote to you. A copy of that letter is attached.

    I shall continue to fly with your competition until I hear from fellow travelers that you have changed the way you interact with your customers.

    Sincerely,

  • BillCCC

    I tried to vote yes but it wasn’t an option.

  • DavidYoung2

    One more for airlines:
    1) Avoid Spirit Airlines at all costs.
    2) Avoid Spirit Airlines at all costs.
    3) Avoid Spirit Airlines at all costs.
    4) Do fly Southwest when possible, even if they’re a few bucks more. You get it back in customer service, baggage fees, an extensive network in case you miss a flight, refund policy, etc. Jet Blue is pretty good too.

  • Mark Cuban

    As consumers we get exactly the system we ask for with our dollars. Most people have no idea how their shopping pattern impact their own lives. When airlines have price wars over $5 or $10 on a route that means we, as consumers, are so blind and petty we would toss out all concerns over that small amount.

  • MarkKelling

    Yes is not an option.

    But we can try and vote that way. :-)

  • SoBeSparky

    Answer to poll question: Corporate America cares about profits.

    And well they should. Customer satisfaction is one of several factors which lead to the ultimate goal, self-preservation and growth. Those two only take place when there are profits. No profits, no capital (loans and new investment), and then no corporation. Sure, some corporations with high customer satisfaction have higher profits. But the cemetery of corporations has many popular bankrupt companies which did not look after the bottom line as the #1.

  • Mark Cuban

    I’ll bet everyone here would exempt the companies help in their own retirement accounts from the rule of not maximizing profits….

  • Mark Cuban

    The company I work for is by far (really far) the most expensive option in our market. But we have been profitable every year for over a decade, even through the recession where some of our competitors went out of business. Why? Because we plow an inordinate amount of our cash back into customer service. Approx one third of our entire company works in this group in an industry that averages less than 10%. If our call wait times go over 2 minutes we panic and there is no pressure to get off the phones until the customer is completely satisfied. As such the vast majority of our customers keep spending money with us and recommend us to others. A customer service philosophy can work and be very profitable if you take the long view.

  • bodega3

    Exactly! I live in a small community and know the value of doing business locally, but I wonder if those in large cities get it? Last week I walked into a major grocery store chain to pick up a Rx. I had transfer it there a year ago and have only picked up medicines twice. The clerk saw me coming and went to the drawer to get my items. THAT is good customer service! I will wait in line at another store just to have one clerk. She knows her repeat customers name and that gets me coming back.

  • SoBeSparky

    There is always room in free market for a higher cost, higher perceived value company. The mass market, however, belongs usually to the firms which market at the lowest prices. While there are just a handful or less firms which can successfully coexist in the upper end of the market, many more firms usually can earn profits at the lower end.

    I prefer many firms which give me higher service levels at a slightly higher cost, but rarely can afford the highest-cost firm. Others however can afford and enjoy the best upmarket firms which excel in customer commitment, such as Silversea and Regent Seven Seas cruises lines, both of which report healthy profits. There is room in the market place for those and the more mass-market Carnival and Norwegian branded cruises.

    The point being, levels of customer commitment do not necessarily correlate directly with profitability.

  • MarkKelling

    But I’m sure your company does not provide this level of customer service for free. There is probably an annual fee to get this level of responsiveness. And it should be that way. Because in the end, if you are providing a product that does what it is advertised to do your customers will not have a problem paying an appropriate price to have it and continue being your customer.

  • Mark Cuban

    Of course, we do charge an annual fee. But most pay it happily. Those that don’t we send to our competition. Let them lose money on service leeches.

  • Carver Clark Farrow

    I disagree. Its not about blindness and pettiness, its that customers do not perceive a value of one airline over the other so many shop purely on price. Given the underlying assumption it is the rational thing to do.

  • Carver Clark Farrow

    I disagree. I’ve lived in small communities where service was routinely crappy. Abysmal. For a variety of reasons, the local business owners felt that they had a lock on service and had no reason to improve.

    I’ve also lived in large communities where service was excellent, because of the intense competition, if your business wasn’t top notch, your customers could go down the street to your competitors easily enough.

    My custom tailor lives in Bankok and he routinely travels to the US. When he comes he always remembers what I ordered, when, and even inquires about my family. Total customer service.

    It works both ways

  • Carver Clark Farrow

    The mass market, however, belongs usually to the firms which market at the lowest prices.
    —————-
    That’s generally true when the goods or services are perceived as primarily a commodity. For example, grocery stores used to be like that but today, many customers, are rejecting the commoditization of grocery stores, electing for smaller neighborhood markets. Within walking distance of my home we have at least five alternatives to the large grocery store

  • chickadee

    “Eight, Bob. So that means that when I make a mistake, I have eight different people coming by to tell me about it. That’s my only real motivation is not to be hassled, that and the fear of losing my job. But you know, Bob, that will only make someone work just hard enough not to get fired.” —-“Office Space”

    Corporate culture is focusing on short-term profitability at the expense of the consumer and the employee. I am hoping that this will bite them in the backside sooner rather than later…

  • Grant Ritchie

    Send a note and my receipt from Company B, who gave me good (or at least acceptable) service to Company A, who didn’t? I LOVE that idea. Can’t wait to do it. Thanks! :-)

  • Grant Ritchie

    Damn, I was on your side until the “service leeches” crack.

  • SoBeSparky

    Niche stores always have existed, yesterday and today, and will tomorrow. I would ask for your sources that, “…grocery stores used to be like that…” other than through personal observations.

    Joseph Agnese in Industry Surveys Supermarkets & Drugstores. New York : Standard & Poor’s, 2010, indicates, “Chain supermarkets (29,300 stores) generated $528 billion in sales in 2009 or about 95% of total supermarket sales, while independent supermarkets (6,300 stores), accounted for the balance.”

    There are several valid reasons that neighborhoods and entire municipalities object when Walmart announces it is coming to town. 7,100,000 Google Search results appear when you type in “objections to Walmart.” The Washington DC City Paper notes, “Wages aside, the principal objection to Walmart’s arrival in the city is that it will drive local businesses under.”

  • bodega3

    Yes, there are exception on both sides. Your example of the tailor shows the service and time that a small business person can offer. I try to do business locally in my small town first. Then I go to the neighboring city. If I can’t get what I want I then go online. Two years ago, I tried to buy a product locally. I called on store in another small town that I thought would have the product. They didn’t answer their phone, but had a message machine, so I left a message, which was never returned. After more searching locally, I bought online. Later I was in the town where the store was located and dropped in and they indeed had the item I had purchased online. I mentioned my call and was told they didn’t return calls. They are now out of business.

  • Carver Clark Farrow

    I don’t think that anyone is disputing the change in grocery store paradigm. I’m not talking about mom and pop, but specialty stores are having greater national presence. For example, Whole Foods, is the #19 chain by volume, Trader Joe’s #21. Whole food jumped 9 spots in the past couple years.

  • jim6555

    Add Allegiant Air and Frontier Airlines to the list of air carriers to avoid. Allegiant has been a Spirit wannabe for the last few years and Frontier is reinventing itself to be like the other two. I am in complete agreement with you on Southwest Airlines. Their people have bent over backward to make my travel experiences good ones.

  • California_Dave

    Excellent discussions on this topic. I worked for a privately-held family run company for 19 years, but the owner got ill and no one else in the family was willing to continue running the business, so was sold for a huge sum (due mainly to a large and happy customer base and goodwill within the community) to a large publically-traded company that immediately focused on short-term profitability by slashing employee benefits, cutting all charitable contributions, and giving large discounts to existing customers under a service contract to renew before the end of the quarter, then giving them poor service. Within 3 years, we had lost 75% of the customer base and all of the knowledgeable customer service oriented employees had jumped ship, including myself. The CEO also moved on along with his cronie board friends (all with huge golden parachutes) to do the same process with another company. The greed and selfishness within our current capitalist system could eventually be our downfall. Let’s hope that the Gordon Geccos of the world won’t win in the end.

  • BMG4ME

    Business exists to allow the people to sustain themselves. When the health of the business becomes more important than the wellbeing of the people served (employees and customers being the most important) then they have forgotten their true purpose. Sometimes tough decisions do need to be made for the health of the business, but that should only be if the health of the business is jeopardizing the well-being of the employees. Laying people off simply to improve profits or dividends when the business can afford not to lay people off, is unforgivable. Laying people off to enable the business to continue to function is a tough, but reasonable action, as long as the cuts are at all levels.

    The most important people to be happy are the employees. Then comes customers as a very close second, but really both have to be both happy. Every customer satisfaction issue is caused by employees. Since each person is responsibly for his/her own happiness, the company has to make sure it chooses the right employees. Most customer issues I have seen are caused either by unhappy employees, by inflexible employees that misinterpret guidelines, or by unreasonable rules created by unreasonable employees that should not have been hired in the first place (the fact they rose to a position where they could create unreasonable rules doesn’t mean they should have been hired in the first place).