The Customer Is Right. Right? Only When You Are Wrong!

"Your customer doesn’t care how much you know until they know how much you care." – Damon Richards

Introduction

The phrase "The customer is always right" has long been a staple in business. But as the corporate world evolves, so does the relevance of this mantra. With the rise of the "Anti-Customer" movement, companies are rethinking how they engage with customers, placing employee well-being and ethical practices above outdated norms.

The Origin of "The Customer is Always Right"

Coined in the early 1900s by retail pioneers like Harry Gordon Selfridge, this phrase was meant to emphasize customer satisfaction to drive loyalty and sales. However, it often led to a culture where businesses bent over backward for unreasonable demands, sometimes at the expense of their own employees.

The Rise of the "Anti-Customer" Movement

In response to the growing importance of ethical business practices, companies are increasingly drawing lines with customers who exhibit toxic behavior. This "Anti-Customer" movement is about protecting employees, fostering a healthier work environment, and maintaining a strong internal culture. Businesses like Trader Joe's and Zappos are leading the charge by openly setting boundaries on what behavior they will not tolerate.

A Different Perspective by VCII: The Customer Support Matrix

At the Value Creation Innovation Institute (VCII), we believe that a more nuanced approach is needed. The "Customer Support Matrix" is a 2x2 framework designed to assess and manage customer interactions more effectively. This matrix categorizes customer-business interactions into four quadrants based on who is "right" and "wrong":

1. Both Customer and Business Are Wrong: The worst scenario, where miscommunication and poor practices lead to lasting issues.
2. Customer Is Right, But Business Is Wrong: Cases where businesses fail to meet customer expectations, like Coca-Cola's "Coca-Cola Life."
3. Customer Is Wrong, But Business Is Right: When customers make unreasonable demands that the business cannot ethically or operationally meet.
4. Both Customer and Business Are Right: The ideal scenario where mutual satisfaction leads to long-term loyalty.

The Examples

Trader Joe's Trader Joe's is known for its unapologetic stance against unreasonable customer demands. Their commitment to their operational model has garnered a loyal customer base that respects their values.

Zappos Zappos emphasizes customer satisfaction but also empowers employees to set boundaries. This balance has strengthened their brand loyalty without compromising company values.

Uber Uber, with its dual-customer model (drivers and riders), faces unique challenges. By managing expectations from both sides, Uber navigates the complex dynamics of modern service-based businesses.

Airbnb Airbnb’s platform depends on both hosts and guests. They've had to set clear guidelines to ensure that both parties feel protected, maintaining trust and integrity across the board.

Low-Cost Airlines Low-cost airlines, often criticized for their no-frills approach, have redefined customer expectations. By clearly communicating what is included and what isn’t, they’ve managed to turn a challenging business model into a successful one.

Telco Providers Telco providers often exploit their market power by bundling services, sometimes ignoring customer complaints. However, the rise of customer reviews and competitive alternatives forces them to listen more closely to customer needs.

So How to Solve this?

The Joint Leadership Model

In this conceptual model, both the customer and the business lead in their own capacities. True leadership happens when neither dominates, but instead, both parties work in equilibrium. This balance ensures mutual benefit and ethical integrity. This happens when the CEO - for example - plays the "customer advocate" role in their abscence in major business meetings or boardrooms.  They pay their salaries after all!

The Mutual Influence Zone

In a throwback to the "Three Circles of Influence", dealing with customers does not work in such manner - especially in the long term. Businesses and customers should interact within a "Mutual Influence Zone." and avoid  the floor of Acceptance and the cieling of Control.   When both operate within this zone—where neither is in complete control or passive acceptance—a healthy and sustainable relationship is formed.

The saying "The customer is always right" is losing its relevance in today's world. The modern approach values both customer satisfaction and business integrity, recognizing that empathy and mutual respect are key to long-term success.

"Empathy is about standing in someone else's shoes, feeling with their heart, seeing with their eyes." – Daniel H. Pink

At VCII, we encourage businesses to explore frameworks like the Scrumbrella and the Customer Support Matrix to create more meaningful and sustainable relationships with their customers.