Human nature and business

Are you giving your customers the $2 treatment?

I’m reading a very interesting book on motivation, called Drive, by Daniel Pink. There is a point made early in the book about the effects of human nature vs. rational behavior. It’s similar to some of the points in The Upside of Irrationality, but this one specific experiment in Drive caught my eye.

Here is the experiment: there are two players and both know all of the rules. They have never and will never meet. Player one is given $10. Player one can offer any amount of the $10 to player two. If player two agrees with the cut, they both keep what they get. If player two disagrees, they both get nothing. Of course, we could all agree that if we were offered $5 as player two, we would take it and be $5 better off. That was even true in most cases for $4 and $3. But here is where the irrationality kicked in…if player one offered just $1 or $2 to player two, in a majority of cases player two said, “No” and both left with nothing.

Essentially, our sense of fair play (or maybe revenge) means we would give up $2 to keep the greedy player one from getting $8. While I’d bet the numbers would be different if it were in increments of $10,000, the point is still valid considering the choices we make every day. We won’t accept the $2 treatment, and we are willing to give up a little money if it means we can make a point.

Consider your own customer service. In a case where we feel a company has wronged us, most of us will spend our own time, energy and maybe even a few bucks to make sure everyone knows how much so-and-so company sucks. Right? There are lots of examples, and it took me a 5-second google search to find www.walmart-blows.com, which has been up since 2005. Also, there are pleanty of other negative sites along with numerous you-tube videos. Luckily, no one has bought TalkToTheHuman-Sucks.com yet.

You may be thinking,”I can’t stop every yahoo out there from using Yahoo to say bad things about my company.” You’re right!  I’m not suggesting that you can. However, there are two important points you need to consider, and stay on top of:

1. Make your customer service so good that the nay-sayers have no credibility with your true customer base.

For instance, if someone posts Target-sucks.com or whatever, it won’t change my opinion of them, since their customer service has always been good in my experience. However, my experiences with VerizonWireless has been a bit mixed, so I might believe some negative press about them.

2. Recognize that you need to respond to any complaint as factual until you know otherwise.

As an example, I give you a post I wrote on some shoddy customer service I received earlier this year. I chose not to be vindictive (since I hadn’t spent any money yet), but it would have been easy to make this one more negative with just a couple of less-rational word choices. If I had lost money or received crappy service for something I spent money on, I would have been less kind. As it turns out, I did finally receive a reply from their CEO, and he resolved the issue.

With blogs, FaceBook and other quick-to-market media sources, never underestimate your customers capability to talk about you from the virtual mountaintop. You have the choice to make those messages more positive than negative. It’s all in how you treat your customers.

Are you giving your customers the $2 treatment?

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