Nothing infuriates buyers more than being 'nickeled and dimed' when they are trying to do business with someone. This week, I came face-to-face with two examples of this. The landscapers at the office submitted their bill and we noticed a $20 increase. We wondered why until we looked down at the bottom of the page and noticed a new line item for a fuel charge. I guess the drive to get to our offices is our problem now. Then there's the furor that has sprung up around American Airline's $15 a bag charge that's causing flyers all over to re-evaluate how they can drag everything with them as a carry-on.
When are businesses ever going to learn? When you pass your problems on to the customer all you do is start a self-fulfilling death spiral. You think that creating small 'poor, poor, pitiful me' charges based on something you have no control over and adding them to everyone's bill is the fair thing to do but in actuality, three things almost always happen and all of them are bad:
- You tell your customers your business is in trouble and make them wary.
- You let them know that you care more about your costs than their service.
- You make them mad and they say nasty things about you, today on blogs that reach millions.
And, then they walk away, sometimes silently. But, walk they do and you're left with a smaller business, the same high costs and now a bad reputation. Nice. Want to try this again?
Like it or not, we have to acknowledge a baseline premise here. Your buyers don't care about you and your problems; you're supposed to care enough about theirs to create an experience that they want to buy. When bad things happen, like out-of-control fuel costs (not our fault we're at $133 a barrel is it?), they affect everyone. When you put a nickel and dime surcharge around it though, you're pricing based on your costs vs. the value of what you do for your customer. And that's just tuned out.
The tuned in approach is stay focused on the complete experience and relationship you have with your customers. Identify areas that are not viewed as critical and reduce your costs there if your profits are being squeezed. Consider narrowing your focus to fewer persona's that you can satisfy better within the cost constraints that you have. Or, maybe even take advantage of the competitive landscape being challenged by adding new services to the experience that support an increased price. Above all, whatever you do, communicate it in advance to your customers through a lens of why you are doing this to better serve them.
We're going to look at alternatives for landscaping services and I'm giving up completely on American Airlines. When businesses start tuning out like this, my experience is that the miserable service and new surcharges just seem to keep on coming. I'll leave them for the other guys this time.
