The Customer Bucket

By Tom McDermott

Have you ever experienced being in the metaphoric bucket that some business create because of bad customers? That place where we all get stuck because of a policy that was designed to handle a few bad customers. Most of us have, and it is beyond frustrating and it happens all too often. Businesses forget that one bad experience shouldn’t dictate how the majority of customers are handled.

Policies are often made when something happens in a business where a customer behaves badly. The result of the new policy is that every other customer gets put into the same bucket. TSA is a good example of this. How many of us are truly bad actors and would smuggle weapons on an airplane? Of course, a very small percentage. It is no different in business. Most consumers behave respectfully and conduct business honestly but because of a few bad actors, we are all penalized.

The notion that if one customer is bad means that all customers are bad drives the good customers right out of the door.

The first thing that any business should do when setting a global policy is to analyze exactly why the problem exists and look at operational changes to mitigate the problem. For example, many fast food restaurants place the soft drink dispenser in a place where consumers can fill and refill as many times as they want. However, some have chosen to place signs on the machines that give a strict restriction on refills limiting them to one. Why put the machine out there with a restriction like that? Most establishments factor the refill cost into the initial price eliminating customer frustration and confusion. Why set the customer up for failure? It would be better to raise the price to cover the cost of the soda.

Having a company inadvertently place you in the bad bucket is equally, if not more, frustrating. For example, I’ve been a patient at the Mayo Clinic my entire life, always paying what I owe. Due to a clerical error, my insurance company did not pay a claim for services I received. I noticed on my bill that it was not paid so I contacted the clinic and discussed the matter with them. After a three way call with the insurance company, the clinic and myself, it was resolved. The insurance company admitted that they made an error. I followed up with the clinic inquiring whether I needed to do anything else, I was told “no don’t worry about it, it will take time.” I followed up several more times and was told the same thing. Eventually, the charge was removed from my bill. Finally, the insurance company paid as they said they would do.

I later discovered that I was completely wrong about the clinic receiving payment. The Mayo actually wrote the bill off and turned me over to a collection agency! I found out when I was attempting to make an appointment When I was routed to someone that I thought was a scheduler. She was actually in the finance department explaining to me that I was not able to make an appointment until I paid the bill. I was furious! I explained what had happened and she agreed to call the insurance company while I was on hold. After a 20 minute wait, she was back confirming that the insurance company had indeed dropped the ball again. She apologized and made the appointment. However, this was not the end of my issues with the Mayo.

The Mayo has a great patient portal where patients can access anything to do with their relationship with them. I logged in to verify my appointment and discovered it was gone. A phone call disclosed that it was cancelled because I had an outstanding bill. After 10 hours on the phone with many different people, I finally was removed from the dead beat bucket. They had a flag on my profile that told the person that was making the appointment that I was a financial risk. Yes, I was in the bucket and it was beyond frustrating. I was put there because I was lumped in with the people that actually don’t pay. All of this was due to clerical errors and the lack of policy to handle unique issues such as this.

In your business, don’t have just one bucket for all. Design strategic policies to make sure the good customers are not in the dead beat bucket! If you don’t, your top line will slowly erode as customers defect.

More publications by Tom McDermott

By Tom McDermott - CEO
Have you ever experienced being in the metaphoric bucket that some business create because of bad customers? That place where we all get stuck because of a policy that was designed to handle a few bad customers. Most of us have, and it is beyond frustrating and it happens all too...
By Tom McDermott - CEO
Customer defections happen all too often and are often caused by sloppy strategies, a lack of training and poor leadership. A customer makes two decisions, the first is the one to start doing business and the second decision is to stop doing business. When a customer defects, b...
By Tom McDermott - CEO
Freud believed that personalities are broken into three components: id, ego and superego. The id being the part of our personalities that provide our animal instincts - things like satisfying hunger or sexual desire, for example. The superego is the component that tells us to do ...
By Tom McDermott - CEO
Great ideas are the catalyst for propelling a businesses to success. The evolution of an idea is concept, planning, buyin, implementation, assess, follow up and modification. How often does it happen when you or your team comes up with a great idea for something that will add pro...
By Tom McDermott - CEO
Why are willing to pay $150 for a meal at Ruth’s Chris Steakhouse but not at Denny’s? Because of perceived value. Consumers are constantly evaluating cost vs perceived value using an undefined formula to arrive at a justifiable price. One could attach a formula to that process to...
By Tom McDermott - CEO
Just exactly what is strategy? By definition, strategy is a plan of action or policy designed to achieve a major or overall aim. It has always amazed me that many businesses do not have a clear operating strategy. They exist on what has worked in the past, and that’s good enough....
By Tom McDermott - CEO
Emotion by definition is a natural instinctive state of mind deriving from one's circumstances, mood, or relationships with others. Understanding how emotions affect revenue will help you grow your top line and achieve higher profits. Many businesses fail to understand how their...
By Tom McDermott - CEO
Are you memorable? Is your business memorable? Are your employees memorable? You may very well be memorable, but unfortunately the memory may be negative. The way a customer remembers you is either positive, negative or indifferent. Which type of memory your customer has is entir...

More publications by Our Staff

I am sure you’ve heard expressions like this to describe salespeople: “That person is a born salesperson,” or “They could sell ice to Eskimos.” To me those sayings are what is wrong with sales, and why studies have shown it to be one of the least desirable careers to go into. Dan...
Who is on your sales team? The answer goes way beyond the people that are actually on your sales team. Each and every employee in your organization is on your sales team. From the receptionist to the cleaning crew all the way to the top of the company, everyone is selling your bu...
Have you considered how others see you? In business or online? How are you showing up? A photograph is the fastest way to convey a message without words. What I am talking about is your BRAND. The definition of brand : A brand is a name, term, design, symbol or any other featur...
This is certainly an interesting question. The answer is both. The problem is all too often the salesperson’s approach and is presented from a completely logical perspective. Upon first review it seems to make sense to present logical reasons why a prospect should buy your produc...
The keynote at a major sales event in Puerto Rico was to be delivered by the chairman of the board. He would deliver the same speech in a second event for corporate and regional sales-people in New York a month later. Due to a schedule conflict the chairman chose to send his spee...
What does it take to be fearless? Associates of mine have always had the impression that I fear nothing. That certainly is not true. I have never been fearless. What drives me through the fear is an internal voice, a voice which has the power to propel me to success. Equally, my ...
Being in the business world for over thirty years, I have always marveled at people’s success, and one of my first questions when meeting someone new has been, “What made you select this occupation, or what gave you the inspiration to start your business”? Overwhelmingly, the res...
Keeping good customers, long term, is the goal of every organization. For a small creative company, in a very highly competitive environment, to keep large fortune 500 clients long term, (over 25 years), is rare. American Airlines, NCR, and a few others were clients for over 30 y...
What's the first thing you notice when you walk into a business, restaurant or home? What do you see? Do you see a place that’s inviting, or a place that needs work? Is what you see professional-looking, hip, trendy, or is it disorganized and outdated? Does what you see meet or e...
Being a person that is willing to speak up takes courage, especially when interacting with a superior. Are you willing to speak up or are you overshadowed by an overbearing egomaniac? Or, are you a supervisor or an authority figure that makes subordinates feel afraid to speak up?...

Lavinia Capital Partners

Phoenix - Los Angeles - Minneapolis

inquiry@laviniacapital.com
(602) 644-1956