Unglamorous things that make money

If there is one mistake I see beginners – and experienced people – make over and over and over again it’s focusing on the complicated, the exotic and the glamorous while ignoring the simple, common sense things that make money reliably.

I notice that the guys I call “The Glamorous Gurus” (you know who they are) don’t like to talk about these things.

I think they know that if they do, bit by bit you’ll eventually realize that marketing and business are nothing more or less than common sense rigorously applied.

You’d also figure out that their endless dog and pony shows about the next “Big Thing” in Internet marketing are not only useless, they also hold you back from making real progress in your business and your career.

Nowhere is this principle more clear than in how the Glamorous Gurus treat their customers.

When you take a good look at how they handle customers service in their own businesses and what they say about customer service on and off the record, it becomes pretty obvious pretty fast that they’re more interested in cooking up schemes to manipulate their customers than in serving them.

Customer service? What’s that?

Have you ever called one of the Glamorous Gurus and tried to get service, help with a product you purchased, or fulfillment on a promise or a refund?

From what I hear, it’s generally not a pleasant experience.

We know this because when we were active with the System Seminar, callers often expressed total shock that we actually answered our phone and returned phone messages.

They were further shocked that we were interested in their issue and worked with them to try to solve it – which sometimes meant a refund or advising them not to buy one of our products because it wasn’t what they needed.

“Don’t the other people you deal with in Internet marketing do this?” I’d ask.

More often than not the answer was no.

We didn’t take this path because we didn’t want to make money.

We took it because it’s the only thing that makes financial sense.

The proof

The proof of this is that with a relatively small list and no public profile to speak of outside of our own events (I haven’t spoken at an outside marketing event in over five years and spoke at very few before that), we routinely outsold people and “syndicates” with mailing lists twenty or thirty times our size. Not 20% or 30% bigger, 20 to 30 times bigger.

Why?

Because people who are treated well come to trust the people who treat them well.

Duh!

So if you’ve been taught that the most important thing in business is manipulating your customers with “genius” marketing and ignoring their problems you’ve been taught wrong. Very, very wrong.

This is not exactly news and there’s even some forty year old science behind it.

Back in the 1970s, a researcher named John A. Goodman was hired by the US government to measure how well government agencies handle complaints and provide service. (Unbelievable I know, but it really did happen once.)

After his study showed how bad the customer “non-service” problem really was, Goodman advised organizations to use 800 numbers to make it easier for customers to call in with service issues.

Most government agencies and businesses thought this was crazy. Based on how businesses large and small and the government handle their customer service lines, most still do.

Goodman did the math on this to see if in fact it was profitable to handle customer service intelligently.

The numbers

1. Only 5% of people who experience a problem with your product or service will ever complain.

Think of the frightening significance behind this…

For every problem or complaint you hear, there are approximately 19 other customers who have the same issue. These 95% will say nothing, but when another supplier credibly offers them a better alternative, you’ve given your customers an excellent reason to leave you.

Many of these justifiably unhappy people will bad mouth you to friends and colleagues – and this is now amplified by social media.

2. 80% of all complaints are the result of bad systems – not people or execution – which means that if you fail to pay attention to customer problems and correct them at the source, they will occur over and over again endlessly.

Fix a faulty system once and you’ll improve customer satisfaction and retention permanently and build a much stronger business.

If you ignore complaints and neglect your systems, you’ll manufacture endless bad customer experiences and ultimately a bad reputation.

3. In a typical business, only 1 to 5% of complaints made ever make it to the “big boss.”

Here’s what happens when you carry the math out to its logical conclusion

For every complaint, problem or confusion, there are nineteen more just like it unspoken.

If you haven’t trained your people otherwise, the details of that complaint will never reach you which means you can’t fix it – which means it will persist forever.

On what planet does this approach to business make sense?

Apparently on the Planet of the Glamorous Gurus because they’ll tell you just “market hard,” ignore any “negativity” from your customers, and everything will take care of itself.

(This may be why individual Glamorous Gurus seem to have a shelf life of about three years or less.)

The right way to do it

Setting your business up to seek out and deal with the problems of your customers is not glamorous. It just makes money.

Give your customers the means to make things right if there is a problem. Listen to them when there is a problem. Seek out the source of the problem – it’s usually within your system – and fix it.

If you want a glamorous name for it call it “future profits insurance via intelligent customer interface design.”

Your goal is to be on the lookout for anything in your business from the first contact to the 100th transaction that doesn’t operate smoothly for your customers and fix it.

This approach to customer service is a profit center, never a cost.

It always was, is and always will be.

Ken McCarthy

P.S. By the way, we’re not the only people who think this way.

This approach to customers not only improves their satisfaction (and increases the probability that they will want to do business with you again), it also works with prospects too.

Here are some provocative ideas on this topic from the man who is considered the world’s leading practical authority on getting referrals in business, Bob Burg. Good reading: The secret of selling need not be secret

Nelson Mandela (July 18, 1918 – December 5, 2013)
The next Google?

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