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Maxed out: The customer is always right

Max dissects the formula that builds customer loyalty—and how it might (or might not) relate to Tiny Town.

Well, now that the Australian government has sent Novax Djokovic back to Serbia to whack tennis balls and spread his uncaring palaver to those who believe words of wisdom come from mouths of celebrities, I could turn my attention to the upcoming winter Olympics™. 

I could muse about the clash between the lofty ideals espoused by the Fundamental Principles of the Olympic™ Charter and the totalitarian obliteration of fundamental human rights practiced by the Chinese government.

Or I could feign shock and surprise in the discovery by Citizen Lab—a non-profit group based at the Munk School of Global Affairs and Public Policy at the University of Toronto—of a security flaw in the MY2022 app that’s mandatory for all participants at the Games that easily converts the innocent-looking app into a Spy-in-Your-Pocket operative for the Chinese government. 

It’s potentially threatening enough the Canadian Olympic Committee has suggested this country’s athletes leave their phones at home and bring bare-bones devices to Beijing. No suggestion whether they should drop them in the trash compactor on the way home, but it would probably be a good idea. If you’re interested, you can read all about it here:

I could even suggest, once again, anyone who feels strongly about how corrupt the International Olympic Committee is and is disgusted by what the Games have become simply ignore them. But such is the pull of sports and national pride I know that’s pointless, notwithstanding cutting off the flow of money is the only way things will ever change.

Instead, I’m more interested right now in the importance of good customer service. You remember that quaint idea, don’t you? It’s something this town used to be known for. It’s something quite a few people still believe is important. And, unfortunately, it’s a foreign concept to too many others.

Chances are pretty good, if you’ve purchased anything recently, you’ve been sent a survey or asked to take a minute to answer a few computer-voiced questions about a recent purchase. One of those questions was probably something along the lines of, “How likely are you—on a 10-point scale with 10 being very likely and one being not likely at all—to recommend this company to a friend or colleague?”

It’s a question you didn’t see until the mid 2000s. That’s when Harvard-educated business consultant, Frederick Reichheld, started talking about customer loyalty and came up with the Net Promoter System of management in his 2006 book, The Ultimate Question: Driving Good Profits and True Growth. Bear with me while I air out my wonkishness.

His work took a deeper dive into the well-established Pareto principle, the 80-20 rule. That insight posited that 80 per cent of outputs result from 20 per cent of inputs. More popularly, that 80 per cent of your profits resulted from 20 per cent of your customers, the loyal promoters of your company and products.

Mr. Reichheld’s amplification was to quantify the impact satisfied—loyal—customers have on a business’ bottom line. Simplistically, if I’m really happy with the widget I bought from you or the service you provided, I’m far more likely to tell other people what a great product you have or how awesome you were to work with.

There were, of course, businesses and managers who were organically aware of that importance without the bonus of quantifying the results. Locally, Hugh Smythe was a true believer. In the early days of Blackcomb, when the nascent ski mountain was a joke in the eyes of Franz Wilhelmsen, who was running Whistler at the time, Hugh realized the best avenue available to him to compete against the, by then, well-established Whistler was to “out-service” them. He didn’t have the terrain, didn’t have the lifts, didn’t have the clientele. But he did have some ideas and he had faith in the people working for him who also had some ideas.

Whether it was Sniffle Stations, Hugh and his managers out cleaning guest’s windshields on snowy days, or other things people weren’t used to from a ski-hill operator, it eventually resulted in what only a few diehards still call the Dark Side. It made Whistler Mountain pull up its socks and resulted in Whistler resort becoming the No. 1 ski destination in North America.

Good products and good services generate a loyal customer base that ensures success. This was brought home to me recently when I tested the “Lifetime Guarantee” offered on a product I’d purchased a few years back on Amazon. The details aren’t particularly important and neither is the product. But the company’s response is important. They took the position there was no guarantee, lifetime or not, because the product wasn’t purchased directly from them and as far as they were concerned could well have been counterfeit.

After a number of email vollies between us, I gave up, but left them with a parable about customer service and loyalty. 

I told them about an old Buck knife I’d owned for 20-plus years, loved and, admittedly, abused. It was a hunting knife and I’d not infrequently used it to split kindling while camping. Its phenolic handle developed hairline cracks and ultimately started shedding shards of plastic. 

I sent it to Buck, admitting I’d treated it badly notwithstanding loving it, and asked if they could fix the handle and charge me accordingly. Two weeks later, a new replacement arrived with a note apologizing for any inconvenience I’d experienced as a result of their product’s failure.

I can’t count the number of Buck knives I’ve bought since then. 

There are other companies who have earned my loyalty in the same way.

By contrast, I won’t touch a Hewlett-Packard product or General Motors vehicle. Both companies refused to even budge when their products failed a few weeks and kilometres out of warranty. Both have missed out on numerous purchases since then.

Ironically, after relating these experiences, the company relented and offered me a replacement. I said thanks, but no thanks. If they’d have done that in the beginning, I’d have been a promoter of their products. Now? Meh. 

Most recently, I was asked if I’d recommend a company to a friend or colleague. Chances are you were too. It seems to happen frequently after a day’s skiing. It’s a two-part question: Would I recommend Whistler Blackcomb to a friend? Will I ski at Whistler Blackcomb next season? 

My scores are zero and 10. Not only would I not recommend WB, I’ve actually suggested to friends they’d probably be happier elsewhere. But I live here. I’ll buy a pass for next year. I live with hope... or denial. 

Can’t be sure which.