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Do You Cut Costs or Deliver Value?

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Do Cut Costs or Deliver Value?

Have you ever heard a marketing message from a company that is so different from the way they operate that it makes you laugh? I was on a flight recently with an airline that has embarked on a marketing campaign that is all about being "friendly." I was seated next to a group of other frequent flyers. We collectively laughed about the contradiction between their marketing message and their actions.

Operationally, the airline's focus appears to be to reduce costs as much as possible while "up-selling" everything from miles, to status, to seating, to video entertainment. As a supposed premier airline, they are charging for things that the so-called discount airlines provide for no charge. Perhaps the premier airline's next commercial should add "upsell and anything for a buck friendly" to their campaign. I don't want to say which airline I'm referring to, but it rhymes with "Ignited".

Why You Must Change Today

When your marketing message does not align with how you operate, then customers draw one of two conclusions: 1) You are intentionally misleading them; or 2) You are so dysfunctional that the right hand doesn't know what the left hand is doing. Neither conclusion is good for your business. If your marketing supports something that you don't follow through on, then it shows that you know better, but are not willing to allocate the resources to make those principles a reality.

How Have Things Changed

It used to be that nobody probably noticed if your marketing message and operations were not aligned. But, in today's world of instant communication, you actually need to shift your operations first, and then after it is operational you can tell people what you have done. If you put the message out there before your operations are ready to execute, even if you have the best intentions, your audience might think that you are not being forthright with them.

Shining Examples of Getting It Right

Ritz Carlton is often regarded as one of the best customer service brands on the planet. Their customer service actions speak louder than their words. Ritz Carlton is known for empowering each employee to spend up to $2,000 to satisfy a guest issue. They know that the customer loyalty and experience is so important, and their employees are so trusted that their leadership empowers every employee to make that happen. But, that commitment to service and guest satisfaction doesn't have to mean thousands of dollars. When staying at one of their sister Marriott properties a couple of weeks ago, I asked the clerk where I could get a couple of bottles of water. She handed me two bottles. When I suggested she charge them to my room she smiled and said, "We value your business. It's our pleasure." So, the hotel made a conscious decision to not collect a few extra dollars, and probably spent about $0.50. Here I am telling the story. Just imagine what the premier airline might do in a similar situation?

Nordstrom customers share stories (true or urban legend) about Nordstrom taking the return of items they didn't even sell... like car tires. There are stories about customers calling Zappos to order a pizza, and their customer service people made it happen. Those stories get shared over and over again. They make you want to try those brands for the experience.

There is an interesting pattern to notice. Ritz Carlton, Nordstrom, and Zappos don't compete based on price. They compete on value and experience. Remember, when you compete and win on price, you'll lose that same customer later based on price. When you win based on value and experience, you raise the bar for anyone else who might want to steal that client away from you.

Put It To Work

If your sales message, marketing message, and operations are not aligned, do you see how you might be emulating the airlines? Invest the time to teach your entire team not only what to do, but why it matters. Once the organization shares a common viewpoint on how you interact with clients, then you'll build greater brand loyalty. Your sales team should never promise what you can't deliver, and operations must always deliver beyond expectations. In most businesses, you don't need to give things away to earn loyalty. Instead, focus on delivering results for your customers, looking out for their best interest, and ensuring that you are solving important matters for them and not just selling your stuff. If you do these areas right, you might end up being in a story about exceptional value and service instead of the punch line for a joke involving an airline.

It's Your Turn

Have you ever experienced a situation when cutting costs (or charging for additional items) within your organization created a customer backlash or worse caused you to lose a client? What ways are you creating exceptional value and service for your customers?