Beloved Company Financial Growth Exceeds the Competition, In Good Times and Bad.
Jeanne is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Many believe that “doing the right thing” for customers is a noble cause, but without provable financial impact. Cynics relegate these actions to irrational business behavior. But it is in that ‘irrationality’ that the beloved companies grow. A beloved company is a business that resists the pull of normal business practices – and is deliberate in the manner in which they will, and will not grow.
This means that when there is a fork in the road and a decision to be made, they always choose to move in the direction of their customers, and their employees. In my work to write the book “I Love You More than My Dog: Five Decisions that Drive Extreme Customer Loyalty in Good Times and Bad,” the great joy was finding examples of these good decisions that drove both financial prosperity and prosperity of the human spirit for these organizations. Here are a few examples made by companies you know.
Beloved Companies DECIDE to believe . . .
- That trust is reciprocated. Griffin Hospital decided to open up records to customers and their families because it believes that trust is reciprocated. Trust forms the cornerstone of the relationship with healthcare providers, Griffin hospital and families. Financial Growth Impact: Malpractice claims dropped by more than 43%.
Beloved Companies Decide to Have CLARITY About . .
- The experience they will and will not deliver. Apple (NASDAQ: AAPL) was clear that it wanted its stores to be places of community and belonging. The Genius Bar is based on the experience of friendship and congeniality at the bar at the Four Seasons. This purpose gives clarity to how people act and deliver when you “belly up” to their bar. Financial Growth Impact: Fastest retailer to reach $1billion in revenues.
- Their higher purpose for customers’ lives. Umpqua Bank created an environment that feels more like a community gathering place than a bank. It changed how it defined banking. Financial Growth Impact: In 2009-2011, in the midst of the downturn, grew assets from $9.3 billion to $11.6 billion
- How to stay relevant in their customers’ lives. LUSH cosmetics removes one third of its products every year to keep customer interest high. Financial Growth Impact: A new store can break even in as little as three months.
Beloved Companies Decide To Be REAL, and Show Their Humanity Through . . .
- Checking their egos at the door. WestJet got rid of “policies” that usually dictate airlines’ behavior and instead made a series of “promises” to both its guests and WestJetters. The executives? Well, they’re “Big Shots.” Hard to get a big head with a moniker like that. Financial Growth Impact: Grew to Canada’s second largest airline.
Beloved Companies Decide to BE THERE by . . .
- Getting rid of the customer “hot potato.” At Rackspace (NYSE: RAX), team structure ensures that when the client calls, there are ready resources to support that client. And it takes the monkey off the back of the client to figure out who to call for what and when. Financial Growth Impact: Revenue growth of 47% annually for the last three years.
- Becoming a part of the story of their customers’ lives. Zipcar (NASDAQ: ZIP) knew that the need for wheels without the resources for owning a car has been a perennial dilemma of college students and young professionals. Zipcar wanted to provide the solution. Financial Growth Impact: 10,000 new customers per month.
Beloved Companies Decide to SAY SORRY by . . .
- Accepting accountability. Intuit (NASDAQ: INTU) spent $15 million for their Turbo Tax errors in 2007 when 200,000 customers were unable to get their tax returns in on time because servers were overloaded. They acquired an IRS concession for customers affected and committed to pay penalties customers experienced. They automatically refunded their fee back to customers who were affected. Financial Growth Impact: 81 percent of sales are attributable to word of mouth.
- Proactively find issues before customers tell them. Every day, Southwest Airlines(NYSE: LUV) reviews the previous days’ flights to understand where customers’ schedules were disrupted. They hold themselves accountable for turning around their customer’s perception of Southwest Airlines. Financial Growth Impact: Proactive apologies generated a net return of $1.7 million in 2010.
The bottom line: building a customer prosperity starts with decision making. Beloved companies get a disproportionate piece of the pie because they aren't always looking over their shoulder at what each decision will get them. Rather they choose to grow by being deliberate. And as proven here - it is a growth strategy that pays off, and proves the cynics wrong.