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Promises should be kept (?)

The promises in the seller-buyer relationship have been, are and will be. Actually, the whole relationship is based on a promise, or rather promises. The plural is appropriate here, because as part of one procurement process, we get several if not a dozen different promises: concerning the product itself, its price, after-sales service, delivery dates and a few other elements. The seller makes promises, and the buyer expects them to be kept. Will it always wait?

 

Exactly. In my opinion, the promises made by companies to customers can be divided into three categories:

 

1. I know that I will not keep this promise, but I promise.

 

This is a category in which, of course, promises are the most attractive to customers and in which they are usually not kept.

 

An interesting example may be the Danish brand Retap - a producer of glass bottles for water, who promises that its bottles will not break. Unfortunately, the bottles break (I know, I checked). Does the manufacturer really believe that the glass from which his bottles are made is unbreakable? I do not think so. Certainly it is a glass more durable and the probability that the bottle will break is much smaller than in the case of its usual counterpart - but it does happen. It's just that the promise of a bottle that "does not break" is much more attractive to the customer than the promise of a bottle that "breaks less than the average bottle" or "probably will not break." Does the manufacturer cheat customers? A bit like this. He makes a promise without being able to fully realize it. Of course, he also immediately declares (which means that he counts, but that his bottles can break) that in case of a bottle break, you can get another one for free. Is this fair? Yes, it is fair to the customer (not counting the shipping cost of 5EUR, which is on the customer's side). Is this the fulfillment of the promise? In my opinion, still not, because the bottle breaks.

 

2. I promise, but I cannot guarantee that I will be able to fulfill my promise tomorrow.

 

This category is dominated by the promises of "the lowest prices". From the customer's perspective, it seems that nothing better could have happened to us. Is it really?

 

First of all, the lowest prices today, no longer have to be the lowest tomorrow. The market is dynamic, the flow of information is immediate. Lowering the price by one company may result in the same competition behavior. Thus, the promise can very quickly be out of date.

 

Second, economists point out that such promises are characteristic for cartels or other forms of price collusion (or, more gently, "market arrangements"). The promise of "the lowest price" and, best of all, a promise to return the difference between our price and the price of competition, means that customers quickly "report" who broke up the arrangements and sells cheaper. The bad news for customers is that in this case the "lowest price" means "the price for which we all agreed on the market". Usually it is far from the lowest price according to the customer.

 

3. I only make promises that I can fulfilll

 

On the one hand, the most fair approach to the client. On the other, often less attractive than the promises of competition that cannot be kept. "Low prices" will always sound worse and less concretely than "the lowest prices on the market".

 

So what to do to make a promise that is attractive, but possible to keep? Identify those elements that are unique to our company and focus your promise on them. It does not have to be the lowest price. It can be the largest range of products. Most branches. Immediate (same day) execution of the order. And many others.

 

And if a given company, does not the product have any unique element? Probably then, it is worth returning to the basic question that every newly established entity or an entity introducing a new product to the market should ask itself: why is my company or my product different from the competition? If we cannot answer this question, instead of making promises without coverage, it may be worth redefining your business model.

 

According to the KPMG model, credibility that means the way in which (and if) the broadly understood promise of a given brand is delivered is one of the six pillars of the customer experience. It is also together with solving problems one of the two basic pillars. Credibility is also immediately behind personalization, a key factor affecting readiness to recommend a given brand[1].

 

Is it worth keeping promises then? The answer seems quite obvious.

 

For her additional support, I will appeal to an interesting management theory which says that we receive as a much more negative situation when we lose something that we had, than when we do not get something. This means that we will be much more angry as customers for a company that promised something to us and did not keep its promise, than for the one that promised us nothing.

If the obligation to keep the promises rests with the company, does it release customers  from verifying them? No. A responsible consumer, when he sees a promise that sounds too attractive, should ask himself: why no one else is offering it? Keep in mind that, quoting the classic: there are no free dinners.

 


[1] [Cyfrowy] klient nasz pan. Jak marki na polskim rynku zarządzają doświadczeniami klientów, KPMG, 2019

 

 

28 January 2019

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