Building a Business by Focusing on Angry Overly Important Individuals?

Jun 24th

I just read a WSJ article about how some hotel chains are trying to woo people leaving negative remarks publicly about their brand.

'I Hate My Room,' The Traveler Tweeted. Ka-Boom! An Upgrade!

Generally speaking, the idea is crap.

In essence they are spending resources trying to make the most unsatisfied segment of their market happy, and rewarding people for trashing their brands with free upgrades & other perks. And so it teaches more people to complain & to find arbitrary things to complain about. Hence the friendly article offering the tip on how to get free room upgrades, with tips like: "Have a lot of online friends or followers. Hotels will pay more attention to your requests."

Hey Ritz-Carlton & Shangri La ... we have 10,000's of readers and you suck! Please save my complimentary upgrades for the next time I am in town. :D

Does anybody think those leading brands got to where they are by tracking complaints on Twitter? The customers who have complaints actually worth listening to will probably give it to you directly rather than Tweeting it.

The people who are unhappy are often the type of people who shop by price and have 0 brand loyalty. And no matter what you do it is never enough. About two days after opening up our membership site (nearly 2 years ago) I got a phone call while on the road by someone who couldn't figure out how to log in. I pointed out where it was. That wasn't good enough. I spent about 6 hours digging through the PHP to try to make the login even more intuitive for them. The next day they asked for a refund because I didn't provide 24/7 phone support. The login wasn't the problem. It was just a handy excuse. The problem was that they were cheap and nothing was going to be good enough for them. And just to put a bit more salt in the wounds, about a week later someone else complained about how the login was changed. FAIL! :D

Since then we have increased our price 200% (as we have added more tools, more staff, and the value of my time keeps going up every day) and we still have many people who are happy as longterm customers at a higher price point. In fact when some people accidentally cancel their account I can get 3 to 5 emails in an 8 hour period when I sleep because they miss the site that much.

But there is the opposite end of the spectrum as well: potential "customers" who demand a free trial, beg for aggressive discounts, or have 50 "one more question" questions before joining. They probably are not sold enough on the solution to be worth the effort of selling to. No matter what you offer them its probably not going to be enough. Their lack of internal value is reflected into their perception of the works of others, and if they buy from you without being sold on you they will probably ask for a refund, or find a way to be abusive to make you want to can them.

In our support suite many non-paying non-customers mark their messages as critical. Whereas the people who are paying customers use a less extreme level, like normal. The levels that people can select are almost a filtering mechanism. Have you spent $0 with us & you mark your issue as critical & you use caps lock & rude slurs? Shift-delete.

I didn't intentionally plan it, but our old programmer even built another filter into our business model. The people who join and then cancel right away get locked out right away. We then send them refunds, but this level of filtering filters out a major type of potentially abusive customer. The type who generally won't read or research but will ask 5 different questions 8 different ways each every single day until they have annoyed your members so much that you are forced to boot them to lessen the noise. The person who makes over 100 posts in their first 2 days isn't taking any time to read or listen or implement, so they would just harm your community without getting any value out of it.

This leads to my theory of filtering: if a person needs lots of support becoming a customer (or before they become a customer) then they probably are not going to become a good customer. And if you take them on as a customer (or spend any money pushing in that direction) you will probably lose money.

The person who sends me an enraged email about "why should I install Firefox" just wasted 5 seconds of my life & will never spend a penny with me. And that is fine.

Many of the best companies aim to be polarizing. They pick their spots and define what they do, and work hard to make that market segment happy. That is how Steve Jobs views flash, and it is how Marc Andreessen likes to invest.

Find out what people smarter than you are doing and find a way to incorporate those themes into your business strategy. The smaller you are the more polarizing you can be, because you don't have to create something that feeds thousands of employees to be profitable.

You could spend every day trying to make any unhappy person happy with your offering.

... OR ...

What if you took those same resources that were spent trying to appease the angry and spent them on making those who are happy that much happier? Does the free upgrade go further when it is given to an enraged steroid addicted customer, or does it go further when given to someone who has stayed with your hotel multiple times in the past? Where are they on this circle?

The concept to think about here is that if someone is already fairly loyal it doesn't take much more marketing or attention to make them *super* loyal. And then they spread the word.

There is a concept of fairness which is preached in school, but you should overweight your business toward your best customers.

The person who has been a paying subscriber for years is worth thousands to tens of thousands of Dollars to our future business interests.

And for clarity purposes, I agree with Chris that their can be great value in being a guide & helping people out. But angry high-maintenance people are rarely where sustainable profit margins come from (unless, of course, you are a divorce lawyer OR a PR firm who gets paid to give hotels bad advice).

From the above WSJ article's comment section

It wasn't enough. It never is. :D

Published: June 24, 2010

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Comments

June 25, 2010 - 1:03am

This leads to my theory of filtering: if a person needs lots of support becoming a customer (or before they become a customer) then they probably are not going to become a good customer. And if you take them on as a customer (or spend any money pushing in that direction) you will probably lose money.

Every Time!

June 25, 2010 - 3:48am

I forget who said this, but it's a good thing when people complain. It means they still want to do business with you. It's those who are no longer complaining that you need to worry about.

I think that may have been in a pre-web context, where those bitching online are those who'd no longer complain (to you directly, as you put it, because they don't think you'll hear). That said, I've tweeted or blog-posted about stuff I wasn't too happy with in the hope of tripping some rep-management filter and getting customer service. It's not always the customer who's bad - sometimes the service blows. Like the time it really took me hours to order from Amazon (their site(s) were breaking)!

I had decided no longer to shop there until I got a gift cert for $50. They upgraded shipping free to 1 day from 2-3 day, and it was already free at 2-3 days. So I'm impressed, and willing to shop there again (it only took a few minutes this past time).

Anyways - while someone who's as successful as you likely has a lot of bad customer stories, I don't know how representative these are. It could just be they're more memorable. You know I have a lot of respect and admiration for you as an SEO and businessman Aaron, but I don't know whether this anecdotal evidence is representative...

June 25, 2010 - 9:49am

I noticed you recently started creating an info-product targeting the SEO market. Wait until you get the ignorant emails about "if SEO traffic is free why do you charge for your products & services? I never pay a cent for traffic, you scammer!"

In 1 to 2 years you will be amazed at how right the above blog entry was ;)

June 25, 2010 - 6:20pm

Haha I hope you're wrong about seeing the market that way! Life's more enjoyable and less stressful when you focus on the positive folks n customers - someone like u shouldn't find it too hard with 1000s of books sold n 1000 members in the forum :)! (But I do hope you're right that I sell enough books to the point where even the disagreeable people are mixed in there lol ;) .)

June 25, 2010 - 3:51am

In the same vein as Seth's hierarchy of leads/customers, one big tip (that hadn't quite occurred to me) is to ask them how you can improve satisfaction...

http://www.directcreative.com/blog/customer-retention
(That's not my blog, for others reading this comment.)

June 25, 2010 - 10:05am

@bookworm.seo, what Aaron is talking about are people who are shitting about your stuff with the primary idea to get refunded or just because they are always unhappy no matter what you do. Genuine feedback is useful, but believe there are "customers" who are just pain in the a**. And the earlier you recognize them and cut them, the better for you.

June 25, 2010 - 6:22pm

I suppose when you put it that way, it's clearer. And I agree on that - reading the case study to that effect in the 4 Hour Workweek about him cutting loose the abusive customers made lots of sense to me.

June 25, 2010 - 10:12am

Offtopic: Aaron, is there a specific SEO reason not to have a social networks share button under blog posts? (If it's not a secret of course :D)

June 25, 2010 - 10:18am

I just haven't seen much value in putting them there. I might add them soon though...I just need to accept that they are more about awareness and repeated messaging rather than the direct-marketing sort of behavior one associates with search :)

June 25, 2010 - 1:06pm

I don't know about you but I can tell with 99% certainty from the initial "complaint" communication whether the person falls into the "loyal customer" or "asshat" category. Each should and can be treated differently. A cursory look at the communication style of someone tweeting negatively about your brand should be able to determine whether the person is genuine or just a freeloader looking for an upgrade.

June 25, 2010 - 6:45pm

I agree with you 100% on that.

And even if you do make an error 1% of the time (or in an extreme case lets say 5% of the time), well freeing up 20% to 30% of your time to spend it with paying customers (and increasing their loyalty) is going to more than offset any losses from that 1% of error.

I think the big issue here is the concept of fairness...it is over-promoted in the business world. Years ago my mentor told me this:

I think the best brands, the best sites have a large portion of their founders personality in them. Never be afraid to be yourself, after all there are 1/2 billion people on the www, not all of them have to agree with you. Concentrate on the ones that share your views, concentrate on making their experience the very best it can be, the rest forget them.

Or to put it another way, the best sites say - this is what we do, this is how we do it, if you don't like it go somewhere else.

I wish I was wise enough to take it to heart. I literally wasted at least a year of my life (over a number of years) doing things the wrong way. Only in the past year have I really started to value filtering the way I should have many years ago.

June 25, 2010 - 1:45pm

@bookwormseo: You said: "whether this anecdotal evidence is representative" I can say, I am definitely one of the dorks who freaks when PayPal screws up my account in here. Not sure how representative I would be, but I may email Aaron a few times every 15 minutes, making sure I am still going to get back in...and he has been so far patient with my psychosis. I know a couple of my pals in the forum would react the same - probably more than I realize actually do.

Just wanted to pipe-in for us anecdotals out here. Keeping it real.

I think his customer service stories are good ones - because Aaron gives away things with more value than most people who sell things. He also has at least one method of recurring payments happening (I can vouch - I pay every month), so sees customer issues from this perspective.

I don't think he is really broad-stroking it that much here. I think once you have offered services for a few years, you see this happen pretty regularly.

I have a tiny little business compared to Aaron's reach, but these observations ring true for it as well. If I don't fire bad clients almost immediately, it is frustrating, time wasting and a financial drain. I never feel like I am making enough, no matter what I am earning.
Good clients will tell their friends, and they will collectively chersih my attention.
I also believe it is getting easier to stop them at the gates...I think idiots are simply making their dumb ideas and cluelessness more visible sooner, or email became less monkey-proof.

June 25, 2010 - 6:25pm

Or email became less monkey-proof - haha great line there Marty! I hear what you guys are saying about the asshats being a drain.

June 25, 2010 - 8:25pm

Nice and fiery, aaron. And very true. Back when I was working in an HR division if you could call it that, I noticed a direct relationship between how much help candidates needed with filling out an application successfully and how unqualified they were for the job.

June 27, 2010 - 3:06am

To some extent I agree, but I've been on the other side of the angry tweets and sometimes they're well deserved. In some cases, people just have crappy customer service, and if they don't pay attention to private emails, you may feel an amplified Tweet will be more effective in getting service.

Last year I bought a web script that had pretty large bugs. What started with little questions being ignored turned into major problems being ignored for weeks a time. When I didn't get a lot much pre-sales support, I chalked it up to "they're probably putting their resources where they need to be - paid customers." But the support once I became a paid customer never improved.

Just to say that sometimes where there's smoke there's fire, and if the only way you can get attention to it is taking it to a public forum, it's not always just because the person is a jerk. They very well could be, but in some situations it's possible the company did something to elicit that behavior.

June 28, 2010 - 11:10pm

Or to put it another way, the best sites say - this is what we do, this is how we do it, if you don't like it go somewhere else.

This is perhaps the best advice to follow. Your customers select themselves. If you have to sell your product by bending over backwards to please demanding people, either your product is no good (which is true much of the time), or you believe anyone can become your customer. For those that believe anyone can become their customer: "any fool can be busy".

Your product sells itself to those that truly have done their homework (and those are the customers you want anyway).

As Godin and many others have long long pointed out: do not try to please everyone. You dilute your product/service by trying to please everyone.

I don't understand why so many don't get this. They treat their product/service like it's just a widget that they must sell the maximum number of to ANYONE. It's like they don't respect what they sell at all, it's just a commodity.

June 29, 2010 - 12:53am

When I first started working to try to improve conversions I found out the above the hard way.

When we had a pop up all over the site we had increased churn, fewer sign ups from our core market perspective, super-demanding customers, etc.

I think people are so interested in top line numbers because that is what people write about. And bigger is always better in the press.

I think it takes having multiple revenue streams to divide your time across to give you the confidence and perspective needed to push away from helping everyone to just helping those who are a great fit.

June 29, 2010 - 3:24pm

I think it takes having multiple revenue streams to divide your time across to give you the confidence and perspective needed to push away from helping everyone to just helping those who are a great fit.

This is it. Diversification allows you a bit more breathing space. If you have a single revenue stream, it's so easy to get obsessed with squeezing the pips out of it - so you become numbers-obsessed and that includes trying to win over those awkward people.

If you're successful enough, you get to avoid that scenario. Simple.

July 1, 2010 - 5:07am

Aaron, you are so right - I totally agree with your arguments. There will always be people who are essentially dishonest and are just out for 'freebies' of one kind or another. I think that one should feel sorry for them since they are deciding to remain on the low level of life's achievements. How much more satisfying to buy something with honestly earned money than to be given a free handout.

However there is certainly value in the step of allowing people a trial for a short time or at a discount - you believe in your product and so you stand behind it.

With regard to complaints about things and whether such people can be converted to 'customers', I believe that there should be a place where they can express their displeasure (a feedback area) and also be given a specific reply. They can then decide whether the service provider is being fair and whether he/she merits their business.

But one should certainly not try to appease such 'angry' people too much. They probably have a 'hidden agenda' that's behind their anger which says "Let's try to screw this person for whatever we can".

July 1, 2010 - 9:32pm

There is no value in offering a free trial on our site. We would get a lot of bottom rung folks coming in and spamming the hell out of our forums and making them useless for paying subscribers.

Apple doesn't offer free trials, and their components are designed to break. There is only 1 of me, and if the THOUSANDS of blog posts and the tools I shared publicly are not enough of a free trial to see that we do quality then that sector of the potential customer base is just not worth serving. At all.

July 5, 2010 - 11:31am

Aaron,

It's amazing how much the paragraphs from 'Many companies...' and ending with 'spread the word' in your post resonate with Sale type #4 in a blog post from hosting provider Servint.

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