Customer loyalty: disgust, elevation and the categorical imperative

CRM has failed to deliver customer loyalty, is Social CRM headed the same way?

In Bob Thompson’s latest post he asserts  that CRM failed to deliver the primary objective of CRM: customer loyalty.  Bob goes on to say that he doubts that Social CRM will cultivate customer loyalty despite all the promise and hype that surrounds it.  Why?  Because the focus of CRM has been value extraction and not value creation as illustrated by the following definition of CRM in an IBM paper:

“CRM strategy, enabled by processes and technologies, is architected to manage customer relationships as a means for extracting the greatest value from customers over the lifetime of the relationship.”

Bob is saying that in his world he is a person what wants to be treated as a person yet organisations embedded in the CRM mindset are likely to view him as a “lead” or a “deal” or an “incident”.  Bob is pointing out that as a person he wants an “I-Thou” relationship and not an “I-It” relationship:  Bob wants to be treated as a fellow human being, treated with dignity worthy of a fellow human being, not just an economic object to be managed by the organisation for its purposes.  It looks like Lior Arussy agrees with him.

Disgust and delight: tale of two customer experiences

Lior Arussy, in his latest post, writes: “I HATE BEING TAKEN FOR GRANTED. I HATE WHEN THE RELATIONSHIP IS ONE WAY AND ONLY WORK WHEN IT IS GOOD FOR THE COMPANY. I ESPECIALLY HATE BEING TAKEN FOR A RIDE AND NOT BEING NOTIFIED ABOUT MORE SUITABLE (AND AFFORDABLE) PLANS. I VIEW THAT AS A BREACH OF TRUST. “

In contrast, Elizabeth Glagowski is delighted with the way an eBay seller has treated her, so much so that she titled her post “Customer Service Blunder Leads to Holiday Cheer”.  Why?  Because the eBay seller responed within an hour, apologised profusely for sending over the wrong T-shirt, promised to send the right one straight away, told her to keep the wrong T-shirt as it is similar to the right one, and he told her to pick another item in a certain price range and offered to send that to her free of charge to compensate her for her troubles.

What is going on here?  Why is Lior so upset and Elizabeth so delighted that she is being an advocate for Paul the eBay Seller?  We are in the realm of human emotions and particularly the emotions of disgust and elevation.

Disgust: its role in social relationships and the moral order

In “Wired to be Inspired” Jonathan Haidt writes:

“..when my colleagues and I actually asked people in several countries to list the things they thought were disgusting, we repeatedly found that most people men­tioned social offenses, such as hypocrisy, racism, cruelty, and betrayal”.

“When we find social actions disgusting, they indicate to us that the person who commit­ted them is in some way morally defective. In this light, we seem to place human actions on a vertical dimension that runs from our conception of absolute good (God) above, to absolute evil (the Devil) below.”

“Social disgust can then be understood as the emotional reaction people have to witness­ing others moving “down,” or exhibiting their lower, baser, less God-like nature. Human beings feel revolted by moral depravity, and this revulsion is akin to the revulsion they feel toward rotten food and cockroaches. In this way, dis­gust helps us form groups, reject devi­ants, and build a moral community.”

Read this article on how some insurance companies who have bought into the McKinsey system are generating bumper profits by deliberately causing delays and hardships for customers – especially when they are at their most vulnerable.  How does this make you feel as a human being?  Are you disgusted?  If you are wondering about the power of disgust then think about the News International phone hacking scandal.  News International had successfully muffled the politicians, the police force, the information commissioner etc for years.  Yet, when the public became aware that a dead schoolgirls (Milly Dowler) phone had been hacked the public disgust meant that the politicians had to take action.

Elevation: its role in social relationships and the moral order

Have you ever been moved, touched, inspired by seeing, reading about, or hearing of a stranger doing a good deed for another stranger?  If you are like me then you might even have noticed tears streaming down your face combined with a strong desire to do good deeds and be a better person.  Why are human beings so powerfully affected by the sight of one stranger helping another stranger?   Here is what Jonathan Haidt has to say on the matter:

“I have defined elevation as a warm, uplifting feeling that people experience when they see unexpected acts of human good­ness, kindness, courage, or compassion. It makes a person want to help others and to become a better person himself or herself.”

“Most people don’t want to rape, steal, and kill. What they really want is to live in a moral community where people treat each other well, and in which they can satisfy their needs for love, productive work, and a sense of belonging to groups of which they are proud. We get a visceral sense that we do not live in such a moral world when we see people behave in petty, cruel, or selfish ways. But when we see a stranger perform a simple act of kindness for another stranger, it gives us a thrilling sense that maybe we do live in such a world.”

“The most commonly cited circum­stances that caused elevation involved seeing someone else give help or aid to a person who was poor or sick, or stranded in a difficult situation”

“Love and a desire for affilia­tion appear to be a common human response to witnessing saints and saintly deeds, or even to hearing about them second-hand. If disgust is a negative emotion that strengthens ego bound­aries and defenses against a morally reprehensible other, then elevation is its opposite—a desire to associate with those who are morally admirable.”

What’s the lesson?

If you want to cultivate customer loyalty (an emotional bond) then heed the words of Immanuel Kant:“Act in such a way that you always treat humanity, whether in your own person or in the person of any other, never simply as a means, but always at the same time, as an end”

If that is difficult to understand then imagine that the Customer is present inside in your business – she is sitting on your shoulder.  Is she left disgusted or elevated by how you are thinking, what you are doing and your motivations behind your actions?

A final thought

For as long as the Customer is simply a means to an end, and greed and fear are the driving forces behind Customer initiatives, companies will fail to cultivate customer loyalty in the social sense of a heartfelt allegiance.

Can you fake a customer-centric orientation?

Computer simulations suggest that over the long term it pays to co-operate and play ‘nice’

Research on competition and co-operation based on computer simulations  (read Axelrod’s The Evolution of Co-operation) suggests that ‘tit for tat’ is the most profitable strategy over the long run.  What does that mean?  In the long run and across different environments, it pays to co-operate whilst remaining vigilant to the possibility/danger of being cheated.  Put more simply, you start by being trusting and giving the other party the benefit of the doubt and thereafter you reciprocate: if the other party ‘co-operates’ then you ‘co-operate’ in turn; if the other party ‘defects’ (does not play nice) then you reciprocate by ‘defecting’ (thus punishing the other party).

The real world is more complex: the art of impression management

Real life is more complex.  I do not react to what you did; I react to what I think you did.  You know that and so that opens up a whole area of possibility called ‘impression management’.  If being a virtuous and trustworthy co-operator does not appeal to you or is simply too much work then you can simply focus on the art of persuading others to believe that you are a virtuous and trustworthy individual and/or organisation: you fake it.

In the personal arena this is called the art of personality: personality is like putting on a ‘suit of clothes’ that give off the right impression; it is about learning the right techniques – in fact it is technique driven.  Character on the other hand is who you really are: it is what you are really about; it is what you stand for;  it is how you behave behind closed doors; it is how you behave when you ‘down’ or on the ‘ropes’.  In the organisational arena there is a whole profession and industry dedicated to impression management: the marketing function, the marketing agencies, the PR agencies…

Why am I bring up this point?  Because I am wondering if you can fake a customer-centric orientation.  Actually that is not true – I do not believe that you can fake it over the long-term.  Yet, I continue to be surprised at how some organisation think they can give the impression of being customer centric without actually being ‘customer-centric’ orientation.  Allow me to share two examples with you.

The AA ring me to get my feedback but they did not really want my feedback

Yesterday afternoon a friendly chap from the AA rang me and told me that he ‘wanted to get my feedback on the AA as I had recently called the AA for help’.  Because I believe it is a great practice – for companies to elicit feedback and customers to give feedback – I agreed even though I was busy.  So he spelled out the game 1 for excellent and 5 for poor.  Then he proceeded to ask me three questions.  First, how do you rate the performance of the person who handled your call for help?  Second, how happy are you with how long it took for the mechanic to get to you?  Third, how happy are you with the service delivered by the mechanic?

Then this friendly chap asked if my problem had been fixed. “No” was my reply, “Because he was not able to get the faulty part”.  Then he asked me “Did the mechanic give you a price for the part?” I responded “Yes, he did. It was in the region of £250.”  The AA chap then started selling to me: he told me how the AA had a policy to cover parts.  What he did not do was to tell me about the conditions or the price.  When I told him that I did not need the service as I was driving a Honda and in the last seven years it had only broken down once (this time) and the only major repair was for some £300.  This did not stop this chap.  He carried on started selling me something else.  Some way through this selling I simply hung up on him.  How did the conversation occur to me?

I am left feeling that I was set-up.  I am left feeling that the purpose of the call was to sell to me and this was disguised as a request for feedback. And that is what I object to: one thing masquerading as another.  If the AA wanted to sell to me then that is what they should have made clear right at the start:  “Mr Iqbal you had a breakdown recently and we have one or two offers/products that we believe will be value to you.  Are you interested in learning more?”  I may have been interested in having that conversation or not. Yet, I would have walked away with a positive attitude towards the AA: they had identified a need, they had then taken the proactive step of alerting me to products that could be of value to me; and they had asked me if I was interested in the conversation.

A customer charter with no heart in it

I was asked for my help in evaluating-improving-constructing a customer charter.   When I asked the people why they were constructing a customer charter one person told me that it was for internal purposes – to inspire/guide the employees.  The other person on the room disagreed: she thought that it was something that the top management team wanted to publish because they believed that it would help to win more business.  Digging into the charter more I noticed that many of the words and sentences sounded great but did not actually commit the company to any specific behaviour that could be measured (by the company or by their customers).  It turned out this was intentional.

There had been no soul-searching.  There had been no collaborative process to involve the whole company in thinking through what promises that company would be glad to make to customers and the market place.  There had been no consideration of what kind of promises are bold – the kind that inspire us, the kind that inspire our customers, the kind that we are willing to ‘go the extra mile’ for. There had been no consideration of other companies that are inspirational in the way that they treat their customers.

The charter lacked heart because ultimately it was empty.  It’s real purpose was to simply act as a ‘marketing’ document that would convey the right impression on prospects and partners.  And the hope was that this would then lead to more revenues.  The funny thing is that the customer charter was not written for existing customers at all.  These customers were pretty much going to continue to get what they had been getting.  And no real changes were being made to inspire / effect changes in behaviour at the leadership level, the management level or the employee level – at least none that were communicated to me.

My take on this

You can’t fake it.  A wonderful concept that I learned from Jonathan Haidt (The Happiness Hypothesis)  is that of the ‘Elephant and the Rider’: the subconscious mind, the limbic brain, our innate take for granted always on (24/7) biological and emotional drives can be though of as the ‘Elephant’; and the The ‘rider’ is our rational brain – the neocortex.  What this analogy is communicating is that whilst you can talk to the ‘rider’ and get him to act what you find is that sooner the rider gets tired of controlling the elephant.  And when that happens the elephant goes exactly where it wants to go.  That is why dieting does not work.  It is also why New Years resolutions fizzle out. It is also why find sounding missions, values and charters do not work.  It is also why a lot of organisations are struggling with creating customer-centric cultures.

You can only create a ‘customer centric’ culture if your elephant buys into it whole-heartedly.  How do you know if that is the case?  Well when you think about / picture being customer-centric you are inspired, you are moved, you are touched.  That is to say that there is an emotional response: it is the kind of response when you find out you are going to be a father or mother or when you find out that one of your children is in danger.  If you do not get that emotional response then I guarantee that your rider is thinking ‘customer-centricity’ is a great technique to help me get what I want.  And as soon as a better technique comes along then you will jump on it.  Or, as soon as it becames hard to practice and apply this technique you will cut corners and ultimately dilute it so that the technique will not deliver its promise.  Or you will simply get bored of it and the elephant will do what it wants to do.

If you are crafting a ‘customer charter’ or a ‘customer experience’ or a ‘customer centric orientation’ then it might be useful to ask yourself the question: “Am I willing to stake everything on this?”  If not then you might want to think about playing a different game.

What do you think?