Some drama over trash recently arose in our area. A local waste management company raised their prices at the beginning of the year. The catch was they did not tell their customers. Oh, and it was a 50% price increase.
Of course, you know how this played out. The bill hit, the customers were irate and well things went downhill from there. The local news got involved after the trash hit the fan. In an interview about the price hike, the company said it did not notify customers because it did not want to overwhelm it’s call center Yes, this is true:
400 cancellations later the company stated, “I think we made a mistake.”
Really?
I just wonder if saving their call center some additional call volume was worth the loss of 400+ customers. I would guess there was there was plenty of additional call volume after the customers got their bills.
Dollar Shave Club
I have been a member of the Dollar Shave Club for at least five years now. It’s a monthly service that delivers razors. If you have facial hair I would highly recommend it (this is not a sponsored post either).
Any way I got this email from them recently:
This company is raising my price by $1 but they still had the courtesy to let me know and even give me instructions on how to cancel my membership.
Do you think I cancelled my membership after receiving this? Nope if anything I am a much happier & more loyal customer.
A Tale of Two Experiences
What would make a company think it is okay to raise prices by ~50% and not tell their customers? While another company goes out of their way to let customers know about a $1 a month price increase.
Business before the Customer
The trash company clearly had its business before the customer. I’m sure the finance team saw dollar signs with a 50% price increase, but no one seemed to think about letting the customer know. I would have hoped that someone in the company voiced some concern over this.
The perplexing part is that there are 3-4 other companies competing in this space and guess what they did? Promptly reached out to the disenfranchised clients and scooped them up by offering a lower rate.
There seems to have been no foresight at all in this, outside of looking at how much revenue they would gain by the price increase. The customers were secondary.
Customers before Business
Contrast this with the Dollar Shave Club. To be honest if they had raised my price by $1 a month I probably would not have even noticed. It is clear though that they value the customer over the business. Even though both are integral, they realize that the customer drives the business.
They were totally transparent which instilled trust. They explained the why, which provided understanding and they gave an alternative that would not have been favorable for them (cancelling my membership). The combination of these components caused me to double down on my loyalty to the company. I’m sure many other customers felt the same way.
Employees Come First (most of the time)
Let’s give the waste management company the benefit of the doubt. Maybe they really were looking out for their employees. Maybe they had a small call center and were truly attempting to minimize the impact on that center. It was still a short-sighted strategy. Without customers you can’t have employees. This is a lesson that this company may now be learning the hard way.
A company can never go wrong by being totally transparent with both its employees and customers. If you are a Dollar Shave Club employee and see your leaders being this transparent with the customer, then you have no doubt they are being transparent with you, the employee.
When a company puts its customers first they are also putting their employees first. This creates a culture that keeps both customers and employees engaged.
Great article