Sometimes, when we look at something we react, formulating an opinion based on first impressions. We make assumptions like this every day and in most cases we are only looking at the small picture, not the big one.
What Brown does for you
You’re not the only one whose time is limited and who winces at high gas prices: Since before anyone now working there can remember, United Parcel Service (UPS) plots out delivery routes with as many right turns as possible. At first, you might respond “What’s the point?” But last year, UPS managed to save three million gallons of fuel and nearly 30 million miles with that simple technique, according to an ABC News article.
UPS vice-president Jim Winestock told reporter Brian Rooney: “I’ve been known to pass up drug stores, three or four on the left-hand side of the road, just to get to the one on the right-hand side of the road.” I think I’ll make more right turns from now on, thanks to this lesson in turning a small inconvenience into a big benefit.
How to lose 50% of your customers and still make money
In a past career, I managed a Wherehouse Records store. They were a corporate chain and one of the first music stores to begin renting videos. For quite a while, their rental rates Monday through Thursday were only $1. It was a steal, giving Wherehouse a lot of rental market share because of this price point.
One day, however, they more than doubled their mid-week rental rate to $2.50. “This is going to kill our business!” I heard some employees moan. “Our customers are going to be so pissed!” proclaimed others. Our customers, of course, were very unhappy with the decision.
I agreed with those sentiments, so I let the Regional Manager know my feelings the next time he showed up at our store. “What were they thinking?” I asked him, incredulous that they could be so greedy and bring so much harm to their business. I saw this move killing their video rental business. It could even cost some of us our jobs.
“How many customers do you think we’ll lose?” he asked me. I pulled a number out of the air: “Thirty percent.” To my surprise, he replied: “What if we lose 50% of them?” Now I knew he was drinking the corporate Kool-Aid, because no one wants to lose 50% of their customers, right?
He continued: “People may grumble about the price increase, but many will stay with us and some might leave. Even if we lose 50% of our customers over this, our price increase is 150%, which means we still make more money than we lost, and it takes less staff to do the work.”
That day was a major revelation for me when it came to big picture marketing. It taught me that we all need to work on seeing past what’s right in front of us and looking into the future and how things might really play out.
Sometimes what is difficult in the short term is beneficial in the long term. Sometimes what seems ridiculous now is standard in the future. Sometimes your logo needs to fit your customer, not your personality. Sometimes fewer features on your Web site is better than more features. Sometimes less is more. Sometimes losing 50% of your business is a good thing.