You've probably heard it a thousand times: "the customer is always right."

Wrong.

Sometimes, the customer is right. Often, the attitude that the customer is always right drives away good business as your company focuses on satisfying those who cannot be satisfied, or focuses on creating short term satisfaction over long term customer loyalty.

Let's look at where exactly "the customer is always right" breaks down, and what you can do about it.

1. The customer is not an expert.

Bret Larson, CEO and co-founder of the telemedicine software company eVisit.com, has referred to "the customer is always right" mentality as "one of the most destructive business models." Why? Because your customers only think that they're experts on what they need, while you and your staff are the actual expert. There are many fields--medicine, accounting, public safety--where giving people exactly what they think they want is ultimately destructive.

For industries like healthcare, Larsen points out that various studies have found that the most "satisfied" patients are also those who spent the most on prescription drugs and were 12 percent more likely to be admitted to hospitals. Giving customers (patients in this case) what they want in the moment rather than what will help them the most could destroy any long-term satisfaction.

This doesn't mean you shouldn't still treat customers with the utmost respect and care. Instead, you should put confidence behind the opinion of yourself and your staff, and stand by that in situations where the customer is disagreeing or demanding something you can't deliver.

You had a business idea and went into business because you're good at what you're doing, and because you have something exciting and high quality to offer to your customers. Part of your job is to explain to them why what you have to offer is the best deal on the market. If it isn't, and your customer can really and truly do better with a competitor, tell them the truth. They'll figure it out eventually, and you'll do your reputation a favor by honestly and kindly referring them to someone who can actually meet their needs.

You're the expert. Obviously your customer's experience matters, but bending over backwards to give them what they want instead of what they need doesn't do either of you any favors.

2. Supporting your employees makes all your customers happy

While supporting the bad customers only makes those customers happy (and doesn't even manage to do that half the time).

Larsen recommends that you remember why you hired your employees in the first place. "Chances are, you assembled your team based on their values and abilities. Put faith in that. Support them however you can. Remember that when you're evaluating performance and giving feedback."

Instead of focusing on making your customers happy, ask what you can do to make your staff happy. If your staff is well trained, has adequate authority to make decisions and solve problems, and has the resources necessary to meet reasonable customer needs (and even a few of the unreasonable ones), then you'll end up with higher customer satisfaction naturally. Your employees will be a joy to work with, and that pleasure in the transaction will transfer to the customer experience.

If, instead, you decide that the customer is always right, then you're going to end up devoting resources to customers who are angry, and can't be satisfied. Those resources that could work towards retaining good customers who pay your bills, instead go towards customers who probably won't stick around, no matter what you do. Your employees become disheartened because customers are trained that if they shout and scream, they'll get what they want. This creates a horrible customer service environment. It may not tank your business entirely, but it will make it harder to attract and keep the top shelf talent that you need to thrive.

3. The customer cares about maintaining the status quo

Most customers are not early adopters. Most customers don't care about the way you're trying to create a new market, or find a new delivery mechanism, or shake up the product line. Most customers just want to know why they can't have the same thing they had yesterday, and the day before.

If your company is in the business of excitement and innovation, there's nothing worse than relying on the customer's love of the status quo to provide your business with feedback. You need to hold to your own mission and push through the resistance of "But Why?" so that you can show them your narrative of "Because."

And even if your company is not focused on revolutionizing your industry, the status quo is probably still not serving your business. All entrepreneurs should be focused on ways to improve their business, their productivity, and their service, if only because stagnation is the enemy of business growth. Quite often, changes in the status quo feel inconvenient to customers, even if they will be beneficial in the long run.

It's not that your customers are always wrong, because after all, very few of your customers are actually trying to defraud you. One isolated incident of a customer being demanding or unreasonable isn't and shouldn't be a reason to fire that customer.

But when you're constantly focusing on the false idea that your customers are always right, you end up choosing your customers over your employees, which sets up a dynamic that will eventually fall apart.

To make sure and keep your business on the right path, choose your employees first. Offer them specific, relevant praise on a daily basis. Be interested in your customer's experience, but if only one person is upset, do not assume that you need to bend over backwards to rework the entire experience to address one outlier.

You are the expert on your own business. Go out there and show your customers why they chose you in the first place.

Published on: Oct 15, 2015