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Customers or Livestock?
I have been gainfully employed since I was nine years old. By the time I was sixteen, I had amassed enough experience, alongside a reputation for reliability, that I was hired to do jobs that are not typical for the average sixteen-year-old. I’m not bragging, I’m just explaining. At sixteen I worked for a local bank, where I had the job of training local retail businesses in how to properly process credit cards. In those days, you couldn’t get a digital terminal and just swipe your customer’s card. You had to use those old machines that mashed a carbon triplicate onto the raised numbers of the card.
Not too long after that, point-of-sale terminals became a thing, and entire businesses emerged solely devoted to the local installation of, and education surrounding, those terminals. What changed with the introduction of point-of-sale devices was far more revolutionary than merely the mechanics of processing cards. What was irrevocably changed was the insight the retailer was now able to acquire into his own business, especially regarding his engagement with his customers.
By the time I worked for Amazon, twenty-five years later, customer behavioral insights were so advanced that Amazon knew, moment by moment, almost exactly how many customers would be buying and how much they would spend. There was an internal web page that showed a moving line chart of real-time revenue. (If you had access to this page, you were precluded from trading Amazon stock without filing documents with the SEC.) Besides being useful for seeing revenue, it was an early-warning system for operational issues cropping up on the website. If the actual collections shown on the chart fell outside a statistical band representing the expected collections, you immediately knew something was operationally wrong with the website. That’s how accurate Amazon’s revenue projections were at the time.
What brought all of this to mind was a note posted yesterday by Matthew B. Crawford about a recent unhappy experience with commercial air travel. He concludes with this observation:
Now I am looking out the window at the Netjets terminal for private jets, where the planes of Silicon Valley firms are coming and going briskly. Competence for us, wholesale dysfunction for you. I’m not sure how much longer ordinary people are going to continue to regard air travel as viable. It’s a frog in the pot situation.
Crawford’s experience is of a piece with a complete vibe shift I have observed in my lifetime during which corporations especially, but by no means only corporations, have begun treating their patrons much less like customers and more akin to how one might treat livestock. To put it another way, business attitudes toward customers have shifted from an urgent sense of the need for businesses to be solicitous, to an almost dismissive, utilitarian posture which operates according to the assumption that any particular customer can safely be viewed as disposable.
I find myself wondering if the extensive quantitative insights enabled by technology are behind this essentially inhuman shift in customer relations. Computer scientist David Gelernter, in his book Drawing Life, observed that “Computers have done a lot of good, and have also done a lot of harm, not in themselves (obviously) but insofar as they underline some of our worst tendencies.” I have been wondering if one of our “worst tendencies”, underlined by computers, is a propensity to be dismissive toward anyone we know that we don’t especially benefit from pleasing.
There is a truism, which we all recognize, that “familiarity breeds contempt”. The way that a growing indifference toward individual customers has coincided with an explosion of quantitative insights into customer behavior makes me wonder if what we’re witnessing is an unhappy side-effect of that data explosion.
In another context, I have observed that children will often behave worse for their own parents than for others. This is not, of course, uniformly true. But it has been true often enough in my experience that I have made a conscious note of it. I have always suspected that at least part of the reason for this is that those children operate with greater insights into the expected behavior of their parents. In some essential way, when they are with others, the inherent relational uncertainty constrains the children’s “worst tendencies”.
So I find myself wondering if the rich availability of customer data has reduced customer relational uncertainty entirely in the business’s favor. Maybe the vibe shift I have observed is due to the lopsided quantitative insight now in the hands of businesses. Perhaps their previously more constrained insight into customer behavior necessitated that they operate with greater eagerness to please. Maybe the now commonplace smug indifference we encounter from businesses is actually due to the improvement in quantitative insights about customer relations we have acquired over the last thirty years.
Maybe there’s a kind of law we could articulate:
The more a business knows about all of its customers, the less it needs to care about any particular one.
That would explain a lot. It would certainly explain the behavior of the online tech giants.
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*koff*Ricochet*koff*
So, we’re getting back into the old days in which businesses dealt with customers on a person-to-person basis instead of treating them as indistinguishable commodities.
That would be an interesting thesis to test by an aspiring MBA student.
I think you accidentally commented in the wrong post. This is the post you’re looking for
Good article – crystallizes a lot of things I have been feeling. I hate nearly every non-local business that I deal with because of the atrocious customer service.
“Your call is very important to us. Please stay on the line, and a representative will be with you shortly.” We all know the drill.
Great post!
Changed it a bit, but it still doesn’t reflect exactly where we are.
The more a party thinks it knows about its voters, the less responsive it becomes to direct voter feedback.
When I worked in politics, there was one thing for certain: the people in certain positions knew better than you, even if you were discussing your midwest hometown and the other person came from the northeast…especially if they came from there.
I drove a bunch of Dole campaign staff around during a visit in ’96. The gentleman who was in the seat next to me is known quite infamously to longtime Ricochetti for his tone deafness and frequent guest appearances on the flagship. He proceeded to give me the business about what Hoosier voters wanted and criticized our tax-cutting efforts. I finally just tuned him out, though mostly because I was driving in a secure motorcade and was supposed to be about a half dozen feet off the bumper in front of me at 60 mph.
There is a strange inverse relationship in politics between perceived expertise and actual voter connection. The more the former is claimed, the less likely the latter is present.
I don’t think I would have been able to resist maybe something just as simple as “You really believe that, don’t you?”
Young pup in my first job. Tried to be deferential, but his attitude just took it out of me.
Brilliant.
Some of us are Republicans in spite of our experiences with Republican muckety-mucks.
It’s your thoughts restated, Keith. Thanks for stirring it up.
Reading of this rather sad trend brought to mind that great motivational quote from Zig Ziglar:
Apparently, the Big Tech’s algorithms say otherwise, more’s the pity.
I should have said business-to-person basis, which would help to explain what is different now as well as what is old stuff that’s coming around again.
Dale Carnegie’s How to Win Friends and Influence People is still in print–88 years.
Pick up a copy today!
This is a fine, sound, thoughtful post – far better than the one that inspired it. Matthew Crawford may not know much about air traffic control. (Hint: it can depend on the weather both at a flight’s origin and at its destination. Eggheaded observers should leave open the possibility that they aren’t observing everything.) He also may not know much about Third-World countries. What’s with the Brazilification hashtag? It is true that when things go wrong in a land like that, folks do look resigned. But they carry on anyway. Also, even there, quite a lot of time, quite a few things don’t go wrong. I bet Mr. Crawford did at last get out of his airport. And will go to another!
Air travel: an outlet for peevishness such as the pre-1903 world could not have imagined. Back then, if a ship went glug or a train derailed or a stagecoach broke spokes, the reaction had to be far more exasperated, or far less. Peevishness is distinctly in-between, and may be distinctly modern.
The factors vary from situation to situation. In the case of air travel, rising affluence and technology-driven lower costs have led to a lot more people traveling by air….it’s a lot easier to provide a personalized-service feeling with a DC-7 carrying 60 passengers than with a 747 carrying 300.
One general factor has been a tendency to: routinize the job as much as possible, hire cheap people, don’t train them sufficiently, routinize the job still more, rinse and repeat. For a discussion and remedies, see The Good Jobs Strategy by Zeynep Ton, which I reviewed here.
Also deregulation