With the recent obsessions around AI and the “job apocalypse” dominating our current discourse, we thought it might be worthwhile to review a recent take on the branding value of human-to-human interaction.
If you view a doorman as only a means to open a door, he’ll seem overpriced. There are mechanisms to do that. Install the automation. Pocket the salary. People still come and go: Savings! Simple, right?
Viewing people only as their role and function is what Rory Sutherland has called the “Doorman Fallacy.” Of course, a hotel’s doorman opens the door, but he does more. He also recognizes guests. He helps with bags and calls cabs. He stands guard at the front. All of this helps build a hotel’s image. If you think of the doorman’s job only as opening the door, you’ve left out the more valuable tasks.
Guests who are recognized on arrival know to expect a little extra consideration throughout their stay. People arriving with bags and kids will know assistance is available; at that point, the hotel’s value begins to justify itself.
How do you calculate these values in your balance sheet? Advertising and design are likely to fall under marketing. Your employee who is helping customers will appear as wage expense. Both can give customers a reason to buy. One might be classified as brand equity, and the other as a cost to cut.
Branding helps you get chosen when people decide where to spend money. Recognition helps your offering get chosen over a competitor that isn’t. It can help you charge more for your product. It can get you a second purchase. You have a name people think of when deciding to spend money. The expectations you build will shape the risk people see in buying your offering.
Some of those expectations come from your advertising. Some come from the employee who knows how to figure out what your customer wants.
Imagine you have a bike store and a new biker wants to buy a bike. They can look online for options. They may not know what to expect from the more expensive options or what style of bike they want.
A bike expert can ask useful questions and talk buyers through the options. Maybe your salesperson recommends a less expensive ride that will do the job. The sale is smaller that day, but the customer knows you will sell them what is best for them, even if it means selling something less expensive.
They now have a reason to come back and tell their friends where they found their bike. They may or may not. But if you judge a salesperson by that day’s sale, you may be missing something.
Your employee has created an expectation for your business: prospects and customers know they can ask these people for help.
That expectation can lead someone to spend money on your business months later, when that employee isn’t around. It can also attract someone who has never met that employee. That’s how wages can increase a brand’s value.
Of course, that value needs to stay with the business when shifts change.
If your helpful advice comes from one great salesperson, they may be the one attracting the customer. Make sure others know the products. Give them time to figure out what someone is buying, and let your targets reflect that they did a good job selling. If not, you risk your next sale negating the last.
When you expect an employee to learn what someone wants and measure their success by how much they sell, which message do you think they’ll follow? Make sure you know the answer before you tell prospective customers you offer personal service.
This can also happen between your marketing and your operations. You may be spending money on advertising that says you will take the time to understand your customers. But you reduce your appointment length. Cut training or remove the ability to offer an exception. You’re building an expectation that your operational decisions make hard to meet.
All of these things will look fine when you look at their individual budgets. When you look at them as a whole, you may be spending money to advertise something you no longer do.
Suppose you find that removing that advice means your customers aren’t coming back as often. Or you’re getting fewer referrals. Then you may need to spend more on acquiring new customers. You may end up spending the wages you saved on new customers. If you look at each area individually, you’ll congratulate your operations team for decreasing costs. And wonder why your marketing agency needs more money to hit your sales goals.
Sometimes customers don’t mind not talking. They can make an appointment. Look up your opening times. Receive a receipt. As a bike store, you can save your salespeople time for the jobs that require advice. You’re offering your customers the best of both worlds.
But when you start counting the minutes your employees spend, you may be treating each one equally. Helping someone confirm their address and working out why they want to buy a bike aren’t the same. The first task is easily automated. But you’d need to consider what your employee is doing and what your customer is taking away from the interaction.
You can find out by talking to your customers. Ask your repeat customers why they came back. Who referred you, and what did they tell them? Read your reviews to see whether customers mention certain actions. Told them what they didn’t know, called them back when they said they would. Fixed an issue without making them explain.
It’s difficult to put a number on each of these. But they can give you an idea of what your customers are noticing about your business. Combined with repeat sales and referral data, these can help you decide whether you’re trying to cut a cost you shouldn’t.
Research can also help your agency with your ad copy. Everyone says they have personal service. What can you say that they can’t? If you’re helping your customer avoid something that isn’t right for them, you can say that. You can have your employees prove it when they speak to customers, too.
You can find these answers by talking to your employees. They will know what questions your customers have trouble asking. This will help with your web copy, advertising, and offers. If you’re cutting conversations with your employees, you’re also cutting off information about your customers.
Once you start thinking of everything a doorman does, you begin to see why cutting his salary may not be the most profitable move. He’ll cost you his wages, but what he adds to your hotel is more than what he’s paid. When you look at reducing a cost factor or adopting new technology, you may need to consider both.
Have the person who is trying to cut a cost from a position that speaks to your customers shadow them for a day. Learn what they learn, where they have to make decisions. How much leeway they have to offer your customer. If you want to cut that out of the process, you’ll need to know how your customer will receive the same help. Self-service and automation drive efficiency until they don’t, and it’s often hard to know when those savings turn into brand erosion until it’s too late. We often do business for social reasons as much as financial ones, and it can be hard to tell the difference until it’s too late. Consider the doorman’s true value before you replace him with that doorman 9000 subscription.
