I GUARANTEE IT!
DEVELOPING A STRONG GUARANTEE IN A SERVICE BUSINESS!
Guarantees! Ever heard of them? What do they mean to you, as a consumer? If you’re like me, they mean almost everything when it comes to parting with my money for a product or service. In fact, I dare say I cant think of anything that I buy, today, in 2020, that I don’t first look at the warranties and guarantees. Our money is important to us. After all, we’ve traded our time and life energy, in some way, to have that money. Any time we are contemplating handing that representation of our life energy invested over to somebody else for something, most of us would like a reasonable assurance that our money will be protected, to the degree that it ever can, in the event that we’re not happy with what we just paid for, whether that be a product or a service. If you’re an online shopper, like I am, you’re probably aware of the guarantees from companies like Amazon, Zappos, or Wayfair. All three of those companies sell hard goods, products to wear or use in your life, your business, and your home.
We might think it’s easy to make a guarantee on a product because its something that is either right or its not. Maybe its defective or maybe it showed up damaged. But what about a service business? A business that sells no product, per se, but provides some kind of service? I raise the question because of the variety of industries I have worked in, businesses I have owned, and the industries that I coach in are, quite often, service type businesses. They’re businesses that provide some kind of service and not necessarily a product, although, as a business coach, I always say that your product IS your service! Every business has a product, even if its not a hard good like shoes, widgets, or easy chairs. Before we talk about how a service business offers a powerful guarantee, lets talk about why you’d even want to offer a guarantee in the first place. Although these diamond mining episodes are not industry specific, I work a lot with the appraisal, real estate sales, and lending industries and very few of the businesses in those categories have any kind of service guarantee, so lets talk first about why you might want to consider getting creative and offering some kind of service guarantee.
One of the first places a good service guarantee is invaluable is within your own company. A good service guarantee enables you to get some control over your organization by making the guarantee very clear and prominent for all in the organization to see, feel, buy into, and support in an effort to be the absolute best in your particular industry and market. With a strong guarantee, there is something to focus on in training new staff. When you’re making a promise to your clients and customers in some strong way, it needs to be part of your strategic identity and part of the spirit of the company. It gives everyone something to rally around and be maniacal about delivering on. The next most obvious place a service guarantee holds tremendous power is with your potential clients and customers. Like almost every airline call out at the beginning and end of a flight when they say, ‘we understand you have a choice in air travel and we appreciate you choosing us’, most good businesses understand you have a choice in which company to choose for a particular product or service and earning that business is a not easy. One of the ways that an organization can elevate their offer and message is by lowering the bar of risk that consumers automatically believe exists with any purchase decision. You’re a consumer of something, think like a consumer. When you are thinking of making some kind of purchase, whether you know its happening in your mind or not, part of you is wondering what will happen if you aren’t happy with your purchase or change your mind after you buy something.
Of course, with some things, like ice cream for example, you cant return the already eaten tub of ice cream if you don’t like it. You can return it if its melted when you get home or moldy or theres something downright wrong with it, but certain things simply cant be guaranteed. What can be guaranteed, however, is the way that thing is purchased or the way a particular service is delivered. When you are in consumer mode, the more your fear of making the wrong choice or having a bad experience is allayed or eased, the more ease you have in doing business with that company. And this grows as the price of the purchase or investment decision grows. The more you have to pay of your hard earned money, the more security you’d like about some aspect of the process being guaranteed. A strong service guarantee can be just the thing that puts that consumer fear to rest and make somebody choose your service over a competitors. While I was writing this episode I was ordering coffee in a Starbucks coffee shop. I’m not big fan of Starbucks coffee but I found myself there nevertheless. I don’t know the specific brews but I knew I wanted the lowest acidity brew that they have so the barista offered me a particular blend that I was clearly unfamiliar with and I said sure. Her parting words as she handed me my coffee were, “sir, if that one isnt to your liking, just bring it back up here and we’ll get you a different blend.” I had given no thought whatsoever to their written satisfaction guarantee because it was such a small purchase, but they have one and the baristas words were very reassuring for somebody who isnt sure about the choice they’ve just made. Her words to me sunk in and are likely to inspire me to go there again now that I know I cant make a mistake in what I choose by going there.
So what makes a good service guarantee? Well, first and foremost, it must be as unconditional as humanly possible. The more conditions and hoops you make somebody jump through, the less strength a service guarantee has. If you need a lawyer to read through the fine print in order to exercise a guarantee, or the guarantee is more hassle than the value of the service, it will be seen simply as a gimmick. A good guarantee has to be simple and easy to understand. It should be written in easy to understand language that clearly outlines your promise. Customers and clients will know exactly what they can expect and your staff will know exactly what is expected of them. As an example, if anybody remembers Dominoes pizza’s guarantee many years ago, it said your pizza was delivered in 30 minutes or its free. Simple, straight forward, and clear. Nothing ambiguous about 30 minutes. They didn’t say, ‘around 30 minutes or so’, they didn’t say ‘fast delivery’, they didn’t say, ‘prompt service’, they said 30 minutes or its free. I eat lunch every now and then at a restaurant called BW3. They have a lunch time guarantee that promises lunch in 10 minutes or its free. They bring a timer to your table and start the clock as soon as you place your order. You’re watching it countdown as you sit there and I have never had to exercise the guarantee. What it does for them is it eases the busy professional’s concern that lunch will take too long and BW3 wins. The service guarantee costs them very little to implement, it becomes a part of their training and service focus with all of their staff, and it allays the fears of the market making it a very meaningful guarantee. If you want to make a strong guarantee, make it easy to invoke. You don’t meet your promised standard, whatever that is going to be, you deliver on your promise. Simple, easy, no questions asked.
Before we get into what a guarantee for your organization or service might sound like, its very important to first understand what your clients and customers truly want. Without some kind of real market research, many companies and business owners mistakenly believe that customers only want the absolute lowest price, or they just want their everything for free, or, in my business of appraising real estate, many appraisers mistakenly believe that everybody just wants they highest value that makes their deal close regardless of whether or not its real. I can tell you from experience and actually conducting these kinds of client and customer surveys, its simply not true. What most people will say when asked for an honest answer about a purchasing decision, is that they want to be taken care of, they want to be treated fairly, they want problems to be resolved, they want communication, and they want to be educated and in the loop.
The obvious question for most of the audience of this podcast, appraisers, realtors, and lenders, how do you offer a service guarantee when you operate in industries where some of the customer and client satisfaction is influenced by external factors beyond the service provider control. One of the clearest examples and one I can hear everybody screaming into your podcast machines is the Appraisal business. An appraiser cant guarantee a particular value. They cant guarantee the right or best comparable sales will be available. They cant guarantee that the buyers or sellers of a home being appraised will be happy with the appraisers opinion. And they cant guarantee that they’ll even be able to communicate with a buyer or seller due to confidentiality rules. There are many external factors beyond the control of the average real estate appraiser. So the question for any service organization in those instances becomes, ‘what can we control?’, and the answers invariably revolve around how you handle and deliver your service. Remember, we said earlier that in a service organization, your product is your service. Maybe said a little clearer, the service you deliver and how you deliver it is your ultimate product.
So what kinds of guarantees can a service organization offer? Well, I’ve already given examples of a few organizations who guarantee their service, even though they may offer a product as well. Dominoes pizza and their 30 minute guarantee, BW3 and their 10 minute lunch, Starbucks and their complete satisfaction guarantee. But each of these companies has a product that they can simply discount all the way to free. So what does the company who’s product is their service offer in the way of a guarantee that makes sense and lowers the risk for the consumer? Well, that’s the point of this podcast, to inspire you to think. I can think of several simple guarantees that can help service businesses like Appraisal companies. For example, how about a no shoes guarantee: we guarantee to always take our shoes off when we enter your home or you’ll eat dinner on us at one of 5 local restaurants. How about an on time guarantee: We promise to be at your door at the time we say we will or… you fill in the blanks for the reward. Of course, you have to know that this is possible given the external factors like weather, traffic, and unforeseen roadblocks, but if consumers or homeowners are concerned that they may have to wait for hours like they do with the cable guy, an on time guarantee can become a strategic marketing and competitive advantage in a crowded marketplace. How about an education or clarity guarantee? ’We promise to go out of our way to make clear the whole process so that you fully understand how we arrived at the number we did.’ The list of ideas you come up with is only limited by your imagination. Of course, somebody might hear this and think, “Blaine, those just sound like gimmicks and I’m not into gimmicks!” I get it. A good service guarantee in a service business where many factors are beyond the control of the service provider AND where the consumer or end user or receiver of that service isnt educated on the whole process can sound a bit gimmicky. The point of a good service guarantee is simply a way to tell the market that you care about some of the things that the market cares about. What it also allows you to do is to say in advance what you might often end saying in defense to an angry caller. Again as an example for most of my audience, a service guarantee like a no shoes guarantee or an on time guarantee gives you the opportunity to say, “we may not always be able to deliver good news or news you want to hear, that’s not why we exist. But we will always do our best to ensure that we’re friendly, we wont abuse you, we’ll go out of our way to explain things, we’ll respect your home, we’ll do more research than everybody else, we’ll be the most professional…”, and on and on that list can go, again, only limited by your imagination.
So my question for you: what will your list look like? What kind of guarantee could you offer that could give you a competitive advantage without compromising any particular aspect of your business? What do you think your real clients and customers really want and care about? Then ask yourself if that’s really true! Most people answer that first part with answers they’ve been giving for years based on some bias, maybe some being a little jaded and grizzled from years of being beat up. But is it objectively true? Probably not in most cases, maybe only in a few. How creative can you be an come up with a guarantee that has some meaning in your particular business and industry? I challenge you! What’s it going to be?…
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