Treating the customer's account as authoritative buys trust and repeat custom at the cost of absorbing some abuse.
The slogan was in print by 1905 in reporting on Marshall Field's business policy and later became strongly associated with Selfridge; the exact coinage is uncertain. It is a commercial policy rather than a factual claim, and its cost falls on staff, which is why many firms have since qualified it.
In practice
- A retailer that honours every return builds a customer base and a staff turnover problem in the same policy.
- An airline that empowers agents to resolve complaints on the spot buys loyalty and pays for the passengers who learn the policy.
- Possible explanations
- The explanation is asymmetry: a dissatisfied customer costs more in lost custom and reputation than most disputed refunds cost to settle, so conceding is usually cheaper than being right.
- In its favour
- As a commercial policy it works for the reason given, and it gave shop staff a clear rule in an era when disputes were settled case by case.
- Against it
- It is a policy rather than a claim about the world, and it is widely criticised for what it costs staff, who absorb abuse that the rule licenses. Its exact coinage is uncertain.
- Standing
- A commercial policy rather than a factual claim, and often criticised for its effect on staff.
- Further reading
- Wikipedia
- Subject
- Organizations & Bureaucracy
- Essay
- Rules for running organisations, and for pressing them