recommend a competitor
November 17, 2021

How to build trust with customers? Santa says recommend a competitor.

By Amy Scott

As we get closer to the end of the year, many of us are beginning to feel more festive, so I thought it was time to hear from Santa. Well, ok, not Saint Nick himself but rather a guest post that encourages us to learn from Santa in a favourite Christmas film. Miracle on 34th Street.

We’ve had a tough year as a world & have tackled some meaty topics on this blog. Series have included advice on Adaptive Leadership, Data Literacy, Psychosynthesis and Statistics. So, I thought it was time to lighten up as we head towards Christmas. I asked our panel of guest bloggers for some festive fun instead.

First of the blocks was Amy Scott. You may recall that Amy is a service designer & CX consultant with many years of experience in turning insights into improved CX that works. She has shared with us before the reality of using marketing personas. In this post, she proposes this controversial solution to building trust – recommend your competitors! Over to Amy to explain herself.

Why would you recommend a competitor?

When you first see this, you must be thinking “Are they crazy why on earth would I want to give business to my competitors?” But this isn’t as daft as it sounds. 

There are numerous reasons you might want to do this and they are all about acting in the best interests of your customers. And by doing the right thing by them you will reap the rewards.

When companies act in this way it clearly demonstrates to your customers that they can trust you because you are willing to put their interests before your own. However, you need to ensure it is not seen as a gimmick, but it is a genuine, sincere and honest act of you trying to help your customers. 

It all boils down to trust and what the benefits are of being seen as a trustworthy partner. After all honesty, empathy and transparency are all qualities you would expect in a friend, so why shouldn’t you expect businesses to behave in the same fashion?

Why don’t more companies recommend a competitor?

The real question to ask is why so few companies actually act in this transparent and honest way? 

Customers have long memories and will reward businesses for this type of altruistic behaviour and by doing this one simple act you will win their trust because you are putting their needs before your own short-term financial interests. This is the stuff that builds profitable long-term customer relationships and loyalty, and it is not new. 

Before I give you some current real-life examples, I saw this illustrated particularly well in one of my favourite Christmas films “Miracle on 34th Street“.  This film made in 1947, nearly 75 years ago, illustrates this point and is probably one of the first times that customer experience made it onto the big screen, although if it was called anything back then it was probably called customer service. 

Learning from Santa (in Miracle on 34th Street)

For those of you, who haven’t seen the film the story takes place between Thanksgiving Day and Christmas Day in New York City, focuses on the impact of Macy’s department store Santa Claus, who says he is the real Santa (i.e. Kris Kringle). While working in Macy’s he is told to push parents to buy their presents from the store, but he ignores these instructions. 

Instead, he tells one exhausted mother where she can get the toy her son wants because Macy’s has run out of stock and then proceeds to tell another mother that she should buy her daughter’s skates at Gimbels (Macy’s archrivals) because they are better made.

When the women are surprised he is telling them to shop elsewhere and question him as to why he is telling them this, Kris responds “The only important thing is to make the children happy. Who sells the toy doesn’t make any difference. Don’t you feel that way?”

And what do you think the customer’s reaction to this surprising advice was? Well, in the film, the exhausted mother approaches the head of the Toy Department and says: “Listen. I want to congratulate you and Macy’s… on this wonderful new stunt you’re pulling. Imagine, sending people to other stores. I don’t get it. Imagine a big outfit like Macy’s… putting the spirit of Christmas ahead of the commercial. It’s wonderful. I have never done much shopping here before… but from now on, I’m going to be a regular Macy customer.”

Then his secretary lets him know later that afternoon that there are six more women who want to thank him, and personally, she thinks it’s a wonderful idea, too.

Examples of doing this in the real world

Now I know it is only a film, but I have experienced and seen the reaction of customers when a company puts their interests before its own. Here are just a few examples

Haven’t we all been to a store and when you can’t find what you are looking for, don’t you find it wonderful when the salesperson advises you which other shops may have it. I mentioned to the shop assistant in Myer that I thought £22 for a cake tin was overpriced and she said to me on the quiet, “Try the £2 shop, I think they are much less there”.  I was impressed but would have been even more impressed if she hadn’t had to say it on the quiet.

Isn’t it great that Amazon always reminds you that you bought a book before, so you don’t accidentally buy it again? They do the right thing demonstrating that they value you by putting your financial interests before their profits. It also benefits Amazon’s bottom line too, as they don’t have to undertake a time and resource-consuming returns process when you discover you already have the book.

Why this works in the wonderful world of customers

Imagine if your bank contacted you to tell you that they just launched a new type of account and advised you to switch your money into it so you would earn more interest, or your mobile provider calling you to tell you to switch to a cheaper plan. How likely would you be to trust them more, stay loyal to them because they act like they have your back? Why would you go elsewhere?  And how many friends, family and others on social media would you tell of their honourable behaviour? How many new customers might a business acquire because of acting this way?

If companies act in the customers’ best interests it consistently brings rewards to them in the medium to long term and will always dwarf any short-term profits that may be made by acting in a self-interested way.

And on that note I think I will end this article with Mr Macy’s response to Kris’s actions:

“I admit this policy sounds idiotic and impossible. Imagine Macy’s Santa Claus sending customers to Gimbels. But, gentlemen, you cannot argue with success. Look at this, telegrams, messages, telephone calls, the governor’s wife, the mayor’s wife… over 500 thankful parents…expressing undying gratitude to Macy’s. Never in my entire career… have I seen such a tremendous and immediate response…to a merchandising policy. And I’m positive if we expand our policy…we’ll expand our results as well.

Therefore, from now on…not only will our Santa Claus continue in this manner… but I want every salesperson in this store…to do precisely the same thing. If we haven’t got exactly what the customer wants…we’ll send him where he can get it. No high-pressuring and forcing a customer…to take something he doesn’t really want.

We’ll be known as the helpful store… the friendly store, the store with a heart… the store that places public service ahead of profits. And, consequently, we’ll make more profits than ever before.”

Mr R.H. Macy, Miracle on 34th Street

The business benefit this scene depicts is pretty farsighted for something written in 1947 and still universally true. Merry Christmas.

How could you change your business to build trust this way?

Many thanks to Amy for that festive post, I certainly now plan to watch Miracle on 34th Street again with fresh eyes. What did you take from Amy’s case for recommending competitors or better deals? If you are a CX leader, I hope it inspires you to identify new ways to treat your customers even better.

I’m also interested to hear from customer insight & analytics leaders. How could you help CX leaders make such a case? How could you design a robust experiment to prove the value? Could some of the advice from “Data Means Business” help you partner with your CX peers to achieve this? Please let me know your festive thinking.