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How To Lose At Winning

Why Service Outweighs Sales: Lessons From an All-Too-Familiar Tale

This is a story about anyone—maybe everyone, but it’s also about no one. You may think you recognize the characters involved, and in a sense, you probably do. But this is a story of such universal experiences that those who were once living, breathing players have faded behind the granite of archetypes.

It’s a story about businesses; how they rise and why they fall.

Widgets International, once a corporate megalodon in a sea of entrepreneurial nurse sharks, was born in a garage roughly a decade or two ago. Or maybe it was a living room—or even a shed. It doesn’t matter. It’s just widgets. In the early days, growth was slow and steady and the business model, simple: stock the widgets people love, offer them at a competitive price, and most importantly, provide exceptional customer service at every level of the widget acquisition process. This is what it takes.

Granted, no business formed in the post-modern world has an origin story that is truly as simple as what I’ve described. As they say, the devil is in the details, and far be it from me to deny the heart-rending, nail-biting reality of an aspiring entrepreneur; the endless long nights, the make-or-break decisions around every corner, the never-ending sensation of stepping off a metaphorical cliff, all undergirded by colliding sensations of infinite potential and soul-crushing impotence. It’s not for the faint of heart—and its far more than a simple equation.

Be that as it may, we’re speaking in broad strokes, so back to my three points: product, price and service. All three are essential to the success of any legitimate business, but as already implied, the greatest of these is service.

Widgets International succeeded precisely because of their focus on service. Product and price were important, of course, but they weren’t manufacturing, nor were they setting price points. As such, their control over those aspects was minimal.

Moreover, they weren’t the only game in town. There were widget companies everywhere—Widget World, WidgiBros, Widgets LLC, Widgipedia—and they were all selling the same brands of widgets at comparable price points. Ostensibly, they were interchangeable.

Yet, our protagonists succeeded where the rest failed. Why? Asked and answered, but repetition breeds belief, so let’s say it again: Service. Service. Service. They understood that in the long run, customer retention outweighs the daily sales figures. To borrow the format of a famous adage, make a sale and you’ll eat for a day; make a customer and you’ll eat for a lifetime—or at least, for the lifetime of the customer.

It only took a few years for Widgets International to emerge as the victor in the marketplace battle. A rotating cast of competitors persisted, but our protagonist remained the undisputed leader of the widget industry. Adhering to their cherished core principle of customer service, they continued to achieve steady, scalable growth—all they could ask for in the niche and marginalized widget industry.

Enter Sanjay Gupta and his now-famous widget documentary. Suddenly, widgets were all anyone could talk about. Apparently, they were good for anything and everything: a shirt, a sock, a glove, a hat—but they had other uses. Yes, far beyond that.1

Overnight, the market went from a ragtag troupe of self-described widgetheads to the next Dotcom boom. Investors dumped buckets of cash into the space to the tune of millions, if not billions.

As the industry’s foremost distributor, Widgets International could not have been more perfectly positioned in that moment. No one, not even I, could fault them for their decision to go public. People often love to hate the rich, but no one hates money.

With fresh capital and a surge of mainstream interest in widgets, there was nowhere for the company to go but up—except for the part where that’s not what happened at all. In the five, ten or twenty years (who’s counting? They’re just widgets) since our protagonist went public, their stock has all-out plummeted, as have their online review scores, and subsequently, their company morale.

Many now speculate that within another year, Widgets International, once flirting with “too big to fail” status, may close their doors entirely. How is this even possible?

The simple answer—and you know where I’m going with this—is that they abandoned their core value and put their focus on sales rather than service. In an effort to appease their shareholders, they slowly traded in their human-centric, customer-first modus operandi for a sterile, lackluster, one-size-fits-all assembly line that has since churned out little more than mediocrity on its best day.

In place of the lifelong widgetheads who knew the products inside and out, they staffed their customer service centers with entry-level script readers who could barely tell a good widget from a goddamned ‘whatsitcalled.’ Instead of careful and considered curation of only the industry’s best offerings, they took the “Walmart approach” and brought in anything that could yield an extra dime.

In many ways, the moves were understandable. Nearly overnight, they had shifted from answering only to customers to answering to their shareholders, and shareholders want a return on their investment—methods be damned. The fastest way to generate that return is to squeeze the internal budget while expanding the sales pipeline; quantity over quality, as it were.

The problem with that approach is it’s myopic. Yes, in the short term, it will suffice to get “the man” off your back and give you room to breathe. But long term, it’s a losing game; a long, slow death by self-cannibalization. At the risk of mixing metaphors, you’re killing the goose.

No matter the size of your company, the long-term success or failure of your enterprise will ultimately hinge on one thing—and that is how you treat your customers. It’s easy to lose sight of this, especially now, when it seems that everyone is ditching their experts for gauntlets of AI chatbots and semi-literate script readers just to save a buck. Many will argue that this is just the way of things now, that a truly customer-centric approach just isn’t scalable.

If this is your argument, I have one question for you: Have you placed an order with Amazon lately? Better yet, have you ever negotiated a refund or an exchange? Amazon, for all its faults has nearly perfected the customer experience. Forget bending over backward; the company’s reps will work themselves into a pretzel for you and take a loss to boot just to make sure you hang up happy.

This is why, despite all the disturbing reports of labor abuses, underhanded and predatory dealings, and the eery potential of all-out corporate hegemony, we gladly shell out that $14.99 for our Prime memberships without a second thought. In fact, the books where we learned all about Amazon’s shitty behavior? We bought them on Amazon.

Why? Because of the service, stupid.

Don’t be like Widgets International. Be like Amazon—at least for this one thing. 

Disclaimer: There will be at least one or two people who will read this and take offense, thinking I’m talking about them. If that is you, a few things. First, deflate the ego a bit; not everything is about you. Second, claiming as much is only an admission of failure. You should probably keep that to yourself. Finally, this piece is truly not about any one company. There are dozens of now-defunct companies in our space whose stories reflect this narrative in one way or another. Simply Google “cannabis companies that went public and failed” and see for yourself.

1If you’re wondering, yes, I just ripped off and butchered a line from a children’s book, but it fit too well not to use it. Sue me. Actually, please don’t.

About the Author

You may not know Bruce Reith, but Bruce Reith knows the cannabis industry. Currently the CEO of H.W. Logic, a consulting firm behind the success of multiple brands in the space, Bruce is a seasoned veteran of the industry with a proven track record of success. Though he is discreet about the significance of his role, Bruce’s invaluable contributions have played a key role in elevating numerous brands to industry benchmarks. When Bruce isn’t quietly dominating the world of cannabis accessories, he’s likely cooking up a delicious Midwestern meal, formulating new flavors for his hot sauce side hustle, or viciously trolling the trolls on the FaceSpace.

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