Telling Your Customer ‘No’ Can Be the Best Way to Grow Your Business

It’s time we admit the obvious: The classic business differentiators have become obsolete. Customers expect the best quality, the lowest possible price, instant delivery, and an experience that wows them every time. Ironically, this begins with adding the word “no” to every employee’s vocabulary. To craft a customer-first strategy that focuses on building credibility, not customer counts, businesses must determine who their customers actually are, practice honesty internally and externally, and act like they're always in the spotlight.

April 11th, 2018   |    By: Joey Coleman    |    Tags: Sales, Customers, Strategy

It’s time we admit the obvious: The classic business differentiators have become obsolete. Customers expect the best quality, the lowest possible price, instant delivery, and an experience that wows them every time.

Despite this change, most companies are terrified to implement the “novel” technique of being honest with customers.

Telling Customers No

Modern buyers focus intensely on customer experience and touchpoint impressions, not on which products perform well. Why? Blame the Japanese Kaizen movement of the 1970’s and 1980’s if you’d like.

Not only did Kaizen spark the total quality management movement, but it also brought defects down to negligible amounts. Customers got high-quality products, and companies suddenly found themselves competing mainly on price.

Not for long, though.

Global manufacturing soon took away that differentiation point. In fact, the global economy with its hypercommoditization drove product pricing as low as possible in nearly every category of product or service.

At the same time, online consumers began to expect things to be built to their specifications in real time — 24/7.

Over four decades, the playing field hasn’t just leveled; it has been smoothed and polished to a high sheen in which you can almost see your own reflection.

The final bastion and only opportunity for one business to “look better” than another is through a transparent, superior customer experience.

Ironically, this begins with adding the word “no” to every employee’s vocabulary.

A Negative Word Can Make a Positive Splash

What’s so powerful about (gently) turning a customer down? Consumers have become jaded and expect salespeople to make promises that stretch beyond imagination.

So when an employee explains to a prospective customer that the business is not the right fit, brand credibility goes through the roof. Credibility in business always mattered, of course, but in a different way than it does now.

In the old days, most transactions happened face to face. So the florist knew that if she wasn’t nice, customers wouldn’t return and she’d be out of a job. Comparison shopping was more difficult back then — you had to physically drive to a different store to check prices — so price didn’t matter as much as face-to-face interactions.

Now, people rarely go to flower shops. They call up 1-800-FLOWERS if they feel like talking, or if they seek a great online experience, they go to a site like The Bouqs Co.

With the ability to effortlessly compare prices and make decisions based on how convenient and easy a company’s website is to use, customers have a lot of power, which makes it tempting for brands to try to sell customers everything under the sun to earn their business.

Earn Better Customers by Telling Them ‘No’

Telling Customers No

Focusing on short-term gains only is a surefire way to trip a customer’s BS meter.

What customers deserve is a serious conversation that could end with an honest statement like this one:

“My gut instinct is that we’re not going to be able to deliver what you need right now, but I want to help you find someone who can.”

Not only does being forthcoming about shortcomings create a valuable give and take, but it also reduces the chances of landing the wrong client.

We’ve all done that, of course: landed a bad client who sucks energy, time, and money.

The reasoning behind it is understandable. Your business needs clients, so your salespeople bring in as many as possible. The problem is that the wrong clients can end up hurting your business worse than a mere lack of clients.

This behavior creates a toxic cycle: You can’t serve the customer, who then winds up becoming a thorn in your side and abusing employees.

Your employees start loathing their roles and treating good customers poorly. Ratings and reviews waffle and then plummet. Then, it’s tough to get people to work for you, let alone buy anything from you.

Soon, you realize you can’t scale — you’re too busy scrambling to make ends meet — and your ability to serve the customer falls apart.

It’s vicious, and no business can afford getting caught in this loop.

To avoid this, craft a customer-first strategy that focuses on building credibility, not customer counts.

1. Determine Who Your Customers Are — and Aren’t

As you’re establishing your marketing materials, create two columns. The left column is a list of people your product is best suited for, and the right column is the people your product won’t serve.

Voila! Your new marketing message is complete.

By being upfront with your customers about who your product is (and isn’t) made for, you’re saving everyone time and frustration. The credibility you earn from this honesty is astounding.

Imagine, for example, you walk into a store and ask an employee whether the store carries a certain product.

If it doesn’t have that product, would you rather the employee try to sell you something different that you don’t want?

How refreshing would it be to be pointed in the direction of another store that does carry what you seek?

It might seem counterintuitive to send prospective customers to your competitors, but the trust you gain from looking out for the prospects’ needs is tremendous. We live in a skeptical world, and most people expect businesses to overstate their qualifications.

Talk to them honestly, and when those customers need something down the road, they’ll remember you and trust you to actually help them solve their problems.

2. Practice Honesty Internally and Externally

So you’re always honest with your customers. That’s great. But are you making sure all your employees are on the same page? Are you encouraging them not to cut corners or overhype your offerings?

Salespeople are notorious for promising the sun, moon, and stars.

Sadly, after they ink the deal, they pass the new customer to an account manager who often has to reluctantly explain: “Sorry, we don’t have the sun or the moon. Oh, and stars? Well, we have one, but that’s it.”

At this point, the customer is irritated, and the relationship is already off to a rough start.

To combat this situation, restructure your incentive plans to reward salespeople only when they bring in the right type of customer.

3. Act Like You’re Always in the Spotlight

The effect of the internet on businesses has created an entirely new kind of transparency.

Consider Yelp reviews. Years ago, bad restaurants only worried about giving good service to local food critics and newspapers because they were the only ones who had the power to share reviews far and wide.

Sure, everyday customers could tell their friends about a bad restaurant, but it often took several years before all those negative word-of-mouth reviews caught up to the business.

Yelp and other social media platforms have transformed the landscape. Not only are online reviews instant and (most often) honest, but they’re also usually done in real time.

Every customer is a potential influencer or critic, and if your restaurant isn’t up to par, you’ll be out of business in a matter of weeks.

“No” isn’t a swear word. It’s a smart word. It’s a concise, clear, and even kind way to differentiate yourself in a global economy where customers have more choices than ever.

A friendly yet clear “no” helps you build rapport, establish credibility, and create an unexpected line of communication with your prospects and existing customers.

Turning people down because you can’t be an asset to them isn’t mean; it’s an incredible gift to you and your customers.

  • Have you ever had to tell a customer “no” to doing business with you?
  • Have you been told “no” by a business and then wanted to be a customer that much more?

Share your story about what happened in the comments!

Also worth a read:

  1. Build Brand Loyalty by Turning Away Customers
  2. Is Caring About Your Customers Actually Killing Your Business?!
  3. 7 Ways Small Companies Can Build Instant Credibility With Customers
  4. Are You Giving Your Customers The Run Around?
  5. 4 Easy Ways To Truly Connect With Customers

About the Author

Joey Coleman

For over a decade, Joey Coleman has helped organizations retain their best customers and turn them into raving fans. He’s an award-winning speaker who has worked with companies ranging from small startups to major brands such as Whirlpool, NASA, and Zappos, and his First 100 Days® methodology helps fuel successful customer experience endeavors at companies and organizations around the world. His book “Never Lose a Customer Again” helps businesses learn how to turn any sale into a lifelong customer.

Discuss this Article

Unlock Startups Unlimited

Access 20,000+ Startup Experts, 650+ masterclass videos, 1,000+ in-depth guides, and all the software tools you need to launch and grow quickly.

Already a member? Sign in

Copyright © 2024 LLC. All rights reserved.