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Is the Customer Always Right? A Reflection on Dine America

Last week, I was at Dine America, the nation’s preeminent conference for restaurateurs. There were many interesting tracks on the business of eating, as well as sage deliveries about the current Presidential election, the environment, operational branding, the analytics behind sports management and so much more.

The quality of speaker was exceptionally high, boasting Trade and Non-Trade subject matter experts of highest order, including Alexandra Cousteau (Yes, the Granddaughter of Jacques), Daryl Morey (GM of the Houston Rockets) and count ‘em — not one, but two Mark Halperins (The Chef (actually spelled “Marc”) AND the Politico who spells his name with a “K”).

But it was two other speakers that really caught me off guard, and provided the inspiration for this little blog. Those speakers were Randy Garutti and Michael Bergdahl. You may have heard of one or both, and if you haven’t, you’ll most likely know their places of employment.

Randy is the CEO of Shake Shack, frequently referenced (and quite rightly so) as one of the hottest restaurant concepts going – within and beyond what is classified as the “Better Burger” category. Michael Bergdahl, aka “Birddog” (as he was affectionately called by Sam Walton) was the Chief People Officer at Wal-Mart, and even better known as one of Wal-Mart’s chief biographers.

Friday morning kicked off with Birddog and his mention of something I’ve probably heard a million times in my life, “the customer is always right.” He said that Sam Walton believed unequivocally that the customer was always right and that even if a request was completely ridiculous, say perhaps, “can you take back a golf club wrapped around a tree?” Sam would always take it back just to save that customer. What’s more, he said, Wal-Mart would actually put that mangled club in a museum, as a monument to doing the right thing in the face of unreasonable requests. I’m struggling to think of many – or any – businesses that would do the same.

Bergdahl went on to explain that this customer-centric principle bore so deep into the company’s psyche that he, as Chief People Officer in accordance with all the executives’ buy-in, helped it become the cornerstone driver of the 3 Values of the “Sam Walton Way”

  • Strive for excellence
  • Respect for people
  • Serve your customers

It was with this that he told the Dine America room that at Wal-Mart no associate was ever allowed to have a bad day. One bad day, he remarked, could cost the company a lifetime value of up to $2400 a year for the life of a customer.

My gut when I heard that was — “who doesn’t have a bad day?”

Funny…that must have struck a sour chord with Randy Garutti as well. He, like Birddog, spent an hour or so talking to us about some of the secrets of what makes his successful business a success. And also like Birddog, he talked about the importance of keeping employees empowered, so they can deliver better customer experience.

But the similarities stopped there. Shake Shack’s Garutti couldn’t have been further from Birddog’s sentiment about having bad days. “Who doesn’t have a bad day? If something happens that upsets an employee or simply an employee comes in that day in a bad mood, it’s only natural, ” he said.  At Shake Shack (home of the tagline: “Thoughtful. Considered. Crafted. Correct.”), the expectation is that the team is responsible for picking up that employee and realizing that they are — human. He also went on to tell us in that very spirit, that the customer isn’t always right, because humans are not only emotional, but they are also for the most part reasonable. I got it really quickly.

I can remember my father, a merchant of more than 60 years, imparting these words of advice to me when I was no older than my youngest child (6- ish):

“Marc, if you remember one thing and one thing only,” he said as seriously as a priest, “I want you to remember this: The customer is ALWAYS right.”

So after 44 years, with a lot more thought on the subject and listening intently to what Randy Garutti was trying to convey to the crowd, I can finally say: “No dad, the customer isn’t always right. He is, however, mostly right, and should ALWAYS leave satisfied and ready to come back for more.”

Kobie Marketing

Kobie Marketing