Last week the United States’ Supreme Court revoked the federal right to abortion.
Now if you’ve read The Mmm…letter dutifully, as God intended, you know I occasionally dip into politics, but prefer to stay focused on marketing, business, entrepreneurship, and pure silliness.
So I will not harangue you with whether the supreme court did the right thing or whether they could have spent more wisely the hundreds of man-hours they dedicated to overturning a right that 70% of Americans support, the same Americans who pay their salaries… I digress.
Instead, I’m going to focus on how the supreme court achieved their goals and the parallels we can draw from the business world.
The supreme court reminds me of a private equity firm – the kind of organization that scoops up a failing business and immediately starts making cuts to prop up revenue:
“Limit 2 per customer”
“Available on Tuesdays only from 3 AM to 5 AM”
“Our bottomless mimosas are no longer bottomless, and due to a change in recipe, we can’t legally call them mimosas”
Etc. And these companies know customers will recognize the policy changes as money-grabs, so they refuse to provide any warning. They make the policy change a surprise, much like the supreme court did its ruling.
Customers wake up to find a new policy in place: “no breakfast served after 11.” And customer-facing employees are left to bear the outrage.
For a short while, revenue goes up, but trust dwindles and customers go looking for alternatives. Private equity rely on these methods because they are highly-analytical people. They can calculate how plump their bottom-lines will grow after they introduce reductive policies. But they struggle to see past the ends of their noses; revenues will grow, at first, but what happens after two-years? How about five?
These policies restrict access to beloved services and weaken customer trust because they rarely provide a benefit to anyone other than the brand. A few years later, contracts expire, customers find alternatives, and profits are back on the decline as the market stabilizes.
And if it sounds like I’m talking out of my butt, you’re right, because I once introduced reductive policies, and had my butt kicked.
In late 2020, I was working with a fair but demanding client. My frustration led me to increase my project rates by 10% (quietly). Initially, my client failed to notice because I set my rates after completing the work. And my client’s accountant handled all of the accounts payable. After a half-dozen or so projects at the new rate, my client smelled something fishy. And once he caught on, it blew up – a week later, he cut me off.
It would take a year before I received payment for outstanding invoices, and just as much time to rebuild his trust. Today, we’re working together again and I’ve I learned my lesson.
So if a naïve Millennial can figure this out and make it right, so too can the combined wisdom of six supreme court justices – n’est pas?
We’ve Updated Our Policy…