Relying on a Good Reputation
Created on 7 July, 2024 • Scale Up Business • 96 views • 2 minutes read
In this article, I want to talk about businesses that rely on a good reputation. Maybe like you, at the beginning, I managed to win customers' hearts “just” through my name and good relationships with a few people.
Relying on a Good Reputation
In this article, I want to talk about businesses that rely on a good reputation.
Maybe like you, at the beginning, I managed to win customers' hearts “just” through my name and good relationships with a few people.
The story usually goes like this:
A business owner sells a product, and the first people to buy it are usually those who know them well. Even if the product's quality is poor, they still buy it out of curiosity. This might be why people with a good and well-known name find it relatively easy to sell things.
I experienced this when I built Email. My first users were my close colleagues. I knew them well; they often visited my home, we ate together, and so on.
Eventually, as time passed, those close to me who initially used Email out of pity, perhaps, started to drop off one by one. When asked why, they gave polite answers like, "I just haven't had the time."
Or something along those lines.
They were good friends, but I could sense the hidden message in their responses.
The bottom line was:
Our product didn't hold value in their eyes. In other words: The product was bad.
As a result, it didn't provide the benefits the buyers were looking for. But again, as good friends, they likely felt uncomfortable saying this directly.
Until one day, I read a sentence in a book that really struck me. Translated into Indonesian, it goes something like this:
"Ultimately, a business must learn to succeed by building value, not (just) through good relationships." I paused for a long time after reading that sentence. It felt like being struck by lightning on a clear day.
Then I read it again:
"Ultimately, a business must learn to succeed by building value, not through good relationships." Finally, it dawned on me. My friends were kind enough to try and buy my product, but I hadn't been a good friend to them because my product didn't deliver value to them.
They used it reluctantly, perhaps because I asked them to. Ultimately, business is about delivering value, transferring the value of a business to its customers.
Good relationships with customers only become important after that value has been delivered to them, or they have felt its benefits. Someone will only care about a business if they have experienced the benefits of its product.
Conversely, no matter how good the relationship between a business owner and their customers, they will eventually stop being customers if they don't find value in the product or business.
It's like a one-sided relationship, unrequited love. Eventually, the customers grow tired of maintaining it. In the end, a business must learn to win by building value, not by relying on good relationships.
Conclusion
Relying solely on good relationships to build a business isn't enough. Initially, close connections might help in gaining customers, but for long-term success, the product must deliver real value. Customers will stay loyal only if they see tangible benefits, regardless of the relationship with the business owner. The true key to sustained business success lies in creating and delivering value to customers.