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Over the past decade and a half that I have been using the internet as my "local supermarket" (i.e. online shopping, or e-commerce), I have seen vendors come, and vendors go, across the world. And there are some hard lessons I have learnt along the way. Sometimes, I find them valuable enough to write them down.
Here is one such lesson:
When a customer orders something from a vendor, the vendor specifies a certain maximum delivery time. The customer is willing to wait for that period. Once that time expires, the customer expects (at least by then, but at the most a day or two later) to hear from the vendor about the status of his order. We shall call this a "Strike 1" situation - the vendor has failed at a very basic level.
Now, if the vendor does NOT pro-actively get back to the customer BEFORE the customer gets back to him, the customer gets seriously edgy, suspecting that something has gone wrong. He contacts the vendor, and when that happens, we are in a "Strike 2" situation - it means that the automatic system meant to keep the customer happy has failed, and you are now dealing with an emergency situation, requiring non-standard intervention.
At this point, the vendor assures the customer that something would be done ASAP - typically in the next 1-2 working days. The customer, though unhappy, agrees to wait.
The time elapses. The vendor does not get back with an updated status, and fails to deliver the goods.
The customer is now irretrievably upset, and in all likelihood not ever going to order from that vendor again. Worse, he is likely to share his experiences with his friends (or his blog), and that's where the "word of mouth" system turns against the vendor, and years of accumulated goodwill goes up in a puff of smoke.
No amount of assurances will fix the issue: the matter has boiled down to one fact - the customer has ordered, the vendor hasn't delivered. Period.
Strike 3 - you are dead.
At this point, the vendor has not choice. Even if the customer had ordered a $1 item, and it would cost the vendor $1000 to procure it, the vendor has to do that. Failing to deliver to the customer at this point risks not only losing the customer, but the market. Sometimes, the cost comes in the form of the $1 item, and a $999 "back from the dead" make-good gift (''here's the DVD you ordered, and to show you that we are sorry, here is a DVD player and 42" LCD TV to watch it on''), sometimes it involves putting someone on a plane to the other side of the country, pick up the item, then fly to the customer and deliver it - this can be far more expensive.
But it doesn't matter what it costs you - when you reach a "Strike 3" situation, you need to think about the loss of your business reputation, not the cost of an individual item.
In this day and age, all commerce is negative-reputation based: all things being equal, a customer is likely to choose a vendor whom he has heard the least bad things about. No amount of "good" feedback is going to increase the vendor's chances - it's the "bad" feedback that decides things.
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