Despite the fact that his own mother had labeled the annual shoe swap a scam, Peters still protested the suggestion in Gorman’s announcement “that it was somehow dishonest for me and other customers to take L.L.Bean up on its policy.” Observing that the company had “made much of its lifetime guarantee” in online advertisements and on its website, Peters took something of a legalistic approach to the policy. Customers shouldn’t be “expected to be strict Constitutional originalists,” he said. “If the intent behind a given policy varies from the text of the policy, then it’s incumbent on the company to change the text of the policy to better reflect its intent.”
In other words, rules were rules. “If they didn’t want people to take the swap,” Peters declared, “they shouldn’t have offered it!”
Now, it’s one thing to observe that when a company maintains an absolute commitment to The Customer’s Always Right, it’s accepting the risk of being taken advantage of. But it’s another thing to contend that, by embracing such an approach, the same company is inviting bad behavior or even sanctioning it. I suspect that Peters (whose rant carries a tone of faux indignation) would not suggest to a young mother who complains about asbestos in the nursery walls and rats in the cupboard that when she decided to rent from a slumlord, she was more or less asking for it, but that’s essentially the logic he applies to L.L.Bean.
Rather than open season on the good will of buyers or sellers, another way of regarding business conducted under the express terms of Caveat Emptor or the Customer’s Always Right is as a commercial exercise in abject trust: either by buyers in sellers or by sellers in buyers. L.L.Bean often framed its “100% satisfaction guarantee” in just such terms. “Our guarantee is not a liability, but rather a customer service asset,” the company spokesman told Green, “an unacknowledged agreement between us and the customer, that always puts the customer first and relies on the goodwill of our customers to honor the original intent of the guarantee.”
If such a commitment seems foolish, it speaks to a general cynicism about the nature of human relationships of which, we sometimes forget, the hurly-burly of business is no small part. The gloomy view was not shared by Leon Leonwood Bean. “I do not consider a sale complete until goods are worn out and the customer still satisfied,” he said in 1916, four years after he founded the company that still bears his name. The absolute commitment to customer service was purchased at a high price almost immediately after he launched. In a three-page flyer he sent to nonresident hunting-license holders in Maine, Bean touted a waterproof boot that he guaranteed “to give perfect satisfaction in every way.” Of the first 100 pairs he sold, 90 failed this test when the rubber bottoms of the boots separated from the leather tops. The mistake nearly put Bean out of business, but he kept his word and refunded the purchase price for every disappointed customer.
Offering refunds for faulty stitching is a far cry from affording customers the opportunity to rent penny loafers for life, but one must willfully misread the company’s “100% satisfaction guarantee” to discover the second interpretation. This is the danger of putting Bean’s personal commitment to customer satisfaction into official company bylaws: it transforms an attitude of good will and close attention into a shield for shifty shoppers. Armed with an explicit and unbounded guarantee, they have a ready defense for dubious returns.
Rules are rules, but rules also change. In the case of L.L.Bean, the new set allows refunds for any reason within a year of purchase, and allowances are made for defects in “materials or craftsmanship” thereafter. (In a nod to rummagers, proof of purchase is now required.)
The new policy is not only more reasonable than the one before it; it attempts to be fair rather than hopeful. Buyers aren’t always right, just as sellers aren’t always wrong. To assume the former is to make an angel of the customer, and to assume the latter is to suppose a devil. We are all better off engaging each other with good faith and good sense, allowing for honest mistakes on either side of a bargain, not rip-offs and weekend rentals.
John Paul Rollert is adjunct assistant professor of behavioral science at Chicago Booth.