The Great Resignation reminded us that there are huddled masses of workers yearning to breathe free. Was customer obsession a catalyst? After all, insisting that everyone from front-line employees to C-Suite executives be customer obsessed is no trivial matter. By definition, obsession is a “persistent disturbing preoccupation with an often unreasonable idea or feeling” (Merriam Webster). Customer obsession isn’t easily purged from your mind when you close your laptop or step away from your computer. When Jeff Bezos flamboyantly coined the expression in 1997, I suspect burnout was not among his concerns.
Customer obsession proponents argue that it fosters “hyper focus” on positive customer outcomes. They rationalize that obsession is beneficial because it improves customer experiences, and has created substantial revenue growth not just for Amazon, but for many companies that have emulated Amazon’s obsession strategy. With a long list of article titles like 7 Steps to Building a Customer-Obsessed Culture in Your Sales Organization, and Customer Obsession: a Concept That Drives Business, it’s understandable that people get caught up in the stampede.
Missing from the hype is that by injecting customer obsession into corporate strategy, stakeholders – including customers – can be harmed. Since it began its customer obsession pursuits, Amazon has ruthlessly exploited its warehouse workers, used its transaction data to undermine small businesses, and allowed use of its website to fence stolen goods.
Oddly, despite its obsession hype, Amazon has engaged in practices that compromise the interests of its customers. An article titled Who’s Responsible for Defective Products Sold on Amazon? (PBS, March 11, 2020) asks “who is responsible when something goes wrong with an item purchased on Amazon?” Answer: “For consumers, [it’s not] always clear.”
In 2015, a woman named Heather Oberdorf suffered a mishap with a dog collar she purchased on Amazon’s website. During a walk with her dog, the collar broke when the dog lunged, causing the retractable leash she was using to snap back and hit her in the face, leaving her permanently blinded in the left eye. Although Amazon sold the defective collar, the company was unable to locate the manufacturer. Oberdorf sued Amazon, but Amazon denied liability, arguing “Amazon makes clear in the conditions of use that third-party sellers sell products on the marketplace, and that those sellers, not Amazon, are responsible for the products,” according to a statement Amazon filed with the U.S. District Court in the Middle District of Pennsylvania in 2017. Oberdorf’s case against Amazon is far from unique.
It’s ironic that Amazon, the company that invented customer obsession, constructed boundaries around it in the form of fine print, loopholes, limitations, restrictions, disclaimers, and legal dodges. “The average consumer has no idea that buying a product from an online marketplace might open them or their families up to risks,” said Rachel Weintraub, legislative director and general counsel for the Consumer Federation of America. “If these companies are successful in arguing that, because of innovation, they fall outside of traditional legal terms, it leaves consumers without a tool that the law traditionally provides them.”
A truthful public relations statement for Amazon and other customer-obsessed companies would be “We’re customer obsessed . . . until it’s in our best interest not to be.” My purpose is not to bash Amazon. It’s to argue that customer obsession is more marketing hype than operational substance.
Search online for “customer obsession” and you’ll get about 2.3 million results – roughly 45 times more than for Nettie Stevens (48,000 results), the American geneticist who in 1905 discovered that X and Y chromosomes, and not environmental factors, determine gender. That disparity seems wrong, but it’s emblematic of how quickly an idea can proliferate in the digital age.
To understand customer obsession’s rapid rise as a business ideal, it helps to consider its evolution from a rhetorical perspective. Amazon’s 1997 shareholder letter is the first documented use of the term – “Obsess over customers.” Between 1996 and 1997, Amazon’s revenue achieved an 838% increase in revenue – from $15.7 million to $147.8 million. Marketing pundits and industry analysts credited customer obsession as the cause, thereby vaulting the expression to the pinnacle of marketing lexicon.
The potential bonanza was too big for marketing professionals to ignore. With obsession, they had a power-packed expression to upend staid marketing parlance. Senior executives needed to be prodded from their torpor, which required replacing dowdy terms like customer commitment, customer-centricity, customer-focus, and service-orientation. Like a gift from the gods, customer obsession amplified the marketing conversation to the highest decibels, propelling the belief that no matter how well companies satisfied customer needs, no matter how ethical or committed to customer success they were, it wasn’t enough. Customer obsession created yet another rung to climb. And consultants eagerly rushed in to help.
Shortly after Bezos launched customer obsession as a business mantra, he cemented its power with a persuasive message. Rather than defending his use of the word obsession, which at the time was more known for its psychiatric meaning, Bezos simply compared customer obsession to other business “obsessions” like competitive, technological, and product – which he framed as flawed ideals. For executives who had already imbibed customer-centric Kool-Aid, it was hard to disagree. Few questioned whether customer obsession – or obsession of any kind, for that matter – was harmful as a business strategy, or deleterious in corporate culture. Like many “shiny business objects,” practitioners saw the huge opportunities in customer obsession, and none of the risks.
Unfortunately, customer obsession is not riskless.
1. It creates narrow thinking in decision processes. In the digital era, business decisions are increasingly complex. While meeting customer needs is vital for any business strategy, other interests, such as those of investors, suppliers, employees, communities, regulators, and the environment should not necessarily be subordinate to customers, and cannot be ignored. And those interests are not always congruent with customer need. Executives are entrusted to optimize finite resources such as time, money, and product capabilities. They must make tradeoffs, some of which are difficult. The absolutism and comparative simplicity of customer obsession, while often a handy decision catalyst, is incompatible with reality.
2. It’s overly simplistic. It’s easy to grasp customer obsession when customers are homogenous. For example, a dry cleaning company that provides services only to one type of customer. But how do companies manage “customer obsession” when customer needs are incongruent or incompatible? As Mark Hurst wrote in a 2021 blog, When Customer Obsession Goes Wrong, “For example, the ‘customer’ used to be the buyer on Amazon.com. Now, Amazon has entered the ads business, and the original ‘customer’ is in another context the ‘user,’ and ad tech has a long history of seeing users as things to be manipulated.”
3. It can be perceived as fake. With Customer Obsession, it’s important to differentiate Hype from Practice. Applying the literal meaning of obsession in operations would assuredly bleed profitability. To create and maintain profits, companies enact restrictions regarding the products and services they provide. Inevitably, product decisions favor some customers, and disadvantage others. And companies would suffer financially if customer policies and terms for product use didn’t mitigate their legal risks. Those risks don’t just vanish. Instead, other stakeholders absorb them – especially unwitting customers, as in the Amazon example. Further, it’s hard to imagine a CFO endorsing discretionary free technical support for customers when the company’s revenue model depends on billable services. Employees are not naive. They clearly see the disparities between a company’s customer obsession messages and its actions.
4. It risks reduced morale and employee burnout. Obsession – whether it’s around customers, revenue, profits, productivity, or process conformity – fosters mistrust between employees and supervisors. A study published on Salon.com regarding profit-obsession found that “supervisors who have a high bottom-line mentality have low-quality relationships with their employees.” According to lead researcher Matthew Quade, Ph.D., assistant professor of management in Baylor University’s Hankamer School of Business, “supervisors who focus only on profits to the exclusion of caring about other important outcomes, such as employee well-being or environmental or ethical concerns, turn out to be detrimental to employees . . . This results in relationships that are marked by distrust, dissatisfaction and lack of affection for the supervisor. And ultimately, that leads to employees who are less likely to complete tasks at a high level and less likely to go above and beyond the call of duty.”
5. It’s harmful to stakeholders. As Amazon and Wells Fargo have demonstrated, prioritizing beneficence for a single stakeholder group compromises the interests of other groups. In Amazon’s case, customer obsession undermined the livelihood of its suppliers when the company decided to use its information advantage to produce its own branded products. Wells Fargo’s obsession with elevating their stock price led them to sacrifice the safety of its employees and customers.
6. It creates dissonance in IT projects. In most organizations, enterprise strategy drives IT strategy. Business strategies dictate which projects get funded, initiated, and developed. Ultimately, the who, what, when, where, why, and how for every IT project must get converted into connected sets of business rules, process details, job function details, and data architectures. In the context of customer obsession, project scopes are still subject to constraints, which means supporting some customer needs, and sidelining others. “Decision boxes” with binary outcomes must be configured in flowcharts, then embedded into lines of code.
How can a strategy involving customer obsession, which lacks boundaries and eschews rules, co-exist with IT project development? How do organizations implement effective governance in a culture of obsession? How does a C-Level executive explain to a developer the rationale for obfuscating the pathway that a customer must take to unsubscribe a fee-based service? It seems disingenuous to tell her “we’re so obsessed with customer loyalty that we’ll use software trickery to maintain it!” These are not easy questions to answer. Absent an effective way for organizations to reconcile these problems, project managers are left to apply their own values and interpretations.
7. It screens the wrong attributes in hiring. Predictably, customer obsession has spawned a copious offering of YouTube videos designed to coach job candidates about the “right” way to appear customer obsessed. Unfortunately, many of the training videos ignore the service dilemmas employees face, and they fail to provide candidates insight into real-world problem solving in the context of customer service. For example, instances where an employee had to weigh whether to satisfy a manager’s requirement to reduce support costs, or whether to go “above and beyond” to service a customer need. Or, deciding whether delivering “customer delight” is financially sensible. Obsession squashes those choices. Other dilemmas are more visceral: whether the employee should protect their own safety, or simply acquiesce to customer demands, or tolerate dangerous behaviors – a choice that many airline employees regularly face. Given the realities they face, how many flight attendants could pass muster as sufficiently “customer obsessed”?
For many people, customer obsession carries the connotation of benign intent toward customers. But that is not a reliable assumption. Customer obsession does not mean customer interests are protected. It does not mean that customers are “safe” when engaging with customer-obsessed companies. It does not mean that organizations subvert their own interests to favor customer outcomes. As Mark Hurst wrote, “How did Amazon’s ‘customer obsession’ go wrong? It seems like an important question, since so many teams today claim to be focused on their customer. That claim often rings hollow, as many teams ship digital products littered with dishonest tricks: dark patterns for addicting users, surveillance and tracking for resale to shady third parties, and opaque algorithms for subtle manipulation. Looking at the digital landscape today can be depressing. If Amazon couldn’t stop its own descent into unethical practices, it seems unlikely that other teams could manage to act better. Is there, in the end, any way for a company to continue to treat people well?” His question deserves thoughtful answers, although I feel certain that customer obsession isn’t among them.
Our current lexicon does not provide a more extreme word than than obsession. Until someone coins an expression that eclipses it, I’m not sanguine that customer obsession – or the illusion of it – will go away anytime soon. But I’m confident that when customer obsession loses its hyperbolic energy – as it surely will – a hot new idea will replace it. Hopefully, one that doesn’t burden companies with decision blinders and doesn’t undermine the interests of non-customer stakeholders. Maybe the Next Great Thing will be balance. In the meantime, we’re better off applauding customer obsession for its marketing impact, acknowledging that operationally, we’re probably not as obsessed as we think we are, and that in a customer-obsessed world, customers aren’t always the beneficiaries.