Bob Burg has a series of posts over on his blog about the old saying “All things being equal, people will do business with, or refer business to, people they know like and trust.” The general consensus is that the “equal” part is the tricky thing here. It’s fairly obvious that if two different vendors provide exactly the same product with the exact same level of service for the exact same price, then, yes, the “know, like, and trust” (KLT) side definitely wins out. What happens, though, when one is more expensive, but with better service, is slightly more convenient, but will take slightly longer to deliver?
I’m going to argue that if we tried to take an objective measurement of “equality”, then things don’t necessarily have to be equal in order for the KLT person to win.
Think about it. How many people continue to make use of a service provider despite the fact that it has become less convenient? Or a little more expensive? I have had the same person cutting my hair for the last ten years — this despite the fact that over the years, through several moves, she’s been up to 30 minutes away. I’m sure during that time, I could have found someone closer who could cut my hair just as well, but the established relationship was worth the extra drive. I’m sure there are one or two other people out there would go even further.
What about price? Can KLT overcome the almighty dollar? I’m working with a client now who specifically hired me for the job because we worked together ten years ago. She told me when we were first talking about the project that she contacted me because she didn’t know who else to trust. Being in an academic institution, she could easily have found someone a lot cheaper than I am (in fact, she probably could have employed multiple someones), but the trust part was that important to her.
Now, the KLT factor will only go so far. If my rates were ten times what they are, my client just couldn’t have afforded me, no matter how much she trusted me. If my “hair technician” moved 100 miles away, it just wouldn’t be reasonable for me to commute that far for a trim every five weeks. Still, as long as the inequality doesn’t grow to great, KLT can be enough for keeping and maintaining that profitable relationship.
And there’s nothing wrong with making a profit.
