Ethics of Educating Your Customers

If customers don’t understand a product, they won’t buy it. Customers become educated through experience. Make it your goal to educate your customers so they can better understand the products or services you offer. Of course, when they are more educated they become more sophisticated and are more likely to know better what they want or don’t want, what it will take to get it, and how much it should cost. They are also more likely to negotiate when they are educated, but this can become a selling advantage if you can uniquely meet their needs. Of course, many customers educate themselves.

It is often advantageous for companies to establish partnerships with other companies that have complementary services and that don’t compete. By working together, they produce solutions that are easier and less costly for customers. But in order to get the backing of the partner, salespeople have to educate the partner about the product or services just as they would educate an end user: What is it? What does it do? Why would it be advantageous for them? Demonstrations, training, or onsite visits are effective ways of doing this.

The goal is typically to provide an integrated solution to the end user. Salespeople may have to sell people in the partner organization on the idea and show them the sales potential. They may have to work to get approval. Then they may need to take it out to their customers. By working this way, companies produce “turnkey” solutions that the customer can use without having to find the expertise to bring together the components. This isn’t uncommon, for example, in situations that require sophisticated hardware and software to work together or in which a variety of older systems must work together when a new component is installed.

When Starbucks was just beginning to develop into a national presence, one of the challenges the company faced was helping consumers understand the difference between the premium coffees it served and the coffees that most Americans were used to drinking. After all, why would Americans want to pay extra for something if they didn’t think it was worth it? Starbucks demonstrated the advantages of its coffee by helping people to understand that there are different types of coffee and letting the taste of the product speak for itself. The book by Starbucks chairman and CEO Howard Schultz, Pour Your Heart Into It, among other things, provided an opportunity to educate an ever-expanding market about coffee.

Can a car insurance company educate its customers about how to lower their insurance costs? Mine does by providing a table that lists the injury, collision, and theft records for all cars. It helps me to understand the insurance costs for cars I am considering purchasing.

Can you educate customers too well? Possibly. But the more likely situation is that your efforts to educate the customer will generate business and loyalty.

American Express offers to educate the employees of companies on a range of financial topics—from financial planning to diversification and retirement planning to education funding and estate planning—with a program free of specific product promotions. According to information provided on their website, American Express Financial Education and Planning Services sought the opinions of executives, human resource managers and employees from 80 different companies before designing their educational and planning programs. The key, they say, is that retirement has changed, that individuals need to be more self-reliant and better prepared. With that as a backdrop, they suggest that employees want more financial education at work and promise to deliver bottom-line results when employees have better financial information and make more informed decisions about their benefits, for example. Since it’s clear that retirement has indeed changed, the promise of free comprehensive financial education would be attractive to companies and their employees. One would imagine that such an entree would be very helpful to American Express salespeople, provided the program provides value and delivers on its promise of an objective, product-free educational program.