It, How Sustainable Can A Business Dependent On Customer Stupidity Really Be?

Submitted By snoopy1001
Words: 299
Pages: 2

1. Take a hard look at your most profitable customers. Not the biggest, not the best, not the most satisfied: the most profitable. 2. Then again, "information asymmetry" is often just a politically correct euphemism for "smart vs. stupid." Growing a business based on "knowing much more" than one's clients is different from one in which growth is contingent on one's customers consistently knowing less. There's a reason why procurement arms of global enterprises are constantly pushing for ever-greater transparency from their suppliers. They want to know who gets paid how much for what. They're on the lookout for margin creep that could trigger competitive bids.

3. it's unlikely that "smart" customers will prove equally profitable as "stupid" ones. Quite the contrary, customer and client segmentation based on "information asymmetries" and "smarts" strikes me as central to the future of most business models. It also begs the question of what constitutes "smarter" and "stupider" customers. For example, many of Amazon's most profitable customers rely disproportionately on that company's recommendation engines for their additional purchases.

4. he smartest/stupidest dichotomy is deliberately provocative. Because, really, how sustainable can a business dependent on customer stupidity really be? A popular advertising campaign once declared, "An educated consumer is our best customer." But for many firms, the smarter customers become, the more discriminating and less