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Sunday, January 16, 2011

Asking for Complaints

As information flows more easily, it becomes more important to have a personal, independent method of protecting yourself and your company.  I just read about glassdoor.com, where employees are able to anonymously post about the companies that employ them.  While a company might be a horrible employer, the fact that it is willing to provide people with jobs might make the horror manageable.  This reflects the ultimate good of employers, even if they are horrible: they are often quite immune to negative information because what they offer trumps it.  This is a lesson for individuals and new companies to follow.

Censorship and other restrictions on information flow are themselves negatives.  If a company or an individual understands the value it has to offer, it welcomes negative information as a way to improve.  One of the difficult lessons that must be learned by anyone building something for the public is that there can be no argument against a customer’s criticism or complaints.  While any defense against what the customer says may appease the customer or even encourage that customer to purchase more goods and/or services, one such customer represents countless others who don’t speak up and would never get that defense.

This principle of representation suggests that everyone who provides criticism and complaints ought to be rewarded.  Of course, when people cotton on to the idea that being critical can be rewarding, they will fall along a spectrum, with some providing no value whatsoever and others being a de facto QA department.  Those companies that recognize this and reward customers proportionally will excel.

However, the vast majority of individuals and companies do not reward criticism.  Instead, they try to suppress it, either by discouraging those who provide it or by discouraging the media that carry the criticism.  This has a general effect which I expect to see grow stronger over time.  The effect is to reduce the overall amount of criticism, and thus slow down progress. 

While the flow of information increases, two kinds of information compete with each other in the arena of criticism.  One is promotion and the other is criticism itself.  Promotion (advertising, whether paid for or not) is far more prevalent than criticism.  This is because it is so rare for promotional information to be discouraged by its subject.  Producers of information have learned, and will continue to learn, that promotion is more profitable than criticism, regardless of their relative value.

For example, a criticism that pinpoints a particular aspect of online marketplaces as something that has a strong negative effect on conversion rates is very valuable, while the phrase “I love ___________” with the name of that marketplace hardly has any value at all.  Depsite this, one would generally have to be hired as a marketing expert by a certain marketplace to make any money with the criticism, while the “I love…” phrase can be added to a website with a little code to start making a few cents a day as an affiliate.  I expect that human intelligence will someday advance to a point where this is no longer the case.  The sooner the better!

Until then, a good general strategy is that if you don’t have anything nice to say, keep your mouth shut.  Conversely, for those who are running businesses and could use helpful criticism, you’ll have to heavily reward everyone who provides it, and the more publicly you reward them, the better you’ll do.