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Make your customers surly?

My partner Todd Hixon relates a story about when he was a young analyst meeting with a crusty old telco exec to talk about pricing, and was told that they wanted to price so their customers were “surly, but not rebellious.”

“How hilariously old school” you are thinking.  “Isn’t Steve Jobs’ ability to delight his customers the key to Apple’s success?  Apple customers are devoted and hypnotized with delight.  That exec wouldn’t last a second in Cupertino…”  But you would be wrong!  Steve is every bit as crusty!  Bought a movie on iTunes recently?  Great experience, but no bargain.  How about that Macbook Air?  Wasn’t exactly free was it.   Ah, but what about the great counter-example:  Google!  Everything is free and their customers are delighted, right?  Hah!  Bid on any keywords lately?  Ask someone who has and you will find them surly as hell.  Google uses a bidding system to price at the highest point they can possibly get away with.  And as a result, they have a very nice market cap.  I suspect that Mr. Jobs would agree that the more complete idea is to “make products that delight customers at a price that delights shareholders.”  Which is in many ways a fluffed up version of “surly but not rebellious.”  In Apple’s case, they don’t rebel because the products are so darn great you forget your wallet is so much lighter.  In Google’s case, like the telcos of old, you have no real alternative do you.