The phrase "the customer is always right" has long been considered a cornerstone of basic customer service. If you have ever worked in retail, especially during the last two months of the year, you know how difficult it can be dealing with customers who live by that saying. 

Where did this philosophy get its start? Coined by the successful retailer Harry Gordon Selfridge in the early 20th century, this belief emphasizes the importance of putting the customer first to ensure business success.  But is that a realistic viewpoint? 

While this phrase has been popular for over a century, its implications in today’s business world are far from universally applicable. In reality, the customer is not always right, and adhering to this outdated belief can sometimes do more harm than good. 

The Evolution of "The Customer Is Always Right" 

The phrase originally served as a rallying cry for businesses to prioritize customer satisfaction. During the rise of department stores in the late 1800s and early 1900s, retailers like Selfridge wanted to build trust by eliminating the practice of haggling or pushing faulty products onto customers. By declaring the customer “always right,” businesses aimed to create a sense of security and fairness, making people more likely to spend money confidently.

Is this philosophy still appropriate for today's businesses -- especially ones with lower margins, like small businesses? No. Business landscapes have drastically changed. Customer behavior, expectations, and access to information have evolved. While customer satisfaction is still critical, blindly adhering to the belief that the customer is infallible can negatively impact both your front line and customer service employees and the business itself.

The Dangers of the "Always Right" Mentality

One of the main problems with the belief that the customer is always right is that it can lead to a toxic work environment. Some customers can be demanding, unrealistic, rude, or even dishonest, and when you automatically side with them, you employees may feel unsupported. The morale of frontline and customer service employees is essential to the overall functioning of the company. Balancing expectations with reality means prioritizing customer whims over employees' well-being can demoralize staff, leading to burnout, high turnover rates, and even resentment toward all customers.

If employees constantly feel that their perspective is disregarded or that they will always be blamed when a customer complains, the quality of their work will likely suffer. In extreme cases, this could result in employees delivering subpar service, defeating the purpose of trying to keep customers happy in the first place.

A culture where "the customer is always right" empowers unreasonable customers. Not every customer has valid complaints, and many are aware of the leverage they possess in such a system. This can lead to instances of customers exploiting this dynamic, making unfair demands, or even behaving abusively toward staff. Businesses must draw a line between satisfying customer needs and tolerating bad behavior. A policy that indiscriminately favors customers creates an environment where exploitation becomes possible.

The Value of Balancing Interests

A more balanced approach to customer service acknowledges both happy customers and happy employees are both integral to the success of a business. Instead of assuming the customer is always right, companies should consider the facts of each situation, treating both parties with respect. By fostering an environment of fairness and understanding, businesses can resolve disputes more effectively and in a way that benefits everyone involved.

Each customer complaint is different, and it is important to investigate the issue before siding with the customer -- or the employee. However, employees who are constantly blamed for customer dissatisfaction without proper investigation are less likely to take pride in their work, knowing they won’t be treated fairly. On the other hand, when a business listens to both the employee’s and the customer’s sides, it demonstrates that fairness is the foundation and builds trust among the staff, which can actually lead to better customer service in the long run.

Customer Service in the Age of Technology

The digital age has amplified both the power and the expectations of consumers. Online reviews, social media, and direct communication with brands have empowered customers to voice their opinions more publicly than ever before. This creates an added pressure on businesses to keep customers happy at all costs, but it also opens the door for manipulation.

With the advent of online ordering, which brings its own challenges, face-to-face customer relationships is becoming more rare. When dealing with supply chain issues, shipping speed issues, and other uncontrollable factors, customers can quickly become negative. Tone in conversation matters, so when customer communication is done via chat or email, sometimes misunderstandings can happen, causing negative reactions. 

In some cases, customers may resort to writing bad reviews or making false claims online, knowing that companies are often eager to avoid negative publicity. In a sense, it is an effort to hold businesses hostage to unfair demands. Pay the ransom ('Give me what I want') or else face the publicity of a bad review.

While it’s essential for businesses to address customer feedback and improve based on genuine concerns, pandering to unreasonable demands or malicious behavior can damage the brand’s credibility. A better approach is to build a reputation for transparency and fairness, where customer concerns are taken seriously, but not at the expense of ethics or employee well-being.

Emphasizing Customer Respect Over “Right”

Customer service should be about respect rather than automatic deference to customer opinions. When businesses approach customer interactions with the goal of understanding and resolving concerns fairly, they are more likely to retain customers while maintaining a healthy work environment.

Treat customers with respect, but also to treat employees as trusted professionals whose insights matter.

In the long run, the phrase “the customer is always right” is a simplistic view of a complex relationship. Customers are a vital part of business success, but so are employees. A more nuanced approach recognizes that both groups deserve fairness, and that real success comes from fostering trust, respect, and a collaborative atmosphere for everyone involved. By doing so, businesses can thrive without falling into the trap of outdated, one-sided standards.

When business and customers work as a team to accomplish a goal, it eliminates the business vs. customer relationship, so both entities can be "right" and everyone can be pleased with the results.Â