In many places in this blog I explained the three modes of commerce: trade, industry and clientry.
I often give examples that (1) trade is the coffee shop with couches from The Salvation Army and the owner's family behind counter, that (2) Starbucks is the industrial model where marketing of every detail lowers costs and has a highly refined effect on customers response and that (3) the French Hotel where the staff brings you cafe au lait while you lay in bed is the clientric model.
The big problem that many people have seeing these three modes of commerce is that some businesses confuse these separate types of commerce.
For example, many simple retail trade operations use the industrial model of the airlines by giving cumulative points for repeat usage (preferred customer cards). At the local retail trade level, this does not work. Regular customers should be known to the owners and staff and genuine recognition of these people should come in the form of spontaneous gifts of a free brioche or fancy cup. Not a punch card with an ‘11th punch is free’.
There are two businesses that try to behave like industrial businesses. One is the utility company and the other is the bank.
The utility company is a monopoly that has your business whether you want it or not. Behaving like an industrial business is a waste of time and money. Monopolies are not part of commerce they are part of the political world. They can do everything wrong with the customers as long as they do everything right with the lobbyists and politicians.
Banks on the other hand are clientric. When they are well run they are likely to have a lifetime relationship with the client, like a lawyer or dentist. But they are never well run, unless they are ‘merchant banks’. Ordinary banks constantly act like industrial businesses.
What you want from a bank is timeliness, reliability of the highest order, and someone to talk to who can help you deal with any particular finance problem. Such a clientric bank would have a complete personal file on you like a doctor with medical records, and would charge for that function. They would give you steadily improved service the longer you were a customer.
Does any of that sound like a bank to you? That is precisely what a bank was like more than a century ago.
There are many businesses that do not understand what they are doing. The businesses confusion tends to confuse us in our ability to distinguish trade from industry from clientry.