The difference between a product and a service: Why pay for something you don’t like?

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Why do some people seem to think they don’t need to pay for your work hours if they aren’t getting a physical product in return? There’s a reason. To understand and avoid this situation, we need to look at things from both sides.

Have you ever ordered a meal at a restaurant that wasn’t good? You can return it. Ever been to a medical specialist who wasn’t able to diagnose you? No one in their right mind would think about leaving without paying. What’s the difference? When is it legit not to pay and how can you avoid customers who don’t want to pay? Here’s our explanation.

Product vs. service

It’s easiest to start with a product – one that’s tangible and makes it clear what customers are getting for their money, even if it turns out they don’t particularly like the product. There’s no avoiding the fact that that happens sometimes. What’s more, you pay for a product before you get it, making it clear that the transaction is complete. It’s one thing if the product is faulty, but being disappointed by what it does is not a legitimate reason to return it. For some reason, paying for a service ahead of time is uncommon, although that’s what we do and it works great.

By the way, if you’re a smart consumer, you check a product before you buy it (precisely because you know that you won’t be able to change your mind in most cases), similar to how you scrutinize trade specialists before hiring them for something.

The problem of marketing

There are almost no professionals who haven’t encountered this issue of clients who don’t want to pay, but those in the marketing industry have had to deal with it far more, for three main reasons:

  1.  When it comes to marketing, part of the service is trial and error, and it’s clear ahead of time that not everything will work. The more you try, the higher the likelihood that you’ll manage to promote the message that efficiently engages a target audience in the right way. But the odds that everything will always work are zero.
  2. Marketing is based on messages and different people see certain things differently, no matter how much you want every one of your customers to see things exactly the same as you.
  3. A large part of the puzzle here is dependency on external systems rather than traditional advertising, where you know exactly when your ad goes up and how many people will see it, although you can guess less about what might happen after. With online advertising today, you don’t always know when it goes up, who sees it and why your campaign is stuck waiting for approval for days. You mostly have no idea what will happen, and even if you did your part perfectly, you’re only partly dependent on yourself.

But we’ll go even further and say that even if the marketing professionals did poor work from the perspective of a client, it wouldn’t be legitimate to cut payments. There are legitimate ways to lodge a complaint about poor service, but deciding when to pay and when not to pay is not one of them.

How it looks from the other side

The first thing you need to do to prevent this is to understand how things look from the other side. We’ll start with the fact that for people from outside of the industry, the scope of your work isn’t always clear. As far as they can see, you made up a name, created a logo or maybe wrote a few words. Why should that cost so much money?

The problem starts when you look at the results as a product and then examine whether they came out good for your client. For example, if you weren’t able to reach the number of people you expected or you sent texts that the client wrote himself and you created a name/logo/slogan the client didn’t like, why pay?

But clients aren’t paying for a finished slogan, they’re paying for a process. The results are simply the outcome of a process that can take dozens of hours or more and your client is paying for your work hours in the end. It’s important you tell them that.

How to prevent situations where the client doesn’t want to pay

The main solution is to manage expectations. It’s easy to promote yourself with promises, but this is where a large part of the problem begins. It’s better to focus less on results and more on the process (which, as we said, is what you’re actually selling): explain exactly what you’re going to do, how it will look, what’s included, etc. Here are the main ways this could manifest itself:

  •         Make sure your customers know who they’re working with. Show them your previous work so they understand more or less what they are going to get.
  •         Try to give them perspective on your work as you go along – at intervals that or comfortable for you or other milestones. Let them feel your experience and the process you’re going through. The better you do this, the more your customers will feel they paid for something concrete, which can prevent problems in the future.
  •         Manage expectations about the process – when it will be done, what’s included, how many rounds of improvements there will be, etc.
  •         As far as is relevant for the kind of work you do, show your customers that part of the work is trial and error, that not everything will work, that patience is required and that results are only seen in many cases after at least two months. Don’t get into a tense relationship from the beginning when clients demand unreasonable results.
  •         As much as possible, don’t commit to something that isn’t completely in your hands. KPIs are advised and you can base part of your model on them, but unless you’re known for receiving payment per success, don’t commit to anything you aren’t sure of.
  •         Reflect on and discuss the reality that you are subject to and elements that aren’t up to you, like various advertising platforms that you don’t know how they will behave on any given day.

And one more tip: For those working with a retainer, we suggest that you ask for payment at the beginning of the month. Besides the peace of mind this gives you, it promotes a sense of security in your results. There may be some who make a face at you, but it’s the best way to make sure that you’re working with the right people – people who believe in you.

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