So, the other day, after picking my son up from school, I stopped in at the local hardware store to pick up something or other, maybe a
sack of nuts few screws. The nuts screws would have been cheaper at Lowe’s or Home Depot, but I try to shop local when I can. That is, I am happy to pay a higher price for the satisfaction of feeling like I’m supporting the local economy rather than a big corporation, for a sense that the employees are well paid and well treated (whether true or not), and with the idea that sometimes it’s really convenient to have a local hardware store, and it would be a shame if it went out of business and I had to drive over to Lowe’s or Home Depot every time my nut sack screw drawer was empty.
Now, as often happens when you run an errand after picking your son up at school, we were in the middle of shopping when he announced that he needed to use the bathroom. So, I found one of the very nice employees there and asked if he could, you know, use the bathroom.
He said no. More specifically, he said that normally he would let us use it, but the assistant manager was in the store that day, and he was worried that the assistant manager would tell the owner, who had a policy that customers could not use the bathroom. He apologized, and recommended that we go across the street to Dunkin’ Donuts, where they have nice, clean bathrooms, and they don’t give you a hard time, even if you come in to use them without buying anything.
Okay, so what the hell?
The standard story that we tell each other and ourselves when we are bemoaning the loss of little mom-and-pop stores is that these big chain stores are run by heartless corporations, that local business owners know and care about their customers, that they see them as people, rather than just sources of revenue. Why then do Lowe’s and Home Depot have open, well marked bathrooms, while my local hardware store has frightened employees who steer me towards Dunkin’ Donuts?
Of course, this isn’t really about bathrooms. Let me tell you another story.
A couple of days ago, I found a cool looking coffee shop that seemed to emphasize ethical sourcing of its beans, and was staffed by a bunch of people with various tattoos, piercings, and hair dyes. My initial thought was, “Hey, this is cool. I could work here instead of Starbucks, and I could encourage people I know to come here, too.”
At this place, they had access to a paid wifi service. Now, they offered free access as well, but I had to go back up to the counter, wait in line again, and ask for the password, which was handed to me on a small card, and gave me access for two hours.
This, like the bathroom, is not a big thing. It’s a little thing, but it’s an annoying little thing. I can’t even tell you how much I paid for my coffee, or whether it was more or less than I would have paid at Starbucks. AND, given the choice, I would favor the smaller business on general principles, but this little thing left me soured on the experience.
My point is not to argue that Lowe’s, Home Depot, and Dunkin’ Donuts are offering public bathrooms as part of a philanthropic effort to prevent public urination and bladder infections. I’m sure that these corporations are just as calculating and heartless as we all imagine them to be. There is only one reason for these corporations to provide nice, clean public bathrooms: the costs (in space, supplies, and cleaning) are outweighed by the benefits (in customer satisfaction and loyalty).
Remember a few years ago Starbucks did not have free and open wifi. For a while they put time limits on it, or required that you use a Starbucks card to access it. So why did they make it so easy now? Well, presumably for the exact same reason that Dunkin’ Donuts lets you use their bathroom: because it makes financial sense.
Sure, there are downsides to having free, unlimited wifi at your coffee shop. Sometimes you’re going to get a customer who milks a single cup of coffee for six hours, taking up a table and an outlet. It has to be hard not to look at that customer and get resentful, to feel like they are ripping you off, getting away with something. But here’s the thing. Whatever that customer is costing you, you are more than earning back from the people who came to your coffee shop because you have free, unlimited wifi. Maybe you even earn it back from that same customer, who uses your table all day on Monday, and then picks up his coffee to go on Tuesday, Wednesday, Thursday, and Friday.
The problem is that the guy who is sitting there using the wifi all day is cognitively salient. After all, he’s sitting right there! All day! It is easy to sit there and brood about how he is cheating the system, getting away with something. The extra customers you get are less salient, because it is easy to imagine that they would have come in anyway. If someone is on the wifi for only half an hour, why would it matter if you have a two-hour limit?
I suspect the difference is that open, unlimited, easy-to-access wifi makes you feel welcome, while limited, closed wifi makes you feel at best like a supplicant and at worst like a would-be criminal who is being scolded in advance.
Why am I so sure that free, open, unlimited wifi is the financially smarter move? Because big corporations like Starbucks and Panera, with lots of data and people who are trying to maximize profits, deliberately switched to the unlimited system.
What puzzles me is why small business owners don’t look at this and say, “You know what? If I am going to compete with these big stores, I should set up free wifi and a nice bathroom. I should try to make my customers feel as welcome and comfortable as I can.”
I suspect that there are two problems here. The first, which I have already alluded to, is one of cognitive biases. It is true in a wide range of contexts that negative events impact us more strongly than positive events: it is emotionally more painful to lose five dollars than it is emotionally gratifying to gain five dollars. So the guy who is freeloading on your wifi is more emotionally salient than all of the people who come for the wifi, spend money, and then leave again before you get mad.
This is a place where the cold, calculating nature of the disembodied corporation has an advantage. It can actually crunch those numbers and discover that this is one of those circumstances where you can cast your wifi upon the waters, for you will find customers after many days.
This may be the difference between the owner and the employee as well. If we use the bathroom, maybe the owner perceives that cost in a direct, emotional way that the employee does not, despite the fact that the employee is more likely to be the one who has to clean the bathroom.
The second problem, I think, is the moral language that we often use when discussing shopping locally, where it is presented as a moral duty to support local businesses. I think that there might be some good, rational reasons to shop locally when possible, but I think that the moral framing causes more harm than good. Small-business owners will often use this as a sort of crutch: “If you’re not shopping local, it’s because you’re a bad person, not because I provide an inferior product at a higher price.” It seems to me that if you’re going to start an independent coffee shop, you need to ask yourself, “What can I do to provide the most satisfying experience for my customers? How can I use my local knowledge and connections to create something wonderful that Starbucks could never pull off?” Every now and then you find something like that. When I lived in Santa Fe, there were a few different places that successfully did this, and I would rotate around, working in various locations, and spending way too much money on coffee.
Of course, the moral argument — this vague sense that small businesses are somehow better than big ones — is one that I buy to an extent. It is one of the reason why I’m willing to pay a little bit more to re-nut my sack. But when the moral argument takes center stage, it eliminates the incentive on small businesses to think creatively about what they’re doing — or at least to copy uncreatively the best practices of their most successful competitors.