Marketing Fail: 5 Customers Who Want to Destroy Your Business

What are predatory customers? 

Predatory customers are business patrons who focus on squeezing as much as they can out of your company — even if it comes at your expense. No matter how good your product or service is, there are some customers you just won’t be able to please.

“Predatory customers are individuals or entities that exploit businesses for personal gain, often without genuine intent to establish a fair relationship,” said Valentin Radu, founder and CEO of Omniconvert. “They may demand excessive discounts, exploit loopholes or use threats like withdrawing business to manipulate companies.” 

The customers are disloyal, demanding and nearly impossible to placate. They believe their needs are more important than anyone else’s and will not hesitate to cause problems to get what they want.

5 types of predatory customers

Spotting a predatory customer is possible when you know what to look for. “Identifying them often involves observing patterns, such as persistently unreasonable requests or a refusal to honor agreements,” Radu said. 

This chart provides a quick overview of the five types of predatory customers and how to spot them.

1. The Arranger: uncompromising and demanding

The Arranger always wants a win-lose situation that ends in their favor. They change terms and agreements, demand nonexistent options, and push for concessions that benefit only them.

An Arranger cautionary tale

Mitchell ran a temp agency, and his company had just won a major contract with a well-known business. If all went well, the contract would be 10 times his revenue in one year.

But things didn’t go well. The Arranger had Mitchell sign a contract permanently waiving his right to take legal action if something went wrong.

Not realizing his mistake, Mitchell hired hundreds of workers and took out a business loan to cover payroll while waiting for the Arranger to pay. But the Arranger decided they weren’t going to pay. The bank demanded repayment, and the Arranger’s refusal meant Mitchell’s business was forced to shut down.

Dangerous marketing that attracts the Arranger

The Arranger looks for flexibility. Offering free estimates to anyone who asks and including language such as “we’re here to make you happy” or “the customer is always right” in your marketing can attract Arrangers.

The specifics may differ, but the pattern is the same. Arrangers are drawn to marketing that communicates one of two things:

• Fear of losing their business: When you have plenty of options and prospects, you’re usually focused on fairness. Experienced Arrangers know your inability to walk away gives them leverage, and they use that leverage to push for the terms they want.
• An unhealthy willingness to be flexible: You can afford to be firm when business is good. But when you’re feeling desperate, it’s easy to do whatever it takes to close a deal — and that’s when Arrangers swoop in.

2. The Corruptor: reliably dishonest and consistently unethical

The Corruptor will say or do anything to get what they want. They’ll lie to you, pester you to do things you’re not comfortable with and ask you to lie for them. They’re always trying to erode your morals and values.

A Corruptor cautionary tale

Jan sells cupcakes online. Her business is new, but things are going well. Then along comes a Corruptor who places an order for 336 cupcakes for an upcoming birthday party. They request a custom design, fresh strawberries, German chocolate — the works.

Jan completes the order and delivers the cupcakes herself. A week later, the Corruptor initiates a chargeback with their credit card company, claiming they never received the order. They follow up by posting a nasty review on Yelp.

Their credit card company gives the Corruptor a full refund, and Jan loses a ton of money. Her business suffers as potential customers take their business elsewhere.

Dangerous marketing that attracts the Corruptor

Corruptors are attracted to marketing that conveys your willingness to accept a one-sided relationship or abuse. Firm boundaries and the ability to say no give you power and protection against the Corruptor.

Corruptors are drawn to marketing that communicates the following:

• Poor boundaries: Corruptors often test their targets. The last thing they want is to take the fall for their own bad behavior. Be wary of questions about gray areas or what you’re willing to do to earn their loyalty — those are red flags.
• No quid pro quo (this for that): If you’re negotiating with a customer and they ask for a concession, they must be willing to give you one in return. If you give them a discount, they should be willing to do something for you.

3. The Disruptor: all about control

Disruptors demand special treatment and want to be in charge. They throw tantrums when they don’t get their way and refuse to use your products as intended. They boss your employees around and hoard access.

Real-life Disruptor example

Apple’s design focus stems from a strongly controlled, perfectionist culture. The company knows its way is the right way and makes no apologies for it. Apple’s attitude is clear: If you don’t like the aesthetic, don’t buy the product. Disruptors don’t get far with Apple.

Microsoft, on the other hand, has a more peace-making culture. When Windows 8 launched in 2012, for example, customers threw a collective tantrum about its design. Microsoft, being more vulnerable to Disruptors, responded by promising to fix the issue with Windows 10.

Dangerous marketing that attracts the Disruptor

Businesses with peace-making or fun-loving cultures are most at risk. If your marketing implies that you avoid conflict or bend to please everyone, you’re an easy target for the Disruptor. Phrases like “the customer is always right” may sound harmless, but they can lead to serious cash flow issues without the right systems.

Here are a few marketing messages that may unintentionally attract Disruptors:

• Designed around you.
• Have it your way.
• The customer is king.

4. The Slanderer: uses guilt and shame to control or punish you

Slanderers will tell you you’ve let them down. They’ll lie, call you names and do whatever it takes to get you to lose your cool. When you finally react, they use it as justification to renege on their commitments.

A Slanderer cautionary tale

Fitz made sure his vendors felt like they were being treated as personal servants. A thousand other firms could do the same job for less, and Fitz ensured his vendor knew it.

“I’m your biggest client. My company pays your bills.” His vendor suffered for it. It struggled to keep employees and constantly discounted its prices to earn more work.

Dangerous marketing that attracts the Slanderer

If your business lacks clear, measurable uniqueness, you leave yourself open to the Slanderer.

Businesses without standout qualities feel the sting of being undercut by competitors or overlooked by customers. When price or flexibility is the only reason someone chooses you, your marketing may be signaling that you’re willing to self-sacrifice just to keep people happy.

You’ve seen the marketing messages:

• We care about our customers! 
• We never stop working for you!

5. The Schemer: looks for loopholes

The Schemer uses their resourcefulness to find a way over, under, around or through your rules. These customers use creative ways to game the system and manipulate you.

A real-life Schemer example

A man in China purchased a first-class ticket on China Eastern Airlines and used it to scam a year’s worth of free meals at the VIP lounge in Xi’an Xianyang Airport.

He arrived before his flight and ate at the lounge. After he finished, he changed his flight’s departure date to another day. He repeated the process again and again, eating around 300 meals over the course of a year. When the airline began investigating, he canceled the ticket before it expired and received a full refund.

Dangerous business and marketing practices that attract the Schemer

Schemers thrive on promises with no fine print. Businesses often make generous guarantees or offers without clear conditions, and that’s where Schemers strike first.

If you offer a money-back guarantee, for example, a Schemer will look for loopholes that let them get a refund indefinitely while keeping your product. It’s ideal if there are no requirements to meet, and even better if you throw in cash or incentives.

To protect your business, ask yourself a couple of questions to avoid attracting Schemers:

1. Does your product or service come with a guarantee?
2. Do you make open-ended promises to your customers?

How can predatory customers hurt your business?

Here are some specific ways predatory customers can damage your business:

• Predatory customers waste your time. They divert your time and energy away from your core mission. You and your staff have less time to serve high-value customers, improve processes and grow the company.=
• Predatory customers harm your reputation. These customers are quick to badmouth your business and leave negative online reviews. That can cost you new customers, especially since most people check reviews before spending money at a company they haven’t used before.
• Predatory customers cost you money. Customers who exploit loopholes or take advantage of overly accommodating staff can drain your budget through free or discounted products and services. Over time, you can lose significant revenue serving customers who never intended to be fair.
• Predatory customers disturb and upset other customers and staff. When a predatory customer makes a scene, it creates a toxic environment for everyone. Bystanders may leave early or come away with a negative impression. “These customers not only drain resources, but also demoralize teams,” said Xin Zhang, marketing director for Guyker. If your team regularly deals with angry, disruptive customers, morale suffers and turnover increases.

How should you handle predatory customers?

If you encounter predatory customers, should you show them the door immediately? It depends. You may understandably be wary of “firing” customers. Acquiring new customers is expensive; it takes time, money and effort. If you can turn difficult customers into loyal, returning customers, they may end up spending as much as 10 times more than a new one over time.

Zhang emphasized that protecting your team and business interests should be a top priority. “The best way to handle [predatory customers] is to document interactions, set firm boundaries and align policies with your team’s empowerment to say no when needed,” Zhang said. “Protecting your staff is just as important as pleasing your customers.”

Here’s how to deal with predatory customers. 

Clearly outline your policies.

Set clear limits on promotional offers to avoid problems upfront. If you’re running a giveaway to attract new customers, for example, state clearly that it’s for new customers only and limit it to one free item per person. Be sure to include those terms in all promotional materials, including your website and social posts, so there’s no room for confusion or abuse.

Train your employees thoroughly.

It’s important to train your employees on your policies and empower them to stand firm, be polite and stay calm when confronted by a difficult customer — and to know when it’s appropriate to escalate the situation to a manager.

“Training employees to recognize red flags and empowering them to address manipulative behavior assertively can be beneficial,” said Josh Qian, co-founder and COO of Best Online Cabinets. “Establishing boundaries is also crucial, as well as clearly stating what is acceptable regarding customer interaction.”

Don’t empower predatory customers.

Posting signs that say “the customer is always right” or using phrases like “we’ll do whatever it takes to make you happy” in your marketing is an open invitation to customers who sense they can get away with something.

That said, you should still do your best — within your boundaries — to solve problems for regular customers and strive for satisfaction and customer delight where it makes sense.

Include terms favorable to your company in your proposals and work orders. 

If you run a service business, ensure that all customer agreements include terms that are fair but clearly protect your company. If you operate a marketing agency and you’re building a website for a client, for example, require an upfront deposit upon contract acceptance and a midphase payment that, when combined, at least covers your costs. That way, you haven’t lost money if the client fails to pay the final invoice upon delivery.

You can also include a clause stating that client approval of your work is assumed unless they notify you in writing within a specific timeframe.

Consider requiring upfront payment in full in some circumstances. 

If you’re selling something custom or special-ordered, it makes sense to collect payment upfront. If the customer decides not to pay, you likely won’t be able to resell the item, which means you’ll take a total loss.

Upfront payment is also smart if you’ve dealt with a predatory customer before and you’re still willing to do business with them. In that case, require full payment before you incur any costs to protect yourself financially.

Withhold the final product until you’re paid in full.

If you’re selling a physical product or repairing an item, you can keep it as collateral until the customer pays. A jewelry repair shop, for example, returns the fixed jewelry only once payment is received.

That principle applies to services too. An attorney may request a retainer at the start of a legal matter but hold off on filing final paperwork or attending a trial until the client’s account is fully paid.

Respond to negative reviews.

If a problematic customer leaves a negative review, you can reduce its impact by responding publicly. Be professional and polite. Express that you’re sorry they feel that way and invite them to contact you offline to discuss the issue further.

In private, you can calmly reiterate your policies and let them know you’re unable to offer additional help. Meanwhile, encourage satisfied customers to leave reviews. Over time, that one negative comment will carry less weight.

Show predatory customers the door.

Sometimes a customer isn’t worth your time. If you’ve done your best and they’re still consuming too many resources, acting unethically, taking advantage or being disruptive, it may be time to end the relationship.

Firmly but politely tell them you don’t believe you can provide what they’re looking for and that there’s nothing more you can do. Depending on the situation, you may need to take additional steps, such as pursuing legal action, calling the police or reporting them to the appropriate government agency.

Jennifer Dublino contributed to this article.