Does your money go to businesses you like?


Here’s a question: let’s say you took all your expenses for the month, and put each into one of three piles: businesses I like, businesses I don’t like, businesses I’m indifferent about. Which pile would be the highest?

I did this tonight and was pretty shocked at the results. I deal with more businesses I don’t like than business I like or am indifferent towards. Counting by dollars spent, the results are better — primarily because I like my landlord. Factoring that expense out, it’s a lot worse. I spend a lot of money with businesses I hold in low regard!

This seems like a great goal to me: spend money at places I like. Isn’t that simple? Why is it so hard to reach?

11 Responses to “Does your money go to businesses you like?”

  1. allan Says:

    A lot of the answer comes from familiarity and convienience.

    Your point does make me wonder if the lowering of stress by finding more compatible businesses would be worth the stress and effort of locating them.

    My guess is it would, a short term effort for a long term reward.

  2. Greg Says:

    I’ve been thinking about something very similar. Specifically, how do you avoid spending money at companies that don’t share your values, for example companies that operate sweatshops or conduct animal testing.

    I recently discovered Socially Responsible Investing and there are some great funds that provide lots of options for investing your money according to your values (Vanguard has a great one), but I wish some of the research that went into those decisions was available to consumers to inform day-to-day purchase decisions. Not to self-promote, but just last night, I wrote a blog post imagining a exactly a solution to this problem.

    Having better information at your fingertips all the time, would make spending your money with business you like a lot easier.

  3. Anthony Says:

    So I went ahead and did this, and upon close inspection of my 3 piles I came to realize that most of the companies that were in my ‘businesses I dont like’ pile were there for the simple fact there is no other option. Most of my monthly expenses come from everyday necessities, power, water, auto, gas, etc etc. I absolutely hate my power company, but they are the only option that Las Vegas has. I could invest in solar power or some craziness like that but at this time its just not really a viable option. I hate my cable company as well, but my job requires that I have a fast local connection and they are really the only ones that can provide that, no matter how much I hate their shady business practices.

    Out of all the businesses in my don’t like pile, there were only 2 that I could actually do something about, they were the store where I do my grocery shopping, and the place where I get my gas. Of course the reason I go to both of these places is because they are close to my home making it convenient for me.

    Bottom line, as much as I’d love to stop giving money to the businesses I don’t like, I really don’t have much of a choice. Thats even more frustrating than the answer to the original question!

  4. Marc Hedlund Says:

    Anthony — boy, do I agree with that. My experience was somewhat similar, but there were a few good choices that emerged when I looked more closely (using our test app). It seems like pretty much everyone absolutely hates their cell phone company, and the other utilities you mention are close behind. There’s no “JetBlue for cell phones” that I know about in the US, and there should be. There are, though, great auto shops I didn’t know about, and even some larger providers like grocery stores that I didn’t realize were such a good deal.

    One of my bigger dreams for Wesabe is that we can start to push on this. It’s pretty easy to see how frustrated people are with their cell providers when you start to stack that data up in one place. For regulated monopolies, like cable, a lot of people agreeing that they hate the provider may not cause a big change, but for competitive industries, as in the JetBlue example, it might. Here’s hoping.

  5. Chris Chapman Says:

    Good exercise, but I think the results are entirely subjective and not really pertinent to whether the businesses in question satisfy their objectives (deliver shareholder value, provide products and services where there aren’t any, etc.) as much as a metric on an individual’s sentiments du jour.

    However, to indulge this exercise the “businesses” I cannot stand are the ones run by the public sector. Here in Toronto, Canada they are myriad: The state-run liquor retailer (we don’t allow private shops), the Toronto Transit Commission (subways, buses, etc.), City Hall, Ministry of Transportation (licenses, etc.).

    How would Wesabe tackle these greater thorns in the sides of consumers?

  6. Marc Hedlund Says:

    Hey, Chris,

    Of course I agree that the results of this test are completely subjective. But that’s sort of the point. A business may be meeting *its* objectives (shareholder value, etc.) without meeting *my* objectives, and if I’m spending my money there, I should at least consider why that is. If I had a personal board of directors, they might say, “Why are you spending money with this vendor that provides poor satisfaction?” As Anthony says, there may be no better alternative in some cases, but if there is, I think it’s worth asking yourself if your money could be better spent.

    I wouldn’t want to say that any startup could fix a governement (!) — but I do think that no matter the “vendor,” a group of people acting in concert is more likely to get a change made than any individual “customer.”

  7. francine hardaway Says:

    I am really waiting for your app to launch. I need a personal finance app, and I hate every one that’s out there. I do spend money at places I don’t like, but not willingly. The real question is,
    what constitutes “not liking” a business? Poor customer service? Goodbye Apple and Dell.
    Poor quality? Goodbye American car.
    Goodbye American health care system, a combination of poor customer service AND poor quality.
    Then do you load on ethical considerations?

  8. jolly Says:

    It would be a lot more effective whenever people “voted with their wallets” concerning businesse they ‘don’t like’, that the (former) payees are made aware of the reason.

    Closing that loop is essential to effecting change.

    Mix in the ‘collective boycotting’ power, and you might get somewhere.

  9. Rachel Porter Says:

    Reading though this string was fascinating. As the owner of a small business and one of the higher-end providers in our industry, if clients contacted me and expressed their disapproval in my services, and let me know they stayed with me because there really was no other option, I would pay attention to it. I would hope the big companies have enough integrity to improve on their services too. Speak up, be respectful but factual, and let them know if you had a choice, you’d choose to go elsewhere. If possible, offer 2 or 3 ideas that if they implemented would raise your approval rating with them.

  10. gabrielle Says:

    As Marc’s spouse, I admit bias in support of Wesabe. However, since Marc and I have been talking about financial issues for three years, I wanted to weigh in here.
    When Marc and I bandied about the idea of a financial site, we talked about paying down debt. I had used Consumer Credit Counseling Services in my early 20’s to help fix the credit card mess I created in college. (Note to self: do not give your kid a credit card. A fixed debit card, fine, but do not do the credit card thing.) I paid off all my debt and bam, I was laid off. Two years of freelancing and suffering and my debt soared. I am nearly clear off that mess (thank you, Marc, for being a supportive husband).
    What I find exciting, however, is not just debt payment or savings, but power of the collective consciousness of a group of users. As Jolly said, “Mix in the ‘collective boycotting’ power and you might get somewhere.” I am invigorated by the possibility of people actively making choices for their finances in a way that may not happen now. I know about Working Assets, for example, but only came across WA because friends were using it. Word of mouth is powerful, but perhaps it is too slow these days and, when you’re at dinner at your friends and they say “switch phone companies!” you can nod and say, sure. But if you’re online, and you see enough other people say, “I love Working Assets!” the switch can be managed in that moment. What power for each of us to control where we spend and how we spend.
    I appreciated Chris Chapman and Anthony’s remarks about being trapped by certain companies with no outlet. Perhaps one of the outcrops of the community conversation is that a company will emerge to fill a void. If enough people in Las Vegas are actively pissed off at the power company, perhaps an alternative will see the market opportunity and step in. Or, perhaps there is a viable option that someone in the community knows about and can share online that otherwise you would not have access to.

  11. Mary Says:

    This exercise tells you one thing — consumers say one thing and do another. It happens all the time. They say they hate a business but still buy from them. WHY? Because when all factors are weighed, those businesses still deliver the best value. Otherwise the consumers would’ve done something else. Voting by wallet happens all the time. But whether you “hate” or “like” a business is only one factor. Other factors often take more important role in the decision making process, conciously or unconciously. Those businesses don’t have to be a monopoly. Gas station is not a monopoly. But Anthony still chose the gas station closer to home rather than driving a little farther to a station he liked more. People may hate Dell for their service but the price is lower. They say they want good service but they are unwilling to pay for it. I’m not surprised at all.

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