Customer service is absolutely critical. And it’s the level of customer service that determines success. It separates organizations from their competitors.

There are different types of service: You can go to a fancy restaurant in New York and get officious service—there’s no warmth with it. At another restaurant you can get pleasant, friendly service that’s still efficient. If the [waiter] warms up to you, you warm up to them. 

The problem is, I expect good service. I become too critical, and that’s why sometimes my wife doesn’t want to go out to eat with me. That’s a problem that everyone in the restaurant business has, when you know how it should be done, and people don’t do what you think they should do.

We used to have a program at Applebee’s called “Wow Service.” We put together a booklet of all these “wow” experiences. One night, a customer’s car wouldn’t start. It was late, she had two kids with her. A waitress got in her car and drove them all home. That’s exceptional.

It all boils down to leadership. The way you treat your employees is the way you treat your customers. Your employees are your “internal customers.” Treat them well, they’ll treat your customers well.

Nordstrom is reputed to have extraordinary service. I once saw a TV reporter who went with a hidden camera to Nordstrom. He had a shirt with a Carson Pirie Scott home label that obviously wasn’t bought at Nordstrom. The guy at the Nordstrom counter said, “How much did you pay for this?” And he said $34, and they gave him store credit for $34. Then the reporter asked why he’d do that when obviously the item wasn’t purchased there. The guy said, “You have $34 that I know you’re going to spend here. You might have a wonderful experience, and then maybe you’ll come back again and again.” 

Ritz-Carlton initiated a program years ago that set them apart in the luxury hotel business. When someone came up to any employee and asked, “How do I get to this bar or that restaurant?”, they didn’t say, “You take a right, go up these stairs, turn left” and so on. They said, “Follow me.” Whatever they’re doing, the customer is more important. I first experienced this at a Ritz in Hawaii—the guy must’ve walked a quarter mile with me. I said, “Isn’t there something you should be doing?” And he said, “This is what I’m doing.”

When you make a mistake in the restaurant business, we have a term called “recovery.” A customer says, “I’ve been waiting an extra 20 minutes for my food.” How do you recover? Not by just giving him his food. The manager comes over, apologizes for the wait, and buys dessert. 

In one of my restaurants in Boston, I walked into the manager’s office and saw a credit card up on the window sill. He said, “A customer left it. I’m waiting for the customer to call us and pick it up.” I said, “No, you call American Express, have them call Mr. Jones and tell him that he left his credit card here before he even knows it’s gone.” I thought I was real smart. I told a friend of mine, who told me, “Customers don’t forget their credit card; the waiter forgets to give it back. It’s not his fault, it’s your fault. You get hold of the customer, then the manager gets in his car, drives wherever the customer is, and also brings him a gift certificate.”

You can train [customer service]. But you have to hire people that believe in it. 

Even when the service is mediocre, I tip 20 percent. When I have good service, I’ll tell the waiter, “The service is fantastic, you made my day.” Let the server know they did a great job. If you have a bad experience, not going back is the best thing you can do.

I’ve had a Lexus now for probably 15 or 16 years—they do exceptional things. Most people dread getting their cars serviced. Most car dealers say, “Drop it off tomorrow at 7.” Lexus will actually send someone out to Longboat Key to pick up your car and leave a loaner car. When they had a major recall, they told me to come in with an empty gas tank. They filled up the tank and gave me a $50 gas card. It makes the experience extraordinary.