Here’s a quick quiz. Which would you choose?

1. A restaurant in a popular tourist area… or a restaurant in a busy restaurant precinct frequented by locals?
2. A second-hand car from a new dealership that’s opened up in a large city… or a third-generation dealership in a small, country town?

Chances are, you chose the busy restaurant frequented by locals, and the third-generation dealership in the small, country town.

Why? Because the restaurant and the car dealership both depend on repeat business from locals. Which means they can’t afford to sacrifice the quality of what they offer or dupe their customers.

A restaurant in a tourist area can, to some extent, afford to charge higher prices for lower quality food because it doesn’t rely on anyone coming back a second time. It knows there’ll be an ongoing stream of tourists to keep it in business.

The local restaurant, on the other hand, relies on repeat business and must continue to impress its clientele or it won’t get people coming back.

The new car dealership in the big city is more likely to get away with its sales staff using hard-sell tactics and selling a few lemons. This is because it doesn’t view each customer as a repeat customer and because, being a large city, the sales people don’t face a high risk of meeting someone in the street who they’ve ripped off.

The small town dealership, however, will only stay in business if it maintains a good reputation in the local community. Moreover, the sales people are likely to often come across their customers in the street. Not fun if you’ve dudded someone.

Now, I am NOT saying that all restaurants in tourist areas or all big city car dealerships are no good. I am just saying that businesses that are solely reliant on repeat business from locals have a higher incentive to meet higher standards.

What does this have to with Internet marketing?

Well the Internet is increasingly becoming a LOCAL community. The emergence of highly interactive social networking sites, review sites and blogs, combined with forums, the search engines and the other features of the Internet has transformed the Net from an environment in which marketers could largely stay hidden and isolated - and could get away with ‘hit and run marketing’ into one in which:

1. People are able to reach a LOT of other people with relative ease, which means that customers are able to talk about YOU to numerous others via forums, blogs, Twitter and other means.
2. People are using the Internet to seek informed advice. The popularity of sites which allow reviews by customers, experts, peers and even affiliates is a testament to people’s desire to get advice before they buy. This means your product is increasingly likely to be reviewed, even if just within a thread on a forum.
3. The search engines and search tools provided by other sites are making it easier than ever and increasingly likely that people will find out about you and your products and services.
4. Once you’ve made an impression online… that impression has a good chance of lingering… and lingering… and lingering…

Whether this really does signal the end of hit and run marketing… I don’t know. After all, the original snake oil salesmen travelled from small town to small town, and we all know how easy it is for con-artists to hit the Internet under one guise, then disappear and reappear under another guise.

But I do believe that marketers who, while not aiming to do anything unlawful, have been willing to compromise on quality and service because of their confidence in an endless stream of new customers, need to think again.

Those new customers now have the ability to EASILY read reviews and discussions about the marketer’s products, and to personally speak with old customers. And such marketers are also more likely to meet their customers on the ‘virtual’ street of the Internet.

Therefore, more than ever, they must raise their standards if they are to survive and thrive in the global AND local environment that is the Internet.

As mentioned last week, I have a lot of thoughts about what an economic recession or downturn may mean for Internet marketers. A lot of others do as well, and I’ll be occasionally sharing - and commenting on - their thoughts as we start to see the fall-out from the global financial crisis.

One of my ‘hit predictions’ is that customer service will become much more important. Depending on your niche, you may not be able to rely on as many new customers buying from you every day, every week, every month, etc. If so, you’d probably be wise to focus less on generating and converting new customers… and more on satisfying your existing customers and getting them to buy more, and more often, from you.

What’s the best way to do this? It’s with top quality products and services, and great customer service, right? I talked about ‘good’ customer service yesterday, but ‘great’ customer service is what brings the kind of customer loyalty and repeat business on which great companies are built. Customers expect good customer service, but great customer service goes beyond their expectations, and ideally turns them into loyal, raving fans.

Ironically, few Internet marketing speakers seem to talk about customer service. They’re full of ideas about generating traffic, building a list, developing products, putting up blogs, converting traffic into customers, selling affiliate products, finding joint venture partners, and so on… but seem to have very little, or nothing, to say about how to deliver exceptional customer service. It makes me wonder whether some of these people are actually running real businesses for the long term.

But maybe when times are good, and there is a continual stream of buyers entering the market, many businesses don’t need to take so much care of their customers. Not if they know there’s plenty more ‘fish in the sea’. But if the economic recession truly causes people to spend less, across all markets, that may mean you and I have fewer potential customers too. And that means we need to take better care of the ones we have, if we’re to survive and thrive.