Why Misaligned Customers Cost More Than They Pay: Nicole Donnelly

Mar 6, 2025

5 min read

Updated: 4 days ago

Many owners believe they do not have the luxury of choosing their customers. Nicole Donnelly says you do. Her mission, drawn as a dog in a hat on her napkin, is to bring joy to 1 billion people in her lifetime. She built Baby Legs into a product customers bought and gave away by the millions of pairs. After selling it she started a marketing agency, and today she runs AI Smart Ventures, teaching people to save time at work with AI. Belief sits in her top five strengths, so she only works with people whose work and intentions she believes in. Her team recently separated from its biggest customer. In money, it was huge. In stress on the team and the way they were treated, it was not good. Her point for any established owner is that alignment is not a luxury. Misalignment has a cost, and your people pay it first.

https://www.youtube.com/watch?v=7sXLSMV-PfE

Inspired by Paper Napkin Wisdom Episode 223 with Nicole Donnelly.

Why you can choose who you work with

When I asked what she would say to a struggling owner who feels they cannot pick and choose, Nicole's answer was short. You sure do. You get so much more energy from working with good customers.

If you do not choose from the beginning, she says, you grow a poor customer base. Misaligned customers give you trouble. They might not pay their bills. There are a lot of bad things that come along with misalignment.

She would rather have people who really want what you are delivering than ones where every step is an argument. Her sales stance is low pressure. Does this work, do you have the money, are you ready? If not, that is okay. You are not a match right now.

What a big misaligned customer costs your team

Nicole did not share the details of the separation. She did share how to think about value. It depends on how you define valuable. If you only count money, losing that client was a big hit. Count the stress on the team and how they were treated, and the picture changes.

There was also something to keep. Serving that customer forced the agency to scale up quickly, and they built a lot of process out of it. Losing the client had an impact on the team, and so did being in it. She says they are still recovering.

I notice how often owners measure a big account by revenue alone. What would the number look like if it included your team's energy?

How to set a personal KPI you can control

Nicole keeps personal KPIs. She focuses on the things she can control. With her child, Sarah, she could not control grades. She could control how much she was there. After she sold her first company, she committed to being present 90% of the time before and after school.

Present meant present. Rollerblading, riding bikes, walking together, not sitting there on the phone. She missed professional opportunities during those years, and it was a conscious choice. The outcome she wanted was simple. Her kid would feel safe to talk to her about anything.

I broke the number down. Two times a day, five days a week, is ten. Ninety percent means showing up for nine of them. One big intention became a daily action.

She also built systems around it. Sarah took longer to wake up, so she swapped her morning workouts for cuddle time and a slower start. After school, a hungry kid got cooked vegetables first. Years later, Sarah, now 20, hugged her on a trip to Costa Rica and thanked her for the way she was raised. Sarah could talk to her about anything, and knew how to cook and do laundry. Some measures take years to read.

For the rest of her life she uses the wheel of life at least once a year. It never balances. She sets intentions at the start of the year, and they are more about a way of being than doing.

How a clear mission makes customer decisions easy

At Baby Legs, the mission was to make parents' lives better every day. That became the filter for every decision. If a customer did not like the shade of purple, the company refunded them, told them to keep the item or give it to a friend, and then surprised them in the mail with two more pairs for free.

Retailers got the same treatment. Leftover holiday styles were credited back, and the retailer was told to give them to customers. Top consumers got ten pairs of a holiday design as a gift. Best retailers got thirty or fifty pairs to hand out. As Nicole put it, "I would rather have my product out there in the world, bringing joy to more people than in my warehouse returning stuff." There was a cost. Compared to the loyalty it earned, she says it was nothing.

Asking what more you can do, not what less

Nicole's agency now asks one question every time it builds a strategy for a client. "How can we add more magic to this?"

AI has made the team far more efficient. She says they are ten times more efficient than a year ago. They did not use that to do less. They used it to give more: creative concepts, a year of content topics, quarterly campaigns, all laid out so a client can execute it or hand it back. The team gets to do more creative work in less time, and they are prouder of it.

The same instinct shows up in her community. When a topic catches fire in their online groups, she opens a free Wednesday session on it. Her company also avoids recurring meetings on Fridays. She believes everybody can have shorter work weeks and get just as much done.

How to apply this in your business this week

Start with one customer and one commitment.

List your top accounts. Next to the revenue, write what each one costs your team in stress. Which one would you not sign again?
Write your mission in one line your team could use to make a decision with you out of the office.
Pick one personal KPI you fully control. Make it specific enough to count, like nine out of ten.
The next time a customer complains, try fixing it and then adding a small surprise they did not ask for.
In your next client plan, ask Nicole's question. How can we add more magic to this?

Alignment is something you choose, early and often.