September 26, 2007
Do the dumbest marketers work for cell phone companies, or is it just T-Mobile?
10/03/07 Update: Somebody from T-Mobile got in touch with me and offered me a Blackberry Curve for less money than what new users buy it for. I took the offer. Thankfully someone at T-Mobile is watching out and taking action - but I still think they would benefit from making this a proactive program instead of a reactive one.
I am a T-Mobile user and yesterday I tried to upgrade to the Blackberry Curve. Even though I am long-time loyal T-Mobile customer, spending $180+/mo on their services, I would have to pay $400 for the new handset instead of the $250 that new customers have to pay. I was furious but the guy in the store could not do anything and recommended that I call customer service - which I did. Half an hour into that call I got the same response.
Obviously I am about to become an iPhone user until those guys screw up - no matter how much it will cost me to break my contract (earth to T-Mobile marketing - it isn't about the money, it's about principles on how you treat your customers).
It is of course not the first time that this has happened to me, as I am sure it has happened to you. This time around, however, I figured I would do some back of the envelope calculations to demonstrate the stupidity of this particular marketing technique/abuse campaign.
I am a very loyal customer and if they would have switched me and not screw up too badly in the future I could have easily been with them for another 4 years. At $180/mo, that is a loss of $8,640. I am also a big recommender when I like a product or service, and can point to many people who switched to T-Mobile because of my recommendations. Let's say that 4 people become subscribers every year based on my recommendations (might be more with a cool toy like the Curve), and let's further assume that 50% of those would have joined through some other marketing outreach program from T-Mobile. For the sake of this exercise let's say that those people who do sign up based on my recommendations would spend half of what I spent. That means that by losing those recommendations they would lose $8,640 in referral business the 1st year, $6,480 the 2nd year, $4,320 the 3rd and $2,160 the 4th year. And supposing that the customer acquisition cost, not including handset subsidies, is around $200/customer, the other 8 referrals who might have joined based on other outreach programs might have saved them another $1,600 in acquisition cost.
So the lost opportunity so far for not giving me the discount is $31,840. I know, it should be converted into its net present value to get the real number - but for a $150 rebate??
Now that is not all. I am sufficiently turned off with this idiotic marketing behavior that I am willing to write about it on my blog. With 18,000 unique visitors/month according to Google Analytics and close to 1,200 RSS subscribers according to Feedburner, I can only assume that a few people will not switch to T-Mobile because of my bad experience. Add to that the number of social networks that I belong to and where this recommendation will get syndicated, and the amount of lost business because of my negative recommendation could actually be far worse than the lost business caused by me no longer being a customer and referrer.
How stupid can this be? And when will the government step up and let us own phones that are no longer locked to a particular service provider?
June 20, 2007
How little things can go a long way to solidify customer satisfaction and loyalty
There are some companies where employees do not really care whether you have a bad buying experience - either acting completely unapologetic or worse, making you feel like it's all your fault.
Not so with Lenovo and Starbucks.
After my recent buying experience with Sony I bought a Lenovo laptop. And just like Sony they ran out of parts for my laptop just before their promised ship date. Unlike Sony, they are the ones that alerted me of the manufacturing delay. The email was very apologetic, gave me an option to cancel my order if I could not wait, and offered me a free gift for the inconvenience if I decided to stick with them. Guess what - I took the free battery and was not in the least annoyed with the delay. In fact it made me feel good about the way the company was dealing with customer problems. Because at the end of the day, you know that something will always go wrong - and it's not the fact that something goes wrong that makes you lose customers - it is the way you choose to deal with those exceptions that affects customer loyalty.
The same happened at Starbucks this morning. I was in a bit of rush and found out that they just started brewing the dark roast and that it would take 4 minutes to get my coffee. Watching coffee brew for 4 minutes is an eternity. I was a bit miffed - thinking that maybe Starbucks' employees had gotten infected with the same bug that is plaguing their neighbor . Sensing my unhappiness, all three employees at the store this morning found a way to apologize, and one gave me a coupon for a free drink the next time I visit a Starbucks. Even the coupon apologizes - telling me that they hope that my next Starbucks experience will be a good one!
Guess who I have talking about all morning?
OK - enough about customer service now, let's get back to marketing...
...but wait...isn't this marketing? :)
June 19, 2007
A solution for those pesky customers that want to excalate their call to a "supervisor"
As I was trolling various support forums to find how to best connect my Tivos with the new Verizon FIOS service I ran across a support chat transcript that made me laugh out loud.
The exchange in its entirety can be found on the TIVO support forum, but the piece that got me laughing was
David Adams: Can I be escalated from this chat?
Kevan: Basically in regards to these chats the representatives (IE me) have the full capabilities as a supervisor to get an issue resolved in any way possible. Unfortunately, for this issue we do not support.
Brilliant! Isn't it? I wonder why I did not think of that earlier!
Just give every phone operator the title of supervisor and you will never have to deal with those pesky escalation requests anymore. Plus, your call center performance metrics will likely improve as you will have less "reported" escalations and "faster" customer problem resolutions.
May 17, 2007
Companies need to add "Customer UI" expertise to their talent pool
And I am not talking about product UI (User Interface) - I am talking about the "company" UI from the customer's point of view. After all my poor buying experiences with companies that have very bright and dedicated people working for them, it became clear to me that most companies should hire or staff a group of independent customer advocates with UI experiences to ensure that all the touch-points through which a customer can interact with the company are all compatible with one another and are all delivering against the same promise that is being made during the pre-sale cycle. That includes packaging, in-store support/returns/etc, phone support/billing/etc., web support/shops/registration/etc, and any other way through which a customer could interact with the company after they first buy a product.
The fact that HP as a company has multiple logins for different shops, and that a "customer" case manager for one division can not handle problems the customer has with another division would go away if you would have a customer-centric company UI group who would police this stuff. The fact that my insurance company sends me statements with a different look and feel, different information in the same places, and different content for the various policies I have would go away as well. The fact that most corporate web sites are organized around the companies' divisions instead of being customer-centric would also go away...you get the point.
A good example of a company doing this right is Apple. I recently bought a new iMac for my son, as well as a new Airport Extreme to upgrade my home office network. I registered those products online, and required some support for setting up disk and printer sharing with the new Airport. I have also been using iTunes to buy my music for years. At Apple, all the touch-points reinforce the same message - we are easy and fun to work with. From the store interactions to the packaging, to the online support and registration systems, all the touch-points are perfectly tuned to one another and they all have "me" at the center.
May 9, 2007
When you get a low ROI as a customer
John Hagel speaks a lot about a new type of ROI - Return On Information -, and how ROI needs to be optimized for both the company as well as for the customer. As a company, if you do not know who the top 20% of your customers are who bring in 80% of your profit, you do not have a good ROI.
As a customer, I just experienced some very low ROI situations - which really affect the way I feel about the company.
First was my cellular provider T-Mobile, which I had to call last week as some people with Cingular accounts could all of a sudden not reach me anymore. After going through the usual interactive voice response system "hell" and providing my home number, home address and last four digits of my social security I finally reached a live person, who started the conversation by asking me for my home number, home address and last four digits of my social security. I thought I was going to strangle him and when I asked him why he had to get that from me again since I had already provided all that rich information to their system - he responded that "his" system had no way of knowing that I came from that "other" system...sigh. At least he was helpful, which is sort of surprising with today's cellular providers.
Next came my buying experience with HP. I bought a new Media Center PC from their online home office store. That went smoothly...registered, used a simple password with all letters, and when I was finished I got a friendly confirmation with a $10 coupon. The problem was that I did not like the monitor choices on their site. In looking around I found what I wanted in their small & medium business online store. So I tried to log in, only to find out that my log-in credentials from the home office site did not work. I had t recreate a new account, and this time I was asked for a password that had to have a combination of letters (with at least one in Cap), numbers or special characters. This one also asked for my mother's maiden name! When I typed in the discount code I had received from HP (I know, it was the home office store - a different division), it was rejected. On Sunday, when I tried to access that account, I could not. Evidently I had forgotten what password I used, and since I had given a fake maiden name for my mother (that is none of HP's business), I could not reset my password. Since they were closed on Sunday, I had to wait until Monday to reset my password, which is when my order was scheduled to ship. When I looked at the home office division, they were open on Sunday, but I figured it was not worth the aggravation trying to call someone there to reset my password on the fort knox computer from the small and medium business division....sigh.
How much would it cost them to get systems that are customer centric instead of division centric? And what do you think their ROI (return on investment) would be to deliver a better ROI (return on information) experience for their customers?
March 29, 2007
Perceived quality loss lags actual quality loss by years
New research published in the latest issue of the Harvard Business Review (available for free here) shows that changes in product quality do not immediately get perceived as such by customers - in fact it can take years for perceptions to catch up with actual changes.
The study, which covered 241 products in 46 categories over a period of 12 years, and which involved over 30,000 consumers, found that most of the perception catch-up happens after the second year following the quality change. Full adjustment to the changes takes 5 to 7 years. Those numbers vary depending on the brand, frequency and purchase and other factors, but even with products where consumers were quick to gauge the change, like toothpaste, it took 3.9 years.
This has some far reaching implications. Not only does it explain other research that shows that it takes 5 to 10 years for product quality improvements to result in higher profits, it also means that companies have a long time to course-correct when something bad happens with their product (assuming they do not get hammered in the blogosphere that is).
February 27, 2007
Buying a car in Belgium...
There is an interesting article in Reveries about an American expat's experience in buying a car in Belgium. He found what he wanted, did not have to "negotiate," and the sales rep became most friendly and helpful after the purchase...
Which experience is better for the customer? Which one is better for the dealership? And which one do you think is better for the automobile manufacturer?
January 24, 2007
Online word of mouth is much more powerful (or dangerous) than offline word of mouth
The latest issue of Revenue magazine has an article on the impact of online research on off-line purchases. Quoting from comScore Networks research they found that in the "toy and hobby" category, 42% of people who did online research bought a product directly related to that research - except that 88% of those people made their purchase off-line and only 12% made their purchase online. In the Consumer electronics space, 18% bought based on online research - but 93% of those bought off-line.
Quoting from Opinion Research, they found that "77% of people who do online research before buying a product purchase something when they went to the store the last time they did online research," with "over half (52%) purchased just the item they did research on, while another 18% purchased that item and additional items."
Another Research paper, this one from Perfomics is quoted as saying that "the majority of consumers conduct research online during his year's holiday season and 43% plan to make both online and offline purchases based on that research." It goes further to say that "the majority of consumers become more brand- sensitive after conducting online research."
That pretty much confirms that unlike what some analyst firms pretend, online word of mouth has the potential of being much more effective or dangerous than off-line word of mouth.
Take the personal example of Mercedes Benz which was well documented on this site (Mercedes - a case study on how to squander a great brand, Mercedes says that cars fail in the first 50K miles - after that it's the fault driver, Mercedes Benz does not care about its customers, and Mercedes Benz - poor customer service ROI). For a long while, those rants came out on the top of a variety of Google searches. So if half of the potential buyers do online research before buying, a disproportionate number of them will run into my online rants and at least pause, if not decide against buying this product. The online negative word of mouth reaches a much larger audience than any off-line word of mouth recommendation would have, plus it spans over a much longer period of time, and it also attracts additional negative word of mouth, which only makes the case stronger!
As an example, witness some of the comment excerpts that are still being made on those stories on a regular basis:
- "Just read your blog, Just decided not to purchase a 60K Mercedes I was looking to buy." (01/04/07)
- "I drive a C180 classic kompressor 52 plate with 35K on the clock. Since day of purchase in Feb 06 the colland warning light comes on every few days. The feeder hose has been replaced, the cap and the head gaskett and still the coolant light comes on every few days. My local MB dealership are at a loss what else to do." (11/21/06)
- "I for one will never buy a Mercedes Car again and will continue to discourage others from doing so" (11/07/06)
- "I PURCHASED MERCEDES ML 350, 2006 IN APRIL 2006. FROM DRIVER'S SEAT, THE LEFT SIDE VIEW MIRROR IS ONLY PARTIALLY VISIBLE! I SHOWED THIS TO HBL DEALERSHIP IN TYSONS CORNER VIRGINIA, AND THEY AGREED TO THIS DESIGN ISSUE, WHIC CANNOT BE FIXED, EVEN IF IT IS A SAFETY HAZARD...THE BEST REMEDY IS TO SHUT OFF THE AC DUCTS ON BOTH DRIVER AND PASSGENGER SIDE! THIS IS THE RESPONSE I GOT, FOR PAYING HIGH PRICE FOR THIS EXPENSIVE CAR " (11/03/06)
- "I like most people who feel badly let down by MB will never buy another car from them, I thought I was buying quality and reliabilty." (07/27/06)
- "Like some other people, I decided I shall never buy or even hire a Mercedes car again." (06/22/06)
- "Funny that I stumbled on your site googling MZB's home office customer service...I should have learned my lesson the first time. I will never lease/own a Mercedes again. They do not stand behind their quality, or service. I hope people read this and take notes." (05/26/06)
- "I've run an independent MB repair shop for over 20 years & believed in the quality of their cars...until now. I'm loosing customers left & right. I can't, in good concious, recommend a new merecedes to my loyal customers, some have been with me since I started & wish to keep me as their mechanic.I am seriously thinking of switching to Lexus,since Mercedes stated this is the car it will try to get as good as by 2009." (04/22/06)
There is no way that these stories could have affected that many people over such a long period of time in the off-line world.
November 28, 2006
Bruegger's is listening! I am a fan now...
As many of you will have noticed, I have had my fair share of mishaps with my local Bruegger's. The last time I wrote about my experiences, Scott Hughes, the VP of marketing posted a comment on my blog asking for more information so that they could address the problem.
We went back and forth on email a few times and then two weeks ago I noticed that they put a new general manager in charge of the store. Not only has the service improved considerably, the whole mood of the store has brightened somehow. And then yesterday I get an email from Scott to inform me that they had made some management changes at the store and asking for my business, saying: "I hope you give us another opportunity."
WOW - Scott thank you for listening! You just turned me into a big Bruegger's fan!
And btw - your new Ciabatta's are great too!
September 22, 2006
Crowdsourcing vs. community outsourcing
Crowdsourcing has been a popular term ever since it appeared in a Wired Magazine article earlier this summer. This past week, Business Week jumped on the crowdsourcing bandwagon with an article in their second issue of Inside Innovation (may require subscription - but you can find a good description of the article by Renee Hopkins Callahan over at IdeaFlow).
What is confusing about the "crowdsourcing" terminology in both articles is that they use "crowd" to refer to the "wisdom of crowds" - a term introduced a few years back by James Surowiecki to describe the fairly simple idea that large groups of people are smarter than an elite few. Many of the crowdsourcing examples used in both articles, however, like the use of iStockphoto to source images cheaply, do not rely on wisdom of crowds at all. Getting your images from iStockphoto instead of from a professional photographer is like outsourcing your photography to the public - where everyone can be a semi-pro with high end cameras below $1,000 these days. In the end you still buy your images from individual photographers. There may be a crowd, but there is no wisdom of crowds involved here.
When a company like John Fluevog Boots & Shoes asks its fans to submit and vote on new shoe designs - that is a model based on the wisdom of crowds. The wisdom of the mass is more likely to identify a winner than a select few (see also related post on when wisdom of crowds does not work).
The Business Week article spells out four rules for successful crowdsourcing - or should it be to outsource your task/process to an outside community.
First, be focused and provide clear guidelines to what you want to have done. Not really all that different from any outsourced project. If you give vague guidelines you will likely get something back that you did not expect.
Second - get your filters right. Since by outsourcing a task to a large set of people you will get a large number of ideas, you need to filter all those ideas so that you can find the gems. But why not use the wisdom of the crowd to do the filtering? IBM solicits ideas from customers and employees during two day innovation jams - which led to 37,000 ideas the last time around. They then use their own employee "crowd" to filter those ideas. As most companies do not have 140,000 employees to draw upon, they could use their fans and customers to select the best ideas. An idea could be emailed to a randomly selected set of active people for voting, rating or ranking.
The third is to tap the right crowd. Pretty obvious when you think about it. Just like you would not outsource a complex engineering problem to a company of 14 year old summer students, you need to be picky about the community you outsource your task to.
Lastly is to build your community into social networks. While this may be key to success in getting certain communities to function in the long run, enabling networks or teams to form within your community goes against the principle of the wisdom of crowds - adding to the terminology confusion.
Renee adds two more rules in her post - find ways to feed the ideas into your company's existing processes and fund the process - as incentives fuel creativity.
In the end, successfully outsourcing product innovation and other processes to outside communities comes down to a deep understanding of two factors:
- understanding of the traditional keys to success for that particular process
- understanding of the fundamentals to successfully create (if needed), manage and interact with communities - virtual or otherwise
July 13, 2006
The importance of good customer service
Irving Wladawsky-Berger has a great post on the importance of customer service. In it, he describes the business model of the leading Indian Telecom conglomerate, and how they focus all their energies on customer service while outsource everything else - including the IT and the network...
That's right - a telecom giant that considers its customer relationships as the core asset, above the network or associated IT. Now that's innovative!
Irving closes his post, which includes some other customer service stories, by saying "Products and services might be commodities, but you never, ever want your customers to feel like they, too, are just commodities. A successful business will make each of its clients feel special by understanding and addressing their unique requirements, and quickly solving problems when they come up. This is really hard, which is why it may very well be most important way for a business to stand out from its competitors."
July 12, 2006
Comcast - a tale of poor customer service and screwed up management decisions
So a guy has problems with his cable modem and spends time in Comcast's online customer service hell (he also happens to be the biggest champion for the movie snakes on a plane, even though the movie makers newer acknowledged that). Then Comcasts decides to send a technician out to have the modem swapped out. When the technician calls Comcast to activate the modem, he ends up in the same customer service hell hole as most customers end up in and spends an hour on hold - and falls asleep on the customer's couch. The customer videotapes the incident and puts it on YouTube. Next thing you know it gets picked up by mainstream media outfits like the NYT, Forbes, and even airs on MSNBC's "Countdown" program, just to name a few. More than 300,000 people view the video on YouTube.
Another good customer service story - right? This must have been a great wake-up call for Comcast management to start fixing their problems...
What do you think happened next?
Comcast FIRED the technician!
...now talk about a wrong-headed management decision.
What do you think?
(For more info - check out Mary Schmidt's blog)
June 29, 2006
Customer entropy partially to blame for poor customer service
Come to think about it, customer entropy (or customer apathy) is partly to blame for the state of customer service. The reason most companies deliver bad customer service is because they can - not enough customers complain or abandon brands after a bad customer service experience.
If more people were to talk back to companies or report customer service abuse to their local local consumer affairs departments, the overall state of customer service would improve.
What do you think? Is there a way to foster consumer activism so that we can finally get the service that we deserve, the right return on providing our personal information as part of buying transactions, and intelligent humans to interact with when facing post sale issues? Or is it like voting - enough people are generally happy enough so that the only thing we can expect is status-quo?
You would expect that a new entrant who delivers outstanding customer service would change the playing field in that sector - but is that really happening?
June 25, 2006
The bar to deliver customer service "delight" is ridiculously low
In the last week I joined an army of people who recently had bad experiences with airlines. It is fascinating to see how low the bar to "delight" customers through customer service has gone in the airline industry (and many other industries) in North America.
My story started with a trip to the West Coast on American Airlines. Since I had ordered my ticket late and had no seat assignment, I went to the airport extra early to get a good seat. When I checked in they gave me a center seat and said that the gate agent would be able to switch me (customer service tip #1: pass the buck). Next I sat in an airport security line for 45 minutes. They had one security line servicing at least 30 gates. First class passengers had their own, and much shorter security line, which ticked off many passengers as TSA (Transportation Security Agency) employees who manage airport security are not American Airlines employees but government employees paid with our tax money. When I finally got to the gate, the agent did not even faint trying to help me - she rudely told me to take a seat as the flight was full (customer service tip #2: screw the customer).
What happened next is the best part. I boarded and realized that my seat was broken. I promptly informed the flight attendant of my problem - after all, who would want to be on a six hour full flight in a broken seat that cannot be locked in its upward position? The aggressive and non-friendly response from the agent was: "I am not sure that they can fix it, and because YOU now reported this problem they may have to take you off the plane and not fly you to California today!" So she was implying that it was my problem, since I had reported one of their defective seats (customer service tip #3: blame the customer). If only I would have sat up-straight and pretended that nothing was wrong with the damn seat, that would have been a much better solution for HER! I put up a stink and they reluctantly gave me another center seat so that I could make it to California.
Then came the weekend, when I had to fly United Airlines to Vancouver. 3 hours prior to my flight I get a call from one of their automated machines informing me that my flight segment from Chicago to Vancouver was cancelled and that perhaps other arrangements had been made for us. When selecting the option to speak with a representative I got a fast busy tone, so I called the main United 800#. After being in a queue for 35 minutes, during which I discovered that my flight was the last one out of Chicago to Vancouver that day and that there was another alternative flight route through Toronto, I finally got a "somewhat" live person on the phone:
United: may I help you?
Me: your automated service just called me to inform me that my flight segment from Chicago to Vancouver has been cancelled and that other arrangements may have been made
United: they did call you and told you that?
United: well, they tell you stuff before they tell us, I see no such thing in my record...
Me: well, can you at least see that the Chicago to Vancouver was canceled?
United: hold on...oh yes, you are right, the flight was canceled
Me: so what should I do?
United: fly to Chicago and see what they say
Me: but it is the last flight out of Chicago today, it makes no sense for me to go there...
United: hold on...oh, yes, it is the last flight out of Chicago
United: you should go to Chicago and they will help you there...
Me: there is an alternative through Toronto on Air Canada - your partner
United: oh I see...let me check
United: there is no flight out of Chicago to Toronto that will get you to Vancouver...
Me: no, but there is one out of Boston that will get me there
United: oh, I see...let me check...this was the last flight out of Chicago..
Me: yeah...but this is Boston...
United: oh I see...I can "protect' that flight for you
Me: great! So you are confirming that I know will fly from Boston to Toronto and then on to Vancouver
Me: do I just check in at United or do I go to Air Canada?
United: that I do not know...try both...
Me: thank you very much
This was not an exchange on Saturday Night Live or some other comedy channel...this was real (customer service tip #4: hire real cheap labor and try cutting cost on training and IT!
No wonder JetBlue has such high praises from customers. In a market where the bar is so low, it does not require much to delight customers!
April 13, 2006
What to do when you have excessive customer churn
According to a recent Forrester report (via Center for Media Research). mobile phone subscriber churn amongst US mobile subscribers is 24% a year. That's right - they loose one out of 4 customers annually.
The main reasons why people switch are price and service - with handset selection, customer service, data services and original content as secondary reasons.
The study suggests ways providers can differentiate themselves to maintain their base and attract switchers, including giving customers the ability to store pictures, IM, and other stuff on the network, be an objective advisor to customers, delivery of audio and video, up-sell the biggest spenders to the hottest handsets, and multiservice bundles.
It is surprising and possibly blinding to see that customer service comes out as a secondary reason for switching. While it may be a secondary reason that people gave in the survey for "leaving" the company, it may also be the one area where cell phone providers could differentiate themselves and "keep" those same customers longer. If instead of spending tons of money on aggressive new customer acquisition campaigns, they would spend more money on proactive customer service calls, they might find their churn rate going down dramatically. Would you switch as quickly if every so often a friendly service rep would leave you a message to explain a new service feature, or to tell you that you might benefit from being on a newer or different plan, or to let you know that there are existing features which you are not using yet that might benefit you and perhaps offer some help in getting you acquainted with its usage, or if they simply were to send you a text message wishing you happy birthday, or a message welcoming you to a new town with some simple factoid about the place when you travel, and the ability to get more information about the place if you want to.
If they could make their customers feel good about being their customers, churn would go down more so than if they were to try to "lock them up" into multi-service contracts or if they were to just continue adding bells and whistles to the service.
February 6, 2006
Customer loyalty and profitability
Joe Nocera had an op-ed piece in Saturday's NYT (requires subscription) about Apple's arrogance in not delivering customer service for their iPod.
Sure, it costs a lot of money to provide telephone customer service and to have a repair department - and much of Apple's profits might well be wiped out if they would provide that service. But like Larry Keeley, quoted in the article, says:"Consumers are just not conditioned to believe that a $300 or $400 device is disposable."
With Apple not having a serious competitive contender to deal with, they can afford to follow Geoffrey Moore's "inside the tornado" growth strategy and ignore the customer. But you have to agree with Keely when he warns that the day will come when Apple will have a serious competitor, at which point Apple will reap what is now sowing.
With so many people feeling like they've been taken to the cleaners, "real" customer loyalty cannot be all that high.
It would be interesting to see a new "brand index category" for this category and see how Apple is doing.
Online experiences will affect brick and mortar business
The Center for Media Research reported on a survey that found that if people have a bad experience with an online retailer, they are less likely to do business with their brick and mortar outlets as well.
The survey was conducted by an ecommerce software vendor.
So while it probably should be taken with a grain of salt, it is an interesting finding nonetheless.
February 2, 2006
Customer service is all about people interactions - not CRM
McKinsey Quarterly has an article on customer service(requires subscription) in which they quote some interesting stats from Forrester: "According to Forrester research, only 10 percent of business and IT executives surveyed strongly agreed that business results anticipated from implementing CRM were met or exceeded."
Diagnosing the problem, they say: :What's regularly missing, in our experience, is the spark between the customer and frontline staff members—the spark that helps transform wary or skeptical people into strong and committed brand followers."
Bingo! There are too few companies that focus on making sure that all customer touch-points with customers are optimized to provide a consistent and delightful experience...
December 14, 2005
Should you care about influentials?
Piaras Kelly argues that Dell should not care about Jeff Jarvis on his blog today. And he goes on to say that what's really important is not what a few key influentials are saying but what the masses are saying.
Having thought about this topic and having written about quite a bit (here and here), I agree with Piaras - but the lesson learned from the Dell saga is that by not responding they let this whole issue fester beyond control and to the point where people who had been happy with them in the past - like Shel Israel, or myself - to no longer buy Dells and switch brands. Plus, if a newbie is searching for reviews on Dell, I am sure that the results are full of negative publicity.
I think that they could have avoided much of that by being better listeners and by being more responsive.
October 24, 2005
Unbelievable customer service
In trying to help the family of my friend, who passed away this weekend, I offered to arrange for the ticket of her brother for him to attend the funeral later this week. What followed is pretty astonishing.
First I checked fares online and settled on a Delta flight. I went through the complete registration only to find out at the end that the passenger must present the credit card with which the ticket was purchased. Figuring this was just a glitch and that I could get around that I called Delta and explained the situation. Not only did the agent not acknowledge the situation, she said that this problem could be solved by paying an extra $100. I said, "you must be kidding me - how can $100 fix this situation and how can it not be fixed with $0?" Upset, I added "this is theft." She proceeded to repeat the exact same sentence as if I was some kind of moron who did not understand English. I hung up...
Then I called American. Not only did the attendant acknowledge the situation, she offered me an emergency fare that was $100 cheaper than what they had on their web site, and she was also very patient while I was placing other calls to get the funeral home information. Go figure...
October 14, 2005
When systems stand in the way of good customer service...
I have always been a big champion of Vistaprint. using them for business cards, over-sized postcards and datasheets. I tell all my friends about it and I know for a fact that many others have used their service because of my recommendations. But then came my latest order...
It started out fine, with me ordering 500 copies of a 2 page datasheet to distribute at an upcoming conference. The person I dealt with was pleasant and helpful and even did a reorder last Friday after I had discovered a minor error. I paid to have my package delivered on Wednesday - but it did not arrive on Wednesday. On Thursday I emailed, and they confirmed that while it should have been here on Wednesday it would get delivered on Thursday. That still gave me enough time as I had to have it in the conference organizer's hands by Friday or Saturday at the latest.
When I received the box however, I noticed a major color problem on the front page - some color was either missing or had been tuned the wrong way - resulting in everything looking deep purplish. I emailed and was told that they could not ship any faster than within 3 business days. I begged and pleaded asking them to reprint overnight and then ship overnight for Saturday delivery - but no go! While I got the standard apologies, I was really upset - as this will not only reflect bad on us, but I have now been wasting all kinds of money and opportunities as well (I did get a refund - but that still results in me wasting money and opportunities).
The bottom line is this - I am convinced that the reason they could not help me is because their stupid order entry system does not allow for deviations from the normal ordering procedures. While physically it would have been possible for them to help me, their IT infrastructure stood in the way of delivering awesome customer service.
And in a world where the product is a commodity, and the service/price ratio is the differentiator - they not only lost a customer, they also lost a real champion. All because of poor IT planning...
October 11, 2005
More thoughts on "touchology"
After living through Francois' ongoing saga of his love/hate relationships with Starbucks and Brueggers, I got to thinking about my own experiences at various Starbucks and similar establishments such at Peet's in Harvard Square and Seattle's Best in I don't remember where. In particular I was trying to recall how effective the "touchology" (the term coined by Starbucks chairman Howard Schultz) was. It has been my experience that a key individual that can make or break the experience for me is that often under-appreciated person known as the Barista. This is especially true if what you want is your basic high octane espresso. No frills, no steamed milk, just a perfect expresso with a nice crema on top. So I surfed over to coffeegeek, a great site about all things coffee. And here I came to realize just how seriously some baristas treat their position. Go here to read about the South East Region Barista Competition. Here is an excerpt of a review of one of the contestant's performances:
" Her distribution technique was a brief North-South sweep followed by three (or four) tamps, the last two (or three) with twists. The set of espressos appeared to have nice dark colors with red reflections. As she prepared her four cappuccinos, she explained that she intentionally overfilled the milk to help keep the temperature down and prolong the stretching phase. Like a few other competitors, she prefers to swirl the two bell-shaped pitchers flat against the countertop, plus a few thunks. She explained that her competition style isn't like her usual work routine because four single cappuccinos isn't a typical order."
Now that is what I would call a "high-touchology" experience. Haven't experienced anything quite like it at a Starbucks but I did come close to it at a small independent coffee house in Acton MA. And yes, as Seth Godin would put it, the lie I told myself about the quality of the espresso was definitely influenced by the showmanship of the barista (who happened to be the proud owner).
October 4, 2005
Great series of posts on marketing lessons learned at Starbucks
John Moore over at Brand Autopsy has a great set of posts (here is one) on what he learned at Starbucks - some which definitely resonate with my high tech marketing background, others which are confirming what goes behind delivering the experiences that I have been enjoying as a loyal Starbucks customer.
Some of the lessons learned include - "rarely, if ever, can you sprinkle magical branding dust to create an endearing and enduring brand." - referring to the fact that you need to first and foremost focus on building your business and not your brand. One will flow out of the other - not the other way around.
Another one is - "remarkable business make the common uncommon" - well Starbucks clearly did that!
And in a third post he quotes Howard Schultz, the Starbucks Chairman as saying “If we greet customers, exchange a few words with them and then custom-make a drink exactly to their taste, they will be eager to come back.” He calls it delivering great customer experiences though "touchology" - brilliant!
Like many of you, I have experienced firsthand how powerful the results of those practices can be - both positive as with Starbucks, and negative, as with Brueggers (update since I last posted this: the last time I went there they had virtually no bagels - their excuse: they ran out of dough - that's like Starbucks running out of coffee beans - unlikely) and many others.
It is amazing to me how many companies are still not focusing on the overall customer experience - which happens through all the customer touch points - advertising, word-of-mouth, product, packaging, service, delivery, repair, etc. It must be too logical for silo-ed companies to understand. Or maybe it's time to redefine the role of marketing!
August 24, 2005
More on call centers
Johnnie Moore picks up the conversation on customer service centers - arguing that companies like Orange actually do invest "a lot of effort into their customer service department to make it efficient", but that what seems to be missing is "a bit of humanity and flexibility."
I actually agree with that - companies do invest in their customer service centers. The problem, as Johnnie Moore indirectly alludes to, is that they run them as cost centers and measure their success based on aggregate customer satisfaction metrics. They do not treat them as another sales and marketing outlet - which they should, and where every conversation is important. Or at least where the importance of certain conversations are based on things that are different than how they prioritize them now.
August 23, 2005
Dell finally responds
According to Online Media Daily, it sounds like Dell finally decided to take the blogosphere seriously (here). In the article, a Dell spokesperson says that they started the new program it a month ago. Too bad they did not talk about it a month ago - a lot of damage has been piled on in that time.
When a crisis hits you in the Blogosphere, response time is of the essence. In this new era companies should all have revised crisis management plans!
August 20, 2005
Nicotine patch hotline with no ex smokers
A friend of ours just told us this hilarious story of when she tried to quit smoking. She used the help of nicotine patches. As indicated on the warning label as a potential side-effect, she started having very vivid dreams. After 4 days of putting up with that, and being exhausted, she called the hotline for help. She was so afraid that without the patch she would relapse. When she reached the hotline desk, they just told her that she should stop using it. She really wanted to talk to someone that had firsthand experience with what she was going through, but found out that nobody on the help desk was an ex-smoker or an ex patch user.
This is like having the AA hotline staffed with people who never drunk before, let alone had a problem with it...
Sometimes you got to wonder where the common sense is in large corporate decision making processes.
May 11, 2005
Institutionalizing Repeatable great customer service
While picking up my coffee at Starbucks this morning I witnessed an act of outstanding customer service. A woman with a child – apparently a regular – was about to enter the store as she was talking on her cell phone. At the last minute she decided to hang outside for the call and finally moved away from the store. When one of the Starbuck employees saw that, he fixed her usual drink, ran after her in the street and gave it to her with compliments of Starbucks. WOW…
You may disagree, but I happen to think that this was not a random act of kindness. I believe that it reflects the hiring and training policies that Starbucks has with regards to customer service. Some companies are just better at
institutionalizing consistently delivering excellent customer service than others. And I do not believe that you can only achieve that in luxury retail chains. There was actually an interesting article reviewing just that in the latest issue of the Harvard Business Review (here).
...hey Verizon...pay attention!