How to steal customers from your competition (or in this case, how NOT to)

If a competitor of yours screwed up and that customer came to you looking for help in fixing the mistake, what would you do?

Today I was getting a haircut and I overheard (not that it was hard - they were NOT being discreet... that's a whole other issue) the staff talking about a person that had their hair dyed at a competitor, but it turned out green by mistake. I gather that the competitor couldn't fix the problem, so the customer - let's call him/her Kermit - called the barber shop I was in looking for help.

Each staff member was quite adamant that they did NOT want to try to fix Kermit's problem, citing the potential damage to their reputation if they were unable to fix the problem.

Come again?!?!?

Let me see if I got this straight: A potential customer has come to your door, asking to give you money and be the hero that your competition couldn't be... and you turn them away?

They were worried that their reputation would be tarnished if it didn't go well, and that it would be a waste of product.

HUH?!?

Tell the customer you will do your best, but there are no guarantees in a case like this, then give it a shot! If it doesn't work, it's not your reputation that's tarnished. It's still the competitor's problem (which they couldn't fix either). Sure, you used some product and some time, but Kermit PAID FOR THAT! You're no worse off then before you started. And in fact, TURNING THEM AWAY IS THE BEST WAY TO RUIN YOUR REPUTATION! That would be admitting to this potential customer that you are just as inept as the first shop.

Imagine if it works and you fix the problem! You can't buy that kind of press!

Now think of what Kermit is saying to his/her friends right now: 1) Barber shop A screwed up. 2) Barber shop B wouldn't help me. Do you think that's doing you any favours? Nope. Now think of what Kermit would say if you were the hero!

In an economy that's so tight, you have to fight for every last customer.

TAKEAWAY FOR YOU AND YOUR BUSINESS:

1. Do a better job than your competition.
2. When a potential customer comes to you asking to give you money, say 'yes'. Even if you don't want to. The downside of turning them away is FAR greater.
3. Empower your employees to think up reasons to take on more business, not shoo it away.

Your turn: You know where I stand on the issue. How about you? Do you think the risk is greater than I do?

Customer information is like gold to marketers - handle it with care!

For all businesses, and especially those that classify themselves as small or medium-sized, good customer data is the cornerstone of any decent marketing function.

Email marketing, the second most important marketing tactic according to marketingsherpa.com (next to social network marketing), is quite simply impossible without good email addresses. Direct mail, making a comeback of late, also depends on accurate data.

We all know how hard good data is to collect. Marketers want it, and consumers want to protect it, thus creating the most significant struggle marketers face. So when we have an opportunity to collect it, what can be more important than showing gratitude to the prospect for their willingness to offer it to us, and thanking them afterwards?

Still, I see examples of unappreciative data collection, which to me is quite troubling.

Take this example: This is the online registration process for submitting a classified ad in our local newspaper. As you can see, there is no indication of how my information will be treated by this organization. I am asked to submit my information and move on to the next step without being promised that my information won't be sold to the highest bidder. In this case, because I am the one that wants to place an ad and I'm led to believe that this is the only way to do it, I am forced to submit.

They are saying to me: "we don't really care what privacy concerns you have, if you want a classified ad, this is what you have to do."

Not exactly the treatment I expect as a prospective customer.

And they SHOULD be treating me better than this. This is a newspaper! Newspapers, perhaps more so than any other type of business, are threatened by the prevalence of online news and information. They need my information. They need me to like them. They need to treat me better than that. If I had a better online experience with them, I might be more tempted to subscribe to their paper. Instead, I will rely on local web sites and media sites for my news, thank you.

After some digging, I did discover that they have a decent privacy policy, but I shouldn't have to dig! Make it obvious for me early on in the process and treat me like the valued prospective customer that I am.

TAKEAWAY FOR YOU:

1. You need good customer information. Check the accuracy of the information you have.
2. When you have an opportunity to collect customer information, there should be nothing more obvious than the privacy policy (only a link to it is required) that dictates how delicately you will treat it.
3. Your privacy policy better not be three pages of legalese.
4. Thank the customer for it!
5. Give them something in return! You can sell them something later. Now is the time to thank them.

Hey, CEO, nothing you do matters!

C-Suite Executives, Brand Managers, Marketing Directors and Ad Agencies spend hundreds of hours and hundreds of thousands of dollars trying to be clever enough to convince their audience to be interested in their product over someone else's.

Guess what CEO, nothing you do matters.

That's right. All the best ideas you and your marketing people have are no match for the effectiveness (or ineffectiveness) of the grumpy, underpaid, unappreciated staff standing behind the cash register.

Case in point #1.

I was in Fabricland today (yes, I am that confident in my masculinity) and the woman in line ahead of me was turned away, yes turned away, by the cashier.

The conversation went something like this:

Customer: "So, I'm interested in the points program you have for regular customers."
Cashier: "That program expires at the end of August, and you'll have to pay again at that point."
Customer: "So, you're saying I shouldn't bother."
Cashier: "I wouldn't bother."

Here's another way of interpreting that conversation:

Customer: "I'd like to buy what you're selling."
Cashier: "Don't bother."

And the cashier looked a LOT like this person.

I can see them now - all the corporate executives, marketing people and agencies sitting around a table trying to design a loyalty program that is more attractive that the competition's; that will inspire customers to return; that will sell more products. They come up with a program that is so good, people come in the store asking for it.... only to be... yes... turned away.

All the brightest talent working on their best ideas, completely undone by the crotchety, hourly staffer counting the minutes until she can go home.

You've heard it before but you need to hear it again: your front-line staff are the face of your company. They create your brand. They sell your products. They cross-sell. They leave an impression.

Invest in them.

At least give them some scripting about how to address the new loyalty program with customers!

Case in point #2.

Me (at the gas station): "Why would I pay for the deluxe wash instead of the regular wash?"
Cashier: "I'm not sure."
Me: "OK, then I guess I won't bother."

Read my earlier post for the details on this one.


TAKEAWAY FOR YOU

1. Spend some time mystery shopping your own stores. You'll be amazed!
   
2. Spend the 14 minutes it takes to write up some proper training / scripting guides for the front-line staff.
3. Hire better. It's 2010 - lots of people looking for work!
   

Surely you have some examples of really crappy front-line service. Post a comment with your experiences!

Kevin Smith blasts SWA - a lesson in Twitter and PR damage control

As I'm sure you know from glancing at the tabloids in the supermarket checkout, Kevin Smith was refused a seat on the plane because they said he needed to buy two seats.

On May 17 he agreed to call in to 102.1 in Toronto, and had plenty to say about the incident. Here's the podcast.

He feels he was treated unfairly and used Twitter to host a serious rant. They (SouthWest Airlines) attempted PR damage control with social media as well, but were essentially sticking by their policies.

What do you think? Should companies be bullied by... or "accommodate" tweeters and bloggers or should they hold their ground in the face of serious PR damage via social media?

TAKEAWAY FOR YOU:

1. Track mentions of your business in the internet - it's easy! (start with Google Alerts)
   
2. Have a policy for responding to negative press, particularly when it comes via social networking
3. A little latitude in your policies, please!
4. Always take a step back and consider whether or not you're being reasonable! What would a normal person expect to hear from you / expect you to do?

National Car Rental - Zero to Hero in 14 seconds!

So, I received a letter in the mail today from National Car Rental, who wanted to charge me $1.00 (plus a $10.00 "Administration Fee", of course) because, apparently, I missed a toll at the Orlando airport. Of course, "in accordance with the terms of your rental agreement, you are responsible for all violations and toll fees".

First of all, I wasn't even at the Orlando airport on the date of the infraction.

Second of all, IT'S $1.00!!

Third of all, don't get me started about this $10.00 administration fee.

So now I'm steamed. I'm thinking about all the arguments I will make, how angrily I will speak with them, how I will destroy their reputation on my wildly influential marketing blog! But first, a call to their appeals department. Mostly because I don't remember running any toll gates, but also because I'm going to tear a strip out of them!

Well, the most unexpected series of events transpired next. For one, they answered the phone right away - no tedious recorded-voice menu labyrinth. But even more impressively, the person I spoke to on the phone - presumably someone fairly junior among the National ranks - immediately reversed the charge. It took maybe 14 seconds. I'm not saying anyone can just call up and get their charges reversed, I'm just saying that in this case, she quickly realized that the best outcome for everyone was to just get rid of it. And she had the authority to do so.

Wow.

Well done National. You probably should never have sent the notice in the first place, but you stepped up and did the right thing.


TAKEAWAY FOR YOU:

1) Try to imagine how your policies and customer service processes affects your reputation.

I'm sure National's policy and process is to automatically send notices to all customers that incur external charges. Makes sense, but doesn't help their reputation in a case like this. How hard would it have been to include a sub-process that eliminates all notices of, say, $5.00 or less. Just pay it. They save all kinds of administrative time and money and avoid any possible brand damage.

2) Try to give authority to the lowest level possible.

I know it's hard to delegate responsibility and authority without jeopardizing control and compliance, but imagine how I would have felt if some bureaucratic appeals process was necessary to get my $1.00 back.

In short, keep your customers happy, not your COO.



YOUR TURN:

Comment with some of your customer service nightmares / success stories.

How NOT to ask your customers for their opinion

I received this request to fill out a customer survey the other day, and shockingly, I was NOT inspired to complete it.

I'm sure I don't need to explain why. Here is the invitation (I decided to disguise the company name as ABC):

To All Participants in ABC Program,

The ABC Board has been leading a strategic plan development process with the assistance of an external consultant who is very experienced in this area. At the 2009 AGM, the members identified some key areas of activity. Before moving forward, we would like to gather feedback from all levels within the ABC membership, from members, participants, supporters, and from administrators to volunteers. Linked are the key strategic issues identified by the membership and below is a link to the online survey.

http://www.abccompany.ca/strategic_direction_2010_en.pdf

http://www.surveymonkey.com/s/abccompany

Please respond to the survey by March 12, 2010

Thank you,

ABC Board of Directors

Oh gee, let me stop what I'm doing and take time out of my day to help you, with no indication of how it will help me. I know some companies expect that customers will simply be pleased to provide input for the sake of participating in the process, but there aren't many of those around!

Surveys are hard because you are asking people to spend a specific amount of time, and you want enough people to respond so that you have results that mean something.

In this particular case:

• They didn't tell me how long it would take
• They didn't tell me how I might benefit (do I get the results? improved service? anything?)
• They didn't express any gratitude for my participation or recognition of the value of my time
• They talked only about what they needed for them - completely one sided

Basically, they didn't do anything to inspire me to participate. Good luck!

And they mention that they are getting assistance from a consultant who is "very experienced in this area". If this survey request is any indication, that consultant either a) had no input on the survey request process, or b) has insufficient experience.

THE TAKEAWAY FOR YOU:

When you ask customers for their opinion:

1. Thank them in advance.
2. Recognize that their time is valuable.
3. Tell them how much of their time you need.
   
4. Recognize that their opinion matters.
5. Offer them something in exchange for their opinion (at least a summary of the results, maybe even something valuable, like an entry in a draw or a gift certificate).
6. Keep asking until you get a relatively statistically significant number of responses.
7. Follow up with them afterwards so they know their opinion was received, included and valued.

Take that big box part 2 - bike shop alive and kicking.

Small, local business success story #2.

Totally Spoke'd here in Stratford.


Bicycle shop - pure and simple. Quality, selection and all that, but above all, a crystal clear position the market. I took my daughter's birthday present in today (bought it from Direct Buy - more on them in a later post) to be tuned up before she started riding it. The guy I talked to summed up their story succinctly and effectively: "95% of the bikes we fix here are from big box and department stores."

That says so much, don't you think?

They are the Un-Canadian Tire. The Un-Sears. With those simple words they solidified their position as the place to go if you want a GOOD bike.

You can say a lot by saying what you're NOT.

So, let's take a snapshot of their success:
- Good retail location... check.
- Good product... check.
- Clearly defined offering... check.
- Clear positioning in the market... check.
- Unique/differentiated... check.
- Appropriate marketing tactics... check (good sponsorships in town).
- Pricing to support positioning... check (they aren't the cheapest).
- Uber-consistency in message...check.

Oh, and by the way, I took the bike in today (Monday). They told me I could pick it up on Wednesday. They called THIS AFTERNOON and said I could come pick it up. Imagine that, they over-deliver as well!

I think what this example shows, as does the other one, is that you have to be so thoughtful, relentless, clear and consistent to really be strong.

How is your company's "checklist"? Can you stand up against these guys?

Take that big box! Toy store alive and kicking.

Yes, big box stores and national chains have made it exceedingly difficult if not impossible for the small, single location, specialty store to survive.

But some do.

Family and Company in my home town of Stratford, Ontario, for one.

Family and Company is a toy store - pure and simple. They face just as much competition as any other specialty store would. Perhaps more. Imagine competing against the likes of Toys R' Us, Walmart, eBay, Zellers/Bay and more. To be a successful David among Goliaths like these you have to be TRULY UNIQUE. Consider these examples:

• They gift wrap, but not with normal gift wrap. It's a bag with loads of ribbon and decorations, additional toys thrown in (which the kids can pick out by the way), unique decorations, and branding, of course.
• They hold regular magic shows.
• Almost every toy has one opened sample for the kids to play with.
• They carry toys that no one else does. Those truly clever toys that just may not have widespread popularity or, more likely, distribution.
• They have tons of kids walking around (in uniform) playing with the kids and offering advice on which gifts to buy.
• They have a small patio outside where entertainers sometimes perform.

Imagine any of those things happening at Walmart.

In addition to their uniqueness, they have also covered all the marketing fundamentals (relevant to them):

• Prime location in heart of downtown.
• Every receipt comes with a flyer attached highlighting upcoming events, sales and specials.
• Extended hours in peak seasons.
• Relentless focus on the kids.

So here's the lesson for the specialty shop:

1. Address your marketing fundamentals.
2. Be TRULY, OBVIOUSLY, MEMORABLY UNIQUE.
3. Be relentless.
4. Be creative.

They remind me of the "Shop Around the Corner" from the movie You've Got Mail. Of course, that store had to fail against the mighty Fox Books for the storyline to work, but I wonder what would have happened to a store like that in real life. They had some uniqueness (storytime for the kids), but not as many as Family and Co. They had some fundamentals covered (location), but not all of them.

I think that's a lesson for small retailers too: You can't hang your hat on one or two differentiators. You have to really stand out.

But if Family and Company gives us anything, it gives us hope.

Don't sell me a product, sell me a benefit!

You would think that goes without saying, but I see so many case of companies that use marketing programs to sell a product, without telling me why I should buy said product!

(SURPRISE QUIZ: Does your web site home page talk about how long the company has been in business, where it's located, and what it does? I don't care! Tell me why you matter to me!)

Case in point: I was at Shell getting gas and a car wash yesterday. I went in to pay and the cashier asked if I wanted to upgrade the basic wash to a deluxe wash. Somewhat impressed by the attempt at an up-sell, I played along...


Cashier: "Would you like the tri-colour deluxe wash for an extra $2?"

Me: "No thank you."

Cashier: "It's a small price to pay for a better wash." (getting there...)

Me: "Why is it better?"

Cashier: "It's a 'tri-colour' wash."

Me: "What does the 'tri-colour' do?"

Cashier: "I'm not sure. But it's three colours."


SO CLOSE!!

I passed on the upgrade.

With the signage on the counter and the (failed) attempt by the cashier, it was obviously a deliberate marketing campaign that the store and/or company was running. But the most important factor was missing - the reason for buying!

Sell the benefits! Sell the benefits! Sell the benefits!

The Power of Partnerships

Too many companies try to do it all themselves. They advertise on their own, they create their own collateral, they empower their own sales force. All fine and good, but a mere fraction of what they could be doing.

Partnerships allow companies to extend their reach exponentially and to customers or markets that they may not have been able to otherwise reach on their own. And this is true for both B2B and B2C.

Case in point: I was vacationing in Key West this past week and wanted to rent a scooter. I asked the concierge to recommend a couple of rental companies and to our delight, she went one better: she arranged for us to be picked up and taken to the scooter rental company where our scooters would be waiting.

Perfect.

Now, there are dozens of scooter rental options in Key West, but because this rental company established a partnership with the hotel, they became the preferred provider. Had I searched on my own for rental companies, I would likely have ended up somewhere else. Instead, Pirate Scooter gets ALL the customers that think to ask the hotel concierge for help.

The thought process is simple: who is my target customer (in this case, vacationers), what other companies are courting the same customers (in this case, hotels), and how can we work together to promote each other (in this case, the hotel sends guests to Pirate, and Pirate agrees to provide door-to-door service, which keeps the hotel guests happy)?

Often times the partnership opportunities are obvious, simple to set up, and lucrative. For many small companies, it can be the ticket to survival or even prosperity.

What partnerships can you establish?

Make money, not excuses

Dollarama is going to be the unfortunate brunt of my wrath with this post.

Not that I buy much from Dollarama (OK, I do! Busted.), but I was in there yesterday because I needed change: coins for my kids' allowances. Now ordinarily I don't like to ask for change from a retailer without buying something. I just think that's a common courtesy. So I bought a pop for $1 and asked for the $9 change to come in loonies and toonies.

Here's what they told me: "We're low on change - it's the weekend you know."

Are you kidding me?

They (I say 'they' because both the cashier and some sort of supervisor were involved in this exchange) said it in a tone as though I was supposed to know that on the weekend, change would obviously be in short supply and that I shouldn't expect any. Well, here are the problems with that:

1) If you know you're going to go through more coins on the weekend, PREPARE FOR THAT! Get more rolls of coins! It's not hard. You're not out of pocket any more than you would already be. It's just a difference in denomination!

2) Don't, don't, don't talk to your customers in a snippy voice!

I didn't buy the pop. I went somewhere else.

So now, instead of buying a pop and going on with my day, I decided not to buy the pop and proceeded to trash the company in a blog. And I probably won't go there again. Imagine if that was your company.

The point is: think like a customer and prepare as much as you can to meet their needs. It's not hard, and it matters.

The cost of freebies, but also of returns and complaints

Cyberspace is a buzz with the recent Tim Horton's HR and PR fiasco.





Just last week a Tim Horton's employee was fired because she gave a toddler a free Timbit (she was quickly reinstated and offered an official apology). The retail price of a Timbit is $0.15, so you can imagine how little it cost Tim Horton's to produce this morsel and subsequently how little it "cost" them (in lost revenue) to give it away. Well, many a pundit is writing about the importance of free samples or free product as a way to build customer loyalty (latest example: Globe and Mail, which was in the Life section, which I found odd). I don't disagree, and in fact, wanted to take this opportunity to talk about how the concept extends to product returns and customer complaints.

Too many companies have ridiculously strict return policies. Now, to give them the benefit of the doubt, a return policy is put in place to minimize abuse. Stores don't want too many people purchasing an item, using it to some extent, then bringing it back for a refund. Valid. But what of the negative impression that leaves? They're basically telling us that the don't trust us. Gee, thanks! They're also of the belief that the cost of returns in this case would damage profitability. Well, as illustrated in the Tim's case, the cost of poor publicity and/or a poor customer experience FAR OUTWEIGHS the cost of the returned item.

Case in point: Recently I returned a DVD I received for Christmas to HMV. Now, it was clearly written on the gift receipt that returns had to be made within 21 days. Doesn't that sound a little strict? Now I know they're trying to reduce abuse (and in this case piracy), but I had the gift receipt and the DVD was still in the original shrink-wrap, so I thought I'd give it a shot. When I got to the counter... no problem. The cashier mentioned the policy, to which I didn't really object, but quickly allowed me to choose something else for $19.99. I was so pleased that I spent $26 MORE than $19.99, then proceeded to tell 3 other people about this positive experience. There may very well be people that would abuse a more lenient policy, but do you see how this simple gesture leads to positive word-of-mouth and to INCREASED revenue (as opposed to lost revenue which they fear)?

The same applies to customer complaints. Too many companies are excessively steadfast when dealing with complaints. Just agree that they're right, even if you think they're wrong! It's not worth it!

Case in point: Just last night I was at our neighbourhood hamburger/ice cream stand ordering a completely unhealthy meal of deep fried delights when I overheard the conversation ahead of me. The customer thought she ordered onion rings. The employee was certain she did not. In fact, the employee even went so far as to say "it's not written down on this sheet" as if to suggest that it's impossible for it to have been ordered if it's not on the sheet. How do you think that customer feels? Will she be coming back any time soon? And what is she saying to her friends? How hard is it to offer an apology, make the onion rings, and say "Sorry for the delay, thanks for shopping here - see you again"?

See the difference?

Now, think about how this applies to your business. How are your policies set up to encourage (or discourage) positive customer experiences and return visits?


Have your say: I KNOW you have examples you can share.

You don't want the business? Someone else will take it!

Here's another thing that boggles my mind: companies that actually utter the words "you would be better off going somewhere else." Come again?!?!

Phone companies are chronic offenders. They offer all kinds of deals to new customers, but if you're an existing customer, you get nothing. It's almost common knowledge now that the best way to have the best cell phone and the best service is to switch companies every 2 years!

I ran into another example in a less-likely-to-offend industry the other day: the hotel industry. I called on a Sunday looking for a conference room for the following day. The response I got: "There's no one here to take your reservation." HUH? Who am I talking to then? For them, they were so caught up in their internal departmental responsibilities that they couldn't take my reservation because no one from the catering department was working that day. Heck, they even recommended another hotel nearby for me to try.

Don't you think someone ought to be fired over that?

How hard is it to add the conference rooms to the booking software so that anyone can book any room?

Stop allowing your employees to invent ways to turn business away. Start inventing ways for your employees to build business.

Everyone matters when it comes to your brand!

It still boggles my mind when I see companies ignore those subtle differences between making a good impression and a bad one. We know that your brand is the collection of impressions that people have about your company, so you need to pay attention!

Case in point: I was at a meeting in a hotel (that shall remain nameless, I suppose. I'm on a bit of a streak of calling out companies for the wrong reasons, so a bit of a reprieve for this GTA hotel) not too long ago. We were holding a small meeting in one of the conference rooms there, and one of the attendees wanted a coffee. We were told that the options were to buy 'coffee service' from catering for $17 (for ONE pot of coffee) or to get one from the restaurant. We chose the latter option, and proceeded to fork out just under $3 for the smallest cup of coffee you've ever seen.

What impression do you think that left on us?!

How much does one cup of coffee cost that hotel? Conversely (and more importantly), how much does it 'cost' them to lose all future conference room bookings (and hotel room bookings for that matter)? And what is the 'cost' of all the bad press we are spreading?

Now imagine our reaction if they had said "We'd be happy to bring coffee to you - how many cups do you need? It's no charge - we're happy you chose our hotel for your meeting."

This is customer service and brand management 101 people!

So here's your job - think of how you are empowering your people to reinforce your DESIRED brand impression. And think of all the possible ways they might be damaging your brand too!

Have your say: Give me some examples of brand damaging or brand reinforcing behaviour you have encountered.