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?

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.

Competition at its best

Hockey fan or not, you have to love this story.

This week, CBC failed in its negotiations to maintain rights to the theme song for its #1 TV program - Hockey Night in Canada. The theme song has been an integral part of Canadiana for more than 40 years. Most Canadians could belt out the tune on command, and it has even become an overly popular ring tone for hockey fans across the country.

Now, tempting as it is, I won't use this space to talk about CBC's failure to retain something so critical for their brand. Instead, I am more intrigued - or should I say impressed - by CTV's response. They bought the rights right out from under them! They will use the song for their hockey broadcasts on TSN (which they own). As deft a competitive move as I have seen in recent memory.

Now, readers of my blog will cry hypocricy and remind me that in a previous post, I condemned Kelsey's for using the Cheer's theme song for their new campaign. But wait - this is different. CTV has recognized the importance of the song to viewers, and is wooing them with it. They didn't try to recapture old, expired magic by reviving a popular theme from somewhere else (as Kelsey's did), they just stepped up to the plate when their competitor couldn't. Kelsey's decision to use the Cheer's theme reeked of laziness. This move by CTV is competitive spirit at its best.

Imagine for a moment that, say, The Keg offered a menu item so vital to the Canadian fabric that Canadians ate there just for that reason, and ate there almost every time they ate out because it was that important to them (this dish would likely resemble a donut sandwich with coffee sauce and a side of Molson Canadian). Now let's imagine that someone had sold the recipe to them, and the usage rights had expired. If Kelsey's swooped in and grabbed the recipe when The Keg decided it wasn't worth keeping (ignoring the needs of their customer base), that would be impressive. Just like CTV's move.

Similarly, imagine that CBC dropped the logo for the show - not really that important to viewers. If CTV had picked that up, that would just seem like laziness.

See the difference?

The theme song WAS the show. It was Canada. Forget that it's a theme song, or a logo, or a menu item. Whatever IT is, if it's that iconic, protect it. And if it's available, steal it! Other examples would include Nike's Jordan silhouette, the golden arches (sadly), and the iPod.

Nice move CTV.

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.