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Category: Customer Expectations

Systems Versus Creativity

Interesting dilemma… Are systems for handling situations and creativity mutually exclusive?

Here is the situation.

One of my vendors informed me that we needed to send in photos of defective parts to get replacements. Makes sense. They need to protect their costs by knowing that they are replacing only that which needs to be replaced.

Our first customer to have a problem after this policy began lived over an hour away. They had flaws in the product that, while usable, were not what they had paid for. It was a special order item so we would need to order new parts for them, no matter which ones were damaged. So we asked if they would kindly take some digital photos and email us to save us a 140 minute round trip. They did and the parts were ordered.

The second customer was a mile away and had ordered an in-stock item. When she called with a problem, we asked her to send photos, which upset her. Why should she have to send photos? Why couldn’t we come out there and snap them ourselves? Heck, why couldn’t we bring her a replacement and take the photos when we got back to the store?

Good question.

The solution to the first problem was not necessarily the exact way to handle the second problem.

Our mistake was that we implemented a system of “hows” before answering all the “who, what, where, when” and most importantly “why”.

How do we get a replacement part? By sending photos to the company. Who takes the photos? Anyone. Why did we ask the first customer to take the photos? Because she was over an hour away and we would need to order the replacement no matter what. Why did we ask the second customer to take photos? Because that’s how we did it the first time. Do you see the flaw in this thinking?

Before you implement a new system, make sure you carefully point out why you do things a certain way, and what the ultimate outcome should be. And empower your staff to use their imagination and creativity to come up with solutions that make the customer happy while following the spirit of the system.

-Phil

PS The very next day the second customer had a replacement, we had photos to send, and everyone lived happily ever after.

Turning Your Customers Into Fans

I’ve just posted a new Freebie on my website based on the presentation I gave in January at the IDEX Show.

It’s called Turning Your Customers Into Fans.

If you want to grow your business, you can use traditional marketing and advertising. But everyone knows that Word-of-Mouth is the strongest form of persuasion. And you’ll get far more WOM if your customers aren’t just customers, but are stark raving fans, evangelists for you.

Knowing how to turn them into fans, and how to empower that evangelism is now available for you free of charge. Check it out.

Cheers!

-Phil

What Audience Segment are You Targeting?

I subscribe to a free service called Help A Reporter Out. Three times each weekday I get an email with requests from multiple sources needing quotes for articles, blogs and books.

One question recently peaked my interest. Below is the question, my answer, and some follow-up questions & answers.

Are retailers doing enough to attract new customer segments or are they putting all their eggs into one audience segment basket?

Most retailers are putting too many eggs into one basket, and usually it’s the wrong basket. The biggest mistake most retailers make is in how they define their audience. Too often they use outdated and inaccurate tools such as demographics or average customers. Defining your customer based on age, gender, income and education doesn’t work in today’s world. Customers are too diverse to be summed up neatly in one little box.

Describe some common mistakes retailers make in their outreach efforts.

The two biggest mistakes most retailers make in their outreach efforts is:

  1. Going after the wrong model of people (see answer above)
  2. Not making the Outreach consistent with the Experience.

Too many times the marketing message is at odds with the in-store experience. A classic example of this a couple years ago was Wal-Mart trying to get into fashion. The marketing talked about upscale fashion, but the store screamed ugly, dirty and cheap. When they dropped that campaign and went back to advertising really low prices their numbers improved greatly.

There is a big disconnect between how customers perceive certain stores and how those stores advertise and market themselves. Thus, those advertising messages are seen immediately as false hype and are discounted or ignored. The best marketing & advertising campaigns are those that consistently match the actual experience in the store. If you advertise excellent customer service, you better have over-the-top customer service in the store. If you advertise low prices, they better be extremely low. If you advertise friendly, helpful staff, you can’t have lots of fine print clauses in all your policies.

With new media tools added to existing traditional outlets like print, radio and direct marketing, how do they select the most effective tools?

All forms of advertising CAN work. The key is in knowing how each form works differently and then using them in the correct way. You can’t do the same thing on Facebook that you do in a newspaper. They don’t work the same. The key to selecting the right tool is to first identify the objective with clear and measurable goals. Then evaluate all the options to determine which tool most effectively can reach that goal. For instance, we use Facebook primarily as a way to fan the flames of our most loyal customers by making them feel like insiders. It is not used for reaching new people. I use radio for that purpose.

Can you offer 3-5 tips on improving their marketing messages?

First, identify the true Core Values of your business. What are the unwavering principles that guide every decision?

Second, evaluate every single aspect of the business to make sure it aligns perfectly with those core values. And I mean everything! From the message on your answering machine to the odor in your bathroom, you have to be consistent enough that any customer walking through the door knows exactly who you are and what is important to you.

Third, align your marketing message with your core values. If your store is about teaching the customer how to shop, use your marketing to teach. If your store is about whimsy and surprise, make your ads about whimsy and surprise. If your store is about efficiency and accuracy, make your ads about efficiency and accuracy.

When you follow those three steps you’ll immediately start attracting new customers to your store, customers who align their values with your values. That is the most important segment of the audience to own.

Merry Christmas!

-Phil

What Chris Brogan Can Teach You About Retail

Chris Brogan, author and power blogger, just posted a blog about a horrible shopping experience titled What Timberland Taught Me About Retail.

There are many lessons in there for independent retailers. I’m going to talk about two of them.

The gist of the story – he saw a Timberland boot advertised on TV and went to a few brick & mortar stores to find it, make his purchase and move on. Unfortunately, the stores were ill-prepared for his visit. Some didn’t even know about the product. Others knew the product but didn’t have it. Others had it but not in the color or size he needed. Overall, he was frustrated that he could not find anyone with credible information – let alone the actual item – about a product he saw advertised on TV by a major vendor.

This happens all the time in retail. Customer sees product in advertisement, customer wants product, customer goes to store, store doesn’t know product, customer goes away frustrated.

But it doesn’t have to happen in your store as long as you are proactive about the situation. To do that you have to know the answer to two questions.

The first question is whether or not the company ever gave such information to all the retailers or whether this was an exclusive channel distribution product.

The best retailers know not only the products they sell, but also the products they don’t sell (and why). Do you have major vendors that also sell exclusives to big-box stores and Internet sellers? Have you asked them for info on the exclusives you can’t get?

If you want to be the product knowledge king, that is information you need. And don’t wait for your reps to give it to you. Ask them right up front to get that info. Start with your top vendors and work down until at least you have a working list of products customers might request that you don’t have. (And know why you don’t have it – by your choice or the vendor’s choice.)

If you choose not to carry an item available to you, there is a reason you didn’t buy it. Does your staff know that reason?

Just imagine the different type of experience Chris would have had if an associate said, “I know the boot you saw. We chose not to carry it because we like model x better. It has… which means you’ll…”

Or if you couldn’t get the product… “I know the boot you saw. We don’t have that style, it is only available online, but let me show you this one. It is similar because…”

Can you see the difference between either of those scenarios and, “Nope, never heard of ’em,“?

The second question is whether or not the sales staff even cared about knowing that information.

Maybe the information did come down the pike. What did you do with that info? What did your staff do?

This is a training issue.

The best retailers are motivating their staff to know more about the products than the customers. In this day of endless information on the web, it is vital that your staff are constantly researching product info. Yes, the customers are already coming in armed with more info than ever before. But now it is your job to sort that info for them and give it relevance. Tell them why a certain feature is included and what it will do for them (benefits). Let them know why one item costs more than another and help them figure out if the extra expense is worth it.

How much product knowledge training have you offered to your staff? How much time do you spend on teaching the benefits of every product you sell? How much time is devoted to continually updating that info? If you’re not doing this, you’re letting customers like Chris get away.

Chris Brogan just told a few hundred thousand people not to go shopping in brick & mortars because they were basically clueless. The only way we can combat messages like that is to constantly give our customers the kind of service that would have made Chris a loyal follower.

Can you do that in your business?

-Phil

Don’t Make Your Customers Mad

Why would I want to make my customers mad? Apparently some retailers think it’s okay to piss off a few people.

This Thursday the fliers hit the door with all the early bird doorbuster specials for Black Friday, and some of them are going to make customers mad.

Look at the fine print in these ads and you’ll see what I mean.

Some of the best deals say “minimum 2 per store” meaning that stores in smaller communities (like Jackson) may only have 2 of those great items they’re using to draw a big crowd. If you’re standing in that line at 5am you gotta ask yourself… Will you be one of the lucky two? Or will you be one of the mad?

Some of those deals aren’t deals at all. Read the model numbers and compare them to what the stores currently sell. Some of those doorbusters are what we call derivatives or one-offs. They look the same as the original, but some features have been stripped out to make it cheaper. Will you be one of the shoppers who did the research and is happy with what you gave up? Or will you be one of the mad?

Some of you will give up sleep, fight crowds, and wait in long lines. Some of you will find that fun. Some of you will be mad. (If you ever wondered why some people love Black Friday and others hate it, click here.)

And think about the staff. They had to give up spending time with their families. They got too little sleep. They’re overworked (and underpaid). They’re on the front lines having to deal with all these unhappy customers. Some of them aren’t all that happy now either.

I’ve never quite figured out why these stores go through all this hassle knowing the outcome is that they will anger as many customers as they please, and not make many friends with their staff, either.

If you’re offering any Black Friday specials, do your customers, your store, and your staff a favor.

  • Make sure you have ample supply of anything you advertise.
  • Be honest about the deal. If it’s a derivative or one-off, let people know up front.
  • Train your staff to learn how to show empathy with unhappy customers and empower them with tools to solve problems and make the customers happy.

This Black Friday most every major retail chain will make a whole bunch of their customers mad by design.

You don’t have to play that game, too.

Happy Thanksgiving!

-Phil

The Three People to Solve the Problem

If you’re in retail, at some point you will have a customer with a problem. And your success will depend on how well you solve that problem in the customer’s eye.

The key is knowing the three people who can solve the problem. Those people are (in no particular order):

  • The person Most Capable of solving the problem
  • The person Closest to the problem
  • The person Least Busy at the time of the problem

The problem for most businesses is the order in which we prioritize that list. From a business owner’s standpoint the ideal priority would be:

  1. Most Capable
  2. Least Busy
  3. Closest

From a customer’s point of view, however, the order would be:

  1. Closest
  2. Least Busy

Notice that I left off “Most Capable”. The customer expects that everyone will be Most Capable. And that’s where the smart retailers succeed. They equip their front line staff with the tools to solve problems so that customers get satisfaction right from the start.

There is nothing more frustrating to a customer who already walked through the door loaded for bear than having to wait around while incompetent fools run off in search of an already over-worked manager to approve a return or refund or some other simple issue.

Conversely, there is nothing so satisfying as a customer than having the first person who greets you being able to fully take care of your problem.

The best thing you can do for your staff is walk them through the basic problems that arise in your business. Show them your thought process and the criteria you use to make decisions. Then empower them to make those same decisions for the customers.

Sure, they might make a mistake or two. Sit down with them when they do and talk through their decision-making to see their process. Use that time to show them (again) how you would handle it. The good ones on your staff will get it quickly. Plus, they’ll feel more ownership for the satisfaction of the customers in the first place.

There will still be a time when the person closest to the situation can’t solve the problem. But the more often they can, the better your customers will feel about you and your business.

And isn’t that the whole point?

-Phil

Yes They are Price Shopping With Their Phone – It’s Okay

The new applications on iPhones allow your customers to scan a bar code on a product on your shelf and get all kinds of information online including the price others are charging for the very same item.

Oh no! Oh, yes. Customers can more easily price shop you than ever before. What are you going to do?

Some stores are banning customers who do this. Don’t be one of them.

Allow your customers to use this new app. Embrace the technology. As Bob Phibbs pointed out so well, use it as a means of connection with your customer. Ask them what they found. See if the info is accurate. Chances are, you’ll be able to add info to what they find, or at the very least be able to make that info relevant by explaining to the customer what it means.

By all means, however, treat these customers with ultimate kindness and respect.

Sure, many of them are price shoppers, transactional customers, who won’t ever be loyal or profitable for your business. But that is no excuse not to kill ’em with kindness.

One thing we know about transactional customers is that they are always big on word of mouth. They love to talk about their shopping experiences.

And when they leave your store, they could be saying, “Wow, what a bunch of overpriced jerks!”

Wouldn’t you rather they said, “What a friendly knowledgeable store – expensive – but they really know their stuff,”?

Embrace the new iPhone apps and other programs that allow customers to price shop and get other info on your products. And then recognize that they came to you first. Now give them a reason to buy.

-Phil

Do You Have It In Stock?

Took the kids to Florida. The pool was heated. Parker brought his swim fins. Ian’s didn’t fit.

No problem, we’ll be in Florida on the ocean. We’ll have no trouble finding Ian a new pair. Right?

A couple of stores that we thought might have fins failed to produce. Plenty of goggles and masks, but no fins. That’s okay; we had an ace in the hole. A huge swimwear store was right up the road. We were sure they would have what we wanted.

Oops.

According to the kid behind the counter, swim fins weren’t due in for another week. “It wasn’t season,” he explained.

Being in the toy industry with both summer and winter items, I understand the concept of seasonal stock. I just don’t buy into it. If you want to buy a sled from me in July, I can sell you a sled. I may not have the biggest selection, but I will have a sled.

My son, however, doesn’t yet get this concept. Needless to say, he was heartbroken.

So ask yourself this… How many customers are you sending away heartbroken because you didn’t have something in stock during what you consider to be off-season?

Perception is reality, and although you may think it is off-season, you never know when a customer might believe it is in-season. Is there a corner of your store that doesn’t move much merchandise where you could put a small display of off-season stuff? Or a corner of your stock room?

Imagine Ian’s reaction if the kid at the counter said, “Hold on,” and ran into the stock room and produced a set of swim fins.

Heartbroken or Happy?

Which do you want your customers to be?

Phil

PS Six stores later we found some swim fins. SIX STORES LATER

What Are They Talking About?

When people talk about your business what are they saying? Do you know? More importantly, are people even talking about your business?

Have you given them something to talk about?

Roy H. Williams, aka Wizard of Ads, mentioned three ways at a recent conference to help you get WOM (word-of-mouth) from your customers.

First, you could choose to be over-the-top excellent in Design. Your store layout, merchandising, decorating, facade and mood could be so unique and outstanding that people talk about it for days and weeks afterward. Have you ever seen the Ferris Wheel at the Times Square Toys R Us? That’s over-the-top Design. Does your business have a cool and unique characteristic? Do you flaunt it? I saw a program on the Travel Channel of the 20 coolest public bathrooms. It was totally intriguing. My grandfather always had the idea of building a carousel on the front of the store with half the ride inside, half outside. Kids could get on the carousel and enter the store that way. Imagine what kind of WOM that would generate (and yes, I’m still considering it).

Second, you could choose to have over-the-top excellent Performance by your staff. I’m not talking about “excellent customer service”. Everyone says they have that. And, frankly, customers aren’t impressed by people who are just friendly & knowledgeable. They expect that. In fact, the only WOM you get from excellent customer service is when you don’t supply it. And that’s WOM you could do without.

What I’m talking about is a performance so rare that it’s exciting, extraordinary and unique. Customer service that is so over-the-top it becomes an experience. And it has to be an every day, all the time experience. If you’ve ever been to Pike’s Place Fish Market you know what I’m talking about – and what customers are talking about. The throwing of fish, the yelling, laughing, playing, the customer involvement. What can you do every day to make your customer’s experience more memorable?

The third, and most intriguing way Roy described was Generosity. What are you giving your customers to make them talk about you? A jeweler who replaces watch batteries for free, a restaurant who gives out free desserts to dinner guests, a hotel that has free curling irons, cell phone chargers, or web connections. Those are just some examples of generosity. But here’s the clincher. To get WOM from your generosity you have to do it, but not advertise it.

Imagine you go out to eat and see a sumptuous dessert menu on the table. You know you want one, but aren’t sure if you want to fork over the dough for an extra you don’t need. But then your waiter says, “How about a dessert tonight? It’s on me.” How could you resist? And won’t you be talking about that meal to your friends? Pretty soon, you’ll be saying, “Hey, let’s go to so-and-so’s. The last three times I was there the waiter gave us a free dessert.”

For the cost of some flour and sugar, a restaurant that does this could buy a lot of WOM, and a lot of loyalty. (And that flour & sugar could probably already be fixed into the cost of the meal.)

Word of Mouth is the best form of advertising – always has been, always will be. But you have to give someone something to talk about. Start looking at your Design, Performance and Generosity and see if you can find something worth a conversation. Then maximize it to the extreme and watch the talk begin.

-Phil

Wal-Mart Got it Right

In this dismal economy Wal-Mart keeps racking up sales gains. Many people are quick to point to the slumping economy as the reason Wal-Mart is doing well. Lost your income? Shop at Wal-Mart.

But there’s more to it.

In 2007 the economy was already starting to slide, yet Wal-Mart didn’t fare so well. In 2007 Wal-Mart rolled out their “high fashion – low prices” campaign. In an effort to compete with Target’s “cheap chic”, Wal-Mart tried to upscale their offerings. The result? Abject failure. No traction whatsoever.

Why did something that worked so well for Target fail so miserably for Wal-Mart? Core values.

Target’s core values from day one have been to offer a step-up from the K-Mart/Wal-Mart fare. They have cultivated the image through store design, product selection and advertising. They have built their reputation and core customers on this premise.

At the same time, Wal-Mart’s core values have been to offer really, really cheap stuff. They have cultivated that image and their core customers over many years. Their core customers shop at Wal-Mart for one reason – really, really cheap stuff, not high fashion. So when Wal-Mart deviated from their core values, they alienated their core customers. And at the same time they were unable to shift customers loyal to Target.

But in 2008 they got it right. Wal-Mart went back to their core values and focused on what they do best – really, really cheap stuff. Yes, the economy helped. No, it wasn’t the only reason. How do we know? Because some other stores also did well in this economy, and not by offering really, really cheap stuff.

Independent stores have fared far better in this economy than their chain and department store counterparts. And the best performing independent stores did it by being true to their core values. They didn’t go after the low price market. They offered great customer service, or expert product knowledge, or high-quality merchandise, or all of the above. They made sure that their core customers’ expectations were met or exceeded. They didn’t leave their core for a grab at someone else’s pie. They stayed true to who they were.

Do you know what are your core values? Do you know who are your core customers and why they shop with you? The best stores know this and are constantly working to make sure every part of their business aligns with these values.

Our values are Fun, Helpfulness, Education, and Nostalgia. It isn’t about the products as much as whether those products are consistent with our values. It isn’t about the services, but whether those services are consistent with our values.

When you know who you are, the business model gets easier. When you stay true to your core, you create loyalty. And in this economy, when loyalty is most fragile, you need to hold onto as many customers as you can.

Everyone knows the old adage that it is cheaper to keep a customer than find a customer. Now, more than ever, that statement is showing itself to be true. Keep your core customers by sticking to your core values. Finally, a lesson from Wal-Mart we can all put into practice.

-Phil