Archive for February, 2009

Little efforts make BIG impressions!

Friday, February 27th, 2009

Last week, I worked with the general manager of a Hampton Inn hotel who shared this story:

Shannon, a front desk agent, had recently joked with a repeat guest (with whom she had a nice rapport) about aging. The guest was a bit self-deprecating about his own age and referred jokingly to his need for Geritol.

Unbeknownst to him, Shannon recalled the conversation and had a small bottle of Geritol waiting for him in his guest room when he returned and checked back into the hotel.  Not only did Shannon’s pleasant surprise put a big smile on his face, it reinforced the relationship and genuine interest and affection she had toward him.

I priced a bottle of Geritol locally and with tax it’s $5.19. Was that a good use of the hotel’s petty cash? Before you answer, let me pass along some additional information that might help you to make an informed decision. Here’s an excerpt from an e-mail message from the guest that was sent to Shannon’s general manager afterward:

“(Shannon) has made my stay at your hotel very remember-able and I guarantee because of her, whenever I return to visit our branch in your wonderful city, I will stay at your hotel. I will also recommend any of my associates, comrades and even competitors to your hotel.”

Bain and Company, the consumer research firm, refers to this type of guest as a Promoter. Promoters, as their name suggests, promote a brand’s reputation, accounting for 80-90 percent of referrals, are the least price-sensitive, and—not surprisingly—report higher repurchase rates than less-satisfied customers.

Sometimes we over-analyze what it’s going to take (and how much it’s going to cost) to turn customers into Promoters. As Shannon has demonstrated, it actually takes just a little effort and perhaps (though not always) a few dollars to make a big impression on a customer!

Your turn: What can you do today with just a little extra effort to create Promoters of your business or brand?

Customers are quite adept at learning their place

Thursday, February 26th, 2009

Earlier today, I stopped by one of those cookie specialty stores to pick up an order of one dozen cookies that had been decorated as pineapples. (In case you’re wondering, the pineapple serves as a symbol of hospitality and warm welcome.)

As I’m preparing to pay, the clerk said, “So that’s twelve cookies at $6.85 each… $82.20. Then two boxes at $3.50 each… $7.00. And…”

I interrupted, saying, “Pardon me. Did you say I have to pay $3.50 for each of the boxes?” She confirmed the charge saying, “If you want a regular box, there’s no charge. But we charge extra for this box because it is only supposed to be used for our gourmet cookies.”

I asked her, “How much do you sell the gourmet cookies for?”

She said, “Eleven dollars per dozen.”

Now, I’m standing there trying to reconcile the absurdity of what I had just heard and asked, “So if I were to buy a dozen gourmet cookies for $11, then you’d give me the box?”

She said, “No. That box is only used for two dozen gourmet cookies.”

“Okay.” I said, “If I were to buy two dozen gourmet cookies at a cost of $22, would you give me the box?”

She said, “We sell two dozen gourmet cookies for $22. If you want them in the box, the cost is $33.”

She said all of this with a straight face.

I collected my thoughts and asked her one final question of understanding which I prefaced with: “Okay, just so that I have this correct, I could buy two dozen gourmet cookies in a bag for $22 and also buy the box for $3.50 totaling $25.50. Or, I could buy two dozen gourmet cookies in the box for $33 and pay $7.50 more. Is that right?”

While she acknowledged that my math was correct, she would not acknowledge the lunacy of their pricing model. Instead, she justified it saying, “It’s corporate pricing. We don’t have anything to do with it.”

In the end, I left having paid $88.86—which included the price of one dozen decorated cookies plus tax. She grudgingly parted with two gourmet cookie boxes with lids.

I’m certain she’s told anyone who was willing to listen about this cheapo customer who came by the store to pick up his order and balked at paying a measly $3.50 for a gourmet cookie box.

She may have even suggested that, since this customer doesn’t even work in the cookie business, what right does he have to challenge their pricing policies? Silly customers. When will they learn their place?

Well, I’ve learned my place. The next time I’m looking to spend $88.86 on a dozen decorated cookies, my place will be their competitor: Cookies in Bloom on University Blvd. here in Denver.

I’ve already called and confirmed they don’t charge extra for boxes.

Trust is a two-way street

Wednesday, February 25th, 2009

I met with a colleague this morning who shared a great story to underscore the importance of reinforcing trust with customers. Trust is a two-way street: customers have to trust the companies with whom they do business and companies have to trust the customers they serve.

If customers don’t trust your company for some reason, you probably won’t know it because they don’t do business with you anyway. They are a part of that elusive pool of prospective customers you may be trying to reach through advertising and marketing efforts.

But what about the customers who do trust your company? Are you reciprocating by trusting them too? The easy answer is “Yes, of course we do!” But the harsh reality is that that’s not always the case.  Consider the following true story I heard from my colleague, Brian, this morning:

There is a regional coffee chain that competes with Starbucks. Like most chains that compete with Starbucks, they have their hands full. It is in their best interest to do everything possible to differentiate themselves from the coffee giant. One way this chain had been successful doing that was through a loyalty program involving those familiar punch cards. Customers received a punch on their loyalty card for each cup of coffee purchased. When the card was filled with punches, the customer’s next cup of coffee was free.

Brian had amassed a stack of these cards over time containing a sufficient number of punches entitling him to several complimentary cups of coffee. One morning, he remembered to pull out one of the completely filled punch cards to “pay” for his coffee.

As he passed the punch card to the employee behind the counter as payment, the employee said, “Sorry, we don’t accept those anymore.”

My colleague said, “Why not?”

The employee then said, “Someone stole our punch and passed off a lot of fraudulent punch cards for free cups of coffee, so we stopped honoring them.” The implication being that perhaps his loyalty cards had been fraudulently punched.

I asked Brian what happened next and he said that he paid for the coffee but has not been back since. I asked how long ago this took place and he said it was about two and a half  years ago.

Now, think about this. Here’s a loyal customer who had been buying enough cups of coffee to completely fill several loyalty punch cards who, one day two and a half years ago, decided to stop patronizing this company (at any of its locations) because one of its employees did not trust that his punch cards were authentic.

Let’s do a little math on what this breach of trust may have cost this chain of coffee shops. We’ll be conservative and assume that he paid on average $2.00 per cup of coffee only once per week and that I’m the only person he’s shared this negative experience with—though it’s safe to assume he has told this story to many others!

  • $2.00 (per cup) x 50 cups (1 per week x 50 work weeks ) = $100 per year in lost sales
  • $100 (annual lost sales) x 2.5 years (period of customer absence) = $250 in lost sales to date!

What would it have actually cost the company if he had TEN completed punch cards? Two dollars? Three dollars? Let’s say it was ten dollars! That short-sighted decision to question the legitimacy of Brian’s punch cards—and, by doing so, his trustworthiness—has cost this coffee chain a minimum of $240 and counting

This is not an oversimplification. This is happening to some degree in every business that opened its doors to serve customers this morning! This company’s relationship with Brian, like all relationships, was based in large part on mutual trust. But this trust had been severed two and half years ago by a frontline employee who challenged the authenticity of Brian’s claim to a free cup of coffee.

Communication, like trust, is a two-way street. I’d love to receive your thoughts and opinions.

The service profit chain in action!

Tuesday, February 24th, 2009

Here’s a story I came across on-line. The author, Jack Bastide, gave me permission to include it on my blog as an example of how expressing genuine interest in customers translates into increased customer satisfaction and—ultimately—sales!

“About 3 years ago we bought two Jeeps. A Grand Cherokee for myself and a Liberty for my wife.  We bought them at two different dealerships. The guy that sold me my Jeep handed me his business card and I never heard from him again.  I don’t remember his name and I don’t remember the name of his dealership.

The person who sold my wife the car is Martha from Courtesy Jeep. I haven’t seen Martha in 3 years but I remember her very well. Why do I remember her?

  • She sends me birthday cards
  • She sends my wife birthday cards
  • She sends us holiday cards
  • She even sent us a happy anniversary card for the one-year anniversary of our Jeep!

So if somebody was to say to me, “Hey, I’m looking to buy a Jeep. Where should I go?” Who would I recommend? Some guy I don’t even know or Martha? Martha, of course. It’s a no-brainer!”

My take-away? It’s worth the extra time and attention it takes to express genuine interest in your customers. Aside from building relationships, it’s unexpected—a pleasant surprise—and lets customers know that you value their business, referrals, and loyalty.

Why pleasant surprises are no gamble!

Monday, February 23rd, 2009

For my 40th birthday, my wife and I traveled to Las Vegas where we met up with several other couples to hang out by the pool, see a show, and play a little Blackjack.

My wife had made reservations at Caesars Palace which, ironically, was also celebrating its 40th year anniversary. From our first interaction with Joanie at the front desk, I knew this was going to be memorable. She immediately made the connection between the celebration of my 40 years and the hotel’s anniversary celebration.

She noted this when she handed me a room key that contained a holograph containing a black and white picture of the front of Caesars Palace in 1966 and then, when rotated slightly, depicted a color picture from the same vantage point in 2006. During our brief conversation, we joked about the theme song for my 40th birthday celebration: Toby Keith’s hit song, As Good as I Once Was.

Memorable room key in hand, Julie and I headed to our room in the recently opened Augustus Tower. It was then that I noticed our room number: 4089.  When we reached our floor and existed the elevator, my wife took a picture of me next to the large number 40 designating our floor number.

We then proceeded to our room, opened the door, and entered to find that our flat panel television set was playing a music video. That’s right: Toby Keith’s, As Good as I Once Was. Not sure whether that was staged or just a bizarre coincidence but I was wowed! And Joanie wasn’t through yet. Julie and I went downstairs to do a little exploring of the sprawling facility and when we returned an hour later, there was small gift and a handwritten note from Joanie wishing me a happy 40th birthday and a pleasant stay.

So how does this pleasant surprise translate into more revenue for Caesars Palace? For one, it’s clearly documented that there is a relationship between guest satisfaction and ancillary spending in a hotel setting.  In one study, J.D. Power and Associates concluded that guests whose overall satisfaction was a ten on a 10-point scale spent an average of $14 more per day on supplemental goods and services (e.g., food and beverage outlets, gift shops, in-room movies, etc.) than guests who were less satisfied.

In fact, the first night of our stay I recall canceling a reservation that we had made at a well-known sushi restaurant down the street in order to dine at Caesars’ own sushi restaurant, Hyakumi Japanese Restaurant & Sushi Bar.

And the payoff for Caesars Palace doesn’t end there. A week later, in a note to Gary Selesner, the President of Caesars Palace, I committed to return to Caesars Palace the next time I visited Las Vegas. Now, think about the number of hotels in Las Vegas that are attractions unto themselves. It would be perfectly natural to assume that customers would experiment by staying at a variety of competing properties—many of which are very uniquely themed in order to differentiate themselves from competing hotels and casinos.

Even so, my commitment to Mr. Selesner was “to return to Caesars Palace the next time I visited Las Vegas.” Notice that there are no qualifiers such as: if the location is convenient; if the price is right; or unless your competitors are offering free show tickets to book. My intent is to return to Caesars Palace. Period.

Think about your own experiences at hotels, airlines, restaurants, department stores, etc. How have pleasant surprises such as upgrades, sample appetizers, complimentary alterations, etc. contributed to your positive impressions of these companies and influenced your loyalty and future spending?

Sincere and specific compliments influence customers

Sunday, February 15th, 2009

A good friend of mine, Shawn, travels nearly every week with his job as a regional sales manager for a large technology company.  Shawn is a member of United Airline’s Mileage Plus frequent flyer program and recently achieved its elite status, 100K (which recognizes 100,000 actual flight miles traveled within the calendar year).

Late last year, on the outbound leg of the flight that would carry him over the 100,000 mile threshold, a United Airline representative approached him in the gate area, thanked him for his loyalty, and recognized his achievement of a status that very few frequent travelers will ever reach.  As a part of the recognition “ceremony,” she took his boarding pass, drew a line through his current Premiere Executive status, and hand wrote “United 1K!”

Shawn was so complimented by the gesture that he saved the boarding pass and uses it as a bookmark.  He recently told me that this simple act by the gate agent reinforced his loyalty to the airline and was the deciding factor to book with United Airlines when comparing flight schedules and fares offered by United and two competing airlines for an upcoming business trip to Calgary, Alberta. And, in case you’re wondering, United was not offering the cheapest fare.

How about you? How have you been complimented lately as a customer?

The wine and food pairing puzzle

Friday, February 13th, 2009

John Fischer, a Culinary Institute of America instructor, in his book At Your Service demystifies the wine and food pairing conundrum, enabling staff to confidently offer suggestions to their guests.

Fischer writes, “The amount of knowledge required to be a wine expert is staggering, and impossible to bestow upon every member of the floor staff. Thus, you need to simplify it for the people you’re training. To me, this means going conceptual rather than informational. You can get your staff to think about wine in a way that will aid in getting wine on the table.”

Exactly. He then goes on to propose a simple quadrant system to support less-experienced staff in assisting the wine selections of their guests.  Regardless of whether you’re the waiter taking the order or the guest placing it, you can benefit from Fischer’s system:

The Quadrant System:

  • North (light-bodied, high acid wines because the grapes don’t get as ripe)
  • South (fuller wines, less acidity because the grapes are riper when picked)
  • Old World (European origin; wine is an accompaniment to food; earthier, drier, and missing some fruit)
  • New World (USA, S. America, Australia; are often drunk by themselves and need to be a complete flavor; sometimes clash with foods because they already contain all the flavor they need).

Put these two axes together and you’ll now be able to identify a light-bodied, fruity wine by looking for a cold region in the New World (e.g., Washington state) or a full, dry red wine to go with a big steak by looking for a warmer region in the Old World  (e.g., Southern Italy).

Bon appétit!

Engage customers. Increase sales!

Thursday, February 12th, 2009

Research from a leading hotel company shows that a guest who is actively engaged with its brand spends 23 percent more money than one who is only moderately engaged.

Actively engaged guests are defined as those guests who have a sense of well-being—confident and secure in their accommodations, feel as though their needs are anticipated by the staff, and are pleased with both their guest room condition and assignment. When its employees produce a 4-percentage-point increase in customer engagement scores companywide, this brand achieves an extra $40 million in incremental revenue.

It makes sense when you think about it. Consider a nightclub environment. Is the DJ or band engaging? Are they inspiring enthusiastic dancing, energetic conversation, memories, smiles, and laughter? If so, then I’ll bet you and others will stick around for another drink…

Engaged customers spend money. Bored customers don’t.

Hotel wake-up calls are tired… (yawn)

Sunday, February 8th, 2009

When the automated hotel wake-up call arrives in the morning, what does the message say? In my experience, the message often sounds something like this: “Good morning. Today’s weather forecast calls for partly sunny skies, breezy, with a high temperature of 52 degrees. Thank you for choosing the XYZ hotel.”

Some hotels take it a step further and include a marketing message such as: “Why not begin your day with a hot breakfast in the XYZ restaurant on the main level? Our breakfast buffet is priced at only $11.95.”

Either way, 80 percent of guests are frequent travelers and hear the same types of predictable wake-up call messages wherever they go. On rare occasions, guests will receive a personal wake up call from an engaged employee who has a bit of enthusiasm in his or her voice. This will make an impression and, in doing so, will become memorable. That’s a good thing in customer service.

Personalized hotel wake-up calls are more, well, personal than automated calls. Even so, they are less common these days as hotels have largely moved to the efficiency of having guests program their own wake-up calls from their guest room phone. In fairness, some guests may even prefer this method for its expediency and accuracy.

So what’s a hotel to do? They want to be memorable and distinguish themselves in the hearts and minds of their guests but it may be impractical or cost-prohibitive to place personalized wake-up calls to every guest.

Consider this sample wake-up call script from the British actor Stephen Fry (Jeeves of Jeeves and Wooster fame): “<discreet cough> Good morning. I’m so sorry to disturb you, but it appears to be morning. Very inconvenient, I agree. I believe it is the rotation of the earth that is to blame.”

Now maybe this script doesn’t fit the style or personality of your hotel. That’s okay. You have to do what works for you and your clientele. Personally, I think most guests of most hotels would laugh out loud at messages like this one. Not only that but they’d have a funny and memorable story to share with the colleagues or customer they meet with later that day!

The French novelist, Colette, said, “Total absence of humor renders life impossible.” I would add that the deliberate inclusion of appropriate humor makes guest experiences memorable.

And, when hotels are trying to distinguish themselves from competitors in a crowded marketplace, memorable beats the alternative!

Unique knowledge drives more sales

Wednesday, February 4th, 2009

Consider the job knowledge that is expected from a typical waiter at a fine dining restaurant. For instance, he or she might be expected to know the menu items well in terms of ingredients, sauces, substitutions—that sort of thing. The waiter would also be expected to know about aspects of the menu that might change from time to time such as the market prices of fresh fish, daily specials, etc.

What may not be expected from a waiter is unique knowledge. By definition, this knowledge is unexpected—that makes it unique. Because it’s unique, it adds to the service experience and is memorable. Ordinary job knowledge is expected and produces predictable results. Because it’s ordinary, it does not add to the service experience and is, ultimately, forgettable.

Here’s an illustration of two waiter scripts, one conveying job knowledge (i.e., bland and routine—and quite forgettable) and the other conveying unique knowledge (i.e., unexpected and refreshing—and quite memorable!):

1. Job knowledge:

“Tonight, our featured appetizer is the Pâté de Foie Gras. May I interest you in an order?”

2. Unique knowledge:

“Our chef trained at the prestigious Restaurant School in Philadelphia and apprenticed at Le Bec Fin. She also traveled to France to refine her knowledge of French delicacies such as truffles, escargot, and foie gras. In fact, our Pâté de Foie Gras is our featured appetizer. May I tempt you with an order?”

Now, seriously, if you’re on the receiving end of each of these proposals, which one might you accept—even if you previously had no intention of ordering an appetizer? Exactly.

And here’s something else I’ve found to be true: Which proposal is likely to bring up the question of price (which may influence a customer’s decision of whether or not to order the appetizer)? After hearing the second proposal (and swallowing, as the waiter’s proposal has likely activated a Pavlovian response…) my hunch is that, for most customers, the price of the appetizer would be irrelevant.

So, make it a point to acquire as much unique knowledge as you possibly can about products, services, the culture and history of your business, the building and neighborhood you operate in, the people (as in the example above), and even proper names (e.g., “Why is the restaurant named Ruth’s Chris anyway?”). You will be providing your customers with a richer service experience and they will be making you, well, richer!

While customers appreciate nice employees, they value knowledgeable employees. And the more unique knowledge employees possess, the more value they bring to the customer experience.

Contact Steve

Begin generating enthusiasm for your customers today!

Phone
303.325.1375

Email
info@stevecurtin.com