Archive for September, 2009

Unique knowledge sells stuff

Wednesday, September 30th, 2009

Safara MugThe other day I was waiting in line at Starbucks and noticed a display of coffee mugs that were selling for $8.95. My first thought was that another coffee cup was the last thing I needed. And, if I were going to buy one, I likely wouldn’t pay full price. I’d look around for a mug with a bright red price sticker on it because, after all, a mug’s a mug. Right?

Maybe not. Alongside the mugs, I noticed a conspicuous display card containing a bit of background information on the mug. It read:

SAFARA MUG

Made by potters in Toki City, Japan, using techniques passed from generation to generation for more than 400 years.

$8.95

No longer was this “just another coffee mug.” It was a unique piece of pottery that had been crafted by artisans with specialized knowledge that had been passed down from one generation to the next. And no longer was a selling price of $8.95 too high. It appeared reasonable, given the origin and craftsmanship of the mug.

Now, I have no illusions that this mug will appreciate in value and one day become a collector’s item worthy of a display case in the Smithsonian. That’s not the point. The point is that this commodity, a coffee mug, had been transformed into a piece of art by simply adding 19 words of unique knowledge.

Unique knowledge is interesting, unexpected, and adds value to the customer experience. It’s not ordinary or predictable. It’s sexy in the sense that it attracts attention. You notice it. It’s unique and memorable.

Consider your own products and services. How can you add value by including unique knowledge—a story that will captivate your customers, reposition your offerings as anything but commodities, and justify your price premiums?

Add value, not fees

Tuesday, September 29th, 2009

crowded airportAccording to this article, all major U.S. carriers, aside from Continental and Southwest, have added a $10 surcharge to most of their fares for travel on three busy days around the Thanksgiving and New Year’s holidays: Nov. 29, the Sunday after Thanksgiving, as well as Jan. 2 and 3.

Rick Seaney, CEO of FareCompare.com, said the airlines likely added the charge because it was a quick, targeted way to charge more on peak travel days. The Sunday after Thanksgiving is one of the busiest travel days of the year, while the two dates in January are popular with holiday travelers as well.

So the airlines are charging passengers a $10 surcharge for the privilege of enduring congested airport traffic, fewer parking options, longer lines at the terminal and security, packed gates and airplanes, and the inevitable delayed flights and mishandled bags that result from seasonal volume.

Revenue-focused companies are really good at identifying and creatively labeling fees and surcharges and the asterisk keys on the keyboards of their legal departments are commonly worn from excessive use. If these companies would channel the same energy and ingenuity into customer satisfaction that they use to identify and apply extra fees and surcharges, they would more than recover the revenues gained from this irritating practice.

Customer-focused companies deal with seasonal spikes in business by adding value, not fees. When Disney is extra busy over the holidays or during spring break, it doesn’t charge its guests fees or surcharges to offset its increased costs. Instead Disney adds value by offering packages that bundle airfare, lodging, and theme park admissions. Disney also adds staff to minimize delays and provides additional entertainment by its characters to amuse children as they wait in line to enjoy another ride. That’s how a customer-focused company deals with volume—not by charging extra for it.

Anytime making money becomes more important than properly serving customers, the business ultimately suffers. When the bottom line drives a company, it will resort to added fees and surcharges while cutting back on service and quality in order to improve its near-term operating statement at the expense of long-term customer goodwill and loyalty.

There should be a litmus test for any such charge. If a board of directors would vote for it unanimously while a group of customers would oppose it unanimously, get rid of it. Instead, make your money the old fashioned way: Earn it by providing value to customers by delivering exceptional product and service quality that justifies the price you’re charging.

What’s in a name?

Sunday, September 27th, 2009

Express genuine interestEarlier this month, I stopped by Hooters for lunch. During my hour-long visit, my table was “touched” by three separate Hooters Girls (my server, Felicia, and two others: Lillie and Kassity) and the manager, Ben.

I don’t always do so well remembering names but they made it easy for me. Two of the servers signed a napkin at my table and all four employees were wearing name tags that were clearly visible. That’s not always the case in many establishments.

All that attention not only made me feel valued as a customer, it also made an impression on me. Instead of feeling like just another restaurant “cover,” I felt as though this dining experience had been personalized—like the napkin—just for me. The staff expressed genuine interest in me, the guest. It was unexpected and I was pleasantly surprised.

Providing and using names is necessary to establish rapport. And establishing rapport is necessary to build trust. And building trust is necessary to gain customer loyalty. And customer loyalty—and the future spending and referrals that come with it—is necessary for business success.

So, what’s in a name? Business success.

Keep service up in a down economy

Thursday, September 24th, 2009

Bell1 copyMy family and I recently dined out at a quick service Mexican grill. While I was providing my order to the prep person behind the counter, I observed the sales transaction of the customer who was ahead of me. At no point during the transaction did the cashier smile or even make eye contact with the customer. In fact, the irony was that the customer said “thank you” as he accepted his receipt. Even so, she still did not acknowledge him.

We have all experienced this level of apathy from “service providers” at restaurants, hotels, supermarkets, etc. In fact, we may have just become accustomed to it. Our expectations, in some cases, may have been dulled by the frequency of mediocre service that we encounter as we dine, travel, and shop.

This was a reminder to me that it would have cost nothing more for the cashier to make eye contact with her customer, to smile, and (with “life” in her voice) say, “We appreciate your business. Thank you for coming in.” Or, a bit more daring, “Thank you for coming in. If those burritos don’t fill you up, come on back. We’ll make more!”

You see, that would have been interesting. That would have been unique. That would have brought a smile to the customer’s face and the experience would have been memorable. But, instead, the cashier just went through the motions, touched each transactional base (e.g., input order, process payment, provide receipt), and robotically, dispassionately moved on to the next functional sequence to satisfactorily process the next transaction.

It brings to mind what I would expect on an assembly line. Imagine an assembly line worker producing a children’s doll. Let’s say the final step in the process is to attach the doll’s head. The worker lifts a doll’s head from a large box, pops the head on the doll’s torso, and twists it firmly until it locks into place. One by one, the assembler “lifts, pops, and twists” the dolls’ heads until his quota is met or his shift ends. Tomorrow he will return and repeat the process over and over again (i.e., “Lift, pop, twist…Lift, pop, twist…) until the end of another workday.

The restaurant cashier may not have been working on a doll assembly line but the behavior was the same (i.e., Order, payment, receipt…Order, payment, receipt, etc.). Expressionless, robotic behavior devoid of any personality may be permissible in a factory environment or warehouse where there are no signs of real, live customers—as long as certain production quotas and delivery schedules are met.

In a customer-facing position, however, the behavior must be different.

In the current economy, while costs are increasing, pricing pressure is forcing businesses to reexamine their pricing strategies. In the case of restaurants, that may mean reducing portions, prices, or both. In the case of hotels, it may mean lowering their rates to increase market share, reducing amenities, trimming labor hours, and other “profit protection” strategies.

These are tough decisions that are indicative of difficult economic times.

Most operators seem to accept that the answers to navigating a recession are found in budgets, productivity reports, and P&L statements. While fiscal responsibility is necessary regardless of the economic landscape, the real key to sustained rapid improvement is to focus your people on focusing on customers. It costs nothing but a little proactive thinking and your time—which, especially in this economy, is time well spent.

Here are some examples:

Create awareness at pre-shift meetings:

“Who would like to describe for the group, in your own words, the difference between the role of an assembly line worker and your role as customer service providers?”

Reinforce standards through positive feedback:

“Emily, I noticed the way that customer responded to you after you thanked him personally by name. That’s just the sort of reaction we’re hoping to get with every customer. Great job!”

Reinforce standards through corrective feedback:

“Oscar, your eye contact and smile are great and your use of guests’ names is coming along. How can I help you to get better?”

Model desired behavior at all times:

As managers and supervisors, your decisions and behaviors (verbal and non-verbal) are constantly being scrutinized by others. As author Bob Farrell says in his training video, Leadership Pickles, “What they see is what you’ll get.” If employees detect management’s skepticism about a corporate initiative, then they too will be skeptical. If management acts with indifference toward customers, then employees will feel justified in doing so as well. What they see is what you’ll get.

Superior service doesn’t cost anymore to provide than mediocre service. Oh sure, it may require a few minutes of dialogue here and there as well as a concerted effort on the part of managers and supervisors to model the behaviors that are expected from their employees, but that’s no more than is already expected from a competent leader. I recall reading a Gallup statistic that revealed 65% of US employees surveyed claimed to have received no praise or recognition for their job performance in the previous year. Consistent, informal feedback from a credible source (i.e., one who practices what he or she preaches) will address this.

By applying these informal suggestions frequently, a service-based business will create more goodwill with its customers that will translate into enhanced loyalty, referrals, and repeat business. And here’s the best part: there are no buttons or banners or expensive, large-scale rollouts required. The only requirement is for managers to consistently apply the basic principles of communication, feedback, and recognition that embody leadership.

Providing pleasant surprises

Wednesday, September 9th, 2009

Pleasant Surprises copyHave you ever received an unexpected upgrade, a complimentary appetizer, or some other pleasant surprise when you were not expecting it? How did it make you feel? I bet you can recall many details from the experience—probably because you’ve reinforced them by sharing the story with others.

Providing pleasant surprises that add unexpected perks to otherwise ordinary transactions, is an effective way to make lasting positive impressions on customers with little or no additional cost.

Here are three quick examples:

  • I brought my Ford Expedition into the dealership for an oil change. When the maintenance was completed, an employee pulled it around front and, to my surprise, it had been washed and was gleaming! Wow—that was a memorable final impression of that experience!
  • While using a self-service kiosk to pay for my groceries at Albertsons, I was approached by a store employee. She asked if I’d like a complimentary bottle of salad dressing that was being given away as a promotion. I gladly accepted and was pleasantly surprised by a complimentary 16 oz. bottle of Kraft Light Ranch salad dressing!
  • And just last week, I stopped by Target to do some shopping. At the checkout register, the cashier rang up my purchases and then handed me a receipt together with a coupon for a complimentary Starbucks latte. Another pleasant surprise!

Providing pleasant surprises can transform bland and ordinary transactions (e.g., oil changes, retail checkouts, etc.) that will soon be forgotten, into unique and refreshing service experiences that will long be remembered!

Building loyalty through value at the LEGO® Store

Tuesday, September 1st, 2009

LegobirthdayMy two oldest boys recently attended a cousin’s LEGO® Star Wars™ themed birthday party at the LEGO® Store. When they returned home, each was carrying a bright yellow LEGO party goodie bag and proudly wearing a LEGO name tag that had been personalized with his name. I asked them how they liked the party. “We had a blast!” they exclaimed as they dumped the contents of their goodie bags onto the kitchen table, revealing:

  • A LEGO Club magazine
  • LEGO Club membership card
  • LEGO Store coupon good for $5 off $35 purchase
  • LEGO Builder’s License
  • LEGO Tips & Tricks card

Soon, they were extending their LEGO experience by immersing themselves in more LEGO activities (i.e., building models, reading their LEGO Club magazines, and going online to the website). While at the website, they identified models they would like to buy with the $5.00 store coupons they received in their goodie bags.

I said to my wife, “The party sounds like it cost a fortune.” To my surprise, she said it only cost our cousin around $125. And that included:

  • A themed, hour-long birthday party at the LEGO Store for up to 10 children
  • A $100 LEGO Gift Card for purchasing the sets each party guest will build and take home
  • 10 invitations, 10 thank you cards and 10 name tags
  • Dedicated LEGO host for the party
  • Exclusive LEGO birthday brick for birthday child

Wow! The LEGO Store is doing it right on so many levels with its design of this birthday experience:

  • By offering themes like LEGO® Star Wars™, LEGO® City, and others, parents can tailor the party’s theme towards their child’s preferences.
  • By including the $100 LEGO Gift Card, they are adding tremendous value to the $125 cost of the party while, at the same time, providing the centerpiece party activity as well as parting gifts for the party guests!
  • By including the invitations, thank you cards, name tags, and dedicated LEGO host for the party, they are saving work for the parents—which is always welcomed!
  • Lastly, by providing an exclusive LEGO birthday brick for birthday boy or girl, they are reinforcing the child’s uniqueness by allowing him or her to receive something special that can only be received by a child whose birthday party is held at the LEGO Store!

While the children are busy building LEGO models, LEGO is building loyalty through value and the customer experience. Brilliant marketing by a brilliant brand!