Linda's Marketing Leverage Blog

Badgering Your Customers is Not Good for Business

In the last month, I've received no less than 15 phone calls from the telemarketing arm of a publication I subscribe to. It's gotten to the point where I recognize the phone number and ignore all of the calls from these people.

I understand the need to remind people to renew their subscriptions, but in that case one or two phone calls and a voice mail is more than sufficient. The interesting thing is I was wavering on whether or not to renew this particular publication, and the ongoing badgering from their sales people is not helping their cause at all. There is absolutely nothing they can say to me on the phone that is going to influence me positively and their ongoing consistent calling makes me want to give the whole thing up just to get rid of them permanently.

If that's not bad enough, several years ago I decided not to renew my membership in a professional organization for many reasons. Again, I got emails and phone calls asking me to renew and I told them I wasn't interested. Then I got on the "Lost member contact" list, and I started to get calls from their board members to interview me about why I had chosen not to renew.

I really had no interest in this--all I wanted to do was have them go away quietly, but this was not meant to be. When I got a personal message from the president of the national association insisting that he had to talk to me to convince me why I was making a mistake in not renewing, I'd had enough. I told the local membership person that if all contact from the organization didn't cease and desist immediately (this had gone on for several months), I'd consider it harassment and take legal steps. That did the trick.

We all want to keep our customers, and we want to find out why customers defect. That makes sense. But badgering people who obviously are not interested in responding, doesn't. For one thing, it makes me wonder if the organization in question is so desperate they can't afford to lose a single subscriber or member. For another, my behavior tells you what you want to know. Asking the same question again except slower and louder doesn't make me any more responsive. The problem is not that I didn't hear you--it's that I've chosen not to respond.

Even worse, the bad experience I've had with these two organizations will stick with me for a long time--much longer than they'd want, if they thought about it. And I'll warn others about them as well.

Is that the way you want your customers to think about you? Think about this from the customer's perspective. No badgering allowed.

A Case of Mistaken (Information about My) Identity

We've all heard a lot about identity theft. But have you considered the problem of corrupted information being attached to your online identity?

I recently had an interesting interaction with a financial institution. Before they would discuss my account with me, they wanted to confirm my identify by asking a series of personal questions. In theory, this sounds reasonable. In reality, it was a nightmare.

I was told the answers were taken from multiple sources of publicly available information about me. Hmm--in that case, it seemed like other people besides me would have been able to determine the answers, right?

As it turned out, NO ONE would have been able to answer these correctly--because the answers they were looking for weren't factually correct.

We started with my age and driver's license number. That was simple. Then they asked about one of my prior addresses. Also simple (and something someone else could have answered). From there, it went downhill. I was asked about a prior employer and given 4 possible choices. None of them were accurate, which I told the customer service rep. She didn't know how to deal with that and said I had to pick one of the 4 answers. But there was no correct answer, which meant we were stuck. She had no idea how to move forward from there.

She finally agreed to send me login information by mail. I went to the website, entered the login, and lo and behold, was subjected to a similar authentication process. The first 2 questions were fine and I answered appropriately, but the third one was again a multiple choice question with 4 incorrect answers, so I was stuck again. Another phone call.  Since they had an established paper address, we got around this by having them physically mail forms to the address they had on file, but it appears there is no way for me to establish an online account with this firm.

Here's the problem: Somewhere along the line some incorrect information was attached to my profile. This was picked up by the authentication program and passed along as gospel. I don't know where they got the information from (and neither do they), so I can't go back and fix the mistakes. The bank's process is to require correct answers to all the questions, so therefore they couldn't authenticate me. 

We got around the problem that time, but the incorrect information is still out there, somewhere, and sooner or later this will likely happen again. As a business, consider that your need for security needs to be balanced with how best to serve your customer. Online systems like this are far from perfect. What's your backup plan?  How will you handle these situations?

I was not eager to go through the hassle with this institution again. End of story: Case (and account) closed.

Insanity: Knowing Customers Are Unhappy and Waiting for Them to Defect

I recently terminated the relationship with the man who's serviced our pool for a number of years.

For quite awhile now, I haven't been happy with the service we've gotten, including the fact that the hot tub never seems to really be clean. But it was always good enough and in the overall scheme of things, it was not bad enough warrant the time and effort to go out and find someone else.

Finally I decided enough was enough. I found another company that offers a pool service that's more complete than what I'm paying for now (and not always getting) and less costly, too. The next step was to call the current guy and go through the inevitable dance of telling him we're canceling service, then have him try to convince us why we should stay.

Except that's not what happened. When I told him we'd decided to use someone else, he said, "Well you must be unhappy because the hot tub isn't getting cleaned, but it's too much effort for me to do this regularly."

Huh? You know your service isn't up to snuff, but you're telling the customer it's too much work to do what you've agreed on a regular basis?  Even worse, you wait until the customer leaves to have this discussion. Instead of telling me that you can't deliver the level of service requested and perhaps lowering the rate, you just keep on keeping on at a lower level of quality and hope no one notices or says anything.

In this day and age, one would think businesses with customers would do everything they can to try and hang on to them. To do otherwise, is just insane.

If you've got a customer that isn't getting the top quality service they expect, what are you doing to change that? Will you wait till they go to a competitor?  Or will you do something to fix the problem and the relationship while you still can?

My pool guy's last words, on the bottom of the final bill, "We've enjoyed providing service all these years and are sorry to lose your pool." Hmm. Too bad he didn't understand it's better to be safe than sorry.

Avis: No Longer Trying Harder

You just can't make this stuff up:

I walked into the Avis Rental Car Office at Boston's Logan Airport yesterday. The customer service rep very efficiently handled my reservation and asked me if I'd like to get a GPS for the car. I told her no, but I would like a map.

"We no longer do maps," she said.

"What? You don't offer maps? Is that because you want people to rent GPS systems instead?" I asked.

"Oh no," she said, quite seriously. "We're trying to save money, so we stopped printing maps. The economy is so bad, we're laying off a lot of people. We're all going to lose our jobs soon!"

Saving money by not printing maps? How sad that an industry leader like Avis has stooped this low. As I got in the car, I wondered if they'd also checked the air in the tires lately, or changed the oil and, when I had to stop suddenly, how recently they'd tested the brakes.

Looking around the rental car office, at first glance I noticed at least 4-5 different printed pieces that could have been eliminated to save money, but instead Avis chose to eliminate maps.This is not a way to make customers feel warm and fuzzy and secure when renting a car in New England in winter. When I hit a traffic jam on the Mass Pike  a half hour later, I thought how nice it would have been to have a local map to find an alternative route.

It's a shame that Avis doesn't do maps anymore. It looks like Trying Harder is out of vogue these days.

Yes You Can...Use Lessons From the Obama Campaign Marketing in Business

In the December 1st issue of Business Week, Jon Fine says Your Brand is Not a Candidate:(Marketing Lessons from Obama's Campaign) "The Obama campaign's marketing was remarkable. But you can't use it to sell yogurt."

His point is that the selling of a political candidate, particularly a presidential one, is very different than buying an everyday product or service. He says the lessons are limited to "something that makes people cry when they see it giving an acceptance speech."

Granted, the Obama campaign was a once-in-a-lifetime experience, for many reasons. But the strategies and tactics the campaign team used so effectively were not.

As I mentioned in my last post, the Obama team understood the importance of building a brand that people crossed party lines, demographics, race, and ethnicity. They knew better than to focus on features, but instead targeted clear benefits. They integrated traditional and new media, effectively used personalization and built an outstanding grass roots, bottoms-up groundswell of support. They kept one clear, focused message throughout the campaign and focused on the benefits to the consumer--the voter. (How many times did we hear Obama say, "It's not about me--it's about you."?)

So which of these strategies are not relevant to businesses and individuals as they market products and services?

They're all relevant.

The bottom line, to quote Million Dollar Consultant Alan Weiss, is that logic makes people think, emotion makes them act. When you get behind the wheel of a brand new high-end sports car or buy an attractive new outfit or treat yourself to a wonderful dinner at a great restaurant, or buy an iPhone, what's driving that purchase is emotion, not logic. It's not about the need for transportation or clothing or sustenance or communication--it's about the emotional experience and fulfillment you get from purchasing that particular product or service.

Look at the hundreds of thousands of teenage girls (including mine) who lined up to see the new movie Twilight this past weekend. If that's not an emotional reaction, what is? There's certainly no logical reason to flock to a fairly mediocre movie about vegetarian vampires.

In a time of recession and economic turbulence, it is even more important for companies and organizations to understand the emotional factors that motivate customers to buy their products or services. Before you decide to bite the bullet and compete on price, understand the implications of what that means. The number one retailer in the world, Wal-Mart, owns that position fair and square. They tightly control their supply chain to eliminate excess cost and because of their size, they have the clout to negotiate more effectively than any of their competitors. Is that what you want to compete with?

Even more importantly, no matter what market position you choose to differentiate yourself, look at what happens when you don't take the time to build an effective brand with clear differentiation and a solid brand promise you can deliver. For a timely example, let's look at the Detroit 3 auto manufacturers, who were in Washington this past week looking for a bailout. Their problems are complex: high overhead, bloated pension and health care costs for retirees, etc.

But even if all of those issues could be fixed, through bankruptcy or a bailout, they'd still be faced with a critical problem. With few exceptions, they haven't built strong, solid brands that consumers feel passionately about.We can't force people to buy Chevys or Fords, any more than we can force people to not want to buy BMWs or Toyotas.

Apple and Nike and Coke, among others, have figured it out.The problem is that many other American companies haven't. That doesn't mean we can't put lessons from the Obama campaign to work in business today. It means that it's a crying shame if we don't.

Stranger than Fiction: AT&T Misses the Connection

This falls under the category of "you just can't make this stuff up."

I've been working with my ISP for two days to figure out why my T1 line has been intermittently flaky. They went to the provisioner (Covad), who has determined the problem is with the line provider, AT&T. In a desire to get this fixed as quickly as possible, I told the ISP to tell AT&T they could come any time of the day or night as long as they called first.

Guess what. AT&T told us they aren't able to call in advance. Wait a minute, aren't they the phone company?  Am I missing something here?  Maybe we should take them over to Sprint or Verizon and help them get one of those great deals on a cell phone.

The Most Expensive Five-Cent MasterCard Bill in History

Case Study in how not to do customer service...

My mother recently received a Citibank MasterCard bill for five cents. No, that's not a typo. The bill, which arrived via US Mail was for five cents, as in one single solitary nickel.

Her first thought was this must be a mistake. Then she realized what happened: She had gone to the automated postage machine at the post office to buy stamps when the postage rate increased last month. The machine took only credit cards. She swiped a credit card and attempted to buy several types of stamps, starting with five one-cent stamps to cover the new rate. The problem was the post office machine only allowed one purchase per credit card swipe, so she took her five one cent stamps and left, rather than spend all day at the machine generating multiple small transactions to get her stamps.

Fast forward to this week. A MasterCard bill arrives with this single five cent transaction on it. She calls Citibank where one of those paid-to-read-the-screen, not-to-have-an-original-thought call center representatives tells her she must pay the five cent bill by the due date, there are no options. The account rep does tell her that yes, there is another transaction that will appear on the following month's bill, however it is not acceptable to wait until the following month's billing to pay this month's five cent charge together with next month's charge. If she does this, the account will be considered overdue and both interest and late fees will apply. (Most credit card late fees start at $29/month; some are even higher.) Furthermore, in this age of subprime mortgage crisis, if her payment is late, her account will be reported as delinquent.

A long conversation ensued in a futile attempt to convince the rep how ridiculous this is (not to mention how costly to the credit card company as well as to the consumer). Still no luck. Finally, my mother says, fine, if that's the way you insist on treating me, cancel the credit card.I have plenty of others I can use.  Immediately, the rep's attitude changes and she transfers her to someone in card retention.

The next conversation goes something like this:

Card Retention Rep: I see you have been a card holder with us for over 22 years.
My Mother: That's correct. And you can also see I always pay my account on time, which is why I think you should just wait till next month for the five-cent charge.
CRR: I'm sorry ma'am. We can't do that. [Sort of reminds you of the computer HAL in 2001: A Space Odyssey, doesn't it?]
Mom: I don't understand why. It obviously cost you more than 5 cents to generate the bill, it will cost me more than that to mail the check, and it will cost you more than that to process and deposit the check. Why can't you add this to the following month's bill?
CRR: It's not in our policy.
Mom: Well, like I told the last rep,  your policy is pretty stupid. It is costing both you and me money so why don't you just cancel my card.
CRR: We really don't want you to cancel your card. Maybe I can look into this. Can you call back next week?
Mom: Why? What will be different then?

As of now, the situation is unresolved. In the meantime, Citibank has spent a ton of money on bill processing, payment and call center resources, a long-time cardholder is mad as hell and not willing to take it anymore, and, as mistreated and frustrated customers usually do, she is telling everyone she knows about this ridiculous situation. And, I, in turn, am telling you. All for a lousy five cents, which is less than 1/8th the cost of a first class stamp to begin with.

Here's how I see it:

Cost of five one-cent stamps                                                                                                                                           $.05
Cost to process statement for five cent balance                                                                                                   Several dollars at least
Cost for Citibank Master Card to mail statement for five cent balance                                                     $ .42 (slightly less if bulk mail)
Cost of toll free number and at least two call center resources tied up for over an hour on this call                          $100? Maybe more

Cost to Citibank MasterCard of alienating a long-term customer and propagating this stupidity through the blogosphere...          PRICELESS.

The Case of the Bay Area's Missing Matzoh

Why was celebrating Passover in northern CA different this year from all other years?

Well, for one thing, because there was an acute shortage of several kosher for Passover staples, including a critical one--matzoh.

Passover matzoh is made from flour and water but must be produced under specific types of conditions to ensure it does not  become leavened, or unacceptable for use during the holiday. Most Jews, even those who are not normally religiously observant, buy and eat matzoh for Passover, so the demand should be fairly constant from year to year.

This year it was the supply that was way off. It appears there was some sort of technical glitch w/a Manishewitz factory on the east coast that severely limited the amount of some types of specialty matzah produced. But that didn't explain why even plain old ordinary matzah,  not just the fancy kinds Manishewitz normally churns out, were MIA.

An article in this week's J, the Jewish News Weekly of No CA, claims this was really a case of confused signals in the distribution channel. For the last several years, chains like Costco and Trader Joes have sold large quantities of matzoh at a significantly discounted price. (The price of matzoh had gone through the roof over the last decade or so. Costco took advantage of this to sell matzoh at a price so so cheap that  one had to wonder if everyone else was gouging consumers or Costco was losing money on every box sold.)

Even though some people eat matzoh all year round, probably greater than 80% of purchases are made for the one-week Passover holiday. So if you don't sell your matzoh supply for Passover, you are pretty much stuck with it afterwards. And there are fewer things harder to get rid of than old, stale matzoh.

This year two things happened here that caused a big disconnect: 

• Most of the retail stores in the area cut way back on their matzoh purchases rather than be forced to "eat"  excess inventory after the holiday
• Costco and Trader Joes decided not to carry matzoh this year at all--eliminating a big source of the product

As a result, it was virtually impossible to find a box of matzoh anywhere in the Bay Area as Passover approached.

Even if you've never been lucky enough to indulge in the ritual consumption of matzoh each spring, what happened here is fascinating. Retail supermarket chains made a rational decision to carry only limited supplies of a product that is both under severe price pressure and has a very short promotional life. The chains causing the pricing pressure, for whatever reason (maybe selling at or below cost finally caught up with them?), decided not to carry the product at all. This resulted in the acute and unexpected shortage.

Who dropped the ball? The manufacturers and distributors take a good share of the blame. One would expect they could make a reasonably accurate forecast of expected annual demand (this is the season when they make most of their profits).  Why didn't someone put 2 +2 together and ask why wholesale purchases of matzoh were so much lower in the Bay Area than usual.

This is also a great example of how markets run based on expectations. We as consumers have been trained to expect a choice of product at both retailers and warehouse clubs/discount chains. The supermarkets had expected to be undercut by the big chains. The manufacturers expected that the market ran efficiently enough that advance orders reflected expected demand. When expectations didn't reflect reality, everyone along the chain, from the producer to the consumer, was caught by surprise, hence the unexpected.

How to prevent this in the future? For one thing, it has been reported that Costco has signaled they will carry matzoh again next Passover in at least some of their larger warehouses. Manishewitz should be expected to have resolved their terribly timed production glitches. And should there be even a hint of a supply/demand inbalance in the future,  some enterpreneur will likely develop a way to exploit and profit from this (maybe a Web2.0 application that lets users track the availability of matzoh on their mobile devices?).

In the meantime, the issue of market expectations has moved to a new front: rice. It appears that Costco and others are limiting the amount of rice sacks that can be purchased by each buyer--because of the expectation that there may be hoarding which would in turn cause a shortage. Except that now consumers are expecting a rice shortage and buying more...

Gee, in any other year, I would have been able to give them my excess matzoh...

When the Package Says About the Product Inside

This week I finally decided to dump my HP OfficeJet All-in-One printer. I know HP has a reputation for building good quality printers and I have an ancient LaserJet 4050 that I think will survive the next nuclear disaster, but the quality of this OfficeJet has been absolutely terrible.

Even worse, the quality of the service and support I've received from HP has been abysmal. I've spent hours talking to offshore support reps who spoke heavily accented English, couldn't move beyond preset standard support scripts, and managed to lose all my account support information multiple times. Finally, in desperation I was escalated to an executive support group in the US right before Xmas, where a pleasant but curt native English-speaker told me I was out of line to expect quick delivery of my package because it was right before the holidays. (Never mind that my replacement order had been misplaced by HP for the previous three weeks.)

But I digress. For all these reasons plus the fact that the fourth OfficeJet I was sent from HP still isn't working correctly, I decided it was time to dump the OfficeJet and move to something else--anything but HP.

I purchase a Brother color laser multifunction center. Since the machine itself is  maybe 1.5 feet wide by 1.5 feet deep by almost 2 feet high, I was surprised when the clerk told me he doubted whether this would fit in my BMW. Aw cmon, I said. I'm sure it will fit. Then he wheeled out a huge box that was nearly 3' cubed. And, yes, it did require an SUV to trek home.

Here's what was so important about this big package:

• From the first impression onward, the package was impressive. Inside the box was another box. Inside that box was a third box, and inside that third box was my printer.
• When I got to the actual machine, there were foam, cardboard, and plastic inserts and other packaging material to keep the machine in good shape, even within the triple boxing.
• There were detailed instructions on how to unpack the printer, step by step, including where every piece of packaging material was and what order to remove it in.
• Even more importantly, the instructions were written in real English that I could understand.
• There were also detailed instructions on what to save and how to repack the printer if it ever needs to be sent back for repair.
• The only assembly I needed to do was to insert the toner cartridges (as opposed to the HP which had loose pieces that had to be put on the machine by the user).

This is in direct contrast to the HP unit, which was sent directly from HP in a flimsy cardboard box that more often than not would arrive torn or pushed in. Within the box, the printer was packed in a thin plastic bag and stuffed in between a styrofoam insert on either side. I say stuffed because it was impossible to get the machine out of the packing without the styrofoam disintegrating. HP sent me three replacement units and they all were sent the same way, so it looks like we have a pattern here.

The key lesson  is that the first impression I have as a customer is what I see and encounter when I open the product. The impression I got from Brother is one of quality, concern for the customer and ease of use. The impression I got from HP, OTOH, is quick, dirty and inexpensive: we make our money on ink and that's where we put our focus, not on printers. BTW, the cost for the Brother was not that much more than an HP machine w/comparable features.

Remember that old saw: You can't judge a book by its cover? Well, sometime you can tell a lot about a product and its manufacturer by its packaging. Caveat emptor.

Hearing Good Things About Bose

We hear a lot of negative customer interactions, so it's always a pleasant change to hear someone talking about a great customer service interaction.

This comes from Chad Barr, President of CB Software in Shaker Heights, OH:

I love my Bose QuietComfort2 Headphones product and won’t use anything else in first class due to peer pressure.

When I first broke it about a year ago, the local store immediately exchanged it for a new headset - no questions asked. When breaking this new headset again several weeks ago, I had to send it to Bose Corporation since the local store did not have them in stock. I just received my brand new headphones from Bose, no questions asked.