Linda's Marketing Leverage Blog

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.

Voting Process Made Easy...for real!

I have been a permanent absentee voter in California for years and years. That way I don't have to worry about where I am on election day, getting to the polls by a certain time, etc. The ballot comes in the mail, I fill it out and return it and everything is set.

Until this year. Somehow I managed to lose my absentee ballot. Actually, I think I may have thrown it out. Here I was less than a week from the election, past the deadline to mail my ballot and ensure it would be received, and dreading the thought of having to go vote in person.

Luckily I live in San Mateo County, where the county government has made these things straightforward and simple. I called the voter registration number (which I found via Google), and told the person on the other end I'd lost my ballot. She said I had 2 choices: go to my normal voting place (which I've never been to and don't know where it is) on election day, or come down to the voter registration headquarters in Redwood City anytime between now and Tuesday and vote there.

I was amazed at how simple and automated the process was at County Center in Redwood City. My first thought walking in to the assessor's office/voter registration office was how clean and neat and organized it was. Real estate related files are all neatly catalogued on cassettes, the mounds of paper that were likely present in this kind of operation previously have all disappeared, and all the service centers in the office are neatly marked. The woman @ the absentee voting station was pleasant, knowledgeable and helpful. She looked up my information on her computer, had me sign an affidavit that I had lost my ballot, then offered me the choice of using a paper ballot or one of the computerized systems they had available.
When I said I'd never used their system before, she said, well it's quite simple and I can walk you through the whole process without a problem. She then proceeded to demonstrate how the system worked (which really IS quite simple and intuitive). It took me about 5 minutes to go through the ballot, highlighting each candidate or initiative to vote for, then I was asked three times to confirm my choices (and given the opportunity to change them), before the ballot was officially cast. I got a receipt with a confirmation number corresponding to my ballot and I was done.  Total time from when I walked in the door until I walked out: less than 7 minutes.

It was actually really simple, effective and efficient. When is the last time you said those words in conjunction with local government? In fact, the most difficult part of the whole process was finding parking in downtown Redwood City.  Well, some things never change...

Hold for an Important Message

If there's one thing I find totally annoying, it's picking up the phone to get first silence, then a recording that says "Hold for an important message from...", then I am put on hold again while the system dials someone on the other end who asks me my name, account number and other information and makes it clear that my call is bothering them. Wait a minute--didn't your automated system just call me?

I've been getting calls from one of these systems for about a week now, regarding a supposed unpaid balance on an account I closed over a month ago. First I'd just hang up when I got the recording, but they started coming more and more frequently, like contractions, and they were getting more and more annoying too.

Today I actually called the customer service dept. of this company and got a rep who very rudely told me that I had a balance to pay, and wasn't I aware that I had to give 30 days notice to cancel my contract so that I was responsible for another month's bill. Her mission was obviously to be curt, cold and get me off the phone as quickly as possible. I asked to speak to her supervisor, who started to give me the same spiel until I told her that not only was I not told about any additional fees to terminate my service, but that I had never signed a contract with this company, therefore I could not be held responsible for the terms of such non-existent contract.

She put me on hold and when she came back it was with a whole different attitude. She had taken time to read the notes on the account, saw that the CSR a month ago had noted that the account should be credited and no further payments were due, and she would take care of it. Did I have anything else she could help me with?

Well, yes, as a matter of fact. I'd like to know who made the decision to implement that horrid autodialing system they're using. Did they really think harassing people with ongoing automated phone calls was going to lead to customer satisfaction and retention? Actually, some people may pay their bills just to make the phone calls stop--it's a possibility.) Oh, and by the way, wasn't it possible that they would make more progress with their customers by starting from the premise that the customer on the other end of the phone isn't always wrong and maybe is someone who should be valued and treated that way?

That's what I would have liked to say, but I don't believe it would have done any good. So I thanked her for her help and hung up.

But I'm thinking of setting up an automated dialing system to call the executives of companies like this and leave a message:

Please hold for an important message from one of your valuable customers. If you don't treat us more appropriately, we are going to not only cancel our service and go somewhere else, but we will tell everyone else we know. In fact, some of us may even blog about it on the internet. Oh, and have a nice day.

Stuck in Lodi Again...

...at the Microtel Motel.

Remember the old John Fogerty song where he was "stuck in Lodi again?" Well, we spent the weekend in Lodi for a club soccer tournament.

Turns out that Lodi is not such a bad little town. It has a quaint little downtown, a number of wineries (which we did not stop at) and the requisite shopping center with Target, Starbucks, Quiznos, Pantera, Chilis, etc. In fact there were 4 different Starbucks we found while we were there.

The problem is we were stuck at the Microtel Inn right off of I-5. We came in with reasonably low expectations--this was obviously not going to be the Ritz Carlton. I booked the reservation on the internet, which gave me a choice of rooms, rates (discount for AAA), etc. Very simple.I did pay a little extra for a "suite", which I figured was the type of divided room w/a door you get at Embassy Suites and other similar places. However, it turns out that for the Microtel Lodi, a room becomes a suite by removing one of the double beds, replacing it with a sofabed, adding a small cube fridge and a microwave, and renaming it a suite.

The desk clerk, who was unfailingly polite, first asked me to sign the checkin form before filling in the daily rate. Good think I didn't do this, because he had an incorrect rate. After finding out that their version of the word suite was different than ours, I had another discussion with said clerk. He informed me that that really WAS a suite. And, besides, if we wanted a regular double room, he was out of those and was therefore upgrading all of the other double requests to "suites" for the lower price.

Thisdid not compute, so I asked if he could then give us the lower rate, since what we had was more like a double than a suite anyway. He smiled and said of course, then proceeded to cross out the old price on my credit card receipt and write in the new one. When I told him that wasn't going to work, he obliged to credit the old charge and recharge it. However, he had forgotten that I was booked on the lower AAA rate, so he had to go back and do that again.

In the middle of the night we discovered that the toilet in our "suite" was blocked and didn't flush right. The last thing we wanted to do was have the desk clerk come up in the middle of the night and try to fix this himself, so we waited till morning to tell the clerk about the problem.

A different clerk was on duty. She listened to me describe the problem, then said with a smile, "Well, those things happen. Maybe it needs to be plunged." Then she walked away.

Let me reiterate what did NOT happen in this interchange:

• She didn't apologize for the incident
• She didn't offer to make any amends for not having a working toilet in the room
• She didn't even write down the room number to get the problem solved

In discussing this with another guest, I found that her room had a bathroom that was both dirty and full of bugs. Yuch.

I should say this was my first interaction with the Microtel Inn chain, and it may very likely be my last. My impression is that Microtel hires clerks that are invariably polite, but untrained in basic check-in systems (crossing out a credit card receipt to do a refund?), ignorant of even Customer Service 101 (how about apologizing for a problem to start?), and totally oblivious to health and sanitary concerns.

Maybe I was out of line in expecting a suite in a motel in Lodi to have a door separating one part from the other. But flushing toilets and clean bathrooms are pretty much nonnegotiable.

Next time if we can't find another place in town, we'll drive to another town to stay. Better than being stuck in the Microtel in Lodi again.

Water, water everywhere--but only once a month

Many of you know that I am passionate about how important customer-facing interactions are to an organization's success.

It's important to remember that customer-facing interactions are not just with front-line employees--sometimes they are with "things" such as websites, email systems or IVR phone systems. And sometimes some of the most negative customer experiences are with company-issued policies and procedures.

Here's an example of a non-customer friendly customer-facing process. Last week I got a letter from Arrowhead, my home delivery bottled water company, informing me that they "take great pride in providing you with superior products and services and strive to continually improve our customers (sic) experience."

The letter notes they are about to change my water delivery from every 3 weeks to once a month, which means that the number of bottles they deliver may increase (what a coincidence) "to ensure that you have enough water to accomodate your new delivery schedule." Furthermore, if my account is set up for automatic recurring charges to a bank account or credit card, the monthly recurring payment date may need to be moved as well (why, I'm not sure--if they're already billing once a month, what's the difference?).

Wait a minute--I thought they were looking to improve my experience? I didn't ask for my schedule to be changed. I don't particularly like the fact that I now have to keep more of those big unwieldy 5 gallon water bottles around the house so that I don't run out of water. Why is this change good for me, the customer?

Ah...when I read closer, I find  the real reason for this rigamarole: "The change is being made specifically to improve our operational efficiency." So this isn't really to improve my customer experience. In fact, if they asked me, I'd probably tell them that the best way to improve my experience is not to make me pay in advance and store their inventory long before it's needed, but to have deliveries occur more often so that this is one less thing I have to worry or think about. In fact, I used to get deliveries every 2 weeks, then every 3, now once a month. You can see where this is going--in a couple of years I expect I will get one annual delivery of bottled water (whether I need it or not). 

Why is it that companies push all kinds of changes, policies and procedures through to us, the customer, under the premise that they are doing us a favor? What were they thinking? Did anybody out here ever ask what the customer really wants?

And, if it's really, really necessary to make a change for the company's sake, not mine, please, please, please DON'T pretend that this is a customer-centered change. Tell me what's going on and be upfront about it. Customers will work with you if they know where you're coming from, but work with us,

Glass of water anyone? I've got a few extra bottles floating around....