Certainly an interesting way to get people to notice a brand. Taking advantage of the natural human faults. It would be interesting to see, however, whether or not this would make people even more upset.
I was reading through some news and I came across an interesting article that was about the “abysmal’’ service of McDonald’s. This is a follow-up article related to another blogger’s post about McDonald’s customer service last month. The article states that 20% of complaints in regards to McDonald’s is about its poor service. The writer claims that despite McDonald’s $2 billion spending on advertisements, poor customer service breaks down the ultimate experience of consumers when they enter a McDonald store. The link to the article is: http://www.businessinsider.com/how-mcdonalds-can-fix-customer-service-2013-5
From my experience, I was never really able to distinguish customer service when visiting fast food restaurants. And thus, if McDonald’s were to really improve their customer service and strive to distinguish themselves from its competitors, they might be able to attract more consumers. The article recommends creating a shared emotional experience, such as through more “smiles”. The article also talks about how some McDonald’s have started implementing a new ordering system where customers walk down registers after ordering, instead of plainly delaying and crowding lines of customers. I think these small changes can definitely change how customers perceive customer service, and can ultimately affect one’s experience at a retail store. So as you can see from this article, McDonald’s still has improvements that it can make. Yet, it has also started to implement changes and I think this is a positive sign, especially considering that just last month, we read a blog post about customer service complaints at McDonald’s. I am greatly intrigued as to how customer service at McDonald’s might change once these small changes are implemented.
Excited by my email update from ShopAkira, a Chicago based store selling brands similar to that of UrbanOutfitters, I immediately started my online shopping escapade after reading about their 50% special going on that day. After filling my cart with 3-5 items, however, my conscious began to regain control of my shopping frenzied brain. A quick glance down at the table where a copy of last month’s bank statement lay, further pushed my conscious mind to the forefront, as I regrettably forced myself to close the ShopAkira tab. Thank goodness…crisis avoided…or so I thought.
You can image my surprise the next morning when I opened my inbox and found another email from ShopAkira. The email not only provided a reminder of the items in my cart but further egged me on to finish my transaction by giving me and extra 10% off if I finished making my purchases with in the next 24 hours. Needless to say online retailer 1, broke student 0… well played big data analytics…well played indeed.
As mentioned in Precision Marketing, companies looking to take advantage of big data need to use “relevance to retain current customers, maximize revenue potential per customer, help to acquire new customers and build long-term customer loyalty.” Gone are the days where customer loyalty could be built on mass e-mail spams and high general awareness. In today’s fast-past, high tech world, online retailers need to send relevant, personal messages to their target segments, in order to build any credible kind of relationship that will result in brand loyalty and increased life time customer value.
Not only can big data help drive brand loyalty and increase customer value, but it can also help to streamline retail practices/decisions and cut costs. I recently read an article that talked about how ModCloth, another online clothing retailer, is using big data in new ways to personalize their consumers’ shopping experience. For instance, their “Be the Buyer” program allows customers to vote on certain products with high-ranking products tagged as “Be the Buyer Picks.” Each “Be the Buyer” poll generates an average of 6,700 votes and helps ModCloth more accurately predict what new product items will sell or what type of product should be reduced in future inventory purchases by product buyers.
The article can be found here:
This week, according to Brand Channel, the classic fashion house, Chanel, will run a branded mascara vending machine in a London department store. I think it is a great idea for Chanel to put up this temporary machine. The juxtaposition of such a venerable luxury brand with such a commonplace item as a vending machine creates an unexpected and intriguing way for consumers to engage with the brand. It’s a fun way to create a little bit of buzz.
Here’s the link to the full article: http://www.brandchannel.com/home/post/2013/05/01/Chanel-Vending-Machine-050113.aspx
Prudential is a PruDON’t
As we’ve discussed in class, it is really important that companies create synergetic incentive systems in order to drive greater affectivity and efficiency. For example, in order to make sure that Apple customers are provided the best customer service experience possible, Apple hires workers for their personable skill sets (instead of technology knowledge) and does not pay its sales associates based on commission. This strategy relieves pressure off of sales associates, maximizing their ability to help customers in friendly and genuine matter.
This is a lesson that Prudential should learn from Apple. A large part of Prudential’s business is to provide and sell life insurance, a service, or lack there of in Prudential’s case. As the world becomes more automated and technologically advanced, customer service can sometimes suffer as a result, especially for industries such as life insurance, accounting, or law where the its consumers may not be to familiar with all the detailed nuisances. Thus, in these industries, customer service should be especially important.
However, my recent experience has left me feeling cheated. In search of a more personalized experience in addressing my personal life insurance information, I took time to visit a local Prudential office to upgrade my life insurance policy. After spending an afternoon with the agent filling out forms and making calls to “corporate” I was relieved to finally be done with the task and confident in my decision to not do this online and risk not having it done correctly. Yet, I was so very wrong. 6 months later I was billed for something that should have been automatically taken care of. But after spending time at McIntire and learning about customer perceptions, I decided to be more forgiving and called the 1-800 number to resolve my issue. After going through the convoluted automated calling system, I was finally directed to a real representative who kindly told me that the papers I had signed 6 months ago had, in fact, not been filed and that my agent no longer worked for the company. Thus, my policy had not changed. The representative did, however, provide me with a solution and I was willing to give Prudential another shot. She advised me to fax in my re-signed form and gave me a confirmation number for our call and discussion.
This is where, however, the Prudential’s customer value system fails. No confirmation number or call was ever provided to me. Even when I took the initiative to call in the next day to confirm the reception and process of my policy change request, the representative told me that I needed to call back a couple days later and could provide me no further information on the reception of my request or its status. When I called back a week later my status was not still updated and I had to, again re-send in my request. As discussed in class, the first mistake can often be forgiven. However, the second and third, not so much, as I will never recommend the company to others in the future; the hassle is just not worth it for something as important and complex as life insurance.
Prudential really needs to evaluate its current customer value system as employees really aren’t taking responsibility for the services they’re providing to customers and there are no repercussions to this. This leads to a lack of incentives for employees to operate to the best of their abilities and can lead to greater customer un-satisfaction when problems arise. Although the company may not feel the negative effects in the short run, the long term effect is loss of current customers, as well as lost opportunities of potential future customers who have been scared off by scorned customers such as myself, using the internet to warn others and instigate justice.
Five years ago I never would have thought to look online for sunglasses. With products like that, it’s important to give them a test run in the store before making a purchase. My recent Zappos experience was enough to convince me otherwise.
Zappos has retailers beat on selection, customer service, and convenience. Zappos offers over 50 sunglass brands in thousands of styles. Consumers are able to sort through their vast inventory on the basis of brand, style, color, price, size, and material. In addition to in-depth item information, each style includes a video of a male and female model to give the consumer a better idea of how the product will look on his/her face. On top of all this, Zappos offers free 2 day shipping and a no questions asked return policy.
The first pair of sunglasses I ordered from Zappos was way too big for my face. They were too big for anybody’s face. All I had to do was print out the return label, slap it on the original box, and put it in the mailbox. Two days later I was credited in full. The second pair was more acceptable. I tried them out for about a week, took them to Foxfield, snapped a few embarrassing pics in them, and decided I could do better. I sent them back Monday and was credited for them today. I’m currently writing this blog post while shopping for my third pair and I’m really feeling it this time. I think I’m going to find a winner.
My point is, Zappos provides amazing customer value through its selection, customer service, and speedy deliver, but should they trust their customers this much? If I wanted to, I could have a new pair of sunglasses every week without paying a dime. While Zappos taking a big risk by trusting their consumers this much, their strategy creates powerful customer loyalty and brand resonance. It have certainly made me an advocate.
A few weeks ago, I actually did go out to a RadioShack to buy something. I wanted a cable to hook my laptop up to my television, which only has an RCA hook-up (the one with the red, yellow, and blue connectors), so that I could watch the season opener of “Game of Thrones” on my TV. Although RadioShack’s business model has attracted a lot of skepticism lately, it is a testament to the enduring strength of their model that when I thought about my need for an uncommon electronic component, RadioShack instantly came to mind.
Still, I had fairly low expectations coming in, and not just because our class had had to write a report about how bad RadioShack was doing and how it needed to improve. I remembered the old RadioShack near my home in Northern Virginia, with its uninviting grey interior, surly staff, and poorly-organized jumble of products. I figured I would be writing a CVA post about my negative experience as I drove up. To my surprise, though, it seems like RadioShack has made some improvements since I last visited.
The store up Route 29 was well-lit, had a brightly painted green interior, and actually seemed very well organized, with a kiosk in the middle where the staff was waiting to take questions. I walked in to try to look around for the cable I needed without even making eye contact with the staff, but a staff member immediately walked up to me and asked me what I needed. As I described the kind of cable I needed, I couldn’t help but think that someone at RadioShack must have read The Apple Experience and taken it to heart.
As it turns out, they didn’t have the cable I needed; although it is possible to hook up my old cathode ray television to my laptop, the staff members explained why it would be bad for my laptop. Considering that I got my TV out of a dumpster around my apartment at the beginning of the year, I was not entirely surprised or unhappy. Even though I did not get the component I wanted, I was impressed with the improvement in my experience since the last time I had visited RadioShack. If they can replicate it in all of their stores, perhaps the company can stay competitive despite everything Wall Street says.
In line with what we have often discussed in class, this article discusses the additional long-term value loyal customers can provide. The article starts by saying, “Once a prospective customer becomes a buyer, it’s important for marketers not to overlook or ignore their their needs.” This reiterates what we have discussed about the need to continue serving customers post-sale and along all touch points to truly create customer value. The article also asserts that it usually takes 3-5 years for companies to reach the point that 25% of their customers are repeat customers. This demonstrates the need for long-term investment and patience in waiting to see returns – something today’s businesses are often unwilling to do. Through several infographics, the article offers tree recommendations for “providing a customer experience the customer deems worth repeating”:
- Encourage High Initial Purchase.
- Push for the Second Sale.
- Invest 25% of the Marketing Budget On Returning Customers.
While I do not challenge these recommendations overall, I do draw a slight issue with one of the statements made a few times in the article – that firms should especially focus the 25% of marketing efforts that should go toward return customers on those who make larger purchases. While I undsertnad the logic – retain those customers who buy more – I argues this is a risky strategy because high disposable income customers’ loyalty is both expensive and difficult to obtain. Those who have to think less about the value of their purchases will garner less value from discounts and marketing ploys. In addition, they can afford to spend anywhere and thus do not have to make decisions between companies. As such, I suggest companies avoid investing too heavily in trying to obtain the loyalty of these customers.
I stumbled upon this article and thought that it was a nice follow up to our whitepaper analysis on RadioShack and our class discussion of how physical retailers can compete with the biggest Internet retailers. Geofencing apps are not new but they have yet to reach widespread popularity. I think we talked about similar apps to these in class.
Shopkick is an interesting app because you don’t actually have to buy anything to earn the rewards; all you have to do is walk into the stores to get points that count towards rewards. If the deals are good enough, I can definitely see how this app can get me off my computer and into the store. Because going to any participating store generates points, the shopper is incentivized to do more shopping away from his computer. This is a good idea for an app, but is the incentive really motivating enough? Is this just another one of those apps that you’d download once because it’s a cool idea, and then never think to use?
Kapture works a little differently. In order to gain rewards, the user has to take a picture in the store and then troll his favorite social networks by uploading pictures for points. I’m conjecturing here, but I don’t think many people would be willing to take on the reputation of that annoying over-sharer just to get points towards a buy-one-get-one-free ice-cream scoop.
Eventually, geofencing apps will be optimized to create real value for consumers but at this point, I think there is still work to be done. Current trends indicate that the future of couponing is mobile, so I wouldn’t be surprised if many more apps like these show up in the near future. Eventually, someone is going to get it right.
On April 2, Shirley provided a solid overview of Tim Cook’s recent apology to the Chinese market regarding Apple’s incongruous warranty policies in China. The controversial mishap elucidates the global imperative for businesses to increase their knowledge, confidence, and skills for serving customers across disparate cultures. This perspective implores globally integrated enterprises to seamlessly integrate best practices in customer value with multicultural awareness so that consistent value may be delivered to all customers, regardless of cultural differences. Anand Subramaniam, VP of Worldwide Marketing at eGain Communications Corporation, dubs this process Multilingual, Multicultural Customer Service (MMCS) and outlines six suggestions to develop it: (1) assess the importance of customer service, (2) assess target markets, (3) assess the scope of customer queries, (4) train agents, (5) adopt culturally nuanced policies and practices, (6) leverage technology. Although there is certainly no magical formula for serving a diverse customer base, Subramaniam’s recommendations illuminate the fundamental need to understand differences and act on commonalities. Realizing and responding to these points of parity and disparity lead to real cross cultural synergies in the customer value sphere. However, easier said than done. Developing and implementing best practices to leverage cultural diversity will undoubtedly remain a necessary challenge in today’s global business environment.