It had been some time since I heard about them but this week they kept finding their way into my conversations. At a large independent retail conference they were a central point of discussion, while working for a major metropolitan design center client I also heard my share about them. Who are they? Direct Buy of course.
Direct Buy which has actually been around since 1971 positions itself as a home improvement and furnishings membership club with a growing footprint of locations and a membership in the 500,000 range. The essential aspect of their offering is the sale of memberships for approximately 5000 dollars up-front, in return for access to wholesale prices on approximately 7000 items provided directly to the consumer. According to the independent retailers at the conference where I presented, Direct Buy recruits members in a fairly small retail environment during an approximately 90 minute interview process. Allegedly, Direct Buy shows the invoice price that retailers like Best Buy or smaller independents might pay for a refrigerator and contrasts that to Best Buy’s marked-up price. While all that makes business sense for Direct Buy, the worst allegation of all is that Direct Buy purportedly encourages members to go to Best Buy to see the product (since Direct Buy does not stock most of the products it sells and instead facilitates catalog orders). While at the Best Buy store, the independent retailers suggest that Direct Buy members are told to get on their mobile device and place their order through Direct Buy.
Having not done the “cloak and dagger” stealth work of attending a 90 minute long Direct Buy sales pitch, I can’t attest to the veracity of the claims made by the independent retailers who passionately discussed these issues. What I can confirm is that the “brick and mortar” retailer is in a state-of-concern about the Direct Buy’s of the world. Assume you pay steep overheads for large buildings, staff, training, lighting, and inventory. Further assume the manufacturers who sell to you, and benefit from your showcasing their products, now also sell to Direct Buy. The consumer can come and look at the product at your store but can only see a picture in the Direct Buy catalog. The product sells at retail prices of 30% to 50% higher at your store and is offered to Direct Buy members at what you can buy it for to have it in stock. Can the brick and mortars create an experience that will assure their survival, or will they go the way of the tyrannosaurus and the full-service gas station?
More importantly is one way of doing business better than the other? Right now those who don’t have as much overhead (many internet companies that simply drop ship products without large inventory or commercial real estate cost) have an advantage on their competitors. Not only are the “brick and mortar” operations losing market share but their staff are serving visitors who want to experience the product before they go ahead and buy it on line. Some day there may be no stores to experience these products.
Two studies from the holiday season amplify the concern of “brick and mortar” businesses. Motorola demonstrated that 51% all consumers and 64% in the 18-to-34 age range, used mobile phones for in-store shopping-related activities. (Comparing prices, finding user reviews, and making a purchase via their mobile phone). Forrester added to those results by noting that their is a 43% likelihood consumers will switch channels during the shopping process (e.g. in-store to mobile device) and as they move across those channels there is about a 50% chance that the consumer will change which retailer they will end up purchasing from (e.g. from Best Buy to Amazon.com).
So what does this have to do with all the rest of us, who are not running retail enterprises with large overhead? Well there are many indirect social costs of saving a few dollars by sending away for items and not shopping locally but I won’t go on to that soap box in this setting. From a learning perspective, the Direct Buy, Best Buy, Local Electronics store example forces us to ask ourselves whether the “experience” we provide justifies the infrastructure expense it costs to deliver it or will consumers become so commoditized to the point where only price matters? Further, how do we avoid creating tangible experiences so that others won’t benefit from us as they sell through channels where customers can’t touch the item or kick the tires?
Ultimately, the question is this…..what valued experiences can you create that makes price less relevant?
My friend and colleague Doug Fleener once described the possible downside of Twitter as being like a “Chamber of Commerce meeting where everyone is selling and no one is buying.” It’s great to have friends as smart as Doug because they force you to think about things differently. Ever since Doug shared his observation, I’ve been looking at Twitter, social networking, and business communication quite differently. Let’s focus on the Tweet….
Most people I know who use Twitter desire a large base of followers. In fact, I heard a presenter on social networking emphasize that “you should do whatever it takes to get as many followers as possible.” She went on to offer various tools including fee-for-service products where I could pay about $150 dollars and be guaranteed 3,500 new followers by morning. It led me to ask the presenter if the objective for Twitter, is to be the person who “bought the most followers.” Now you see why I am typically a presenter and not a student in class.
Really, who are those 3,500 people that you can pay to have follow you? I could create 4,000 false Twitter accounts (all I would need was 4,000 different email addresses and an active imagination when it comes to generating names). Then I could set-up a website charging $139.99 and guarantee you 4000 newly purchased admirers. Think of the money that would save you!
All of this begs the question, who is listening in a world where everyone is expected to “lifecast” or “market their message on line?” Who are these people who specialize in my area of expertise with hundreds of thousands of followers (and I have somehow never heard anything about them – until their Twitter page popped-up)? How many search engine optimization, direct marketing, leadership,and motivational gurus are there? Hopefully, your brain does not work like mine and you don’t actually wonder about such things.
But what does it mean to “win at Twitter or in the social media space?” I think Doug Fleener implied the answer in his keen metaphoric example. The person who wins when everyone is talking – is the person who listens effectively. The greatest success, I have gained from Twitter or most business communications is the opportunity to listen to the few voices that have compelling things to say and then leverage that listening to inspire me to do things differently.
Thanks to Doug, I do things differently. I tweet less, filter who I listen to better, elect not to follow everyone who follows me, and let my follower count take care of itself. I also go into networking settings (like Chamber of Commerce mixers) with the mindset that I will not join the herd of people who are simply there to sell something. Isn’t it great that by “listening” we grow personally and professionally, and by constantly talking, tweeting, and marketing we end up getting what we hunt for – large follower counts of people who aren’t listening.
So here’s my challenge,
Where should you be talking less and listening more?
Who is really listening to you?
What message do you want heard and by whom?
By the way, did I mention I’d be glad to sell you 4,000 followers for $139.99. Somehow, I suspect you just stopped listening.
You have probably heard the well-worn phrase that “knowledge is power.” I think that’s wrong! Knowledge is just that – knowledge. Unless information is put it into action their is no power in it. Lets take the knowledge that you’ve collected on your best customers as an example. Assuming you have taken a great interest in your customers and collected a considerable amount of information about them, the power of that information or knowledge is only as effective as the action you’ve taken on it. Agreed?
But no one would go through the effort of collecting information if they are not going to use it right? Well people usually think they are going to use things they collect but sometimes simply don’t. Since I’m reeling off cliche phrases, let me throw in that “the road to hell is paved with good intentions.” Typically when I go into a business with a rich customer relationship database, I’m surprised by how little action has been taken on that data, In those cases, I typically hear that the data was collected with the “intention” to use it to strengthen relationships with existing customers but that the staff “got too busy” keeping up with their day-to-day activities to maintain that hoped for regular contact. Worse yet, many business leaders I talk to do little to collect data in the first place.
Having heard these themes so many times, I finally decided to engage a business partnership that provides these “relationship management” services on behalf of extremely busy, well-intentioned business leaders and owners. Since this podcast and blog is about sharing ideas and not about selling products or services, I’ll simply mention the name of the business WOWful Connections and later give you a contact number, should you have additional interest in the resource. But I will use WOWful Connections as an example of what you can do in your business to strengthen the loyalty of your high value customers. Let’s start with what data you collect on those who you must retain. For example, do you know their…
Name, address, phone, email, fax
Date of Birth
Spending patterns
Annualized customer value
Job Title
Twitter url
Facebook page, Linked-In address
Career History
Educational History
Recreational interests
Partner/Children’s names and dates of birth
Family members interests
By no means is the above list of customer knowledge exhaustive Wowful Connections they are assisting business owners do far more comprehensive research on high value customers both by using traditional sources and on-line strategies).
As you assess your opportunities in customer knowledge acquisition, you might want to start with the question. “what don’t I know about that my high-value customers that I should and could easily know?” The next question, you may want to ask is “how would I know and respond to any significant positive or negative events that affect my customer?” For example, WOWful Connections deploys on-line alert methods and scans of blogs, Twitter, Linked-In and other social media posts of those select high value customers.
Most importantly, what are you doing with the information that you have obtained? How have you incorporated your customer knowledge into your ongoing outreach with those customers? Seth Godin once said “”The easiest thing is to react. The second easiest is to respond. But the hardest thing is to initiate.” With that in mind, are you regularly initiating contact with your existing high value customers in a way that reflects your understanding of their uniqueness? WOWful Connections is helping business leaders and owners economically connect with those high-value customer on a quarterly basis and in a personalized way.
So what step will you take this week? Will it be to collect and document customer information or to build a system to assure follow-up? For those who know their well-intentioned efforts for customer loyalty buiilding might get lost in the hectic nature of day-to-day business contacting WOWful Connections (888-711-4900) may be for you. For others, it’s important to do something to maintain the relationship and connection that exists between you and your most important customers. What step will you take?
On occasion, my father would begin to make a point with the phrase “if I had a dime for every time…..” and finish it with something like “a politician made a promise they did not keep – then I would be a rich man today”
With inflation, I’ve decided to modernize my father’s speech style by saying “if I had a dollar for every time someone asked me to join their affiliate program, write a book about their product, endorse their book, etc. I would be a much more affluent man today.” But, what if I actually joined all those affiliate programs, accepted every paid endorsement that came along, or felt compelled to be “nice” by blending my brand with anyone? Would I be wealthier or poorer for it?
When economies tighten there is even greater talk about the importance of “strategic alliances.” While much of this talk comes from people looking to connect with a big referral source, some of the energy behind business affiliation makes sense. But here are a few guideposts to consider when you are throwing your brand equity in with a “strategic partner”:
Join a parade- When I did a syndicated radio program and local radio show for over a decade, everyone wanted to be interviewed on the show. Everyone from motivation guru Tony Robbins to vice-presidential hopeful John Edwards. The interviews of greatest interest to me were with people who “did not need to be interviewed.” The best interviews were with people who had already achieved success, had their following, and had something to say – not something to sell. That notion also applies to strategic alliances. Similarly, when it comes to marketing events and publicity, it’s often better to connect to a well-organized community event that is trafficked as opposed to one that you attempt to create yourself – thus join a parade don’t start one.
Determine agendas ahead of time – One of my favorite collaborations came with a company that flew me into meet with them and began with “this is what we seek to gain from our association with you…..what do you want to gain from partnering with us.” Rather than trying to sell me on all the upsides of associating with them, they were laying their agenda on the table and wanted to know mine as well. Since our desired outcomes were compatible, the relationship was mutually profitable.
Brand equity is more valuable then fast cash – This is such an obvious rule to live by but desperate times breed some rather desperate measures. Recently, I’ve seen some rather “odd relationships” forged between high equity brands and rather cash rich companies of lesser integrity. While the money is nice (in yet another well-worn phrase of my father) “there is no free lunch.”
Having shared my three caveats about partnerships, please realize that I form written collaborations agreements with every company I write about. Companies like Starbucks, Ritz-Carlton, Pike Place Fish Market, and UCLA Health Sciences all share their huge brand equity with me and I share my authorship, consulting, and international speaker brand equity with them. It creates wins for both sides of the relationship.
I truly believe that there are no self-made men or self-made companies. Each of of stand on the shoulders of great people and brands that came before us, the challenge today is to not take that dollar every time an unworthy partner comes along.
What game-changing partnership opportunities await you and which ones should you let pass?
I welcome a discussion of the rules you live by when deciding with whom to partner!
As a business owner and consultant, one of my favorite phrases has been “how do you know?” For example, I might ask a CEO of a business that I’m consulting with about their overall level of employee engagement and after they give me their subjective assessment, I typically spring the follow-up question “how do you know?” The purpose of my question is not to put that person on the defensive, but merely to help clarify the data upon which a person’s conclusions were formed.
The question “how do you know” is one I apply to my own business on a regular basis. For example, I might reflect on the overall health of my business and give it a letter grade of a B+ or an A- suggesting there is always room for improvement. When I drill down deeper on the evaluation, however, and ask how do I know it’s an A- and not really an F-, I start to define the metrics upon which I can more objectively forge my opinion, worse yet I find many metrics that are lacking.
Let me give you an example from a small business client of mine that brought me in to increase customer loyalty. Now the obvious starting point would be to determine the loyalty of existing customers and to look for market segments such as highly loyal, merely satisfied, and even dissatisfied groups. So I did the obvious and asked for a current assessment of customer loyalty. The business owner responded, “I think we have a pretty loyal customer base.”
You guessed it, I then responded “how do you know.” His reply was, “I see a lot of the same customer faces in here on a regular basis.” Now it gets annoying to keep asking the same question over-and-over again so I simply varied my “how do you know” question and challenged his follow-up response by saying “which faces, how frequently?” Without belaboring the point further, suffice it to say, we needed baseline data on customer loyalty before we could even begin to know how or with whom to improve it.
Not being a person who loves numbers as much as I do people or ideas, I have come to understand the critical importance of metrics in business. In fact, I see many business owners make one of three mistakes when it comes to collecting helpful data to answer their important “how do you know” questions:
they rely on subjective feelings and collect very little data
they feel helpless to collect data because they don’t have an optimal measure, or
they collect so much data, that it can’t be analyzed meaningfully
To that end, I offer the following challenge to you! Take one “how do you know” question that is begging for data. Realizing that the need for perfection can paralyze action, what is a beginning way to collect some data? Not the perfect way but “a preliminary way.” How can you keep the data collection process and the data outcome on your radar, so you can use the data to answer your critical question?
It can be as simple as evaluating how quickly your team responds to your clients’ email by having a staff member create a log for the time/date the email was received and the time/date the response was sent (obviously tech solutions are much more ideal) but if email response times are important, even a basic manual approach to collecting performance data is a big step in answering the question “how do you know” how quickly you responded.
Some time ago, innovation consultant to Fortune 500 companies and author Gregg Fraley blogged that “Starbucks is Dead.” He went on to acknowledge that his comment was a “bit of an overstatement.” But he made the observation because of his experience. According to Fraley, “Starbucks has gone from a ‘highlight of my day’ to one of avoidance. Why do I see Starbucks as dead? Because when I go its dirty, crowded, and often staffed by dizzyheads who don’t leave enough room for milk. And, this hurts the most to say, the coffee itself has slipped. I still find good cups at Starbucks, but not always.”
Given his expertise as a creative thinker, Gregg went on to note that in preparing his blog he “stumbled on My Starbucks Idea — a site for consumers to post ideas for Starbucks consideration. In just a few days participating I’ve noticed real ideation, real dialogue on the site. It’s a good signal. The heart stopped but it’s beating again. If they want to continue the recovery they’ll not only listen, they’ll take action on the ideas that have been posted. Lots of action! Good luck Howard!”
Now lets fast forward to the final quarter numbers for Starbucks in 2009 when the company reported a net profit of $241.5 million (a number almost 4 times greater than the same period a year before). Not only did Starbucks listen to the customer’s ideas of innovation but they also used the voice of the customer to regain their swagger.
Stuart Lauchlan writing for mycustomer.com notes “Starbucks’ CEO Howard Schultz is relishing the company’s reversal of fortune – and attributes the success to the firm’s focus on customer experience.”
According to the article Howard Schultz notes that,”The global economic crisis has profoundly shaken consumer confidence and retailers who want to stay relevant in the future will have no choice but to recognize and respond to this new reality. At Starbucks, we know that to continue and to accelerate our recent momentum we will have to continue to improve, continue to innovate, and continue to focus on strengthening our connection to our customers…Our holiday performance was among the best in our history thanks to improved merchandising, a highly-effective, well-designed in store customer experience, compelling value offers, disciplined inventory control and above all else, energized, passionate Starbucks partners who exceeded the expectations of our customers,”
Howard went on to note that “our customers responded enthusiastically to all of our holiday innovations and initiatives this year. Our holiday beverage platform which this year included caramel brulee latte was a big hit, delivering 30% up lift in holiday beverage sales compared to last holiday season. We offered a relevant and more focused merchandise selection, including a selection of gifts for under $10. A Starbucks card beat sales targets with over $500 million loaded in the first fiscal quarter and our legendary Christmas sled holding coffee, a seasonal favorite, celebrating its 25th Anniversary this year not only handily beat sales targets but also sold over 300, 000 of this extraordinary blend in one single day.”
In addition to seasonal product innovations, Howard spoke extensively about the success of Starbucks social media efforts, “We also advanced our partnership with Product Red by leveraging our strong Facebook presence to connect with consumers in 156 countries for a global, virtual sing-a-long to raise money for the global fund,” This effort was the largest global campaign ever on the Facebook platform and further strengthens Starbucks unique connection with our customers. I am particularly pleased to report that to date our partnership with Product Red has helped to provide over $7 million days of life saving medicine in Africa.
In the spirit of a classic comedy skit in Monty Python and the Holy Grail, it appears that “Starbucks is not dead yet.” While wounded by the recession, Starbucks has mended and returned to the basics of creating relevant innovations in product and customer experience design. How are using economic challenges to rethink your customer experience, to listen to the ideas and innovations of your customers, and to position yourself with a strong presence in the places your customers are and not where they have to come to find you?
Gregg Fraley, Starbucks listened and took action. Lots of customer-centric action.
Assume you take over leadership of a troubled work team or organization. Your employee engagement scores, customer engagement metrics, and performance measures all reflect significant cultural chaos. Which of the following approaches is mostly likely to achieve an effective cultural revolution:
a) (since crisis requires a direct approach) immediately impose your authority and control,
b) (since buy-in is essential to change) immediately seek input from employees and increase employee empowerment,
c) (since such dysfunctional cultures seldom change) get your resume prepared so you can find alternative employment soon.
While every situation is different and many effective leaders might stabilize the crisis by taking a directive approach, the science of employee and customer experience management suggests that option B – the listening and measured empowerment strategy – is the best long term course of action.
Take for example, a study published in the journal of Leadership and Organization Development that tested a conceptual model involving what is often referred to as “transformational leadership”. As you are probably aware, transformational leadership refers to leadership behaviors that influence the values and aspirations of followers and activates followers in the direction of higher-order needs. In essence, motivating the follower to go beyond their own self-interest for the sake of the organization.
In the Leadership and Organization Development study conducted by James Avey, Larry Hughes, Steven Norman, and Kyle Luthans, employee negativity and cynicism were significantly reduced by a leader who demonstrated positivity and utilized a transformational leadership approach. More importantly, the most effective mediator of staff negativity was the leader’s ability to effectively empower staff to have a sense of ownership and control over the change process. Many studies had previously demonstrated that controlling leaders often get compliance over the short-term but in the process they squelch dissent and drive passive acting-out behaviors.
So if you combine research findings on authoritarian leaders and transformational leaders and appreciate that most of us want not only to “right our organizational ship but also keep it sailing”, option B (the listening and graduated empowerment approach) is definitely the best bet.
For course, it is possible to inherit a situation so dire, that both options A and option C should be considered. Hit the command and control switch and have your other hand on the ejector button with a well-prepared resume available for a possible soft landing.
However, even in that scenario, a positive approach will still come in handy!
A clearly defined business strategy makes tactical decision-making easier. Let’s take the case of Home Depot, one of the major US-based home improvement big box retailers. Home Depot competes aggressively head-to-head with the Lowes brand. Home Depot’s story is well-told in the 1999 book Built from Scratch: How a Couple of Regular Guys Grew The Home Depot from Nothing to $30 Billion. In the book, Bernie Marcus and Arthur Blank, cofounders of the Home Depot, share how they built the first national chain in their industry by concentrating on three things 1) low prices, 2)customer service, and 3) strong leadership values.
Many might argue that service, pricing and values at Home Depot all hit a low in January of 2007 when its chairman, president and CEO Bob Nardelli resigned from the company. During Nardelli’s time atop Home Depot the company lost market share to Lowe’s and Home Depot stock fell 8 percent. Despite that poor performance, Nardelli left Home Depot with a $210 million severance package involving cash payments, stocks awards, and deferred stock options.
In the transition period that followed Nardelli’s departure, I had an interesting happen stance meeting with a senior leader at Home Depot. The meeting occurred in an airplane (a location I lovingly refer to as “my second office”). While sitting next to this leader, he shared the new strategic vision for enriched customer-experiences at Home Depot in the post-Nardelli era. In a “small world” moment and to my delight he talked about how leadership was reading my book The Starbucks Experience.
During the flight we discussed how and what Home Depot sought to do to return to the core service values that created the company in the first place. Our conversation focused on how leadership could decrease the cavernous warehouse feel of their stores, how they could get their sales staff engaged with customers to ease the shopping experience and to offer the customer “do-it-yourself” knowledge and guidance. Most importantly we talked about how they could increase friendliness and decrease wait times in Home Depot checkout lines.
Through the intervening years, I’ve personally watched the positive transformation of the Home Depot Experience including having employees more consistently go out of their way to ask me if I need help and personally assist me locate items in the vastness of their warehouse stores. From my perspective, checkout wait times have also vastly improved.
So let me use Home Depot to support my initial assertion, namely that a clearly defined business strategy makes tactical decision-making much easier. With a strategy to elevate “customer experience” as a business differentiator, Home Depot can make tactical decisions through the filter of “how much will the tactic enhance the customer experience.” As such, Home Depot recently prioritized a large investment to purchase 10,000 handheld devices at a cost of 60 million dollars in an effort to further improve the customer experience. The devices will enable Home Depot employees to check inventory, stock shelves, find items for customers at other Home Depot stores and even check out customer purchases.
While technology is not the experience, the investment in this technological infrastructure follows directly from Home Depot’s business strategy. If Home Depot’s strategy had been to compete exclusively on price or products alone the tactical decision to deploy the handheld device technology would likely not be justified.
Here are a couple of things for you to consider in your business based on the Home Depot’s handheld device decision:
How consistently do you and your business resist taking on tactical initiatives because they are inconsistent with your defined business strategy?
What tactical choices should your business be making to truly “walk the talk” of your defined strategy?
I’ll be watching Home Depot closely to see how well they execute the desired strategic benefits to the customer from their intensive tactical investment in experience-enhancing handheld devices. I suspect you might be watching too.
I have been talking a great deal about service-centricity as the foundation for customer-centricity. Let’s further that discussion to examine what it takes to execute a service-centric business strategy. I will be using the UCLA Hospital System because of my intimate knowledge of their operations, thanks to the opportunities afforded to me to work with Amir Rubin the Chief Operating Officer and others in the course of working on a book about UCLA.
UCLA is undeniably one of the premier hospital systems in the world. On measures of quality clinical outcomes they are in a class of healthcare systems with the Mayo Clinic, Cleveland Clinic, and Johns Hopkins. If you had a complex medical condition or transplant need you would be very fortunate to be at UCLA. However, if you wanted “world class” customer experiences – UCLA might not have been for you. That’s where Amir Rubin and numerous other leaders at UCLA came in. Leadership saw an important opportunity to raise patient-service consistency to the level of their legendary medical outcomes.
The need for the elevation was highlighted by overall patient satisfaction scores in the 40th percentile – a far cry from enviable levels. So how does an academic medical center with an annual budget well over 1.3 billion dollars, 1000 inpatient beds, more than 80 specialty clinics,and 8000 employees elevate its service culture?
It started with a crystal clear understanding of UCLA Health System’s purpose. That required making adjustments to the corporate vision to raise service to a more prominent place. In it’s basic form the vision was “be the best” and represented a reasonable flow down from the corporate mission of “delivering leading edge patient care, research, and education.” But to be effective, a vision statement must take the corporate vision and make it both personal and relevant to each employee. As such, the UCLA vision now reads, “healing humankind, one patient at a time, by improving health, alleviating suffering, and delivering acts of kindness.”
From the standpoint of the revised vision, Amir Rubin shares “if you think about this type of strategy deployment leading edge patient care, research and education doesn’t speak to people’s passions and objectives and why we are all here. Yes, that’s our mission we are doing those things but what do we aspire to be? What do we aspire to do? How does that speak to the researcher, physician, the nurse, the housekeeper, the accountant, and the person in finance? I think improving health, alleviating suffering, and delivering acts of kindness speak to different people in different ways. Certainly, we want to improve everyones health but sometimes it is only alleviating suffering. Sometimes, particularly if you are not directly at the bedside, or even if we think about what business we are in – we are into caring. We are in the kindness business.”
So have translated your mission statement into a vision statement? My friend Terry Paulson says “the difference between a vision and an hallucination is how many people see it.” Is your vision statement compelling? Does it help your people have a line-of-sight opportunity to appreciate what’s necessary to create service excellence?
Previously, I’ve shared 4 customer interaction strategies that businesses either consciously or inadvertently deploy. Those strategies are product-centric, service-centric, customer-centric, and customer-adaptive. I hope I communicated that whichever strategy you choose is less important than how effectively you execute it. I will skip over product-focused business strategies and begin with a service-centric approach.
Does your service compete or exceed that given by your competition? Here’s an even harder question. How do you know if your service is as good as you said in response to my last question? One last inquiry, how consistently do you deliver extraordinary service? As you contemplate these questions, let’s examine what exceptional service involves. From my world view, extraordinary service occurs when you fulfill a customer need in ways that are:
1) Relevant: giving the customer what the customer cares about right now
2) Easy and Consistent: reliable and painless the first time, every time, and across all channel s
3) Speedy: it respects your customer’s time, and
4) Secure: it protects your customer and their data
Quality guru W. Edwards Deming said, “It is not enough to do your best; you must know what to do and THEN do your best.” Do your people know what they need to do to deliver relevant, easy, consistent, speedy and secure service? Service-centric businesses make service excellence known and measure service outcomes.
Let me give an example from time I’ve spent at Zappos – a premier service-focused internet shoe fulfillment company. In fact, Zappos’ tagline is “powered by service.” At the Zappos call center, staff who are called customer loyalty team members, aren’t measured on sales volume. Instead they are encouraged to handle a call to the resolution of a customer need. They are even encouraged to send callers to an alternative site if the product is not in inventory. In essence, the Zappos customer loyalty team member can say, “I can’t find what you want in our stock but I did locate it at shoes.com. I can help you find your item on their website – so you can purchase it yourself.” Now that’s service!
Zappos customer loyalty staff are also not measured on how many calls they handle in an hour. They are measured on how quickly they get back on the line with the next customer. Zappos leadership can answer the question of how good their service is through data they derive from weekly audits of calls received by their staff. Leaders will audit one of call per week at random for each call-center worker and in that call they will look for whether the employee established rapport with the customer, whether the employee accurately communicated and followed policies, if the employee resolved the issue for the customer and did so to create a wow for the customer such as the manner in which they infused life and joy into the message they shared with a customer about upgrading the speed of shipping.
One last way leaders at Zappos can answer the question of how good their service is comes through survey data. After each call received at the call center the customer is sent an email survey. There are three basic questions in the survey – the first two of which are measured on 0-10 scale:
1) How likely are you to recommend Zappos to a friend of family’ member?
2) During your last interaction with us, you contacted a member of our customer loyalty team, if you had your own company that was focused on service, how likely would you be to hire our person to work for you?
3) A qualitative question that asks, if you had one thing that Zappos could do to improve on what we did today, what would it be?’
So if you are service oriented, how are YOU doing and how do stack up to companies like Zappos?
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