How about we start with ‘I’m sorry’?

During the last few weeks, I’ve had far more than my fair share of incredibly frustrating customer service issues to work though. I’ve also encountered quite a few dangerous–or at least annoying–driving situations. Whether caused by global warming, sun spots or, more likely, the universe simply balancing out my karma account, it’s led me to a few observations and conclusions.

In the case of the customer experience snafus, all four companies made stupid errors, some certainly more egregious than others. In all cases, it took quite a bit of time and back and forth–on the phone or via email–to get things straightened out.

Now I get that mistakes happen. I get that, in the big picture, these issues are comparatively minor (feel free to add #FirstWorldProblems if you retweet this). And having led customer service teams myself, I also get that–contrary to retail mythology–the customer isn’t always right. Nevertheless, in the scheme of my multi-year engagement with these companies, these were major fails that had the potential to diminish or destroy my relationship with the brand.

Ultimately, in all cases, the matters got resolved to my satisfaction. Yet how these interactions left me feeling about these brands is markedly different.

Based upon my horrendous experience, I will never do business with one company again. Two of the others, in the end, finally did the right thing. But it was way too hard and took way too long. Now I question whether they really value my business, despite my being a pretty significant, profitable customer. They’ve got plenty of good competition, so when my agreement is up I’m going to be shopping around. The fourth, I’m more or less locked into for a bit, but one of their employees really stepped up and solved a complicated issue.

So what made the difference?

Only 1 of the 4 said “we’re sorry.” When it’s obvious you screwed up, you need to take responsibility. Right away.

Only 1 of the 4 acknowledged how frustrating my experience was. Want to connect with customers? Demonstrate empathy.

Only 1 of the 4 really took on the problem. In all four cases it was immediately clear that the issue was on the company’s end. Yet 3 of the 4 tried to shift blame –and the work of figuring it out–back to me. When you become the customer’s trusted agent, you win.

Only 1 of the 4 had one person who stepped up to drive the matter–in all of its complexity–to resolution (way to go Megan at Cigna!). Own the customer’s problem completely and you have a better chance of owning the relationship.

Which brings me to my recent driving experiences. In one case, someone rolled through a stop sign. Had I not taken evasive action, I would have T-boned them going at least 30 mph. The other day, someone was darting in and out of the traffic going at least 70 and nearly collided with me. Yesterday, someone texting (on the Expressway, doing about 60!) started to drift into my lane, coming within inches of hitting me before they corrected their trajectory.

In all cases, I leaned on the horn; not in a rageful way, but definitely loudly and with a sense of urgency because, hey, high-speed collisions just ain’t my thing. In all cases, I got the same response. They gave me the finger. You know, the one Johnny Manziel likes so much.

Maybe I’m old-fashioned, but it seems to me that whether it’s dealing with customer service issues, engaging in basic human interaction or dealing with loved ones, if we’ve made a mistake–even if we’re embarrassed by our behavior and feel protected by the mothership brand or five thousand pounds of metal–the appropriate response is “I”m sorry.” And the sooner we say it, the better.

Nobody likes a victim. And, in my experience, a little contrition goes a long way, even in the most challenging of circumstances.

The big stall and your angle of attack

Many brands, particularly in retail, seem stuck in a persistent malaise. Earnings report after earning report detail tepid sales and mostly flat-lined profits. The accompanying press releases describe the consumer as “on the side-lines.” Others opine that shoppers have adopted a wait-and-see attitude toward spending. The CEO of The Container Store recently concluded that we are experiencing a “retail funk.”

I freely admit I don’t know a lot about aerodynamics. But what I do remember about why planes stall mainly has to do with their speed and the “angle of attack” of the wings. The reasons we are seeing a big stall in retail are similar.

The lack of speed comes from little to no growth in discretionary income. Combine that with a consumer wariness toward spending after a brutal recession–and an uneven recovery–and we have little forward thrust. There is little reason to believe that this will change markedly anytime soon. And, of course, no brand can do anything to change these macro-economic factors.

The angle of attack is how you approach the market–and this is entirely within your control. Confronted with a lack of acceleration you can choose to follow the herd, taking a one-size fits all approach, making average products for average people, engaging in a race-to-the-bottom price war and so forth. Best case: you hold your ground and your results are in line with your industry segment–which is to say strikingly mediocre. Worst case: inadequate speed and an insufficient angle of attack cause you to plunge to the ground. Not very appealing.

Perhaps you’ve noticed that even in the worst of times there are still some clear winners. Perhaps you’ve noticed that somehow, even when the stock market goes through its gyrations or consumer confidence wanes or weather conditions are not conducive to seasonal apparel sales, somehow or other, a few brands manage to shine.

Maybe these brands are less concerned with the speed of the market and more focused on their angle or attack?

Maybe if you are losing lift, you might want to stop doing the same things over and over that got you there in the first place?

 

 

 

 

 

 

The discount ring

I’m amazed that Wall Street analysts are “surprised” that as hot brands get bigger (think Michael Kors, kate spade), their level of discounting increases. Apparently they were all sleeping during their first year economics course when supply and demand was covered.

Target_market_bullseye

 

 

 

 

 

Whether it’s Walmart or Chanel, at the center of any brand’s customer bullseye will be customers who don’t need a discount (or any extra incentive) to buy. This is what I referred to in my recent obsessive core post. As we move out in the rings, away from the center, we encounter customer segments that are less and less intrinsically loyal and thus more in need of extra incentives to buy.

Since Walmart’s value proposition is largely about price–whereas Chanel’s rests on a high percentage of full-price selling–the composition and dynamics of these various customer segment rings will obviously be quite different. But the fact remains that as a brand grows by casting a wider net for customers it will, at some point, develop a discount ring.

As the name implies, customers in the discount ring don’t buy unless they get a deal. In fact, most brands will have multiple discount rings. There will be a ring that needs only minor or modest incentives to pull the trigger. Others only come off the sidelines when prices hit a much deeper level of markdown (or some other incentive).

Unless we are examining a brand that has decided strategically to shun price discounting completely–or assessing certain companies early in their life-cycle–the existence (and relative growth) of a discount ring should surprise no decent analyst.

The real question for anyone trying to understand the validity of a brand’s long-term customer growth strategy is whether the company has a firm grasp of the dynamics within each of these rings and is intelligently balancing the portfolio of these different customer segments.

Coach is a brand that in recent years lost its grip on its customer portfolio and pushed too far on the discount ring. They have paid a steep price and are now trying to rebalance.

In Michael Kors’ case, there are only so many customers willing to pay at or close to full-price for their core offering. Sustaining growth means appealing to more customers. And that means they will need to become more reliant on more price sensitive customers.

Ultimately the point at which the discount ring becomes meaningful is mostly a matter of brand maturity and math. If you get shocked by that it just means you’re not paying attention.

The starting point–the pivotal matter of strategy and intelligent customer development–is to build a level of deep insight about each relevant customer segment. Then we must become intentional about how each plays into the brand’s long-term growth. Having a discount ring emerge is not automatically a matter of good or bad. How it plays out over time is a strategic choice.

Choose wisely.

Just because you killed Jesse James . . .

“Just because you killed Jesse James, don’t make you Jesse James.”

- Mike Ehrmantraut to Walter White, Episode 3, Season 5 of Breaking Bad.

Just because you’ve shot down my idea doesn’t mean yours is better. Defending the status quo can be necessary, but mostly it’s an excuse to stay trapped in our fear.

Just because you sit in judgment of all the “idiot” drivers and “slothful” welfare recipients and “feckless” politicians, doesn’t actually do anything. Though your fragile ego may get a hit for a few seconds, putting others down isn’t a solution. And it certainly adds nothing to the level of discourse.

Tearing down something else isn’t the same as your building something worthy or interesting. So instead of complaining, let’s see your plan.

Being the critic is mostly a place to hide from the hard work of leading us to something new and meaningful. So instead of judging, let’s hear your ideas.

Eliminating the competition may make life easier for a bit, but eventually our art, our projects, our passions have to stand on their own merits.

The universe is listening. And waiting.

 

The obsessive core

Every great brand has an obsessive core. The person who camps out for hours before the next iPhone is released. The Harley Davidson fanatic who sports the logo tattoo and is dressed head to toe in Harley gear. The frequent shopper who willingly pays full price and is an incredible source of great word of mouth. The raving fan. You get the picture.

The great thing about most obsessive core customers is that they are highly profitable and help acquire new customers at a low-cost. If you lack such a passionate group, chances are you are making average products for average people. Good luck with that.

Yet brands blessed with an obsessive core–or even a bit less enthusiastic but significant group of “heavy-users”–are often led astray.

Many luxury brands–including my former employer Neiman Marcus–tilted too heavily towards their obsessive core shopper and neglected other important, profitable customer segments. When the recession hit, the day of reckoning was harsh indeed.

Most high-flying e-commerce companies gain their initial traction with an obsessive core. By focusing on an underserved niche that loves to shop online, these brands can often quickly and cost effectively acquire thousands of profitable customers. Alas, as we’re starting to see with many companies that have attracted millions in venture capital funding, growing profitably beyond that initial core is not so easy.

Unfortunately, the factors that create the obsessive core, the raving fan, the incredibly passionate brand advocate, often cannot be scaled.

Unfortunately, in our quest to exploit the seductive virtues of the obsessive core, we can lose sight of the big picture.

The key, I think, is to not let ourselves become obsessed with this group, but to place them in the appropriate context.

 

It’s just cheese

My now ex-wife had a great first career in brand management at Kraft Foods. Early in our marriage, when she would get all wound up about something that had gone wrong at work, I would often find myself saying “you know Nancy, it’s just cheese.”

Around the same the time, I was in working at Sears. To be sure, I had my share of seemingly miserable days. And when I would get caught up in my own tale of woe, Nancy would sometimes remind me that I was devoting my life to making the world safe for moderately priced, largely unfashionable, family apparel. It’s fair to say that neither of us was curing cancer.

At a dinner party a few years ago, several of us endured a tax attorney prattling on about how tough his day had been. Finally, the pediatric surgeon seated to my right interrupted his rambling and interjected: “Yeah, that sounds really awful. Of course when I have a bad day somebody’s kid dies.”

It’s so easy to get caught up in the minutiae, to tell ourselves that because we are spending time on something it must be, by definition, important.

It’s so easy to spin ourselves into a maelstrom of worry about the small stuff.

It’s so easy to lose perspective.

But more times that not, it’s just cheese.

“Chief Silo-busting Officer”

We’ve all heard the term “customer-centric” ad nauseam. And “omni-channel” is quickly reaching similar status.

My inbox and RSS reader are chock-a-block with articles, white-papers and sales pitches, all promising the keys to omni-channel success. Some extol “a single view of the customer.” Others opine on cross-channel inventory visibility or similar elements of a supposed seamless customer experience.

By now, the building blocks of what I like to call “frictionless commerce” are well-known. By now, if you’ve been paying attention, you know what to do. Yet it’s not getting done. We all know it and the customer data proves it.

The simple fact–the blindingly harsh reality–is that a bottoms-up strategy takes too long. The business world is not short on well-intentioned VP’s and Directors each pushing their particular agendas to act on behalf of the customer. Yet despite their passion and clever PowerPoint presentations, they all hit the wall at similar points.

Time and time again, over and over, the barrier to customer-centricity, omni-channel success–or whatever the heck you want to call it–starts and ends with organizational silos: silo-ed systems, silo-ed customer data, silo-ed inventory, silo-ed metrics, silo-ed incentives and on and on. When customers don’t care about channels, yet brands remained anchored in channel-centric thinking and structures, the gap between expectations and reality remains stubbornly large.

Some more forward-thinking companies have put senior executives in charge of “omni-channel.” Others have named Chief Customer Officers.  Good for them. Necessary perhaps, but not sufficient.

The hard, essential work of moving towards remarkable customer-centricity and true frictionless commerce requires an all-in, top-down strategy. And that, my friends, means it must be owned and driven by the CEO, supported by the Board of Directors.

Until the Chief Executive Officer becomes the Chief Silo-busting Officer all the talk about omni-channel this and omni-channel that is really just that. Talk.

 

HT to Suzanne Smith at Social Impact Architects. She addresses this issue for the social sector in a recent post.

Collaborate with the unknown

Few truly important things happen in the warm safety of the familiar.

Clearly, the tried and true works some of the time. Yet much of the really interesting and impactful happens as we challenge our self-imposed boundaries and confront the bracing chill of our discomfort. When we choose–and don’t let any one tell you it’s not a choice–to walk through our fear, nearly infinite possibilities come in to view.

Innovation, by definition, implies a dance with uncertainty. Meaningful change occurs when we accept that this might not work, but we forge ahead anyway.

We exert so much energy–and spend so much time–fighting the unknown.

What if we decided to collaborate instead?

I don’t need to make you wrong

I don’t need to make you wrong to have a valid point.

I don’t need to make you wrong to express my wants and needs.

I don’t need to make you wrong to own my truth.

I don’t need to make you wrong just to feel better about myself.

My happiness does not require others’ suffering.

And what exactly is the point of creating a longer list of enemies and idiots?

When we make cutting the other person down our priority, our energy is almost always wasted.

When we start from a position of  “I’m right, you’re wrong,” our capacity for compassion is diminished.

When our ego pushes us to focus on everyone else–and to believe that everything would be okay if all these other folks would just get their act together–we lose sight of what we uniquely can do…what we are called to do…what we must do.

Customer service: Are you a ninja or a nincompoop?

Having divorced and moved earlier this year, I’ve had quite a few occasions to interact with companies’ customer service functions. In most cases, I’ve merely been updating my personal information. In others, my request was a bit more complicated. I’ve also bought a fair amount of new stuff, so I’ve had to deal with delivery issues and the like.

Most requests have gone smoothly. A handful were remarkable. Others were noteworthy for their sheer incompetence.

Addressing customers’ problems can be the proverbial moment of truth for a brand. The commitment to owning the customer’s issue can truly illuminate the difference between those that view customer service as a necessary evil and those that understand it as a key competitive advantage. Reflecting on my recent experiences, I’ve come up with a few simple guidelines to separate the ninjas from the nincompoops.

Seek first to understand. Before you shoot off the canned response or solve a problem I’m not having, make sure you actually know what my desired outcome is. I’m still trying to get an account issue resolved with a major upscale home furnishings retailer–I won’t say their name, but it rhymes with Festoration Lardware–because their CSR’s keep suggesting fixes to a problem that’s different then the one I’m experiencing.

Start where we left off. If I’m already into my third conversation or umpteenth email, don’t make me start all over again with my story. Pay attention to the chain of interactions.

Respect my communication requests. If I say I prefer to be contacted by email, don’t call me. Seems simple, but two companies specifically asked for my preference and then promptly ignored it.

Do what you said you we’re going to do. The folks at Regus told me they’d get back to me in 1 or 2 business days. 3 weeks later I’m still waiting. And they haven’t responded to my follow-up requests.

Anticipate. You can merely do what the customer requested, or you can act as an advocate or trusted agent and look at the bigger picture. I asked Hilton to update my account information and reset my password. They handled that request very efficiently but also noticed that I had not gotten credit for a recent stay. So they went ahead and took care of that without my asking. Nice.

Add a dose of wow. Offer to waive a delivery charge because I’ve made multiple purchases? Upgrade my shipment to next day delivery? Expedite my order because I’ve had a problem? Yes, please.

Avoid ironic messages. “Your call is really important to us.” Really?  Then why am I in a 10 minute queue?

Treat different customers differently. Yes, every customer deserves good and respectful service, but some needs must be prioritized above others. If you know–or can reasonably surmise–that some customers have greater lifetime value and/or significant brand influence potential–you might want to show a bit more care and attention.

It’s worth remembering that every customer interaction with your organization is an opportunity to enhance or detract from your brand’s value. Every interaction has the potential to increase the odds of positive word-of-mouth or turn someone into a detractor–and, worst case, a vocal and influential one.

You don’t have to call your customer service staff ninjas to get this right, though maybe that helps. Mostly, you just have to care.