theIdeaStudio (Customer Crossroads)

Idea City Day 2

After a rocky start yesterday, we had an amazing line-up of speakers.
A couple of the highlights...

Co-creation is everywhere. Robotics manufacturers like Roomba are creating platforms that are hacker friendly. You open up the top and the circuit board says 'welcome'. Even better, the company has contests and prizes for the best hacks and inventions on their platform. Helen Greiner, co-founder of iRobot, was one of the speakers. She believes robots are a potential solution to many risky environments --they build military robots that are currently in use in Afghanistan. She also believes they are a potential solution to elder-case, so that people can stay in their homes longer.

Alexander Bock, the inventor of the power-skip boots that are featured in a Zurich Insurance advertisement told us a bit about his invention. But he really caught my attention when he discussed the problem of preventing counterfeit goods being sold. I believe his approach relates to licensing the wholesaler, rather than the manufacturer of the goods, to choke off illegal distribution, and improve the ability of the patent-owner to monitor royalties. If I can find out more, I will post on this later.

The best speaker in many respects was Dr. John Helliwell, who is researching the economics of happiness. He researches SWB -- subjective well being. It turns out that a major contributor to well-being, to our subjective report of our overall life satisfaction, has to do with how much time we spend with friends and family. We also feel better about our overall lives if we trust our neighbors. And we feel better about our work if we trust management. He wrapped up his session by getting all of us to sing "the more we get together, the happier we'll be". And we all sang.

Dr. Helliwell, it turns out, is part of a program funded by the Canadian Institute for Advanced REsearch. I heard four of their scientists speak yesterday, and they are an impressive bunch, including several Nobel winners. One of the things that interests me personally, is how applicable to our day-to-day challenges much of this academic pure research actually is. I spoke later on to some of the CIFAR people at lunch, and they are trying to get this message out to people.

More later. Ciao for now.

Idea City Day One: logistics can trump content

I advanced on the Isabel Bader theatre for the three days of Idea City with a spring in my step. It's that feeling that school's out, but the professor is still in -- a holiday for the brain.

And met some great people, started some great conversations. My brain was pumped and ready to rock and roll.

This morning's sessions were about the macro of our world -- physics and astronomy. Dr. Lawrence Krauss, author of the book The Physics of Star Trek, did a fantastic job of explaining the expansion of the universe. He was clear, energetic, lively and on time.

So even though we started half an hour late, he more than made up for it.

Unfortunately, when we became close to an hour behind schedule, the audience got restless. We were looking at bad PowerPoint slides. We wanted our coffee. People started actually leaving and coming back in with coffee, making a lot of noise. Someone behind me went for snacks in their bag. I'm now out here blogging, even though there is a nice trio performing, because it's 12:10 pm and we still haven't had our break.

I think there's a tie-in to ccustomer experience somewhere. It might be about respecting your customers' human needs for a bathroom break and a coffee, and not always putting your own agenda first. Because it doesn't matter how important your message is if no-one is listening.

The number: boomers at mid-life

If you want your thinking to stay fresh, you need to browse outside your regular route sometimes. For me, that means sometimes reading the automotive section of the newspaper, [among other things]. It was a rewarding detour, because there was an interview with Lee Eisenberg, author of the book The Number.

The Number

The Number is the amount of money we think we need to enjoy our post career lives. But it also symbolizes our success and social status in a very significant way. Eisenberg's book [which I confess I have not yet read] is about the different ways people think about and plan for their financial future.

Reading the interview got me thinking about the boomer demographic, who is now moving into another major life change. The impacts will be huge, and not just for the automotive sector.

The boom

The boom in births following WWII spanned approximately 1946-1965, according to Diane Galarneau writing for Statistics Canada.  Writers divide the boom in different ways. Ms Galarneau divides it into those born from 1946-1955 (Wave 1) and those born between 1956-1965 (Wave 2).

Wave 1 women today are aged 52 to 61. Wave 2 women today are aged 42 to 51.

Wave 1 encountered better economic conditions and less competition in the labor force than Wave 2 women. But Wave 2 women were more likely to get out of exclusively clerical jobs, and had higher representation in professional and managerial work.

The rates of higher education also show fascinating differences. By the age of 35, only five per cent of pre-boom women had degrees; 13 per cent of Wave 1 women got degrees and 16 per cent of Wave 2 women earned them.

Wave 2 women had their children much later, on average. At every age (in an admittedly old study), she found that Wave 2 women were in the work force in larger percentages. The dual income family became a reality of life for most baby-boom women, and it hasn't gone away since.

The ripple

So what does this all mean for customer experience? And why focus on the women?

The change in women's life circumstances during the last few decades has been one of the big drivers of change in society.

Unlike many of their mothers, these women will enter retirement having had a lifetime of dealing directly with money. They made their own money, they spent their own money, they saved their own money.

These are the women who have adopted any method possible to streamline their lives, and were the force behind everything from better frozen food to workplace daycare to franchised home-cleaning services.

Because of improvements in birth control, they were able to defer having children. This means, for many, that when they finally get their children off on their own, they are in the crunch years of saving for retirement. And they may also be caring for their own aging parents.

What these women decide they want for the next couple of decades of their lives will be interesting to watch unfold. For organizations that pay attention to their evolving needs, there are likely to be tremendous opportunities.

But we'll need to be paying attention.  Like every other cohort group, the boomers will bring their values and their history along for the ride as they move through the stages of their lives.

Resources:

Globe & Mail interview by Michael Vaughan, "How to enjoy that long post-retirement road", June 14 2007. Not generally available without a subscription. http://www.globeandmail.com

The Number: A Completely Different Way to Think About the Rest of Your Life, by Lee Eisenberg, 2006.  ISBN 13: 978-0743270311

Baby Boom Women, Diane Galarneau, Statistics Canada Report, 1994

Vendor Relationship Management -- what the heck is it?

Vendor relationship management -- VRM of course -- is something new on the technology horizon.

"VRM provides customers with tools for engaging with vendors in ways that work for both parties."

As a definition, this is a bit vague, but a look at some of the ideas this group is bandying about is helpful. The idea is to create tools that help empower individual customers / consumers / viewers etc. to manage out from ourselves our needs and wants, thereby giving us better tools to support our recent empowerment in the information age. So instead of just feeling empowered and overwhelmed, we feel empowered and in control.

There's a very good diagram here that helps to understand how a VRM system might work.

Examples of VRM

• Instead of having to deal with telemarketing and mail efforts to support public broadcasting, perhaps having provide us with a way to donate directly on our own, revealing only what we want to reveal. This one is a project of the VRM Project at Harvard (see resources below)

• Being able to generate offers -- sort of like consumer RFPs, but less cumbersome -- instead of lead generation. So perhaps I could put out an offer for a bookkeeper, or a house painter, for example, and be able to effectively manage the responses to that. I would identify myself as a lead, and vendors would respond to my offer

• You want to buy a server, so you use Technorati tags to identify your needs and the stage of your purchase, and monitor the incoming expressions of interest using an RSS reader

Essentially, VRM feels like it could be like a want-ad on steroids, a combination of Craigslist and virtual agent. We never really got CMR (Customer Managed Relationships), we got stuck with somebody else's CRM. So we can't really tell them what our needs are, what segment we are in, or anything else that might help both parties. We have to engage on the terms of the vendors only.

VRM is a concept about creating the tools to turn this CRM/lead generation formula upside down.

It reminds me a bit of the electronic invoicing and payment systems introduced first in the 1980s by companies like GM, and embraced on a much wider scale in the early 2000s. Companies were faced with miscellaneous invoicing formats from their thousands of suppliers, and were forced into a very inefficient process. Technology changed that, ultimately for the benefit of the suppliers and the buyers, although it was the large buyers who drove the development and adoption of the process. Just-in-time inventory really only became possible because of the infrastructure established around invoicing and payment, which could then be extended to ordering.

Zopa and Prosper -- the non-bank intermediaries in personal lending -- clearly share some genetic material with the VRM meme.

All rather exciting. And just when you thought the information age was starting to look mature and predictable. Surprise!

Resources:

Thanks to the Computer Assisted Management for Performance list at GoogleGroups for the heads up on this.

The Harvard VRM wiki portal is here, hosted by Harvard's Berkman Center for Internet & Society, and led by Doc Searls. The public broadcasting VRM initiative is here.

The RFP idea came from Phil Windley, here.

The server purchase example came from Don Marti, here.

More examples of other people writing on this idea are here on the wiki.

Marketing to employees: McDonald's, Staples, Taco Bell, KFC

Lots of external advertising has a spill-over effect on employees, and sometimes this is deliberate. For one thing, it shows management believes what they are telling you in the internal communications. If you put the same stuff in TV commercials that you put in the procedures manual, you must really mean it.

The next step is to really try to build an employment brand.

Quite apart from being a good place to work, you also have to communicate this to prospective employees.  And you have to attract the kind of people you really want. Leveraging the tools of marketing is a very good place to start.

Richard Floersch of McDonald's, said in a recent BusinessWeek article that building an employment brand is absolutely critical. Staples VP of HR, Dave Almeda noted in the same article that "It's impossible to tell where HR ends and marketing begins."

How to get started:

1. Figure out why happy employees are happy. Find out why the people you like, like your organization. You've got it, I'm talking research. And you'd be surprised how much of this is going on at the world's leading organizations. If you're not doing any of this, no wonder you can't compete for the best employees.
2. Extract the core DNA of what your best employees love about you, and start building a creative brief. Yes, you will need help from the marketing department to do this. This is a good chance to demonstrate how cross-functional co-operation can really work.
3. Use professional messaging to get your story out. After you've gone this far, you can't just revert to stuffing ads in the careers section and doing PowerPoints on campus. You'll need to think much more carefully about recruitment materials, channels of information, and the communication package.
4. Avoid being seduced by expensive trinkets to recruit rock stars. Yes, this will get attention. We all love to get free stuff. But it's unlikely to close the deal for you with talent that has options. For that you'll need to demonstrate that you can deliver the employee experience.
5. Reinforce internally. After all this work, you can't have the dinosaurs stomping around and wrecking stuff. Follow up internally to reinforce that your culture at its best is helping you win the talent wars. Match your external communications with the internal experience. This probably means that things are different than when the current old boys and girls started. And thank goodness for that.

Resources: "It's Not a McJob, It's a McCalling", BusinessWeek, June 4, 2007  -- you'll need to scroll down a bit to see the article.

New media measurement tools: Xuuk

Eye-tracking technology is cool, but it's always been a kind of headset-and-wires operation, not something you could use in a real advertising setting.

Xuuk has launched a gizmo that can track eyeballs for posters, billboards and displays. It's a low-end disruptor -- and although it is unlikely to have all the functionality of laboratory units -- it's extremely cheap at $999. And it potentially brings a whole new group of customers into the market.

Xuuk claims to be able to detect eye-balls looking at it from up to 10 meters away. It plugs into your USB port, so you can look at statistics.

Like many technology crossovers born in academia, Xuuk could use a little marketing support to make their message clearer. But don't let that stop you. This baby could be great tool to refine your merchandising and visuals for those times when you don't have a big budget available.

3 Myths of Personalized Direct Marketing

I posted a while back about a rather engaging personalized direct mail piece. Michael Simmons of Vialuna Group, who created the piece, sent me an e-mail. So we started talking about what personalized direct is all about.

Michael Simmons' Top 3 Myths/Mistakes in Personalized Direct

1. The “Dear Bob,” Myth: Take an existing direct mail piece and add the target’s first name. Violá! You just built a personalized direct mail piece.

2. Brand Everything: This direct mail piece is my one shot to grab some mindshare, so even if the offer isn’t right they’ll still remember our name.

3. I Know My Target (Audience): I have (or bought) a GREAT customer or prospect list, now all I have to do is add “Dear Bob,” and my mark to this tri-fold mailer to make it effective.

Sadly true, and I know you're getting this stuff in your in-basket as often as I am. According to Michael Simmons, "It's not enough to throw personalized direct mail over the fence without creating a two-way dialogue."  Don't think the old unpersonalized stuff is an acceptable alternative. Because digital printers have made it so easy, you don't have an excuse.

Imagine a 25 per cent response rate

Simmons says a crowded direct mail piece that is "plastered with your value proposition, your mark, your attributes, your favorite color" etc. will LOWER your response rates.

You only have two to five seconds to make a pitch in direct mail, so it had better be all about your customer or your prospect, not all about you. The reward for doing things right is high. Imagine having a response rate of  25 per cent which is the average rate claimed by Vialuna. (Recipients who visit the personalized web site.)

The cure to stodginess: charm and delight

I saw a sample of a new approach that totally charmed me. It put a smile on my face. It made me feel like this guy understands my life! [Except I wanted to pick both swamped AND pressured -- see graphic above.] Check Vialuna's approach out here. It won't be quite as charming if your name isn't Susan, but play along, OK?

"Finally, the truth is personalized direct mail often comes across stodgy because we think we know our target audience, but we don’t know individual targets. To prospects and customers, our company is engaging in a one-to-one conversation with them via post or the Internet. If your friend’s name is Bob and you call him Fred, Bob now knows how much you value the relationship. Customers and prospects react the same way to personalized marketing executed with often BAD data."

If you're not trying some of these new tools, your efforts are going to look a bit cheap to your customers. Like another statement stuffer from your bank, and how charming is that?

Full disclosure

I've never met Michael Simmons, and I have no business relationship with Vialuna. The truth is they made this article easy by giving me some thoughtful responses to an my e-mail I sent. If you want blog coverage, it's worth trying to charm your target. Demonstrate you understand their world. Make it easy for them. Gee, kind of like personalized direct. Hmmm...

What's YOUR opinion about innovation

I've been involved in an extended project on innovation, sponsored by Schulich Executive Education Centre, part of the Schulich School of Business at York University. The reports -- which are free -- are summaries of conversations of people like you on topics related to innovation, and include a large number of very cool quotes that I think you'll relate to. Keep reading to download the reports, learn more about the upcoming book, and add your point of view on innovation.

New Channels: Can you murmur to your customers?

The Murmur oral history project has created a very interesting way to communicate with people in a location-specific way.

"We collect and make accessible people's personal histories and anecdotes about the places in their neighborhoods that are important to them. In each of these locations we install a [murmur] sign with a telephone number on it that anyone can call with a mobile phone to listen to that story while standing in that exact spot, and engaging in the physical experience of being right where the story takes place. Some stories suggest that the listener walk around, following a certain path through a place, while others allow a person to wander with both their feet and their gaze."

This concept feels eminently portable into other environments.

How about having a recording of a decorator helping me understand how to avoid making the wrong choice of paint colors for a hardware store?  Or a label on a line of skin-care products where I could hear how to choose the right combination for my age and skin type? Or a bank poster with a phone number on it that has a recording about the product?

This kind of communication could feel personal if done well. It could give me an expert view without the sales pitch. It could offer an extension of expert help outside regular business hours or outside the regular business location. It offers the potential to provide expert help where none was formerly available. And it can let the customer engage in more information without engaging in a sales discussion. That alone would be of interest to many people.

Murmur started in Kensington Market in Toronto in 2003. You can experience Murmur in three Toronto locations, as well as Dublin, Edinburgh, San Jose, Vancouver and Montreal.  You can sample a Murmur recording by clicking on the maps on the web-sites listed. Not as much fun as strolling around the city and listening on your phone, but a way to take a mini-holiday at your desk on a Friday afternoon.