Customer Experience Crossroads

Pondering GM: were they living in a cone of silence?

Watching the GM saga unfold, the most striking thing is how long it took for changes to be made, in the face of clear data.

I recently came across an old news story about GM -- around 1999 or 2000 was when the analysis was written. It was course material in a marketing management course. The how-not-to-manage-your-marketing-function part of the course.

The article talked about the pressing needs: To rationalize the brands and banners. Rationalize the dealer network. Get a better fix on consumer desires. The same article made reference to these problems having been in place and observed at least a decade before. 

It makes me think how truly impressive it is when a company can make big changes without a huge crisis. It speaks well of a whole culture when this can happen, not just of an executive. Because the example we have of GM is of a whole company that seemed to be living in a cone of silence half the time.

The service experience: GM vs Acura

Let me illustrate just how huge the cone of silence was by telling you about my 1989 Acura Integra.

The Integra was a delightful car, totally fun to drive and the perfect accessory for a young career woman. When I took it in to the dealership, here's what it was like: 

• Everyone was sharply dressed.
• The place was clean, and they served free coffee.
• They had a van that would drop you off if you worked nearby, or drop you at a transit station if you didn't.
• When you picked the car up, it was always freshly washed
• There were little paper things inside so you knew no oil from the mechanics feet got on your carpet or seat
• The whole thing was a pleasure. I actually enjoyed the ritual of it. I felt like I belonged to an exclusive club.

A few years later, I accepted a fabulous position as a regional manager for a bank. The job came with a car, and my market area included Oshawa, home of three GM plants and the head offices of GM Canada. I wore out three cars on that job, all pretty good vehicles, actually. Two Grand Prix and a Grand Am. No problems, just a lot of driving.

But here's the customer experience at a big GM dealer in Oshawa.

• The reception area was so dirty, I didn't sit down
• I actually didn't put my purse or briefcase down either, because the cement floor was pretty awful too
• There was a beat up wooden podium that served as a counter. It looked like it had been repainted about a hundred times.
• The guy serving me was dressed in oily gray coveralls
• I wondered if I was in the right place
• I felt like I had stumbled into some kind of guy's clubhouse
• They didn't wash the car. In fact, I kind of took a good look at the seat before I popped my suited behind down
• I never went back

If you see it once, it's a pattern

OK, it was one dealership. But there's a good saying in the world of sales and service: "if you see it once, it's a pattern." There are no isolated instances. If some bad thing is happening in one place, it's happening in other places.

Did no-one know how the industry was changing? Or did no-one care? Or did they think that it wouldn't really matter? Or did people try to make changes but just give up due to the tremendous inertia in the organization?

Things may have changed a lot at that dealership. But how would I know -- I never went back to check. And that is just the reality of dealing with consumers. Once we write you off, you're gone from our world.

GM seems to have a game plan now. And good luck to them implementing it, because they have a BIG hill to climb.

Resolutions for 2008: Avoid PowerPoint Hell

Let's all resolve to avoid PowerPoint Hell this year, and avoid creating it for others.
Here's my simple strategy -- send this video to your work group and ensure you include the worst PowerPoint offenders in your organization. [This kind of point is best made with humor, and this is very funny.]

Don McMillan: How NOT to use PowerPoint

Thanks to Adam Lawrence for the link.

Productivity tools, marketing tips, hacks, etc. for customer experience people

With the crazy-busy season now upon us all, it seemed like a good time to talk about how to do things well without destroying your personal productivity [it seems like a laughable concept many days].

Rich McIver sent me this list of top 100 customer service hacks for web entrepreneurs.
Some of my faves...

#9  Send out handwritten notes whenever you can. Yup -- things that take real time to do reflect greater investment in the communication. It would be a relief to see this among the direct mail, wouldn't it?

#15  MOO. Love their business cards. I had some made just for the blog, and they never fail to charm those that receive them. I didn't know they made postcards, too.

#17 - 30  This list of organizing tools looks great. As soon as I get out from under this e-mail, I'm definitely going to look into this further :-0

#68  LinkedIn. This is where I look first when I want to contact someone but can't find their contact info. It's the new phone book, and everyone should be on it.

Susan's additions:

#101  I just discovered that I can save locations in Google Maps. So I'm starting to build maps of some things that I use a lot, but can never remember where they are. For me, this is the locations and details of focus group facilities. I can never remember which one has the movable camera, which one has the popcorn machine in the lobby. If I have time, I might start one for restaurants I like to take clients to. [Very cool productivity tool, and I think we'll see a lot more commercial use of this soon.]

#102  I get a lot of e-mail that I don't want to ignore, but I also can't help. Examples: people who want to do their co-op at my company; people who are looking for permanent employment; people who want to be in my focus groups (I outsource recruiting).  I now have several signatures in Outlook that are customized "form letters" that I use to respond. These are the short notes I would individually type if I took the time, now available for quick replies.

#103  AOL Instant Messenger Pro can be used to securely send large files. Like the huge digital audio files I use on a lot of projects that are way too big for e-mail. Same thing for that graphic-intensive PowerPoint. Brilliant addition to the tool for the business user. [have you noticed how business is colonizing all the stuff that's supposed to be for teens?]

What are some of yours?

Are all customers created equal? or why does everyone forgive Apple so easily?

Apple dropped the price of the iPhone. You probably heard about this too.
Very shortly after the big launch at $599, the price is now down to $399.
If you bought early, you get a credit for $100. But it's only good in the store if you buy some additional stuff.

"Our early customers trusted us, and we must live up to that trust with our actions in moments like these"  -- Steve Jobs

Companies with less goodwill might find themselves in a descending spiral with stuff like this. People might say that they should have seen this coming. But Apple seems to have such a deep well of goodwill that they don't pay full price for these slips.

I'm just as interested in what is behind this move, and how we might understand what is going on here. Here's the most interesting chatter I found out there:

Steve Levitt, of Freakonomics fame, writing in the New York Times, says that economic models for pricing generally ignore the consumer response to the reason for the price:

"What economists (and Apple too, I guess) ignore is that consumers hate it when companies follow practices that look like they are designed to maximize profits. You won’t find it in economic models, but consumers care about the reason a firm chooses the price it chooses. ...Apple’s price cut looks like one driven purely by a desire to maximize profit, which is why everyone is so mad."

As Levitt goes on to point out, something like 10 - 20% of the gift card recipients will not use the $100 coupon. He suggests that Apple should have gone all the way and offered the early buyers a $200 coupon, which would have made it harder for people to be angry with them, and not cost all that much more.

Seth Godin says the trouble with this event is that it was differential treatment of customers that was random and unpredictable. Instead of spending $20 million on these coupons, Apple could have offered customers some other kind of preferential treatment in keeping with their early adopter status. Among his ideas:

• free exclusive ringtones commissioned from major artists like U2 and Bob Dylan, and available only to early adopters
• free head-of-the-line pass for their next big thing
• ability to buy a specially colored, limited-edition iPod

Godin's conclusion is brilliant, and worth remembering:

"The key is to not give price protection to early buyers (that's unsustainable as a business model) but to make them feel more exclusive, not less."

Some lesser luminaries have also weighed in with some interesting variants on this theme:

DV Hardware reports that the iPhone -- even when turned off -- continues to download e-mail. This can result in some big-time data charges if you happen to be traveling abroad with your iPhone turned off.  Author Thomas De Maesschalck speculates that this is the reason Apple was able to reduce the price so quickly!

Nerdblog suggests that this type of price cut is standard practice in the mobile phone industry. [So why was my Razr still so expensive a month ago, after the original had an unfortunate encounter with a small body of water??? Perhaps because I live in Canada... sigh]

Way back on July 24, BrandCurve predicted this price drop would be coming as a result of poor subscriptions due to the high price of the phone+subscription combo:

"I can’t say I’m surprised by the low numbers.  With a price tag of $500, the iPhone isn’t going to fit in the budgets of the masses.  It’s a cool toy but hardly essential.  Also, consumers are educated about electronics these days.  They know if they wait a little longer, the prices will drop.  There is little need to rush into laying out $500 when that price will plummet not too far into the future.  And of course, there is always the question of how AT&T is negatively impacting sales.  Their wireless services are not known for top-notch coverage or customer service."

The marriage with telco's known for their hostile customer relationships is something I've also wondered about.

I do still feel that Apple is becoming more part of the mainstream, and that they will be less lovable as a result, cool products notwithstanding. Time will tell, as always.

September 14 addendum:
Reader Rich McIver from Inside CRM drew their post on Apple to my attention: 12 Effective Strategies Apple Uses to Create Loyal Customers.  Personally, I think this is a great title for a book, and the mere presence of Apple's name is probably enough to make it sell.

I'm not sure I totally agree with all their points, but my brand is not as successful as Apple, so what the heck do I know? See what you think. Feel free to add to the conversation by commenting here. Do you agree with the 12 points?