Customer Crossroads

Design and Innovation at Apple: Jonathan Ive

"Apple has put the design of great customer experiences on the map, not just as a means to win creative kudos but as a way to earn billions of dollars and revolutionize industries. "Apple's big contribution is showing that you can become a billionaire by selling emotions, that design can be a valid business model," says Gadi Amit, founder of NewDealDesign, a product design boutique in San Francisco."

Businessweek online has a nice piece about Jonathan Ive, the design chief at Apple, dating back before Jobs' return to the helm: Who is Jonathan Ive?  I'm working on an extended project about best practices in leading and managing innovation, and I found this article meshed very well with the learning we are getting from others. 

A few of the things that struck me about this piece relate to the process of innovation and environment that enables it as much as the end product of innovation.

1.  Making your own decisions about what's good
Ive's team doesn't attend a lot of design conferences, even though they win lots of awards.  The two reasons offered for this is that they themselves are the highest standard they know of, and the team focuses on the judgment of team members, rather than external recognition. Ives also admits that they don't want to let others in on too much on their process, or they might be able to close the gap.

2. Limiting the number of projects
When you take on too much, you don't do any of it well.  Far better to ask your team to do a few things really well; things that might give you real lift-off compared to your competitive set.

3. Set the standard for success, then work to that
The example used was 'no visible screws'.  These are constraints that force tremendous innovation in design.

4. Don't put your innovators in a ghetto, make them part of the core business
Apple's design team is closely involved with engineering and production.The products not only have to look good, they have to be something that can be manufactured and that works. The design team works directly with suppliers to create new finishes and new methods of using injection moulding. The suppliers get better themselves by virtue of working with Apple.

5. Seek to fail and improve

If you're not failing, you're not trying. Here's how Ives puts it:

"One of the hallmarks of the team I think is this sense of looking to be wrong. It's the inquisitiveness, the sense of exploration. It's about being excited to be wrong because then you've discovered something new."

A former Apple designer, Hartmut Esslinger confirms that the innovation process includes failure:

"Apple innovates in big ways and small ways, and if they don't get it right, they innovate again. It is the only tech company that does this."

References:

The Businessweek article and a slide show of design images is here.  An analysis of what makes the iPod design so special is here, including the point about no visible screws

A rather bizarre thing -- www.jonathanive.com is not actually run by Ive, although it is dedicated to him. It seems to be on a mission to gather AdSense revenue, perhaps from a devoted fan. I can't imagine how odd this must feel.

More stuff about Ive, plus lots of pictures are on the Wikipedia site. [Is having your own wikipedia bio page that others take the time to edit a new definition of fame?]

Thanks to Core 77 Design Blog for pointing out the story, [even though the magazine itself was sitting on my  kitchen counter at the time... such is the new world of information.]

What's the story?

Reshma Anand, a qualitative researcher in Bangalore, has posted on a very innovative idea about how to enrich storytelling. She thinks that if we put ourselves in the present tense when we tell a story, we can add to the richness of the detail and enhance our recall. 

This makes complete sense to me, although I bet it takes some skill to get people to do this. If you try it, you'll see what I mean.

Instead of saying, "I stood at the reception desk for a while. No one was around, so I went to sit down." you are now saying "I am standing at the reception desk, waiting for someone to notice me. They don't seem to be around. I decide to sit down and wait." 

Interesting to remember that Einstein used just such a method to imagine what would happen to his streetcar if it accelerated to the speed of light. He tried to put himself in the moment on the streetcar, and then to put himself in the moment of someone observing the streetcar. [And people think qualitative isn't scientific...d'oh]

The nuances and recall help to enrich what is being said.

Kim Bercovitz told me recently about another innovative approach -- using actors to tell a story as a research method. It sounds a lot like the kind of improv used to entertain conference participants, except applied to get clarity around experience and emotions. The participants keep correcting the actors' performance of the thing until they get it right. And then you know you have all the ingredients, don't you? [I suspect there's a lot more to this method than I'm capturing here, sorry Kim.]

Even objects have stories to tell, as this post from ethnographer Grant McCracken shows. Grant's own stories give us insight into the mind of the researcher, the professional observer, the person who can never stop watching and thinking.

Reshma's post illustrates something else brilliantly: there is no big book out there of the right way to observe. A lot of people seem to think there is. There is trying, and testing and learning and improving. There is no one right way.

The rules are all nonsense, really, because your method is only as good as the insights you get.

You want to break out, you want to be better than everyone else? You do it by ignoring the conventional wisdom, or tweaking it, or trying something different.

Kisses and hugs to all the clients out there who help you make these moments of magic happen -- by leaving enough space to try something a little bit different. They are the ones who win the biggest prizes in insight. We bust our butts for those clients, to try to make the risk pay off. 

Umpqua Bank building integrated customer experience as lifestyle brand

"If a bank wants to stand out, it’s fairly difficult to do so with the financial products it offers. It can, however, differentiate the manner in which it sells and packages those products."

Umpqua bank has charmed us before with their gorgeous web site and their coffee-serving branches that feel like living-rooms or hotel lobbies. They continue to push the envelope.

The CD
Their latest move is to offer CDs to customers that have compilations of local, lesser known musicians, as documented in the NY Times Magazine story, Branching Out. The program, called "Discover Local Music" is not an attempt to make money on the music -- just a way to entice people into the stores and build the brand. Check out their online store here.

Their corporate voice is really interesting as well.  Like this little sample from the music store page:

"We might be biased, but it seems our little corner of the world turns out a staggering amount of amazing music. Having grown up on the West Coast ourselves, we thought it might be nice to share a bit of that local flavor with you. You find your new favorite band. Local culture flourishes. Everybody's happy. We hope you enjoy."

Go, Reach, Savor and Cruise - these are bank accounts?

Bank products and packages are well known for their mystifying names, usually all about the bank, or pointing to a specific feature of pricing or interest rate. [See samples of Wachovia here and BMO here] Umpqua's packages have names that speak to life-stage aspirations. They may not tell you much about the account, but they at least appeal at an emotional level.  And there are other goodies too:

"Club Carefree 50 is an exclusive club geared toward people 50 or better with tons of great benefits such as travel discounts, The World's Greatest Reads Book Club, Club Carefree 50 Community Connection Corps, and much, much more. Visit your nearest Umpqua Bank to get involved or to find out more."

The current offers for this Umpqua club include a newsletter, travel discounts, charity events that members can get involved in, socials, and safe driving programs. It's easy to join -- you just open a Cruise account, available to those over 50. The name implies all the good things that we hope for in the second half of life: less hard work, more ease and fun, and of course travel.

Can a bank be a lifestyle brand?

Some people think that Umpqua doesn't have enough of a "bank" look and feel -- but what they are doing seems to be working for them in terms of business growth. They are distinct, they are pursuing their own pathway, and like Apple, they are bound to get better and better as they keep persisting.

Because after all, who really wants banking -- banking is boring, complex, sometimes scary, potentially frustrating and risky. It's only a means to an end. We want status, security, safety and  comfort. And perhaps some fun.

Why marketing is more important than ever, but not in the marketing department

We have a paradox in front of us these days.

One group of people is decrying the problems of the marketing department, and talking about what the future marketing department will look like. 

The other group is saying how important customers are, and how the knowledge traditionally held in the marketing department is now critically important to business sucess. 

Both of these things are true.

Some of this came into focus for me recently while reading John Bradley's column in Strategy Magazine, "Balls, bollocks & cocks on the block". Bradley compares the performance of Shopper's Drug Mart (a large retail chain here in the great white north) with Kraft, and finds Kraft wanting.  Specifically, he sees Kraft attempting to build direct customer relationships via recipe delivery thingy "What's Cooking", and finds it problematic that they never bothered to close the feedback loop.  They didn't fine tune their recipe delivery based on his selections, and they didn't follow up when he unsubscribed. He attributes this to underfunding of a good idea.

On the other hand, he sees Shoppers Drug Mart as disciplined and integrated, having avoided the fight for resources that plagues organizations with multiple brands.  Here's the stuff I circled and tore out:

"In my experience, probably the biggest impediment to radical change in a business is the brand management structure. No surprise really. After all, it was invented for the express purpose of generating a Darwinian battle for resources; not for realigning organizations. And once a brand management structure is in place, the danger is that the rest of the organization thinks that marketing is something the marketing department does rather than something the business does, which makes single-mindedness even harder to achieve.

"The bottom line is that marketing-driven companies have the ability to push through and implement radical change; marketing department-driven companies don't. The clock is ticking as much on the traditional brand management model as it is on the big ad agency model."

All businesses have a larger service component than they did in the past, even manufacturers like Kraft. And services require integrated thinking because they involve delivery on an ongoing basis. Services are intensely operational.

When brand management was introduced to a lot of service companies, they brought this legacy of siloed thinking with them into the marketing department. We seem to finally be through that phase of evolution.

If you are in an industry where customer experience is a key differentiator, strategic marketing is going to be the job of every senior person: thinking about what customers to serve, and what the value proposition is. 

Tactical and functional marketing is what will be left in marketing: media buying, creative production, research co-ordination. But they are not going to be running the place.

References:

Another perspective on this issue is here at Church of the Customer

Cashless Monopoly: how we train the consumers of the future

We're not that far from toy-buying season, so keep your eyes out for the new cashless Monopoly, which will be available in the UK this year, and next year in other markets.  The new game gives players a VISA branded debit card, and includes a card reader that players use to exchange money.

Is cash disappearing completely? Probably not. But cards are here to stay, and are likely to become more and more embedded in behavior at younger and younger ages. 

While this may represent just another line extension for Monopoly, Visa deserves some credit for participating as a partner. Talk about product placement for your brand with emerging consumers!

By the way, the official history of Monopoly at the Hasbro site says that inventor Charles Darrow was unable to convince Parker Bros. in the game due to its many "design flaws". After Darrow sold 5000 to a Philadelphia department store and couldn't keep up with demand, Parker Bros. was willing to listen to him.  When you think you have something innovative, you have to follow your own judgment sometimes and take some risks, or the naysayers will get you.  And they never invented anything, did they?

References:
Thanks to regular reader Apoorv D. for bringing this article in The Mail on Sunday and this piece from the Financial Post to my attention.

Choosing a Qualitative Method: handy-dandy decision tree you can download

We talk about research quite a bit on this blog, because you can't manage the customer experience or even really think about it meaningfully if you don't start diving deep into what is actually going on.  To do that, you need research.

Now that there are so many options in using new communications technology to support research, I get a lot of questions about which method is better, and that type of thing.

You can't really do it that way, though.  You need to think about the objectives of the research before you know which approach makes the most sense. 

Handy-dandy research decision tree to help you (Click image to enlarge.)

I've put together this handy-dandy decision tree with some diagnostic questions that should help you think this through.  You can even download the PDF and stick it up on your wall, and share it with friends and colleagues who will marvel at your amazing ability to dig out useful resources.

Download qualitative_choices_decision_tree.pdf

Although the graphic looks slick, the real value is in working through the diagnostic questions.  After you have done that, you'll have a clear idea of your options. Then it's all down to budget.

How much to spend?

You can get into calculating the ROI of your research, and there are formulas. 

I have one that's really simple: I think clients should get about 10 times the payback from a project, or we're wasting their money.  So if it's a $30K project, you'd better think that great insight and great strategy should be worth about $300K to the business, either in risk avoided, effectiveness of effort, or raw revenue.

I once got into a lengthy round of negotiations with a human resource department that wanted to research some employee problems, after already having surveyed the employees. I suggested that perhaps the real problem was that the executive -- quite rightly in my view -- wanted to spend the money FIXING the issue, instead of putting more $ into research. HR didn't agree, and kept pitching the research and asking me to find a way to do it cheaper, smaller, etc. Of course the unhappy end of this story is that they kept having the management team reject their request for money, and I wasted a bunch of time scoping a project going nowhere.  All of which could have been avoided by getting clear on what was needed and why. And sometimes, more research is not actually what you need.

So use the diagnostic questions, get clear, and be a star. What could be simpler?

Addendum Sept 22:

Roger Cauvin pointed out that I missed ethnography. What the heck was I thinking?

This is Broken: online bill notifications

I thought it would be nice to get my business phone bills online, thinking it would help me stay on top of client invoicing.  Unfortunately, the bill does not come any earlier. 
The notification I get that the online version is available is an amazing display of poor usability.  Here it is:

*****************************************************************************

Your latest statement for account number xxxxxxx is now available in the Online Bill Manager service.

To view your statement:
1. Go to the Bell Business Portal at www.interaction.bell.ca.
2. Enter your username and password, then click OK.
3. Click on the Billing link on the left side of the page.
4. Click on the Online Bill Manager link.
5. If the Online Bill Manager - Administration page appears, click on the Access link on the left side of the page. (This page only appears for users with administrative abilities.)

6. Click Statement.

If you have any questions about the Online Bill Manager service, please contact us by replying to this e-mail.

Thank you for choosing Bell.

*****************************************************************************************
By my count this is five clicks to link to the bill.  Definitely broken.
What it should do, IMHO:  give me a link to the bill that pops open a sign-in page.  Once I sign in, bingo, there's my bill. Why is this so difficult for an engineering company?

Xerox uses unsubscribe questionnaire to learn

While unsubscribing from some Xerox e-mail, I came across this rather nice little questionnaire. (Click image to enlarge.)  I thought it was short, had a good range of options for me to choose, and looked like it would probably help them understand their subscriber stats.

The truth is, I'm just not engaged with their category right now.  I was shopping for color printers a year ago, and seriously considering their solid ink option. But ultimately went with a color laser. 

Perhaps they could have added the option, "just bought competitor product" or something like that, but this questionnaire is still miles better than anything else I've seen on an unsub page.

Companies that should have a blog

Buzz Canuck nominates several companies and some whole industries, like banking, that really should get blogging.  I can only agree with this excellent list.  A few others I'd love to see (not all Canucks, but that's the flat world for you):

• Home Hardware -- all those things I need to know to keep my house going, like how to replace the spring on my screen door. [But don't make me give you my postal code just to look at your site.  That's just cheesy]
• Ikea -- how do I make my livingroom look as good as your showroom?  Why isn't Akrobat available in the beech finish anymore? These guys have passionate customers, they're a natural for blogging
• Dremel -- I bought one of these cool tools recently, and am just dying to know what all the gizmos are for, and what other projects I can do with it.  Perfect blog material.

As for the banking industry needing to blog, it's a great idea, I've suggested it myself to a one of the best, but they haven't acted as yet. [I'm still hopeful] The mutual fund industry could probably have a go as well. 

Anyone care to add to this evolving list?

What blog readers want

Dave Pollard's Blog -- How to Save the World -- contains some of the most insightful writing online.  Here's a list he has posted about what blog readers want to see more of.  Several of these items make sense for any communication, such as a web site, user guide, marketing brochure, or sales conversation.

Take point #13, "relevant aha graphics" for example.  Don't you wish everyone used more of these, especially in user manuals?  [I try. And so should we all.]

Point #6 refers to political opinion, but many of us would appreciate clever concise opinion in other places, like from our broker or our IT supplier.

Point #8, personal stories resonate through so much of human experience. Stories are better than explanations, anytime.  Plus they are more fun, more interesting and more likely to be shared.

Dave's List

1. original research, surveys etc. 
2. original, well-crafted fiction   
3. great finds: resources, blogs, essays, artistic works
4. news not found anywhere else
5. category killers: aggregators that capture the best of many blogs/feeds, so they need not be read individually
6. clever, concise political opinion (most readers prefer these consistent with their own views)
7. benchmarks, quantitative analysis
8. personal stories, experiences, lessons learned
9. first-hand accounts
10. live reports from events
11. insight: leading-edge thinking & novel perspectives
12. short educational pieces
13. relevant "aha" graphics
14. great photos
15. useful tools and checklists

Cautionary note: Dave's blog has a tendency to draw you in and keep you reading, with his mix of the highly personal, spiritual, theoretical as well as practical stuff. 

Who's talking about you?

It's important to stay on top of the buzz, to see who is talking about your brand. There's not much excuse now that there are such great tools to do this online. Here are a couple of examples:

Technorati and other blog search engines will tell you who's linked to your blog.  I track this but forget to check, and as a result missed that Buzz Canuck named us as one of Canada's top 20 talking about WOM (Word of Mouth) and related issues. And Converstations gave us an honorable mention in their blue-ribbon blog list. [By the way, thanks!  You guys made my day putting me in such good company!]

These search engines can also be searched for your brand name, and will tell you who is blogging about your brand. [Bloggers just do this for fun.]  You need to do this to stay on top of the buzz.  It needs to be on at least one person's job description to monitor, summarize and distribute.  Or hire a service to do this for you. And if no one talks about you in a blog, you are either dead or really boring -- a finding in itself.

Google alerts will send you an e-mail anytime a given topic has something new that they've indexed.  This is how I keep finding out about other people who share my brand name -- the artist, the PR consultant, the joke-book author, the career counselor who specializes in creative types, and one day recently, the crook.

Social tagging software such as del.icio.us allows people to tag and categorize things they find online that they want to visit again, without using bookmarks on their browser.  It's a very handy tool.  See how many people have saved access to your web pages by putting your company name into their search box.

I know I'm not the world's expert on this topic -- anyone care to add a few more tips to this list?

Personalization Trend: design your own credit card

People want personalized and customized goods

People have wanted personalized and customized goods since forever.  Before the industrial revolution, that's all you could get, because everything was made by individual craftspeople.

The industrial revolution showed that people would trade low price for a lack of personalization.  Remember the famous saying, attributed to Henry Ford: "The customer can have any color they want, as long as it's black".  Low price in automobiles actually translated to access; before the Model T, few people could afford to buy a car.

Information technology = affordable personalization

What the information revolution has given us is affordable personalization. For some years now, this has meant incredible amounts of consumer choice in first world countries in items such as clothing and home decor.

The hold-outs are organizations that want you to display their brand, even if their brand isn't particularly cool or stylish.  So we've had two or three choices in computer color -- black, grey and beige, with the occasional dollop of white and silver.  Cell phones, equally boring, spawned a whole industry of covers, to give people more customization ability.

Personalization comes to financial services

The last hold-outs have been banks, typically offering very limited choice or customization options, uniformly bundled up in the corporate color with the logo occupying most of the real estate.  Change is on the horizon, however.

Postbank.nv lets you customize the look of your credit card

Postbank in the Netherlands lets you customize your Maestro debit card. You can use their images, or use your own image that you upload at the time of application. There are rules about the images -- nothing copyrighted, no pictures of art, no naked bodies, etc.   This is just too much fun for words, and apparently quite popular.  Postbank.nv is part of the innovative ING group.

Customized Visa card from Postbank.de

The German Postbank let me create this good looking card with a picture of my summer place*.

Garanti Bank Flexi-Card offers many options, not just color

Turkish Garanti bank offers the Flexi-card. In addition to visuals, the Flexi lets the customer build their own feature set:

"During the application process on the web, applicants can manipulate over 10 parameters such as the reward rate and type, interest rate, card fee, and campaign type to create their preferred combination. Customers who want a simple approach can choose to select one of the four ready-made packages from the web -www.flexicard.com-
or  from Garanti branches."

GE Consumer Finance is a 25% shareholder of Garanti, so we may see more of this among the GE family.  More information on an English-language site is here.

Our take

Are you using IT to give more control over customization and personalization to your customers?  If you aren't, now would be a good time to start, before you are totally behind the proverbial 8-ball.

References:

Tip of the hat to Springwise, who brought two of cards to my attention.

Zopa and Prosper, who give their customers the opportunity to lend their money to borrowers using customized lending syndicates, also appear to be a manifestation of this trend.  We wrote about them recently here.

* The castle is actually an outbuilding of a castle near Alexandria Bay, N.Y., built in an age when hundreds of craftspeople worked for dozens of years to build something unique and individual that only the super-wealthy could afford. A nice era to visit, but I wouldn't want to live there. 

Latest on Free-Agent Nation: Hotel Offices for Rent

Springwise reports today on a new trend designed to serve all those independent workers who don't have traditional offices.
The Hoxton in London UK offers office space for rent by the day at reasonable rates, converting underutilized business centres into revenue sources.  They call themselves an "Urban Lodge".

"Each room is kitted up with a desk, free WIFI, telephone, and private bathroom. Just bring your laptop and you are ready to make your day pay."

The Coffee Office in Windsor, Canada is a similar concept, designed to serve the independent worker, using more of a membership model.

"A 'Built for Business' Club for today's Mobile Business Warrior with hi-tech meeting and business centre amenities available at affordable membership rates.  It is the meeting place of choice for today’s busy professionals – a functional setting away from the office that helps build on their success."

The look of this one is very reminiscent of a frequent flyer lounge in an airport, which makes sense, as these things are designed to serve similar customer needs.

Everywhere I look, there are trends related to serving the growing number of independent workers. Personally, I don't think this group is going away any time soon, and in fact I seem to meet more young people taking this route all the time. So if you aren't thinking about them as a segment with unique needs, you may be missing big opportunities.

Update: second Bizsmart letter arrives

I'm a more important customer than I thought ... maybe ...
In a previous post, Sales missing in action, I told you about a rather weak customer retention effort made as a major financial institution closes down it's no-fee chequing/checking subsidiary, bizSmart.
It happens that I got a second letter... written to the owner (me) of a different business.  This one is offering me free chequing until next May. AND a different 800 number to call. 
Some differences in langauge between the two letters:

The "Good Customer" letter:

"We are committed to supporting small businesses and helping you achieve your goals. We appreciate your business and CIBC looks forward to continuing to meet your financial needs"

The "Get Lost" letter:

"If you do not make alternate arrangements, your bizSmart account(s) will be automatically closed... Thank you for your attention to this matter"

So the rule of communications in use here is, if we think your account is so small that it's a nuisance, we will use the minimum of civilized language and see no need to be overly polite.

Here's my take on this as a guiding principle: all your communications reflect your brand, no matter who you are talking to.  Especially when you don't really know who you are talking to.

Prospects versus customers: marketing and the user manual

More compelling insights from Kathy Sierra (via Seth Godin) in her blog post "Why marketing should make the user manuals". Heck, you don't even have to read the story, just look at the picture and you'll get the point. 

Even stand-outs in the experience management realm mess this up.  Just compare the Ikea catalog to their self-assembly instructions.  The catalog is appealing, glossy, full of photos, and uses diagrams only when they are actually clearer and better for communicating.  The self-assembly instructions are clearly not part of marketing, they are part of low-cost manufacturing. 

If you think about how much of your business comes from repeat customers or referral customers, you might want to think about changing your approach.