Customer Crossroads

Are they bored, or are you bored? Managing your merchandising and when you should change things up or leave them alone

I tried to find matches in the grocery store this week. They weren't with kitchen supplies (like rubber gloves and foil liners for the stove). They also weren't with candles. Employees in this massive superstore weren't sure if the store even had them. I came across a couple of store managers. They wanted to know what I needed the matches for. [Hello -- this is a staple item. Fire was one of the first things humankind discovered. We now have portable fire. Surely there should be little doubt about the need for fire sticks from time to time. What else are people supposed to use to light their candles with? Candles that fill a significant section of the store, I might add.]

Finally, I learned that they were in two places: wooden matches were with camping stuff, and paper matches were in the cigar boutique. Things had been moved for seasonal reasons.

You've likely had this experience -- looking for something simple and being unable to find it. [Just for reference, Bisquick is now with pancake mix, not baking supplies and muffin mixes as one might expect.]

Another grocer in my neighborhood regularly reorganizes the produce section. When asked about this one day by another customer, he explained that 'customers like it.' The other shopper was very clear: grocery shopping is a chore, and you want to complete it as efficiently as possible. Moving things around does not add value, it detracts from value and is highly irritating. Other customers clearly agreed with this sentiment.

What's happening here?

I think the staff in the store get bored, so they move things around because they like it. It keeps them engaged. They get bored putting the stuff in the same place.

It has nothing to do with what customers want.

We do need to keep staff engaged, however, so what's the solution?

The tax man's solution

The tax man changes things every year. New taxes, different deduction rules, you name it. But the basics remain highly consistent. Otherwise voluntary completion would never work.

Actual changes to the flow of forms or the layout are driven by larger considerations, such as usability improvements, not by the need for the form designer to have some creative scope.

Situations that call for novelty and situations that don't

If your consumers are just trying to get a job done, don't make it harder for them by changing processes for no good reason. And make changes one at a time, and as infrequently as possible.

Keep things fresh by having features with special displays.  And let staff get as creative as possible with these.

So the produce guy should have a feature table that they change all the time, and get creative with this. but keep the ginger root and the garlic in the same place.

The flip side of this would be places that cry out for novelty. Like the posters in a bus station. If you are a commuter, you have to look at the same stuff twice a day. The more change the better.

Finally, would it kill them to put matches in two places? With the cigars AND with the candles? Hmmm?

Starbucks customer experience: not special, not really even local

I walked through my local Starbucks yesterday to see what they'd done with their recent renovations. Kind of hoping it might be a more suitable location for a business talk than it was before. Sadly, there are now fewer seats overall, and the customer space is quite a bit smaller. The counter is bigger, so the staff are likely happy. I have to assume that they're focusing this location on the takeout business, which may actually be a good decision, despite my dissatisfaction.

And therein lies the Starbuckian challenge.
They aren't unique anymore, they're not rare. They are convenient. They are, frankly, mass. Premium mass perhaps, but mass all the same.

In one of the emerging neighborhoods here, Leslieville, I saw a number of unique coffee houses one day. That's Tango Palace Coffee Company at the top of the page. The Dark Horse Espresso Bar was down the street a ways.

And Red Rocket Coffee, above, was not far from the streetcar depot, home of the transportation locally known as The Red Rocket.

This is what local looks like. I expect each of these places has a loyal following, their own strengths and weaknesses, some unique blends of coffee, and perhaps some fresh baked goods.

By comparison, Starbucks has become the Holiday Inn of coffee places -- it may not be special, but there won't be many surprises.

Despite their iconic status, Starbucks has some big challenges. Not the least of which is sheer size. There's no avoiding this once you go public, however. There's no joy in being a utility -- all the money goes to the growth stocks, and that's what Starbucks became.  Their recent decision to close some outlets likely makes a lot of sense.

Now what?

In today's marketplace, you can be budget-bargain or you can be high-end. You can stand for indulgence, or you can stand for the environment, or you can stand for being the smart decision, or many other positions. The mushy middle is a tough place to compete, however.

So what does Starbucks stand for right now, what is the brand meaning? And how does the experience reflect this meaning, reinforce this meaning, and bring this meaning to life?

Starbucks can thrive, but there's no way it keeps its premium price point unless it keeps its game up. So re-examining their coffee taste is a good idea. McDonald's has improved their coffee taste. The donut places are still serving good coffee. And together, these define the budget end of good coffee. Starbucks has to stay above this in the minds of consumers, and they have to earn their premium price. I hear people say it's the best coffee in the world, but I find this hard to believe, and it certainly doesn't mesh with my own experience.

The third-place thing is definitely still working for them -- at least where you can find a place to sit.

I think they might try to customize their focus for each local market, wherever they can. So that locations in business districts have more places for quick meetings, and locations in neighborhoods are friendly to SUV strollers. [I've never understood why they don't have stroller parking of some sort to end the congestion, or  designated seating, or something like that]. Customizing to be local within a consistent larger theme could mean that you get to know individual locations that suit your preferences. For me, I'd avoid the SUV locations, and head straight to the business and artsie ones.

Where they hang the work of local artists, this seems like a good thing to me. It helps them preserve a sense of place. Doing this takes time and effort, however, and staff need to be given a mandate to spend the time and make the effort.

One thing they could definitely improve is their food product. This stuff tastes like it was shipped in bulk from a single factory, and has been on the shelf for days. Especially since we are seeing the rise of local bakeries and patisseries again, that offer the real deal.

Resources:
For more on the challenge of running public companies check out this story by Miro Slodki, Is it time we fired our shareholders?

I've written about the coffee business before.

Cafe, Coffee Place, Coffee House: names and their meanings

Far Coast: Coca-Cola pilot coffee cafe in Toronto

Getting a good coffee in Kingston Jamaica and other third place observations

Starbucks Customer Experience

Becky Carroll has run quite a few posts on the Starbucks experience on the Customers Rock blog. As has Meikah Ybañez-Delid on the CustServ blog.

Building an experience with research: last of the Harley Davidson series

I've spoken in previous posts about the great marketing work done by Harley-Davidson, especially their current push to build a bigger customer base of women riders, and their focus on making the brand experience operational.

Building this kind of insight into your customers is achievable only with consistent dedication to gathering insight. I see evidence all over their marketing of high-quality research, both qualitative and quantitative.

I had hoped to interview someone from Harley's research team, but haven't been able to make that connection.  However, I can share with you a small peek at their approach, because I happened to get a pop-up survey on their web site, and was quite impressed with the quality of the questions. [Naturally, I saved a few screen shots]

A look at H-D's pop-up satisfaction survey

The ratings covered these areas:

• accuracy, quality and usefulness of the information on the site
• ability to accomplish the purpose of the visit
• reliability of the site

More interesting:

• whether the site is consistent with the brand image, and whether it creates a positive impression [Everyone should be asking this; most do not]

Most interesting:

• whether the site meets your expectations
• how the site compares to your idea of an ideal web site

I need to explain this last one a bit. Sometimes we have low expectations. So meeting our expectations in that case is no big deal. But customer loyalty does not relate not just to satisfaction, or meeting expectations, they also relate to delivering high quality -- and people form this notion of quality quite independent of your specific brand or experience.

There were more questions, but these were the ones that caught my eye. Because if you are just asking overall satisfaction, you are not getting the full picture. You also need to know how well you are doing (on any topic) compared to a standard of excellence that your target customer has formed independently of you.

There was more evidence of sophisticated thinking. For example, a typical list of "why did you visit the website today" has 5 or 6 generic responses. This questionnaire had 22 options! Ranging from "seeking employment" to "getting screensavers". This list itself was undoubtedly based on previous research with site visitors.

It was no surprise to discover that H-D had enlisted the help of research specialists to get to this happy place. The ready availability of inexpensive survey software means we see a lot of weak satisfaction questionnaires. Many of these probably came from a template provided by the hosted software application.

Gathering and using customer insight is like making a pearl

The fact that you see these weak surveys everywhere doesn't mean this is the way to do it. It just means a lot of people won't invest in good information. There isn't a lot of substitute for real expertise, hard thinking and thoughtful testing.

As I have often said to prospective clients, 'You are paying for insight, not for method". However, I digress.

Seeing a sophisticated approach to one small element of the insight equation only confirmed my suspicion that considerable sophistication goes into Harley-Davidson's marketing, including the gathering of customer insight.

It has to. Because that is how you get messaging that is outstanding -- you base it on genuine insight, gathered over years, layered on prior learning, and guarded like the crown jewels. It's like an oyster building a pearl, layer by layer.

Resources

I've written about customer satisfaction a few times.

Customer Loyalty and Sacrifice: Are Your Customers Just Settling For You?

Differentiating and the Zone of Goodness

Traveling in Baggage Class: Modifying Expectations

More than Scrabulous: Credit unions, P2P lending and payments now on Facebook

While some of the major FIs have garnered publicity for their pages on Facebook, others have been starting to offer actual transaction capability. So when I take a break from playing Scrabulous, I can check out account balances or send money to a buddy. Soon, I'll be able to apply for a peer-to-peer loan, or check out my loan portfolio.

Credit Unions leading the charge to transacting on Facebook

SEFCU is a credit union with 160,000 members serving New York State, and is the latest to announce transactions on Facebook. MShift, a provider of mobile banking solutions, built the SEFCU application, as well as the KeyPoint Credit Union Facebook application, launched November 2007. KeyPoint's 80,000 customer base is heavily weighted to technology professionals, and it only makes sense that they would be at the forefront of access innovations.

FiServ, the giant solutions provider for financial processing technology has launched the MyMoney application (screen shot above) that offers access to a number of credit union accounts. And possibly the ability to aggregate from multiple credit unions, although that wasn't entirely clear to me after researching this. Although the application was built with credit unions in mind, Fiserv says they can work with any operating platform.

[One thing I didn't care for too much were the gushing testimonials from Fiserv employees on the comments page.]

The driver behind this initiative is simple -- bring the banking to where the people are, especially Gen Y potential customers. But not only them, of course -- other demographics are rapidly adopting social networking as well.

P2P Lending

Lending Club has a Facebook application that is really just a page at this point, with redirects to their web site. But they are in a quiet period while awaiting their SEC approval to issue another 600 million in notes. So I'm guessing things will look quite different here in the near future.

Prosper, another P2P lender, is also live on Facebook. Prosper's application appears much more interactive inside Facebook, adding items to your feed about opportunities you are following, etc. Transactions still occur inside the Prosper web site.

Sending money around

A few operations are now launching that promise to let you send money around the web via Facebook as well. PayMe promises to let you use PayPal from inside Facebook. OneClick Pay is already live, as is Moneybookers.

Is Facebook taking over the world?

Most of these applications have users in the dozens. So there's no need to panic if you're an FI without a strategy in place yet. However, exponential growth curves do tend to look slow in the beginning.

Some buffing up is needed in the customer experience

One thing I noticed about these Facebook apps and the associated pages is that the companies are not doing a tremendous job of interacting with people. For example, the KeyPoint page has a question about the app dated April 1, 2008 that has no response.

Here's my tip: if you launch a social networking application, you need to build communication protocols and revise job descriptions to ensure that ongoing communication occurs. What's the point of opening a dialogue with your customers  and then failing to talk? 

Resources:
Finextra: SEFCU taps Facebook, July 10, 2008

SEFCU press release about Facebook

Credit Union Journal, Fiserv units unveil  financial platform for users of Facebook, April 2008, PDF file

Bloggers writing on this topic: CU Tomorrow; NetBanker, Inside Facebook

Where's the Experience section of your website: Harley-Davison is a textbook study in customer engagement

Harley-Davidson is a great example of brand stewardship over many years. Whatever false steps they may have had in the past, they are a case study in customer engagement.

The Harley-Davidson web site has many opportunities to get involved.

There are places to post your personal 'rally cry' for this season. Harley is so closely associated with America, that when America is in trouble,  customers likely feel concern in a deep, gut-level way. Not because they are Harley owners, but because of their values. So this season, you can post a rallying cry for America by filling in a few blanks [marked in yellow above] and adding your name to the list, as some 21,000 people have done. And you can invite a friend to post theirs too.

Of course you HAVE friends if you are a Harley owner -- ever heard of  HOG, the Harley Owners Group? Events, insurance, roadside assistance, touring manuals, you name it. In fact, Harley owners likely bump into each other all the time, recognizable not just by their ride, but by their gear. 

If you don't want to post a rallying cry on the site, you can post your personal riding creed, and look at the creeds of others.There's an inspiring film about the Harley creed, and even stories about the making of the film. There are downloadable goodies for your desktop or your iPod, and skins for your electronics. You've got to love a business where people pay to advertise your brand.

This is a company that has operationalized their brand values in a very meaningful way. It's not about Harley-Davidson the brand as much as it is about the Harley-Davidson brand experience.

Here's the thing that really got me. A lot of companies say they are experience-focused. And maybe they are. But this is the first time I can recall actually seeing a menu item on the home page labeled EXPERIENCE. [Okay, one more web design needed for my site too. Jeez.]

In the previous post, I talked about Harley-Davidson's strategy for marketing to women.

Next post I'm going to get speculative about Harley's research.

Marketing to women: membership in an exclusive club

This is the year Harley-Davidson really hopes to crack the women's market. And this ring, offered as a premium, almost makes me want to surrender my Vespa.
The ring is available to women who complete a Rider's Edge course and buy a new Harley-Davidson or Buell motorcycle before the end of October. Having one will instantly identify you to the rest of the secret community of Harley riders.

H-D has a whole section of their site geared to women, and includes some fabulous historical images and stories of iconic women riders. There's a book of stories that highlights core brand values in a way that resonates with women:

• the feeling of freedom and confidence that come with riding a Harley
• feeling like your own person
• doing what you really want to do
• being in the moment, being one with your bike

For the women, there's a subtle emphasis on making life changes, often involving a mate. Here are a couple of excerpts from the stories:

"After a long days ride, dirty from the road, sunburned and windblown, I have to say that I've never felt more beautiful!"

"As I ride through the mountains ... I am overwhelmed by the beauty around me. I have never looked at this landscape the way the Sportster shows it to me. As I turn my head to admire the splendor of these mountains, I hear the roar of the Sportster engine.  It speaks to me as if to say, "Hold on to me and leave all your cares behind".

For the experience marketer, there are several great take-aways from Harley's efforts.

The historical photos make it clear that Harley has always wanted women as riders. They're no fair-weather friend. And they've taken the operational steps to support this, by having dealer events geared to women, and responding to women's concerns about body size and strength as barriers to riding.

Harley has also managed to be female friendly without watering down the very masculine nature of the brand. They've done this by emphasizing their core values rather than their masculinity. And they haven't gone all pink in their marketing.

There's too much to the Harley story to cover it in one post. These folks are engagement experts. Next post, we'll deconstruct it a bit more.

Resources:
Mediapost: Harley-Davidson reaches out to women, July 9, 2008
Harley-Davidson web site

This just in: lots of financial services news

There seems to be a lot happening in the financial services space these days, some of it good, and some of it clearly a wrong turn however well intentioned. [None of the latter shown below]

Underbanked Americans

The Centre for Financial Services Innovation, whose focus is the low end of the demographic spectrum, has just released new research results on the underbanked. Some 40 million households are unbanked (no active bank account) or underbanked (may have a bank account but is actively transacting with non-banks).

The demographics are interesting: more than half own a home, more than half are white/non-Hispanic, and almost half work full time. As you read the attitudinal and behavioral material, the surprises just continue. A six page download presents a good summary, including an overview of 8 attitudinal segments.   There is also a free webcast scheduled for July 8.

Payments in your watch

Why have your paypass on your key-fob when you could have it in your watch? That's the reasoning behind the launch of the Altair's PayPass wristwatch that uses MasterCard's contactless payment technology. This is not the first such innovation, but we're bound to see more of this in the future, through the competing technologies related to telephones or cards. Reminds one of the cable versus telephone battle that still wages. (Read more about this in Finextra here).

Visa on Facebook target SMBs

Visa has launched a new social networking application through Facebook target SMBs. The incentive to join is $100 toward targeted Facebook advertising, an interesting idea. Features include expert Q&A that would be similar to LinkedIn. I applaud them for trying this, and building an application that could potentially  provide support for things other than information. What I'm not sure yet is how you prevent these things from becoming a really giant version of the Yellow Pages. (Thanks again to Finextra for the heads up)

Mobile P2P payments

MasterCard has launched a P2P payments network accessible through your mobile phone, in the US. The story from Finextra references Tower Group research suggesting that the growth curve here is exponential. The target market here is the underbanked -- the 40 million households referenced above -- and the huge international remittance business.

The major impediment to widespread adoption of this kind of service will be that it threatens the existing infrastructure. But people are bound to like the idea of having the bank machine in their pocket.

Teens and technology

I did some research on teens use of technology that gives strong support to the notion of the handset as the main access device. Imagine mobile computing without having to drag a laptop around -- how cool would that be! I put the slides for a recent presentation on this project on slideshare.