Over the past several decades, technology has changed everything – including people. Consider the impact that the internet has already had on education, communication, science, travel, government, and business. In the past, a bad customer experience may have meant a lost customer or two, but today’s rapid advancements in technology have challenged that notion. As a result of social tools and online connectivity, the customer’s voice is amplified and has the potential to outshout the corporate marketing machines.
Ask any customer experience, research, or marketing executive, and they will tell you that gone are the days of companies engaging prospects through one-way dialogue. Customers will not simply be talked at, so market leaders have shifted their listening and response mechanisms to capture more of the customer’s input and behaviors. Now more than ever, customer relationships have a lot more to do with listening and engaging – that’s why developing a VoC and CEM program (Customer Experience Management) offers a huge opportunity to drive loyalty and increase sales. Continue reading “Your Customers Are Talking. Are You Listening?”
Late afternoon today, I sat in the eighth-floor conference room at 111 N. Canal St in Chicago and reached for my regular Friday indulgence of a Starbucks white chocolate mocha topped with whipped cream. As I waited for my colleagues to join me, I reflected on the company’s recent performance. While other retailers are still reeling from recession, Starbucks is enjoying consecutive years of 5% or more comparable store sales growth. However, more recent market research has revealed some unexpected findings and according to the data, they are not always meeting their customers’ expectations in the area of customer satisfaction. As a result of these concerns, leadership had come up with a plan to invest an additional $40 million annually in the company’s 4,500 stores, which would would allow each store to add the equivalent of 20 hours of labor a week.
The guiding point was to improve speed-of-service and thereby increase customer satisfaction. Further foundational questions have me wondering, “do they believe what their customers tell them about what constitutes ‘excellent’ customer service? And if they deliver it, what will the impact be on their sales and profitability?” What makes Starbucks’ success even more interesting to me is that the company has spent almost nothing on advertising and marketing. Most of their marketing budgets consist of point-of-sale materials and local-store marketing and is far less than the industry average. (Most fast-food chains have marketing budgets in the 3%-6% range.) Continue reading “Rediscovering the Starbucks Customer”
Lately I’ve been interested in the explosion of beauty apps in 2014. It presents me with a new way to engage with colors that I like as well as make-up brands that I love. With the bigger picture in mind, the rise of personal data collection and analysis in the health and beauty markets are being revolutionized by new tools allowing consumers to explore their products whenever and where ever they want to.
As a consumer, I’m interested in the idea of using technology to help with my shopping experience. As Mintel research shows, a quarter of lip, eye and/or nail make-up users are interested in using a device to virtually try on products in-store (e.g. a digital mirror to test a lipstick shade on an image of themselves.) This rises to 30% among 16-24-year-olds. Continue reading “How the Beauty App Revolution is Changing the Way I Shop”
One thing is certain when it comes to quality athletic wear – it’s expensive! So why are women flipping for Kate Hudson’s new athletic gear line? Take a single pair of Lululemon yoga pans. On average, they cost more than $90. And a simple pair of my favorite Nike running shorts can easily cost $50.
It only makes sense that you want to look and feel good when working out, but by the time you get an entire workout outfit together you could spend upwards of $200. This is exactly why actress Kate Hudson co-founded Fabletics, a brand that offers top-quality active wear online at amazing price points. With Fabletics, the average outfit (including tops and bottoms) costs no more than $60, and shipping is free for orders over $49.95. I decided to take a look for myself. Continue reading “Kate Hudson’s New Athletic Line Fabletics”
You might not think of it this way, but we all live in a perpetual purchase funnel. It was a complex state of being for me as a new-car buyer this spring. Armed with seemingly limitless megabytes of information, I could research nearly anything – from BMW ratings and reviews to safety features and financing options – so when we got to the dealership, we were better equipped to test-drive and negotiate a sale. We are more powerful consumers now than at any point in history.
For the most part, the primary tools driving this consumer empowerment fit in the palm of our hands. Mobile devices with auto-specific apps that allow you to find dealers with the model you want, and calculate retail and trade-in costs, are game-changers. So are social media sites, where the latest vehicle and dealership buzz pages are viewed by prospective buyers in a click or two. These sites have become an integral part of the purchase process. A recent global survey of 8,000 car buyers by Capgemini found that 71% of respondetnts would likely purchase a vehicle from an automaker or dealer if they found positive comments on social media sites. Continue reading “The New Age Consumer”
In terms of their economic impact on corporate revenues and profitability some customers matter a whole lot more than others. It’s an irrefutable fact. It’s true for not only big ticket items – consider: the highest earning fifth of the population accounts for 55 percent of new car sales volume, up from the 40 percent in the 1980’s – but across most any goods and services sold in the marketplace today. The exact figures and percentages may vary somewhat, depending on the industry context and also on whom you ask, everyone agrees that a relatively small number of customers tend to account for a disproportionate amount of a brand’s current value, as well as its future growth potential.
Consider Procter & Gamble, the largest U.S. maker of household products and a paragon of mass marketing. The company routinely spends more than $2 billion each year on advertising and promotions in the United States, and more than $3.5 billion worldwide. But is P&G really a mass marketing brand company? It sure looks like one to me, at least on the surface, given that it’s home to such blockbuster brands as Crest toothpaste, Puffs tissues, and Tide detergent. After all, what customer segments don’t brush their teeth, blow their noses, and wash laundry? Today P&G can easily boast of having some assortment of bottles, cans, rolls, cartons, boxes, and canisters on the shelves, under the sinks, and in the closets of more than 95 percent of all U.S. households. Continue reading “Customer Value Contributions”
Enter the word “relationship” into any search engine and see what comes up. Millions of returned links, not all of them G-rated. Romance advice. Dating advice. Marriage advice. Parenting advice. Divorce advice. Plus the chat room type environments and message boards and matchmaking services, all staking out their ground in the relationship-building business arena. This blog post is not about those types of relationships. It’s about relationships with customers – and, to a lesser extent, with suppliers and partners, as well.
Here I speak of relationships not in terms of holy matrimony but of corporate moneymaking. Therefore, the motivating factors are more likely to be fear and greed than the heartfelt words exchanged during my wedding vows. That said, certain words like “trust,” reliability,” and “commitment,” are equally relevant in both worlds. I will define a customer relationship as a series of repaired interactions that, if managed correctly, accumulate over time into a positive memory bank of experiences with a product or service – or, better yet, with a company as a whole. The art of managing relationships is the art of managing every form of interaction so as to record it as a positive memory. Practically every company in existence sets out to build strong, long-term relationships with its customers. Continue reading “Relationships with Customers”
In this post, I look at the changing consumer landscape to help explain the growing infatuation that today’s corporations are having with a concept called precision loyalty marketing – delivering the right message at the right time through the right channel to the right people. In particular, I’m going to take a look at how precision marketing is being used effectively by companies like Kraft Foods.
I think in the past consumer loyalty used to be easily won. Some families were Ford families. Some families were Crest, Skippy, and Tide families. A brand choice is almost like a political affiliation. As long as it performs reasonably well and is advertised heavily enough, people would continue to buy it. Usually, a leading brand could do no wrong. These days, on the other hand, consumers are constantly testing limits of their brand loyalty with a simple question: What have you done for me lately? With increasing frequency, we are coming to an equally simple conclusion: Not enough. Continue reading “The Way We Live (And Shop) Now”
Launched by Procter & Gamble in 1961 as the first mass-marketed disposable diaper, Pampers quickly became the company’s fastest growing enterprise. With the introduction of the disposable diaper, Pampers gave families, and moms in particular, unprecedented convenience, time savings, ease, and confidence in dealing with the large amounts of you-know-what that healthy babies produce at unpredictable times throughout the day and night. And although Pampers has remained the world’s biggest diaper business by far, they have always faced increasing competitive pressure.
For example, Kimberly-Clark was not just a follower in the market. In 1989 they introduced Pull-Ups training pants with an “I’m a big kid now” tagline. They became an immediate hit. Because Pull-Ups commanded a significantly higher price and profit margin than diapers, Kimberly-Clark soon had 90 percent of the market segment with the most profit. They were also gaining increased support from big retailers such as Kroger and Walmart because of the new sales and profits that Pull-Ups generated at that time. Continue reading “How Pampers Changed the World”