Do you miss Circuit City?

So, Circuit City is toast. And the public doesn't seem to care. I typed in Circuit City in search.twitter.com and most comments are negative, reminding others of the layoffs of 3,400 'overpaid employees' (just followed by the golden parachute of its outgoing CFO), asking for the future of their extended warranties and overall complaining about Circuit City as a brand with sub-standard service:

"No one ever waited on me when I went to Circuit City. I'd just walk around and leave."
"Why are they even still around? I have a pretty long list of useless retail stores. They're on it."
"The sales people seemed to eager."
"Dear Circuit City, I never loved you. You never made me happy. Now I'm leaving you by the side of the road (at a strip mall)."

Just like many other electronic retailers, Circuit City was a company that never considered service as part of their core offerings. The advent of the Internet made these stores almost obsolete, maybe with the exception of big ticket items like flat screens and dishwashers. Laying off the majority of their overpaid (meaning: most qualified) employees dramatically increased this severe lack of professional service and focused the company on car dealer like sales techniques.

When you reduce your competitive advantage to 5% off and other direct sales approaches, you reduce your business to a flea market. A flea market filled with deals and no-name vendors that have no storefronts, no fancy advertising, just Google on their side.

I feel bad for all the employees and vendors owed money by Circuit City (HP and Samsung are owed more than $100 million each.) The layoff of 3,400 seasoned employees should have given you an indication of things to come. Cutting to the bone might have been a good thing in the 80's when companies had huge bureaucracies. We've been living in lean times for a while and cutting the juiciest parts out is a sure sign of a company in distress and close to failure.

Obsession with customers

Joe Nocera, of NY Times fame, yesterday wrote a piece about Amazon's obsession with customers and his personal experience with their service.

He questions Wall Street's obsession with short-term goals:

"Maybe, just maybe, taking care of customers is something worth doing when you are trying to create a lasting company. Maybe, in fact, it's the best way to build a real business - even if it comes at the expense of short-term results."

And he concludes:

"There is simply no question that Mr. Bezos’s obsession with his customers — and the long term — has paid off, even if he had to take some hits to the stock price along the way. Surely, it was worth it. As for me, the $500 favor the company did for me this Christmas will surely rebound in additional business down the line. Why would I ever shop anywhere else online? Then again, there may be another reason good customer service makes sense. “Jeff used to say that if you did something good for one customer, they would tell 100 customers,” Mr. Kotha said.

I guess that’s what I just did."

Customer experiences become more and more important: Thoughtfulness is on the top of my list. Two examples:


My wife and I used to have a mortgage with Citibank and switched a few months ago to ING Direct. What a dramatic change:
The ING Direct web experience might be the best I've ever encountered. It takes less than 30 seconds to pay the mortgage, everything is superbly organized, no unnecessary paperwork. A pure, minimalistic experience. Exactly what I'm looking for when dealing with a mortgage company. The brand promise. Overdelivered.



Second Example: You know the situation: It's a dark bar, you get the check, it's hard to read and even harder to write down the tip and total, sign it. This bar and, dare I say it: Camel, improved my overall experience by offering the first back-lit bar check.

Bruce Temkin spoke on his blog about ten customer experience resolutions for 2008. All brands should have those resolutions posted in each room and our sites. And by all brands, I mean all brands. When a bar can delight you with something besides cheap and stiff drinks, you know that every brand can make my life better.

Apple on the defense

After their iPhone discount PR meltdown, increasing virus problems and more and more users calling their Mac a lemon, here comes the tragic customer experience from an Apple Store:

"He (Ed.: the sales clerk) said he was working at the store while going to grad school. And, yes, he hated the job, it was a bore -- he hated the attitude, like selling Apple stuff was an honor; but really it was no different than selling shoes, except selling shoes paid more. He knew he was taking out his frustration on customers; he felt bad about it, but he assumed he would be fired weeks ago and that would be it. What does it take to be fired, he asked. Apple's supposed to be about customer service, yet they seemed to like he was acting like an a-hole, he said. That pissed him off even more. The hypocrisy. They wanted him to act cool, kind of above it all, it was part of the image. But not crossing the line (wherever it was that week), to the point of terrorizing the customers."

If you have a moment, read the whole story, it's pretty hilarious. And sad at the same time.

I don't frequent Apples Stores very often but there's a flair of arrogance and "We're better than the rest of you" in the air. This attitude was apparent during the iPhone discount meltdown, basically telling early adopters (Yes, me!) that they are suckers.

Apple used to be the underdog, fighting the good fight. Now, they're the big dog again since nobody regards Microsoft as an evil force anymore (Google is slowly getting comfortable in that role.). Customer service has always been Apple's weakest link (Don't remind me of all the blown iPod batteries and annoying calls to Customer Service). Not a big deal when your competitors are messing up but fatal when competitors are waking up. (Even though they still don't get it completely.)
Hopefully, Apple doesn't have to learn the hard way that a strong brand and exceptional advertising are just a small part of the equation.
Products and customer service are more important.

My virgin flight

I had the opportunity to fly from LA to NY and decided to experience Virgin America for the first time. The hype has died down and I wanted to see how Virgin America measures up to low-cost carriers such as Jet Blue and Southwest.

The online experience when purchasing tickets was on the same level as Jet Blue/Southwest: intuitive and no unnecessary frills. Check-in and boarding are very typical and generic, it just feels a bit more upscale because of Virgin’s advanced design.

When you walk into the plane two things stand out: Mood-lighting and the fresh smell of the leather seats. That smell will disappear (they’ve only been around for a few weeks) but the mood lighting enhances the flight experience. It just makes the trip feel more upscale and in line with other advanced travel experiences (W Hotels). The seats are comfortable, recline further than other coach seats I’ve sat in before.

I was mostly looking forward to the Entertainment Center, called ‘red’. Overall, I would give it a ‘7’ out of 10:
- Music Selection is fantastic: Either 16 radio stations (from Wine Country Radio to Dance) or you can choose from 225 artists: Mozart, Coldplay, Underworld, Johnny Cash, Barry Manilow, Aqualung – they do have something for anyone’s taste. Even Bert and Ernie are there to entertain the little ones.
- TV selection is below average. CNN, A&E, Food Network were one of the few channels that worked. Some channels didn’t work, some were sorely missed (local networks, very important when you’re flying on weekends and don’t want to miss out on sports).
- 16 music videos were offered. Too mainstream, nothing that interested me. Can you say, Kelly Clarkson?
- Good selection of movies (300, Blades of Glory, Hoax, Waitress, The lives of others), the $8 price was a bit too high, but they offered more than 10 free short movies. Very cool.
- Premium TV: A few selected shows of The Office, Simpsons, Heroes and (yes, I’m not making this up) Twin Peaks. The cost of $1.99 seems a tad high since I can get the same content on iTunes and the selection felt arbitrary. Hopefully, networks will partner up with Virgin America in the near future to market their new shows.
- Multi-lingual TV: A mixture of Korean, Japanese and Chinese shows with a few Hispanic episodes. 75% of the content is tailored towards Asian customers. Interesting approach.
- 11 different games one can choose from. I played Doom for a few moments, because of the lag it felt like playing on an old computer.
- The chat functions are pretty cool but nobody was chatting at all.
- The email and Internet functions are already part of the user interface but not functioning yet.
- My favorite: the food selection. Flight attendants still make one tour of the cabin but you can continue making orders on your screen, right before the landing. My order took only 2 minutes to be delivered to my seat. That’s better than any call button. Sodas are free, alcoholic drinks and any snack will cost you.
- The real bad: My system acted up quite a bit, stalled for a few minutes and it finally rebooted. I guess Linux is not as good as advertised. I saw a few people with the same issue.

The main attraction: Customer Service. Flight attendants are very friendly and helpful. Pure perfection. That’s their best marketing attribute right now.

Overall, I would fly Virgin America again. I wish they would have chosen smaller airports, just like Jet Blue when they started to fly from Long Beach and Burbank. But I would choose them over the other two any day.

There are wrong questions

My wife and I just spent a weekend in Santa Barbara. I do highly recommend wine tastings, can’t recommend any of the restaurants. I can’t say the food was bad or even terrible. It was just not good enough for the asked price: too salty, too complex for its own sake, not surprising enough.
Service was pretty good but the current service model in restaurants has major flaws:

During our various visits, we were constantly asked:

“Is everything good?”
“How’s everything?”
“Are you having a good time?”

Now, everything was good and we had a good time. As a customer you're in a tough place: You can either start to explain your issues with the food and look like a petty jerk. Or you just smile not to ever come back.

Questions like "Is everything good?" don't allow room for a real answer.

Instead, restaurants should ask questions that allow for honest answers, such as
"Did the food meet your expectations?"
or
"What did you think about the food?"

Good, open-ended questions will lead to informed discussions. Good questions can help moving through issues - to clarify, expand, and engage. Good question establish an atmosphere for meanignful discussions.

The ongoing demise of CMO's

According to Spencer Stuart, the average tenure of CMOs at top-branded companies is only 23 months. CMO's have to face immense pressure to demonstrate results – fast – and often at the expense of the brand and its customers.

Many times, a new CMO sends the current advertising agency into an unproductive frenzy when they, upon joining a new company, immediately question their predecessor’s strategy. If the agency isn’t immediately fired (which often happens), an incredible amount of time is spent on the re-education of the new CMO — oftentimes as much as three months. Also, because advertising campaigns are tangible, new CMOs have a tendency to quickly look to the creative for a change in direction. Clearly, these knee-jerk course corrections, designed to demonstrate that the CMO is making an impact, are not only expensive propositions, but, more importantly, force the consumer to accept yet another brand positioning.

Agencies have to shift their thinking from pure creative to advertising that moves products. If you as an agency can't talk to C-level executives and produce work that moves product, more and more accounts will be put up for review. Clients have to understand as well that advertising can't be the savior. If you have a bad product, good advertising will be just another lipstick color and the pig will still be a pig.

Agencies and clients have to understand that they are in this together. Clients used to put products on the table. Agencies creative ideas. At this point, everything should be on the table: Product, Advertising, PR, Customer Service, Consumer Experiences.

Avoid the phone loop

Frustrated by the endless phone loops of pressing '1' and '#'? Bringo can help you: You put in your own phone number and Bringo will connect you directly with a customer service rep.
I tested it and it worked really well. Got a call from AA within a few seconds.

Another example why companies need to change. While corporations continue to build walls, people find ways to tear them down.

Turn Customer Service into a Marketing Discipline?

Bad customer experiences weaken your brand: the call to your company, the application process, the talk to the shop clerk, the cleanliness of the store.

Customer Service has more impact on the brand than any advertising messages. In a way, advertising messages set expectations, customer experiences has to deliver. For that reason, marketers should consider claiming customer service as a discipline.

Interruptive and disruptive marketing doesn't work anymore, Viral Marketing and WOM are about to become cornerstones of the marketing universe and permissive marketing is still too close to disruptive marketing. There are instances when customers already are open talking to us: On the phone, at the store.
We don't have to limit building connections to social networks or marketing-based platforms. Connections happen every day with representatives of your company. Make them count.

Lying stock photos

I needed customer service from a technology company a few weeks ago and found the phone number in the support section of the site. The page featured a very good looking woman, pleasant smile, perfect teeth, $2,000 dress.

I'm pretty sure the guy with a thick Indian accent wasn't her. Very nice, very helpful, very professional. But definitely not her.

Is this false advertising? Where's the friendly looking person you featured on the website?

Another lie, I'm afraid.

Did I expect the beautiful woman to deal with customer issues for 9-hours a day using a pad and a laptop?

Do we want to be lied to? Do we really want to see the sea of cubicles, walls filled with phone scripts and poor customer service agents dealing with irate people?

I would argue that there is a good medium between reality and complete lies. Take a few pictures of actual employees. Sure, hide the full reality of their cubicle world. But feature real people. Your employees deserve that confidence boost. At least you're not hiding behind a beautiful stock photo.

Electronic Retailer Suckometer

Since I had horrendous customer service experiences at Best Buy and CompUSA, I decided to analyze the relationship between customer loyalty and the order procurement and order processes. In addition, I analyzed the recruiting efforts and how 4 retailers retain their best employees. Last but not least, I analyzed three order fulfilment variables: product availability, timeliness of delivery, and ease of return.

These 4 retailers were researched: Best Buy, Circuit City, Fry's and CompUSA.
I googled the following terms: 'Brand Name' sucks.


Not a big surprise, Best Buy topped the list:

Best Buy 2.5 million results
Circuit City 968k results
CompUSA 143K results
Fry's 112k results

To be fair, I had to divide the results by the number of stores in the US and the Eletronic Retailer Suckometer reads like this:

Fry's 3,733 results per store
Best Buy 3,200 results per store
Circuit City 1,489 results per store
CompUSA 1,430 results per store.

Clearly, as unscientific as an analysis can be. But very insightful. An opportunity for a good company to take over this vertical.