Monthly Archives: October 2013

October 4, 2013 · 10:23 am

The Name On The Door

Today’s Foodie Friday Fun is about the business side of food, a restaurant, so if you’re here today for cooking tips I apologize. You probably know chef Gordon Ramsay from his incessant TV appearances and, if so, you’re aware of his obsession with quality and high standards. What’s happened here in New York to his Gordon Ramsay at The London restaurant is a great lesson for any business.

Ramsay at BBC Gardeners' World Live 2008

(Photo credit: Wikipedia)

The restaurant opened in 2006 and soon thereafter won two Michelin stars. For any of you non-foodies, suffice it to say that there are currently only 14 places in NY that are two or three stars – they’re hard to win.  Unlike the Zagat ratings, these are all done by professional inspectors who are totally anonymous.  That was 2008.  In 2009 Ramsay sold the restaurant to the hotel (he needed the money – that’s another story) and licensed his name as part of the deal.

Fast forward.  The new guide came out and both stars are gone.  In a year (he had the two stars last year).  That’s pretty unheard of and shows a significant decline in quality and standards.  The chef’s response (via Eater)?

“Gordon Ramsay is not involved in the day-to-day running of the restaurants or kitchens, as this is a licensing agreement, but is in communication regarding updates and changes at the restaurant.”

In other words, although my name is on the door I’m not involved.   We heard something similar out of Donald Trump when the Trump casinos went bankrupt (how the heck do you lose money running a casino?!?!):

“Other than the fact that it has my name on it – which I’m not thrilled about – I have nothing to do with the company.”

I’ve done licensing agreements and one thing that is always a part of them are the product standards.  Since it’s your name, you always have the right to examine the product and if it’s not up to your standards, to demand that it’s fixed or not sold.  You might shrug and say well, that’s the restaurant business but it’s your business as well.  If the quality of whatever product or service you’re providing – even through a third party – isn’t up to snuff, it’s your name and reputation, not the third party’s.  Given that many of Ramsay’s other places – where he is more hands-on apparently – have held on to their stars – his place in London has three! – it’s clearly not that the chef has lost his touch.  It that he was out of touch with the New York place.

If your name is on the product, you need to be involved and maintain the standards that warranted your name on it in the first place.  When people knock on your door, they see you, not the landlord, not the builder, not the cleaning crew, not even the people who actually do the work.  You.  I’m all for meeting the customer expectations that my name engenders.  Aren’t we all?

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October 3, 2013 · 8:52 am

Cell Phones And Car Keys

I did a dumb thing a little while ago. I lost my car key. I had another one at home but having only one is a bad idea because apparently one can lose them (ahem). It’s one of those “smart” keys – as long as it’s in (or on, which is how I lost it) the car, the vehicle will start. Since I was due for a regular service anyway (which is where I’m writing this post) I asked the dealer to replace the lost key with another. Want to guess the price to do so?

$275.

I don’t know about you, but I didn’t pay $275 for my top of the line mobile phone. “But your phone is subsidized”, you say. “The cell companies do that to get you to pay for the service.” Exactly the business point and it applies to your business as well.

I don’t know what the key costs to manufacture – it’s a chip, a battery, and a case, basically.  Let’s be generous and say $50.  The woman at the service desk said “it takes an hour to program” as if there’s a coder in the back frantically assembling the software.  My guess is they plop the fob into a holder attached to a computer and it’s done pretty quickly.   But I understand the cost/value equation.  Why do they charge that much?  Because they can.  It’s not as if you can go on Craigslist and find a cheap key.  The issue isn’t can they, but should they?

I bought the car for $31,000 a few years ago.  I’ve spent a fair amount in regular service with them (the car has been worry-free otherwise!) although I could have gone anywhere to get an oil change and new filters.  And now, when I do have an issue, they’re choosing to maximize their profits instead of saying “let’s forego the easy $100 because this guy is a loyal customer and he’s going to have to replace that car in a year or two.”  Their short-term thinking is influencing my long-term thinking.

I know we’re all in business to make a profit.  My job is to help companies to do so.  One model – the cell model – is to tie you to the company by making it easy to become a customer and to make sure you’ll buy highly profitable services through subsidies.  I’m not sure that’s right for a car company – I don’t see them subsidizing your purchase so you’ll buy services.  However, doing the little things that build loyalty do that as well, and there is nothing that feels better when you do something totally stupid than a brand that lifts you up, dusts you off, and helps you fix it in a way that makes you feel good.  I realize the dealer didn’t lose the key.  The question is are they going to lose the customer?

Does that make sense?

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October 2, 2013 · 10:29 am

Who Runs Social?

Any time I’m working with a client and the subject of social media comes up, there’s usually a pretty good discussion of how social is seen within the organization.  More specifically, there’s generally an internal tug of war of sorts over messaging and ownership.  I thought maybe my keyhole into this issue was sort of unique but as it turns out it’s actually very common.TCG_0913_SocialMedia

The folks at The Creative Group did a survey of more than 400 advertising and marketing executives about who should own social media and that internecine battle was evident from the results:

Overall 39% of advertising and marketing executives said they think social media belongs in the public relations/communications wheelhouse, compared to 35% who said it should be the responsibility of the marketing department. Meanwhile 15% said it should be delegated to customer service, and 5% said it should be the direct responsibility of the company’s CEO (6% said they don’t know).

Of course, this sort of misses the point.  As I discuss with clients, social media isn’t focused on the brand or on the company – it needs to be focused on the customer.  Figuring out who “owns” it is about you.  Instead focus on the customer’s needs and decide who is best equipped to serve them in the social channel.   The answer may not be tied to one department.  Hmm – working together as a team – what a concept!

The other thing the survey raises is that with multiple internal stakeholders there is bound to be multiplicity of thought on messaging.  The entire organization needs to be aligned on that –  it can’t come with a constant PR or Marketing or Customer Service point of view.  As with many things in the business world, often the politics supersede the thought process.  This is usually the biggest hurdle to an effective social plan.  Once the politics get sorted, the messaging can flow as a customer-focused stream.  Resolving customer issues and carrying on a conversation that engages the customer (and NO they’re not only wanting to know about your latest and greatest product) is social’s role.

Who runs social?  Your customers do.  Any questions?

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