Category Archives: Huh?

August 6, 2015 · 11:32 am

No News Isn’t Good News

I’ll let you in on a little secret.  Here at the World Headquarters, we step away from the computer screen at lunch time, usually to watch the big screen.  Generally it’s a whip around through the various news channels to make sure that it’s worth continuing to work the rest of the day.  After all, if the world is going to end, I’d rather try to sneak in one last round of golf than write a few more emails.

One thing I’ve noticed lately as I watch CNN/MSNBC/FoxNews during lunch is how little actual content I see.  Mostly I see ads.  After many years in the TV business I understand why, but when you factor in national breaks, promotional spots, and the local cable affiliate breaks, a viewer can leave the set for 5+ minutes at a time and not miss a thing.  Entertainment programming doesn’t seem much better. Then again, maybe I’m just old and cranky and wrong.

It turns out I’m not.  As Business Insider reported:

Almost every major TV network in the US is stuffing more ads into their commercial breaks in a “desperate” attempt to prop up ad revenues as ratings across the industry decline, according to a report from investment research and management company Sanford C. Bernstein. The report shows that prime-time TV audiences (as determined by Nielsen C3 measurements: TV watched both live and three days after the show was first aired on catch-up services) are down 9% year on year, yet ad loads on some networks are up as much as 10% on last year.

The chart I’ve embedded shows how commercial hours have changed in the last year across major cable network groups.  3% or 4% may not sound like a lot, but when you’re running over 10,000 seconds of commercials a day, that’s several minutes more each day.  Times 7.  Times 365.  The problem with that is that in the process of maintaining revenues you’re exacerbating the problem of viewer abandonment.  In particular, viewers are going to streaming, where commercials loads are way smaller if they exist at all.  What I find nice about the commercials on Hulu, for example, is that you know exactly how long they will last.  I have no clue as I’m taking my short lunch break if I’m ever going back to the news.  In this case, no news is very bad news since it means yet more of what I definitely did not tune in to see.

We can’t alter our products to preserve an income statement when that alteration provides a lesser experience for the consumer.  It’s a short-term fix that will have very bad long-term ramifications.  Cheaper ingredients, lesser workmanship, or ad cramming are all part of the same mindset.  It’s one we should avoid, don’t you think?

 

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July 27, 2015 · 11:10 am

Dumb and Dumber?

I did something kind of dumb the other day. I’m hoping that my bank doesn’t compound my stupidity, but I’m not hopeful. Let me give you the details since they’re a good example of how any business gets opportunities to build customer loyalty and how they often whiff on the chances.

Dumb and Dumber

(Photo credit: Wikipedia)

First, my dumb thing.  I paid a bunch of bills via my bank’s website.  I had plenty of money in one account but had failed to transfer it into the bill paying account.  Fortunately, I realized this when many of us remember stuff: just as I was going to bed.  However, since there had usually been a lag time in between when I “paid” the bills and when the bank actually transferred the money, I figured I’d do it first thing in the morning.  I got up and my bank account showed it was overdrawn.  I transferred the money from another account (in the same bank) to cover the bills and figured I was ok since I hadn’t received the email from the bank that they had paid the bills.  This is now when the bank’s opportunity began.

Just to be on the safe side, I called customer service.  The person who helped me looked at the account history and said “oh, you’re going to get hit with overdraft charges.  The good news is that even though you paid 10 bills, you max at out 5 charges at a time.”  At $37 each, that’s not such good news, actually.  She said that since the charges had not hit yet she couldn’t remove them but asked me to call back after 2 when they should be on the account and someone else would help me.  Apparently, the bank debits the money immediately even though they don’t notify you that they’ve paid the bill.

When I called back and asked to speak with a supervisor, I was told that there was nothing she could do since it was my mistake.  Let me now put this chance into context.  The supervisor saw that there was plenty of money in another account.  She saw that we have multiple checking, savings, health care, IRA, brokerage accounts and a safe deposit box with the bank.  I have a bank-issued credit card as well.  Oh – we’ve also been customers since 1981.

How was this loyalty reciprocated?  With $185 in fees.  After a few minutes, the supervisor credited back 2 of them, saying she wasn’t supposed to do this.  She suggested I call my branch and maybe someone there could help.  By now it was late on Friday and while I did speak with someone at the branch, they suggested we chat today since the managers had left.

So how did my dumb mistake lead to the bank being dumb?  First, how can a customer service supervisor not have the authority to do what she believes is best for the customer?  Either she hadn’t been empowered or she was lying to me – neither is acceptable.  Second – one thing for which my town doesn’t lack is banks.  If the $111 in fees is worth more to them than my business over 35 years, so be it.  Maybe the 3 banks literally across the street feel differently.  Ignoring the fact that banking has become commoditized to a large extent and not providing a service edge is dumb.

Great customer service means great customer retention.  Over-delivering on customer expectations and rewarding loyalty are tow of the most basic tenets of that.  I was dumb – they’re being dumber, so far.  We’ll see how I fare at the branch.

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July 24, 2015 · 9:04 am

I Wanna Go THERE!

Foodie Friday, and today we’re going to vary from the usual routine.  Most Fridays, I rant about some dish or bit of cooking trivia and attempt to relate it to your business.  This week I want us to have a think about some information I read about the food business and how it markets itself to children.  After all, what better way to get a family into your dining establishment than to have a kid demanding to go!

The folks at Media Post reported on a study by the folks at Packaged Facts, which does research in the food, beverage, consumer packaged goods, and demographic sectors.  The study, called Foodservice Marketing Trends in the U.S.: Technology, Mobile, and Social Media, examines how restaurants and others in the food service industry can grow their businesses based on the trends uncovered by the study.  So far, so good.  It’s what they put in the press release that concerns me:

The family demographic is important for restaurant marketers to target. Almost inherently, acceptance by kids strongly influences parent choice in where to dine and parties with kids aged 12 and younger account for almost $18 billion in annual restaurant spending. However, it’s often easy to overlook kids as vital consumers of digital marketing. Successful modern day restaurant strategies often leverage digital entertainment to increase brand engagement with kids.

It goes on to talk about what several firms are doing to market themselves to kids in order to have the kids ask the parents to take them to the dining establishment.  These activities include downloadable apps using a QR code on the menu, branded tabletop games (which cost the adults money so the kids can play – no pressure there), and the ability for kids to upload things they color or make to their Facebook pages – guess no one told the restaurants that kids under 13 aren’t supposed to have a Facebook page.

My real concern is that there are a number of laws that have been put in place to protect kids.  There is something called CARU – the Children’s Advertising Review Unit – that works with the marketing community to protect kids.  It issues guidelines.  There is also COPPA, which is a law that protects kids’ online privacy.  I couldn’t find any specific guidelines for mobile, but I wonder if the general online guidelines are being followed.  These include:

  • Reasonable efforts, using all available technology, should be made to establish full disclosure and choice exercised by a parent or guardian when a site wishes to obtain personally identifiable information from children for marketing purposes.
  • Advertisers who maintain children’s sites should not knowingly link their sites to pages of other sites not in compliance with CARU’s guidelines.
  • Advertisers who communicate with children via e-mail should remind and encourage parents to regularly monitor their children’s e-mail and online activities.
  • Information collected for the purpose of obtaining verifiable parental consent should not be kept in retrievable form by the site if consent is not received in a reasonable amount of time.

In other words, just because kids are a good set of influencers, the food industry – and all of us in other industries as well – have some rules that we ought to follow.  In the rush to grow sales, it’s never a great idea to grow legal liability at the same time.  Marketing to kids is tricky business, and I wonder if the people who focus on that target are as focused on the laws and guidelines that apply here.

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