Tag Archives: Business operations

The Price-Value Experience Thing

Yet another edition of “Interesting Research That Proves What Common Sense Told You.”

Image representing Forrester Research as depic...

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In this case, however, the results are actually surprising in that they do confirm one’s own thinking.  The study comes from Forrester, who tested the relationship between customers’ perceptions of their experience, their perceptions of price-value, and their loyalty. This report shows how customer experience trumps price-value perception as a loyalty driver.  In other words, we don’t mind paying a couple of dollars more for a better customer experience.

Media Post summed it up this way:

New research from Forrester finds that when it comes to building loyalty, people respond more to the experience they have with the retailer than with their perception of price.

They went on to quote Maxie Schmidt-Subramanian, the analyst who wrote the report:

In order to move the needle, she says, stores need to focus on the core components of positive experiences, including:

* Meet customer needs. “If the product or service is wrong, price becomes irrelevant,” she writes.

* Make it easy. That can include anything from keeping store aisles clear to making it possible to start shopping online, and then still find the items in your cart when you switch to mobile. “Amazon’s two-day shipping and one-click ordering continue to make a strong impact on shoppers,” she says.

* Make it enjoyable. “That comes down to basics, like making sure dressing rooms aren’t messy and that it’s not a hassle to use your coupons.” And stores like Trader Joe’s, QuikTrip, and Costco may be low-cost, she says, but the amount they spend training their employees to be more knowledgeable makes the experience more pleasurable.

Well, yeah!  Businesses often spend way too much time trying to shave costs while persevering margins.  Intuitively, getting customers to pay a bit more can more than amortize the costs of excellent service, particularly when that service doesn’t involve any more staff, but better training and higher responsiveness.

Maybe this isn’t learning something new today but I think it’s always good when we get reminded of things we probably already felt.  What do you think?

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Wet Newspapers

Here are a couple of quick examples of how two companies address the same customer happiness issue with two differing degrees of success. You’ll notice I say customer happiness rather than customer service. That’s because more often than not the service defines the happiness or lack thereof.

It rains here from time to time. As I’ve mentioned previously, we have a couple of newspapers delivered here at Rancho Deluxe each day. Rain and newspapers are fundamentally incompatible – just try to read one that’s been left out in the rain unprotected.  Every once in a while, the delivery person doesn’t get the newspaper wrapped up too well and it’s wet.  Not a big deal.

We’ve had a wet week and so each of the two newspapers – The NY Times and USA Today – has shown up wet.  What happened next is the subject today.  In the case of the Times, I went on their website where the link into account service is very clear and let them know we received a wet paper.  I was given the option to get a credit or to have another paper delivered – potentially that same day.  Three clicks and all done.  The paper did show up followed by a telephone call from a human – not a robot – making sure I’d received it and the matter was resolved.  Wow.

Compare that with yesterday’s experience with USA Today.  First, they redesigned USA Today ‘s website and it is very pretty.  Unfortunately, they’ve let “pretty” get ahead of “useful” and it took several minutes to get past the pretty pictures and actually locate the link into my account.  At one point I hit the “subscribe” button (which is all the way down the page – I wonder how that link converts?) but I could do nothing on that page except subscribe.  Oh wait – there’s a “chat with us” link available.  Maybe they can help?

Nope.  I gave them my name and email and told them I was a current subscriber.  This was at 8:25 am.  The autorespond said their reps were unavailable until 8 am in the same time zone I was in.  Right – 25 minutes prior.  Fail.

I won’t bore you with the details of how I finally got to the right page but when I did I clicked on “wet paper”.  I was not given an option on how the issue would be resolved (I still don’t know).  I was told it would be resolved within “1-2 business days” which is what the follow-up email said.

Two big companies, two very different responses to the same problem.  With which company would you rather do business?  More importantly  which one is most like the way your business handles issues?

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Golf Economics And You

Here we are at Monday again and of course I spent a chunk of the weekend playing golf.

United States Golf Association

 (Photo credit: Wikipedia)

As you know, I think we can learn an awful lot about business (and life) from the game and I came across an article this morning that’s a perfect example of that. It’s on the USGA website and was written by an agronomist about course care in challenging times.  What caught my eye is that he writes about a new business model for the game and of course that sort of thinking is exactly what we try to do in this space.

If you’re not familiar with what’s going on in the golf business, it’s a mirror of many others.  The number of folks playing (the customer base) is down, those who do play are playing less (consumption), and the costs of maintaining and operating the business are always going up.  Sounds like a lot of other industries.  So let’s see if what he suggests might help some of those businesses.

First, he talks about making a difficult game easier.  The USGA has a “tee it forward” initiative which encourages players to play from tees more appropriate to their skill level (which also speeds up play).  The piece also gets into removing long rough and getting rid of many bunkers (sand traps) that make it hard for less-skilled golfers.  While I have mixed feeling about that as a golfer, I do think that any business needs to take a hard look at barriers to usage.  Playing golf badly is no fun just like spending hours trying to decipher a PC problem or fix an issue with your car can make veins pop out of your neck.  Game manufacturers have long known this – almost every game offer the ability to set the difficulty level.  How can you do that in your business?

Next he talks about controlling costs.  In golf’s case it’s actions such as not cutting grass in some areas – there are out-of-play areas adjacent to tees that are mowed, irrigated and fertilized and acres of turf can be removed from many golf courses without altering the golf experience.  It reminded me of a legendary story about the early days of Capital Cities Communications and how they were so cost-conscious they only painted the sides of the buildings that faced the roads.  Where can you look at costs without impacting your product?  It needs to be a regular evaluation.

Finally, he talks about using alternative grasses which will cut maintenance and stand up better to heat, etc. which provides a better play experience.  This too is a great point for any business.  While the product may not change (the game is the game!) making it a better user experience is a constant.  No one likes to play a burnt-out golf course jut like no one likes any experience that doesn’t meet the brand promise that got them to the product n the first place.  Lt’s put that on our “to do ” list as well.

What else can you come up with?  Do you like what the author is saying?

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