Tag Archives: Customer

Who Is Working For Whom?

Have you ever been in a clothing store where the customers were busy stitching together the goods?  Maybe there is a guy in the corner screening designs on to T-shirts or a grandmother doing embroidery on a scarf.  How about a restaurant where the customers cook the food (OK – I have been to one of those – many Korean places let you grill at the table but still…)?

I ask this because it’s something pretty common in the digital world.  After all, what would Facebook, Twitter, Pinterest, Quora, and dozens of other sites be without the user-generated content that makes them worth a visit?  Sure, each of those sites provides the platform and the tools with which to interact, but if no one ever posted anything what would they be?

What’s triggering this are a couple of things.  First, the Instagram fracas I discussed yesterday.  Second, Twitter is deigning to let users download all of their tweets as if Twitter had anything at all to do with the content itself.  It got me thinking of all the crappy students who got paired up with smart kids in school and got an “A” because the smart kid did all the work and wouldn’t let the team fail.  The least one can do is to have an appreciation of and respect for the horse that got you here.  The platform is a “C” student – it’s along for the ride in most cases.  The importance of the content to those sending and receiving it doesn’t change based on the platform although the platform can help get it into a form that makes it more digestible.

When any of us who run businesses start minimizing the contributions our customers make to us, we’re in trouble.  In the case of many digital businesses, where the customers literally make the stuff on which the business depends, we should be thinking of as many ways to reward those folks and how to say “thank you” each and every day.  Screwing around with privacy or your data use policy or being obnoxious about using your customers as currency (even though we all know we’re being sold) is a sure way to blow up the business.  You with me?

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Love The One You’re With

One of the trends I hear discussed all the time is that of chasing the next shiny object.  As it turns out, that’s not something that occurs solely in the tech space.  A recent study from Adobe – The Adobe Digital Index – shows that online retailers are ignoring the 80/20 rule by ignoring current customers in favor of attracting new ones.  Maybe today’s screed should have been titled “You Always Hurt The One You Love.”  Their summary:

Online retailers spend nearly 80% of their digital marketing budgets acquiring shoppers (new visitors), but does this focus make sense? To find out, Adobe Digital Index analyzed 33 billion visits to 180 online retail website in Europe and the United States from April 2011 to June 2012. Our data indicates retailers should shift spend to returning and repeat purchasers, two existing customer segments that drive a disproportionately high share of revenue, exhibit higher conversion rates, and really step up in the Christmas holiday season and tough economic times. Migrating just 1% of shoppers to returning purchasers could generate as much as $39 million in additional revenue per retailer.

In other words, we’re spending way too much time and money chasing new customers while we ignore a lucrative user base that’s just waiting to be asked to the dance.  40% of revenue for online retailers comes from returning or repeat purchasers, who represent only 8% of all visitors, according to the study.  In other words, you have to attract five to seven shoppers to equal the revenue of one repeat purchaser.

Having run an online retail business I can tell you that the vast majority of our thinking was about attracting and converting new customers.  It wasn’t as if customer service was an afterthought and we did allocate a good deal of our marketing to up-selling our existing customer base.  However, this study opened my eyes to the fact that we probably could have done more with those who’ve already demonstrated a desire for our products and I’ll keep that in mind as I work with clients going forward.  How about you?

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Surprise!

“Surprise” is a loaded word.

Mega Surprise

(Photo credit: Wikipedia)

We delight in surprise parties (well, maybe as long as we’re not the one being surprised) and we dislike surprise hairs in our soup (particularly if they’re not our color).  It’s a powerful concept, although I guess the scientists would tell you that it’s not the surprise itself that’s the issue – it’s the emotions that follow the surprise event.

Surprise is a concept of which we need to take full advantage in business while simultaneously avoiding it like the plague.  When a customer can’t find something in the store, we can take joy in their surprise when a store employee digs around in the back until they find an item thought to be out of stock.  This happened to the Mrs. just this past weekend. She’s now a customer for life and has been telling the story to everyone.  Earned media indeed!

On the other hand, when you advertise a product on sale and are out of stock an hour after the store opens, customers feel as if they’ve been lied to – it’s hard for them to believe you haven’t pulled a classic bait and switch to get them to the store.

Managing people often involves surprises of both sorts.  There are little ones like a key person calling in sick and big ones like them resigning.  On the other hand, sometimes we’re surprised by pieces of business those employees find out of the blue or by their achieving a higher standard in their work.  Yay!

I guess what it all means is that we need to manage expectations constantly both to avoid the bad kinds of surprise and to increase the impact of the good kind.  No, we shouldn’t have people thinking that a hair in their soup is permissible – that shows a need to manage something other than expectations – but we can make sure that when we set standards we adhere to them.  Customers and employees notice.  Our job is to surprise them in the good way.  Given how few organizations are able to get to their own professed standards, it shouldn’t be that difficult a task.  You agree?

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