A New Insight On CX

Sarah-Nicole LeFlore writes on “The Key to Great CX? Balancing Delight and Ease” here:

“Delight has become a customer experience buzzword. A lot of people think that their customers will stick around if they dazzle them with perks and discounts. By contrast, some experts believe that you should forget about delighting your customers and that the best experience is the easiest one. Neither camp is wrong. We say “Do both!” The best customer experience is both easy and delightful…”

All too familiar, no surprises, no new insights here. But the real meat is in the ‘Comments’ section – three of them of significance are summed up here:

Michael Lowenstein talks about – no kidding, he’s serious, giving examples – consciouslyintroducing ‘favorable friction’ in customer experience of course with a deliberate strategy to create the value in the experience rather – exclusivity for example – than friction caused by incompetence or worse, apathy. Read the article here.

Ed Powers  avers – it’s included here more for completeness than any newness – it’s a bit more complicated than what it seems. According to the neuroscience, the brain makes goal-directed decisions among alternatives using a value computation weighing six elements: Context, Payoff’s, Costs, Delays, Probabilities and Preferences. The brain views effort as a cost which offsets the payoff, so reducing cost increases value. “Delight” increases preference, which also increases value. But depending on context, how the brain perceives the nature, speed or likelihood of the payoffs between options also affects value perception and their ultimate decision.

The most insightful comes from Chip R. Bell arguing: ‘Delight has been defined as value-added or exceeding the customer’s expectations – that is, taking what the customer expects and adding more. That is a linear approach that risks elevating the customer’s expectations right along with the add. Upgrade me to a better room because I am a loyal guest of your hotel and what am I likely to expect my next visit? And, what happens if you need to sell that upgraded room rather than use it as a perk.’

He introduces a new concept: ‘I recommend value-unique, not value-added. As customers, we are far more attracted by different than we are by more; ingenuity more than generosity. And, there are unlimited ways to be unique and clearly a limit on how far you can push “more” before running out room or going bankrupt. My wife and I have the same brand of car and take both to the same dealership for service maintenance. The service tech always puts a logoed bottle of cold water in the cupholder of the car after an oil change or tire rotation. That is value-added and is very nice. But, they also always make certain my favorite flavored coffee K-cup is at the Keurig coffee machine the day I wait in the waiting area for service (Hazelnut is in my customer profile). And, there is sometimes a long-stemmed flower on the dash to take home to my wife when I drive away…That is a story I am eager to tell all who will listen.’

He further draws support from another experience of his: ‘The line to get in Ellen’s Stardust Diner on Broadway in NYC was three blocks long; the wait was two hours and in the rain. The food was okay, the seats were uncomfortable, the diner was packed. But, the magic of watching waiters perform Broadway songs was magical and worth the un-ease we endured.’

My two – actually three – bits:

a. I like the concept of value-unique. But over time, even the K-cup coffee and the long-stemmed flower would be reduced to value-added. It only means it requires a constant refresh.

b. Value-unique does not stay unique for long if it is material based as observed in a. Can be replicated. However, hard to copy if the uniqueness is in the service delivery. Example: Ellen’s Stardust Diner.

c. As Ed says different strokes for different people. Me thinks it’s useful to segment the market into Basic/Utility/Essentials buying, Comfort/Brag-orthy/Indulgence (giving oneself a treat) buying and Luxury buying.  The value-unique (experience-unique) concept seems to go well with Indulgence buying – the burgeonng middle where many companies play and hence desrving closer look. So also ‘favorable friction’ mooted by Michael. Needless to add the concept is carried far beyond reason in Luxury buying. While it may be all costs with Basic buying. At times the driving forces do get mixed up across segments.

Rounding off with one more value-unique experience:

The “Le Petit Chef (Little Chef)” restaurant in France, came up with an original way to entertain guests while waiting for their order by using an overhead 3D projector on the ceiling.  The animation is on the table and your plate. There is a small chef who appears on your plate, and that’s only the beginning.

Watch one of the several clips available here:

Video is available here.

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Source: The case of Little Chef was brought to notice by C V Anant Padmanabhan

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So What Are We Doing For Them?

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A Counter-Intuitive Perspective On Customer Retention

A lightly edited extract from an article by Geoffrey Keating (dated April 19th 2020).

**

These are uncertain times for any business. 

Maybe you’ve seen your top of the funnel demand decreasing. Or your sales cycles are getting longer. While each company feels the impact differently, one thing is certain – businesses are being forced to adapt to change at a pace we haven’t seen before.

One strategy we’ve found particularly useful in trying times is doubling down on customer retention.

This isn’t a new insight. In the last five years alone, the cost of customer acquisition has increased by over 50%. Businesses have gradually started to switch their focus from “How do we acquire more customers?” to “How do we retain the ones we already have?” 

Getting a handle on Customer Retention:

When getting started with retention, the obvious first step might be to look at exit surveys or recently churned customers. It might sound counter-intuitive, but this is actually the wrong place to start. 

Instead, look at your best customers. 

Why did these customers stay with your product? What actions did they take in your product? Why did they expand their usage of your product? If you can figure out what and why, you can start to reverse-engineer that path for other users.

You’ll often hear these referred to as “activation metrics” or “aha moments”, the high value engagement actions and events. An analysis of these events will help you understand the behaviors that, when performed, best correlate with users continuing to use your product for an extended period of time.

The canonical example is best illustrated by Chamath Palihapitiya and the early Facebook growth team. They understood what actions separate their best customers from those they lost – namely those that added 7 friends in 10 days.

And once you understand these behaviors, you can optimize your product or communication to help even more users take these actions, see value from your product and ultimately become a long-term, happy customer.

Now that you’ve got a handle on some of the data behind your retention, it’s time to come up with creative ideas for predicting churn and improving retention.

One good example: For early stage retention, encourage new signups to take high-value product actions without delay.

Most products see a precipitous drop in engagement in the first few days. Those that don’t – Facebook, Twitter, Pinterest – do so by making sure users complete valuable product actions early on…

The other retention strategies, elaborated in the article, include looking for warning signals in terms of ongoing engagement intensity rather than mere clicking activity, communicating ROI whenever possible, avoiding single point failure by going beyond the champion in the company, optimizing the cancellation flow (seen to reduce the churn!)…

Of course the traditional wisdom of gleaning feedback from customers who left cannot be ignored. Churn is a natural byproduct of any business. Customers come and go, as does the demand for your product. Though it may be painful, make sure you have a well-considered exit ramp. Acknowledge the reasons they’re churning, address them, and make sure they leave endeared towards your company. You can use this data to either a) reclaim churned users or b) identify cohorts who are especially prone to churn, so you can get ahead of it. Best case scenario, you’ll open the lines of communication for a winback in the months ahead. But even if that’s off the table, you’ll get valuable insights you can use to help improve your product.

A quick win is tackling involuntary churn. Accidental cancellations or missed payments could account for a significant percentage of churn. The answer here is pretty simple: track the data and then create an automated email to remind users whose payments are overdue, or whose credit card is expiring…

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The article and more may be read here.

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It’s Elementary, My Dear Watson!

An old classic from Hubspot:

The entire North American sales force of Frisky Dog Food was gathered together for their national sales convention at Miami Beach. In the great auditorium the marketing director was giving a performance that any revivalist would have been proud of. Using the old pattern of call and response, he was really working up the spirits of his sales team.

“Who’s got the greatest dog food in North America?” the marketing director asked.

“We have!” the audience replied.

“And who’s got the greatest advertising campaigns?”

“We have!”

“Who’s got the most attractive packages?”

“We have!”

“Who’s got the biggest distribution?”

“WE HAVE!”

“Okay. So why aren’t we selling more of the product?”

One bold voice from the crowd replied:

“Because the darned dogs don’t like it.”

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The clip is available here.

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Selling A Double-Bed To The Pope

Pardon the frivolty.

The challenge was no less in this sales scenario:

The class-room lectures were over and now it was time for a project assignment.

The professor called for a bundle of combs to be brought in.

He called his students and gave them each a bunch of combs. They had to sell these combs to the monks belonging to a near-by monastery. They would take turns one after another, each given an hour to do selling.

 The first went in only to return crest-fallen after an hour.

‘What happened?’

‘Sir, the monks out there – every one of them – have their heads shaven to a shine. No surprise they had no use for a comb. Could not interest even one.’

The fellow going in second had different ideas.

He went up to the Administration and talked them into buying combs for the visitor’s rest-rooms. After all a visitor would almost always need to freshen up himself after the long travel from the city.

So he returned before his time managing to sell three combs, one each for a rest-room.

This fired up the third chap’s imagination.

Going in next, he too went up to the Administration. Made inquiries and found the monastery took in students for its residential training programs, providing them dormitory accommodation. From there it was a short piece of work to get them to provide each student a comb as part of minimal amenities.

He too returned before time grinning ear to ear – he had sold fifty combs, the intake capacity for next six months. After all a comb used by a student would not be used by another. Thus he had identified and addressed a recurring need.

What more could be done?

Looked a little hard on the last fellow going in.

Like his colleagues, he too made a bee-line to Administration block.

No clue what was going on…until it was close to the hour. He came out looking very exhausted. And then it was noticed he was walking out unencumbered by the bag of combs! What had happened? He gave or threw away his goods in disgust? The Prof was not going to like it…

After the first few steps, he broke into a sprint…all the way to the base, hands pumping the air overhead.

‘The entire lot of two hundred combs sold and they want more!!!’ he cried excitedly.

Steadying his breath, finally he broke the story: ‘It was not easy…had to meet monks at three levels. Finally they agreed to giving away combs to all visitors who came to the monastery. That would be about a hundred every month!’

But why should they be giving combs to the visitors?

‘You see, I believe, there is a good reason to: Coming here and observing the monks with shaven heads live a life of austerity, dedication, reclusion and rectitude, one would love to carry a ‘piece’ of this monastery with them back to their world for continued inspiration. A comb with select sayings of Buddha etched on it could be just that ‘piece’ – small, inexpensive for a give-away, in frequent use and enduring. A constant reminder to its user of his continued attachment to and his responsibilities in the material world. Also, imagine this: when he sets the comb on his head, it would be like receiving blessings from a Hand, also etched on the comb.’

‘Of course it took some talking to make them see the point.’

So it was spiritual appeal riding on utility fitted the given scenario too well, winning the day for him.

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Source: Based on a story from moralstories, image from indiamart.com and sierrapinesumc.org

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When Good Experience Is Bad Business…

It’s not uncommon to find ‘experts’ go so wrong in their trend predictions, but to freely admit it in ‘print’ and re-calibrate oneself is not.

“Ask any retailing expert, guru or know-it-all worth their weight in consulting fees and they will all tell you the same thing: the future of physical stores rests with “experiential” formats that present shoppers with an immersive atmosphere that can’t be replicated online. But what happens when they are wrong? Over the past year or so, two of the most high-profile new retail startups in the country – Pirch in the kitchen and bath business and TreeHouse which was billed as the green home improvement store — have either shut their doors completely or drastically scaled back their operations. Each was considered by all manner of retail observers (including yours truly) as the poster child for the future of retailing, yet each failed to achieve success. And somewhere in the telling of these two tales lie some lessons for other retailers trying to sort out how to keep all those physical doors open.“

The retail guru Warren Shoulbergwho ‘loved Pirch and TreeHouse…and said so to anybody who asked‘ is reassessing the retail scene of the ‘experiential’ kind in his recent blog post. What is best about his blog: his posts are short, readable in minutes affording an easy peek into an expert’s mind. And, I thought, they have applicability far beyond retail.

Read his crisp insight here.

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Retail: Negative Perceptions – So Easy To Generate

“Good service design is important for the overall user experience. Yet, it is even more important at the end of an experience (or exposure to a brand) due to the Peak-End Rule and Recency Effect. Placing the business needs before the user’s needs, breaking the user’s flow and not addressing a user’s need at the point of their need are primary culprits in designing a poor experience.”

Chris Kiess writes in his article “Service Design — How to Fail at the Checkout and Ruin Your User’s End Experience” appearing here.

While he talks about “8 ways I see retail merchants like Target, Walmart or Meijer fail in service design as it relates to the end of the customer experience and the final impression they make with consumers,” there’s an interesting snippet about a negative perception and how it could be turned around.

First about the perception:

“The biggest faux pas of superstores is having too many checkout registers and not enough cashiers. Most people would probably not be concerned during the holidays (or any other time) if they sauntered over to the checkout and there were ten cashiers at all ten registers with lines behind each. This would give the customer the illusion the store is busy and they are doing everything they can to help customers move through the checkout process. But, what generally happens instead is you walk up to the checkout area after finding everything you need and there are thirty registers with only five in service. This, I cannot understand. On the surface, it gives the impression the store could do more. After all, there are twenty-five more registers and surely they could open one or two more of them. It boggles the mind that a store would feel the need to install thirty checkout lanes and never use them all at one time.”

He suggests:

“This is largely about human perception. The simple fix is to cut the number of registers installed and use a greater percentage of them during busy times. This would give the impression (and shape perceptions) a greater effort is being employed to move people through the lines.”

A thought:

The suggestion could still leave at times a few unattended counters. So why not have counters that could be rolled in from back of the store on need basis and wheeled away when done? Just as many as needed, leaving no visibly unattended counters at any time.

Also could the stores do like the airlines doing in-line check-in with staff going around with their special devices? Of course, it needs some adaption to allow for handling the purchases in the cart.

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Image from here.

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The Magic A Word Added Does To A Message!

Went to a well-known shop in Chennai this morning to buy sweets for Mumbai friends.

On the glass-door at the entrance was this message greeting customers:

Am given to twisting and turning in my mind messages leaping at me. Nice amusing game while it lasts. So it was this time too. Went up to the manager and suggested a word, just a word, may be added to the message to make it…

He thought for a moment and broke into a smile when it hit him. He said he’ll get it done which I doubt very much.

Anyway, here’s the suggestion made:

While welcoming all customers, new and old, light is now specially shone on the repeat customer – the most sought-after in any commerce. Hinting at habit forming?

Adds an engaging dash of intrigue: Why do they come again? Unique fare, good prices, courteous staff, nice ambiance…some tribal knowledge to flaunt when in company?

To think a mere adverb, usually trite and superfluous, could work a magic on the message!

The nice little game left me feeling good for a short while.

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He’s A Cat At (Emotionally) Connecting!

Can teach Marketing/Advertising a trick or two!

From Jineesh Mathew:

 

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Cognitive Bias: Watch Here How It Plays Out

This is an edited extract from an interesting post on a topic much written about. from James Altucher, one of the few offering down-to-earth counsel that I like reading.

Cognitive biases are used in almost every sales campaign, business, marketing campaign, movie, news, relationship, negotiations, everything. Almost all of your interactions are dominated by biases and understanding them is helpful in standing up and seeing things for what they really are.

James takes up a rap song of all things and analyzes it for ideas how to be get better at persuasion!!

“

The song “Lose Yourself” is from the movie 8 Mile. Although I recommend it, you don’t have to see it to understand what I am about to write. I’ll give you everything you need to know.

Eminem is a genius at sales and competition and he shows it in one scene in the movie. A scene I will break down for you line by line so you will know everything there is to know about sales, cognitive bias, and defeating your competition.

First, here’s all you need to know about the movie:

Eminem is a poor, no-collar, white-trash guy living in a trailer park. He’s beaten on, works crappy jobs, gets betrayed, etc. But he lives to rap and break out somehow.

In the first scene he is having a “battle” against another rapper and he chokes. He gives up without saying a word. He’s known throughout the movie as someone who chokes under pressure and he seems doomed for failure.

Until he chooses himself.

The scene I will show you and then break down is the final battle in the movie. He’s the only white guy and the entire audience is black. He’s up against the reigning champion that the audience loves.

He wins the battle and I will show you how. With his techniques you can go up against any competition.

After he wins it, he can go on to do anything he wants. To win any battles. To even run the battles each week. But he walks off because he’s going to do his own thing. He chooses himself. The movie is autobiographical. 300 million records later he is the most successful rapper in history.

”

Here is the scene (8.55 mins) with explanatory subtitles:

 

In case of a problem playing it here, it may also be viewed on YouTube.

James also generously provides for supplementary reading here.

Also helps to know if you wish to do all you can in a competitive situation. For instance, you could show your competition as not in the prestigious ‘313’ group (quite the opposite of its negative connotation in the clip!)…

All in all a great effort, so effective in laying it bare for us in the shortest possible way. Thanks, James.

Of course, there are tomes on the subject to read if you so wish.

 

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