Thursday, January 22, 2009

The Importance of Being Consistent in Your Small Business Customer Experience

In your small business, your goal needs to be to consistently deliver a remarkable Customer experience. A vital key to success is consistency – to deliver the same experience every time.

The idea and practice of consistency is best understood by looking at both sides of the delivery system: from the company's (your) point of view and from your Customer's experience.

The Company's View of Consistency

To you, the small business owner, consistency means repeatability, doing the same thing the same way time after time. It means eliminating variation and variability in the process and in the outcome. It means standardization. It means, to some degree, automation – even with your "people" processes.

Consistency means uniformity in all dimensions of the Customer experience:
  • Sight: Your appearance and image must be the same every time regardless of the location or who's doing the work. That means a uniform appearance for staff, a designed and managed color and decorating scheme, a professional logo, and consistent use of colors. Keep the look – the image of your business intact both in the store and on line.
  • Sound: How you answer the phone and greet Customers (including your voice mail message) needs to support your intended Customer experience. So do your background music, paging and announcement messages, and even the background noise in your store or office.
  • Smell: Smell is our most powerful and visceral sense. It can evoke strong emotional memories and feelings. Pay attention to how your business environment smells. Imagine, for example, walking into a swimming pool supply store – what smell would you expect? Chlorine, of course, and that "plastic" smell of pool toys and supplies. The smell clearly identifies the environment and helps put you in the emotional mood to purchase items related to your swimming pool experiences. What about walking into a florist? A restaurant? A mortgage broker? A bank? Ambient fragrance and smell is not an accident – it is a manageable, controllable dimension of your designed total Customer experience.
  • Touch: How do things "feel" in your managed Customer experience? Rough? Smooth? Soft and sensuous? It matters! For example, why do car salesmen want you to take a "demonstration" ride? First, to let you experience that "new car smell" but equally importantly, to have you touch and feel the fresh new seats and to have you feel with your finger tips your hands on the steering wheel – the little groves that cup your fingers just so... How the steering wheel feels in your hands as you turn the wheel... Since your finger tips are among the most sensitive parts of your body, that feeling goes directly into the sensory part of your brain where it is logged in as, "Ooh, this feels good!"  (By the way, do you know how pet shops sell puppies? Once the salesperson sees you make eye contact with a specific puppy, they immediately bring it out to you and place it in your hands – in a specific way: with your hand carefully wrapped around its little chest (for support, of course...) so that your fingers are in direct contact with its little beating heart! Once you feel that puppy's warm little heart beating in your fingers, nothing on this earth can stop the flood of emotions which lead directly to the opening of your wallet.)
  • Taste: Not every business can directly take advantage of this sense, but perhaps you can find a way. It's obvious that restaurants, bakeries and donut shops, food courts, etc. use the sense of taste explicitly. So do "samplers" in big-box store, grocery stores and food courts across the country. Why do these insidious, kind-looking "sampler" people want you to put one of their products into your mouth? To quote the old advertisement, "Bet you can't eat just one!" How might you use this powerful sense to enhance your remarkable Customer experience? One small residential contractor bakes cookies several times a day at their reception counter, then puts the hot new cookies out on the Welcome counter for their Customers and prospective Customers to enjoy. The contractor gets a double "bang" because while the cookies are baking, there's a powerful, delightful smell that fills the store (this is the same logic as baking bread while you're holding an "open house" in Real Estate), then the taste and handling of the fresh, warm, just-out-of-the-oven cookies continue and magnify the experience — Customers love them! This simple practice sends a subtle message of comfort and confidence in the environment, which helps relax Customers and breeds trust in the contractor.
Consistency helps you simplify and deliver experiences your preferred Customers want.  As you begin to standardize and map out your delivery system, you'll discover that you have some decisions to make. You cannot effectively or efficiently deliver all things to all people — you have to decide who you want to be your preferred Customer, and who does not fit that profile. You must prioritize.

When you take that step, you help yourself by designing streamlined processes and systems which deliver exactly what your preferred (generally your most profitable) Customer wants and eliminates the rest. This as the added benefit of communicating to low-priority (usually less profitable) Customers that you're not the best fit for them — perhaps they should look for a different provider. This laser-like focus allows you to differentiate your Customer experience and get even better at serving your best target Customers.

Your Customer's View of Consistency

As you see, consistency in the delivery of your Customer experience is a manageable part of your firm's strategy. But there's another side to the story. We have considered so far your firm's point of view. Now let's look at it from your Customer's perspective.

Consistency on your part is viewed by Customers as reliability, predictability, stability and certainty, which build confidence and trust. When you're consistent, Customers are confident in what they will receive from you – every time. You're reliable — I can count on you. Customers know exactly what to expect — you're predictable. Customers know that when they want what you offer, you will deliver — every time. They also know that if they refer a friend or colleague to you for what you offer, you will come through exactly as promised — every time. I believe in you — I trust you.

Consistency helps your Customers feel in control. They choose the experience they want — and they get it — every time. They choose their experience, and they receive it — every time.

Consistency helps your Customers feel good about themselves. When people feel "in control", they feel better about themselves. Consider the example of two college co-eds who were about to graduate. The first one, Sue, announced to her roommate that she had become engaged. The roommate was excited to learn who Sue had decided to marry. She knew that Sue had been dating two boys, Steve and Larry. Which had Sue chosen?

Steve was a very attractive man, tall and dark. He came from a wealthy, connected family. He was about to graduate from Law School with high grades; he had a bright, secure future. Larry was average in appearance — no fashion model, but still handsome. His family was middle class; he had no family wealth or influential contacts. He, too, was about to graduate from Law School with good grades. He had a promising future.

"So who did you choose?" asked the roommate.

"Well," replied Sue, "When I'm with Steve, he's attentive and respectful. We always get the best seats and great service. He always makes me feel good about being with him."

"But I have chosen Larry to be my husband and to spend the rest of my life with."

"You chose Larry?!? asked the roommate, obviously very surprised. "Why?"

"As you know, Steve makes me feel good about him. But when I'm with Larry, he makes me feel good about me."

That's the feeling you want your Customers to have — you want them to feel good about themselves for choosing to do business with you. Remember that your business is not about you! It is totally, absolutely and completely all about your Customers!

Consistency overcomes product and service quality. Even a wonderful product or service can be destroyed by inconsistent, unreliable delivery. In his breakthrough book, The E-Myth Revisited, Author Michael Gerber tells two compelling stories to anchor this profound point.

The first story is about his experience with a new barber. The first time was wonderful. An assistant offered coffee and shampooed his hair. The barber used scissors only, and delivered an excellent haircut. Delighted by this first experience, he returned for his second haircut. But the experience was vastly different: just one cup of coffee, no pre-cut shampoo, and the barber used mostly electronic shears... but still delivered an excellent haircut. Now confused, Mr. Gerber visited the shop for the third time. This time he was offered no coffee, a "pre-trim" before the shampoo, and a mix of electronic shears and scissors. Again he got an excellent haircut — and he never went back. His Customer experience had been unreliable, unpredictable and simply confusing. Confused Customers don't buy, and they don't return. And they certainly don't refer others!

Gerber's second story tells about discovering a hotel which delivered a remarkable Customer experience the first time — then repeated that exceptional service each and every time he came back. The secret is that the hotel had defined processes and systems which ensure consistency. They had taken the time to learn what Customers want, then created systems that deliver each Customer's preferences — every time.

(For additional reading on the design and execution of Customer-centric systems and processes, see Secret Service by John. R. Dijulius III and The New Gold Standard by Joseph Al. Michelli.)

The heart of delivering a remarkable Customer experience is consistency. Delivering the experience the same way, at the same level — every time.

It's important for you because the pursuit of consistency helps you discover and eliminate the costs of variability and the challenges of having to invent how to deliver your product or service over and over again, with uncertain results. Your operation will run more smoothly and at lower cost.

But the real importance is what your consistency does for your Customers. It gives them confidence in you, and perhaps even more important, it gives them a sense of control in today's uncertain world, and makes them feel good about themselves by choosing to do business with you.

If you want to grow your business in today's competitive environment, you will grow your "share of wallet" (the amount of purchases each Customer makes with you), and you will enlarge your Customer base (add new Customers) through referrals and "word of mouth" comments when you deliver a consistently remarkable Customer experience.

Richard Randolph
Florida Customer Service Institute
www.FloridaCSI.com

Sunday, January 11, 2009

Why Focus on Small Businesses Customer Service?

Small Businesses are the backbone of American business. They
  • Represent 99.7 percent of all employer firms.
  • Employ about half of all private-sector employees.
  • Pay more than 45 percent of total U.S. private payroll.
  • Have generated 60 to 80 percent of net new jobs annually over the last decade.
  • Create more than half of non-farm private gross domestic product.
  • Supplied 22.8 percent of the total value of federal prime contracts in FY 2006.
  • Hire 40 percent of high-tech workers such as scientists, engineers and computer workers.
Source: U.S. Small Business Administration
  • Excellent Customer Service is proven to be positively correlated with long-term financial success and growth (See benefits and Business Case below)
  • Small businesses are typically underserved in the category of Customer Service delivery. While there are many Small Business Assistance Providers (SCORE, SBDC, and special-interest resources for Women and Minorities), they all tend to provide "general interest" and "basic / entry-level" assistance for specific categories such as starting a small business, general marketing, accounting and small business loans, government contracting, construction contracting, etc. None emphasizes the business benefits of delivering consistently Remarkable Customer Experiences as a sustainable competitive advantage.
  • Small Businesses usually do not have the resources (money and time) to hire the big-name consultants and authors who provide industry-leading concepts and practices. Too often, small business owners resort to price cutting, cost cutting and other short-term expedients to win business — a model that does not provide long-term sustainability.
  • Conclusion: Small Businesses will benefit from learning and practicing Consistently Remarkable Customer Experiences and notable Customer Service as a key sustainable strategic differentiator.
The Business Case for Customer Service

Dozens of research studies across virtually all industries over decades have produced consistent and conclusive results: Providing remarkable Customer Service is a winner in all cases.
  • Increased Customer Loyalty — Satisfied Customers are significantly more likely to come back to do business with you in the future.
  • Higher close rates — Companies that win high Customer Satisfaction during the sales experience sell to a higher percentage of shoppers.
  • Positive Word of Mouth — Satisfied Customers not only solicit others to do business with you, their opinions carry more weight than your advertising.
  • Price premiums — Consumers will routinely pay a higher price to do business with companies that have a reputation for high quality and consistently great Customer Service.
  • Lower operating costs — High-satisfaction companies have lower warranty expenses and spend less on service recovery in general.
Sources: Gallup; American Customer Satisfaction Index


Note that Customer Service is a tactic used to reach a goal — it is not an end in itself. The real goal, normally, is to grow a Customer base that is loyal, enthusiastic and profitable. To achieve this result, the business delivers Consistently Remarkable Customer Experiences, of which excellent Customer Service is a key component.

//Richard Randolph
Florida Customer Service Institute
www.FloridaCSI.com

Tuesday, January 6, 2009

How to get it right — and how to get it wrong!

As a subscriber to Brighthouse Networks cable television service in Orlando, on December 8, 1008, I tuned to a popular TV show only to find a blank screen. “What’s wrong with my TV / cable box?” I wondered. Switched to a different channel — another blank screen… then another and another. Now I knew I really did have a problem! What to do about it?

Call Brighthouse, of course! See if they can remotely discover my problem and fix it… if not, perhaps send someone over in the next day or two to diagnose and repair. Busy signal on the phone!!!... Try again. Same result. Try again and again. No joy! Now what?

Try their website! Why didn’t I think of that first? (Well, because they have a reputation of “24-hour live service” of course… I prefer to deal with a living, thinking human being!). Got through to the website right away, but no mention of any outage, so I looked at the troubleshooting page. Not really any help there… Guess I’ll just wait it out. If it’s my problem, it will still be there tomorrow. If it’s Brighthouse’s problem, they’ll fix it…

Next day, everything had returned to normal. Guess it was a systemwide problem, not an individual one. Case closed; back to “life as usual.”

Imagine my surprise when I got a special letter from them a few weeks later. They described the problem, the cause of the problem, and offered some surprising compensation: a pro-rata credit for the service interruption, and in addition, free Showtime and Movie Channel service for the entire month of January, 2009. Sure, I had to go on line to register, but upon doing so, the complimentary service was up and running immediately.
Wow!

Though the outage interruption was not handled well at first (in my opinion, as well as lots of other affected subscribers), Brighthouse did an exemplary job of Service Recovery. They explained what had happened, they apologized, then they offered atonement in excess of the injury.
Well done, Brighthouse! I’m now a bigger fan than I was before this incident.

On the other side is my experience with
mycokdrewards.com. On a two-liter bottle of Diet Coke they promote, “Find the code under the cap. Enter code at: mycokerewards.com or text code to “2654.” Hmmm… must be some kind of promotion. Let’s see what it’s about.

Found the code on the inside of the bottle cap. Logged in to mycokerewards.com. Found the “Enter Codes” arrow and was greeted with “Please sign in or register before entering a code.” Oh, well, I’ll go ahead and register…

First they demand your BIRTHDAY (month, day and year!), then “Are you a U.S. resident?” Well, I guess they need to ensure that players are “qualified…” Next page: Email address (twice!), password (twice!!), and a “security key.” Oops… the Security Key is case sensitive… have to re-enter… Starting to get pretty intrusive! But then the fun really starts: First name, Last name, Gender, Address (discovered that it won’t take my PO Box address !!!???), then three check-boxes for “I understand and agree to: the Privacy Policy, the Rules, and the Terms of Use”…

Hold it! Too much information for me to disclose — especially when I don’t even know what I’ll get (if anything) by giving out all this personal and confidential information.

Hit the “close window” box and abandon this fruitless effort. This, in my opinion, is NOT “a consistently Remarkable Customer Experience”!

The only good outcome of this frustrating experience is that I can now ignore and disregard the “my Coke Rewards” promotions! One more interruption off my list!

Kudos to Brighthouse; five lumps of coal to My Coke Rewards!

//Richard Randolph
Florida Customer Service Institute
www.FloridaCSI.com

Sunday, January 4, 2009

Secrets to Small Business Success in a down economy

How can a Small Business succeed in today's challenging economy? How can we generate more revenue without adding heavy marketing costs?

Let's start with the basics. There are only two ways to improve profit: Lower costs or increase income.

Although it's a popular practice in an economic downswing to focus on "lower costs" (downsize, cut training, cut advertising, etc.), let's remember two facts. 

First: You can only cut costs so far — when you're down to zero, you can't go any lower! 

Second: Except for those operations who are bloated and wasteful (do you know any small businesses who fall into this category???), cutting key expenses is like killing the Goose that Lays the Golden Egg [see story on Wikipedia] — you could be cutting off tomorrow's source of revenue for today's short-term benefit.

So the effective and responsible long-term action is to concentrate on ways to increase revenue in the short run without adding costs to do so. Sounds great — but how do you do that?

The good news is that there are only a few ways to increase revenue: 
  1. Increase prices
  2. Sell more volume
> Sell more to existing Customers
> Sell to more (new) Customers

We'll have to discuss "Increase prices" later — it is actually a legitimate and viable option, but not as a 
first choice.

Let's turn our attention to how to sell more to existing Customers. We have to answer two basic questions:
  1. Why do they buy?
  2. Why do they buy from you?
At its most basic, Customers buy to satisfy a need or want. As I use the terms, "need" is a physical or mandated requirement (pay taxes, comply with regulations, etc.). "Want" is more emotional in nature, having to do with lifestyle, personal preferences and desires. In other words, I "need" transportation; I "want" a new Lexus... In this context, most consumer purchasing, as well as a great deal of business-to-business buying falls into the "want" category.

This is important because "wants" include a great deal of emotion in the purchase decision. It's this emotional component we want to consider.

We can view the emotional side of a purchase to include two core elements: Feelings about the product or service itself, and feelings about how the transaction is handled (in other words, feelings about how we are treated while we are in the purchase process). And that's our key to success!

Small businesses have three basic pieces to work with to establish a competitive advantage:
  1. The product / service they offer
  2. The delivery system by which the product / service is provided to the Customer
  3. The Customer Experience in which the transaction occurs
Let's assume that, in today's competitive world, products alone rarely drive purchases, especially at the small business level. While it is absolutely critical that you offer superior / excellent products and services, as a small business, your competitors will also offer good (or even identical) products and services. And even a temporary advantage here is easy to duplicate by others. So a "product /service excellence" strategy cannot provide long-term advantage. (We'll save the "low-price leadership" discussion for another posting...)

The delivery system includes the process in which products and services are delivered to the Customer as well as the environment in which the transaction takes place. This can be another source of temporary advantage (i.e., Rainforest Cafe). Of course, you want to offer a distinctive business environment and fast, accurate order processing and delivery to your Customer. But your delivery system is also subject to copying or "fad" behavior, and is not a source of long-term advantage.

So what's left? The emotional dimension of Customer desires — the consistent Remarkable Customer Experience! This is where the Customer just feels good about doing business with you, and wants to do it over and over — and also wants to tell others about how good you are! They become your Advocate — in reality, an extension of your sales force.

Notice that delivering exceptional Customer Service is not an end in itself — it is, instead, a means to the end: a consistently Remarkable Customer Experience. It is one of the tools you use to produce a consistently happy (an emotional response!) Customer / Advocate.

So in today's challenging economy, how do we stimulate existing Customers to buy more? We help them feel good about their purchases and about doing business with us — and at a deeper level, we help them feel good about themselves because they do business with us.

Notice that this approach also drives our second objective: get more Customers to do business with us. Our Advocates and other positive word of mouth will drive new Customers to us in a positive upward spiral of success.

Also notice that it takes little to no expense to deliver consistent Remarkable Customer Service and a Remarkable Customer Experience. It does take (1) a decision on your part to do so, then (2) the hard work to study and communicate with your Customers in depth to discover their real wants and desires; what it is they're really looking for when they do business with you. (Remember that when people buy drills what they really want is "holes.")

//Richard Randolph
Florida Customer Service Institute
www.FloridaCSI.com