The Super Bowl and the people who watch it
It was a record. Over 111 million people saw the Giants beat the Patriots. Madonna’s halftime show was judged one of the better in recent years. The commercials got mixed reviews, as usual. But, most interesting for us was the behavior of the millions who watched it. Jimmy Kimmel had a funny bit the night after the game. He showed videos of viewers when the plug was pulled and their TVs went dark. So focused were viewers on the moment that this sudden interruption produced behavior that was as strange and frightening as it was humorous. We’re left to wonder why such behavior is so unique to Super Bowl. It’s no surprise that as many people watch the Super Bowl as much for the commercials as for the game. What did surprise us was the InMobi Mobile Consumption Survey which reported nearly 40% of viewers used their mobile devices during the game to either discuss commercials, get additional information about an advertised product or watch commercials a second time. MotelyFool.com reported some interesting facts: An estimated $10 billion was wagered on the Super Bowl 1.25 billion chicken wings were consumed over the weekend An estimated 49.3 million cases of beer were sold Pizza Hut, Papa John's, and Domino's combined to sell roughly 4 million pizzas 8 million pounds of guacamole was consumed on Super Sunday 1.5 million TV sets were sold during the week of the Super Bowl Sales of antacids increased 20% Old Milwaukee Beer rolled out a new TV commercial to an estimated 15,180 homes in one market, North Platte, Nebraska. Crazy you say. Nope. Even given the miniscule TV audience, it was reported the Old Milwaukee commercial managed to outperform some of the nationally broadcast Super Bowl commercials in an increasingly important metric of Super Bowl advertising. Bragging rights chatter on social-media networks. The Huffington Post observed that research ...
Service Design: A hot topic with a long history
In the past few years, Service Design has hit the marketing lexicon as the latest and greatest path to marketing success. A close look, though, would suggest that Service Design is an activity that many leading edge marketers have been practicing for years. The goal of a Service Design program is to provide customers a quality of service that meets their needs. Wikipedia states, “The backbone of the Service Design process is to understand the behavior of the customers, their needs and motivations.” Specifically, Edvarsson and Olsen say Service Design is a detailed description of customer needs to be satisfied and how they are to be satisfied. They set out four steps in the process: Service Operation; the way in which a service is delivered Service Experience; the customer direct experiences of the service Service Outcome; the benefits and results of the service to the customer Value of the service; the benefits the customer perceives as inherent in the service weighed against the cost of the service Now it’s possible for this explanation to get very complex. We could talk about the “service design matrix.” Or the “multitude of theoretical systems used to accurately design systems in order for them to remain competitive and to continue to attract customers.” Or we could refer to a particular quote we loved from Frontier Services Design that said, “Service Design can be hard to explain because it should be so damned simple and obvious, right?” So what do we conclude? We certainly agree a deep understanding customer behavior and motivation is critical to uncovering services that would set any marketer apart. And the way in which the service is delivered must be on target so that the customer perceives added value. And, of course, the ultimate tale of the tape is that the service should be experienced in a way ...
Call it Research? Call it Insights? No. Call it Strategies.
We’ve run across a multitude of research professionals who opine about the future of marketing research. The prevailing feeling it that the industry must change or it will perish. No longer, they say, are marketers interested in thick research reports that in a quickly evolving marketplace are often out of date by the time they are presented. More importantly, they no longer want a research function that is incapable of taking a seat at the table and sharing responsibly for the decisions that are made. So focused is the research industry on changing its image that it can’t even agree what to call itself. To regard a research company as simply a “research company” now suggests doing business with an anachronism. It would seem much safer to contract with an “insights company.” Isn’t that what everyone now wants? Insights! Wrong again. What companies should be seeking are “breakthrough strategies.” The one’s that come as a result of research, insights, deep understanding, vision, perceptiveness, creativity and the courage to take a stand. In today’s hyper-competitive marketplace, there should be little tolerance for research, or even insights, that are devoid of strategic implications. Stake you claim with companies that see research and insights as a means, not an end. Indeed, the traditional research function is fading fast. And the insights function is just a way of rebranding the same old, same old. A new breed is evolving that sees its role as digging deep into consumer behavior and motivation in order to create strategies that make a difference. Let’s call them Strategists. Let’s put them at the table and see what making a difference really means.
Are brick and mortar stores a dying breed?
Circuit City, Blockbuster, Border’s, Filene’s and the Sharper Image are only a few of the better known retailers that have closed their doors in recent years. The full list is ominous. Check out this Wikipedia listing if you’re up for a big shock. (http://en.wikipedia.org/wiki/List_of_defunct_department_stores_of_the_United_States) Sure, you can blame it on the natural evolution of things. Or stronger competition. Or the growth of internet shopping. Or constant price battles that force weaker players to fold up their tents. But, really, it’s more complex than that. Do you really care whether your office supplies come from Office Depot, OfficeMax or Staples? Does it matter if your light bulbs come from Home Depot, Lowe’s or Ace Hardware? What difference does it make if you buy your next TV from Best Buy or HHGregg? What’s relevant is that many of today’s retailers are turning a blind eye to the retail disasters or yesterday. They have forgotten how to differentiate themselves. They have become commodities. No, brick and mortar stores aren’t going to die as a relevant shopping channel. But as smartphones become a ubiquitous shopping tool and the internet offers a myriad of place to find it cheaper, customer loyalty will become more and more difficult to achieve. The question that ever retailer should be asking themselves is where to take a stand. Is offering the greatest customer service, like Nordstrom, an answer? Is it making the shopping experience a form of entertainment, like Apple stores, a way to go? Is providing the highest quality products, like Whole Foods, an option? Maybe it’s instigating the perception that being a generic brand is to offer unbeatable value, as Costco has done with its Kirkland brand. Whatever it might be, remaining a relevant retailer means digging deep to find a unique point of difference.
Hyatt’s Random Walk Down Service Street
Last month, Hyatt Hotels’ C.E.O., Mark Holamazian, announced that Hyatt Hotel employees will be performing “random acts of generosity” for some customers, such as comping a bar tab or waiving charges for a family breakfast. Bloggers have noted that conducting a publicity campaign around gestures hardly seems random, and runs the risk of angering those who don’t receive the largesse. Rob Walker’s Consumed column in this week’s New York Times Sunday Magazine points out that the Hyatt campaign is an effort to leave the customer grateful. Walker cites a coming paper in the Journal of Marketing which argues that a customer who is made to feel grateful is likely to become “enduringly loyal.” Humans enjoy reciprocating out of gratitude, and we feel guilty when we don’t, which is a phenomenon that businesses can exploit. But, as Walker writes, in order to inspire gratitude, favors must be performed “as a function of free will,” not merely in service of company rules. Loyalty programs sponsored by hotels and airlines do not automatically inspire gratitude; instead, frequent customers feel entitled to the free flights and hotel nights, andstrategize to gain the most generous rewards for the points they’ve earned. It’s not wrong for Hyatt to be ramping up customer service, especially now. Service has always driven loyalty, especially when customers are giving more thought to how they spend each dollar. One recent studyfound that nearly half of all customers feel service has declined since the recession started, and more than that said they’ve recently cut ties with a company due to a service lapse. It’s no coincidence that Nordstrom, with its legendary customer service, has recently trouncedcompetitors such as Macy’s and Saks in terms of sales and stock performance. But we question whether Hyatt’s scattershot, random approach is the best way to go. ...
Even Apple has some room to improve
Walter Issacson’s biography of Steve Jobs reads like a Grissom novel. It’s an intriguing page turner and the perfect chronicle to the most interesting and successful career of our lifetime. Jobs was a perfectionist. No detail was too small for his intimidating scrutiny. He pushed, ranted and swore unmercifully at employees and suppliers until they satisfied what he was after. He was sometimes wrong, though rarely, but he never ever compromised. What he got in return were iconic products and, at the time of his death, the most valuable company on earth. We were most intrigued by the creation of the Apple retail store. How the idea emerged and how it evolved to create a totally new retail experience for customers and a profoundly profitable division for the company. This in spite of a number of board members who thought Jobs as crazy for wanting to open retail stores and for some “experts” who considered Apple stores to be a wildly radical idea that was doomed to failure. Today, we were intrigued by news that Apple has appointed a new head of their retail operations. The piece we saw said, “Apple’s minimalist retail stores, like its gadgets, get generally rave reviews. So while it may be tempting for the company’s newly tapped head of retail not to mess with the formula, judging from complaints posted on consumer message boards, there may still be room for improvement.” It went on to say that most common complaints on online message boards like AppleInsider.com, MacForums.com and Yelp.com seem to be directed toward the store’s staff: a blue-shirted army some customers contend can come across as smug and often arrogant, to the point of alienating customers who aren’t particular tech savvy.” Blogger Joe Manna writes, “The ...
Are you behind the smartphone age curve?
A recent Nielsen study shows that the vast majority of smart phone users are under 45 with ages 25-34 making up the most mobile age group with 62 percent owning smartphones, a 21 percent increase since last year. But don’t be deceived, Jamie Carracher of Edelman, Inc, write, “In 2011, some of the nearly 80 million Baby Boomers in the United States have turned 65 and are now “officially” senior citizens. Need context? Vint Cerf, Google’s chief Internet evangelist and one of the fathers of the Internet, turns 68 in June. The web, often viewed as a realm for just the young, is getting older. Carracher goes on to say, “It’s no secret that senior citizens have typically been slow to use new technologies, including social media. But recent trends show older people are among the fastest-growing demographics online. While overall usage of mobile devices is still relatively small among older people, it’s important to note that usage is growing, and in surprising ways. Older people are gaming on their phones. Around 13% of 55- to 64-year-olds and 5% of people 65 and older play games using a smartphone or standard cellphone. “If it’s good technology, seniors embrace it the same as everyone else,” he said. “The key here is if it is truly ‘good’ and they see a real use for it, whether for entertainment or business or lifestyle. They are smart shoppers who aren’t so much interested in useless ‘bells and whistles’ many products contain.” We’d warn that as a retailer today you are behind the curve if you aren’t study your customer’s behavior in order to provide the kind of engaging smartphone apps that help them shop your stores. But to be a leading edge retailer means that you are also developing engaging apps with older customers in mind as ...
Do customers have an emotional connection to the stores they shop?
Alex Ridder of IModerate.com raises the question…”Do consumers have an emotional connection to any retailers. If so, how did those retailers establish that connection? She writes: Retailers should take note of a study recently released by Motista. The findings reveal that only 18 percent of consumers have an emotional connection to their retailers. Moreover, only 24 percent of consumers said they would make their next relevant purchase with the retailers they frequent today. The findings also shed light on the different ways in which men and women interact and connect with retailers. But what stood out to me most was this tidbit… “Consumers who feel emotional connections to their retailers are four times more likely to shop those retailers first when relevant needs arise, as compared to consumers who are simply familiar and satisfied with their retailers.” There is no question that when it comes to understanding emotions, many of today’s marketing researchers are largely out of their element. Most have educations in general business, marketing, marketing research, or statistics. We’ve even run into a few with liberal arts, history or literature backgrounds. Fewer have been trained in social sciences like psychology, sociology and anthropology--the very disciplines that focus on emotions, feelings and cultural influences in seeking to understand and explain why we behave as we do. While some companies are pushing new approaches for studying emotions, let the buyer beware. Most research as practiced today is outstanding at explaining the rational. But when it comes to emotions, we're not even close to having a common language to explain emotions much less the ability to interpret correctly an emotional expression. When two people say they feel shopping a particular retailer gives them a feeling of "happiness”, can we conclude "happiness" means the same to both people? We’d say not today! In his course, ...
Understanding customer path to purchase–promise or hype?
Google “Path to Purchase” and you get hundreds of thousands of hits. Yet it’s not a term that is particularly familiar to many Marketers, Operations Professionals, or Store Managers nor have they attempted to harness its power. Simply stated, the Path to Purchase acknowledges the complexity inherent in understanding consumer behavior. It recognizes the many forces that play a role in motivating consumers to purchase your products rather than those of your competitors. For example, consider the role of media in the consumer’s Path to Purchase. In just the last 10 years, we have moved from a mass media environment to one of segmented multi-media. It was not long ago that: TV, radio and print advertising were the prime media for motivating customers Companies created websites with the sole purpose of showcasing their products and discussing policies rather than leveraging a powerful selling tool at hand Companies consciously, and capably evolved their catalogs and their website did what it could to catch on as a force to sell products Twitter and Facebook had little influence on the products consumers purchased There was no GroupOn. No interactive media. No apps. Companies were slow to acknowledge how critical it is for their brand to speak with one voice across all media influences: To have a coordinated message, look and feel whenever and wherever the brand is saying “buy me” to customers. It’s clear that the power of traditional selling channels is being diluted. Physical and digital channels are becoming integrated and customers are being asked to consider more messages from more sources than ever before. New touch points, such as smart phones, social reviews, and platform aggregators are being increasingly used in combination with websites, catalogs, point of sale material and, of course, traditional advertising. Additionally, thanks to the rise of social networks, word of mouth is becoming the new currency. Indeed, it ...
Apple store lavishes service on disgruntled iPhone user
The customer enters a teeming Apple store one week after the release of the new iPhone with a head of steam built up over a seven-day period of unalloyed product frustration. “I want my money back,” the customer says to the first associate by the door. “This phone is a complete failure on every level. And don’t even try to tell me I’m holding it wrong.” The associate in harm’s way, a maybe-at-most-23-year-old woman, changes her bright smile into a look of sorrowful concern. “That’s terrible you’ve been having trouble. I’m so sorry. Let me help you right here if you want to return it and get your money back,” she says. “One thing, though--you don’t have to, but would you mind telling me what’s been going on with it? I’d really like to know.” This initial rejoinder is a pitch-perfect response. She apologizes before doing or saying anything else. She is immediately acknowledging there is not going to be an argument or hoops for the customer to jump through to get satisfaction—in this case wanting his money back. She then does a quick verbal pirouette to express genuine interest in what the problems have been. After the customer finishes his description of dropped calls, email issues, lost data, and more, the associate again apologizes, sympathizing with the customer’s plight. “I know that must be really tough when you’re on a business call or sitting waiting for an important email,” she offers. “If you have a minute, there’s something I can do that might help quite a bit by just resetting the connection—you won’t lose any data—want me to give it ...
Cruel, unusual and effective?
In our assessments within retail stores, we often see the actions of shoplifters through our video cameras. Though shoplifting is not typically on the list of behaviors we look to capture and code (we only half-kiddingly say our cameras are placed for the business purposes of good - like pinpointing barriers to the sale and identifying new opportunities to increase performance and the customer experience), it’s an activity that is impossible to ignore. These shrinkage incidents have become so prevalent, in fact, that we’ve developed an expertise in the observable assessment of how dishonest people behave when they’re in a retail environment—often in interesting ways that suggest an earnest attempt to look honest. This is, of course, its own tell. The old rule of thumb that potential shoplifters get spooked when approached by an associate (unwilling to look them in the eye, for example) stays true — but not always. We’ve seen a new breed of brazen behavior that almost reads as sociopathic: chatty, superficially charming customers who show no fear in front of associates, almost “selling” themselves as a way to throw off the scent or any hint of wrongdoing, like they’re just that jovial long-lost friend coming across the lease line. But if certain stores have their way, even these wily coyotes might take up another hobby. The New York Times reported yesterday that a number of stores in the region which cater to Chinese immigrants are now adopting shoplifting procedures borrowed from mainland China retailers. Essentially, if you’re caught, the stores seize your identity cards, and you pay the ...
Science of Churrascaria
If you’ve visited Chicago recently, you may have bumped into the burgeoning churrascaria movement—where at last count four of these Brazilian-style steakhouses manage to thrive within a five-block radius. They’ve splashed themselves over cities and suburbs alike, beckoning diners with an all-you-can-eat concept far removed from the buffet chains and those sometimes frightening strip mall Chinese joints. If you haven’t been, the different churrascarias are remarkably similar. $50 gets you dinner, which includes an over-the-top salad bar (think prosciutto, hearts of palm, smoked salmon, and artichoke hearts—not cottage cheese with pineapple chunks) and at least a dozen varieties of steak, chicken, lamb and pork—all brought to your table on giant skewers and sliced to order by servers dressed in gaucho garb. Cheese bread is brought to your table first (irresistible, but the centerpiece of a fill-you-up-early-fast-and-often consumption strategy on the part of the house). Dinners are accompanied by equally rich whipped potatoes and plantains. Patrons can select the salad-bar only, generally about half the price. But nobody goes for this option (it’s less than two percent of all diners, which may seem low, but since the show is all about the meat, not a complete surprise). For what are higher-end restaurants, it’s an amazing formula to behold, and works on a broad volume of business. Where you might think the table of 10 college-aged guys would eat the place out of house and home since there is no end to the high-cost food offerings as long as you continue to want more, such a table doesn’t cause a ripple. In fact, restaurant managers and chain ...
When execs come to visit the store: what’s real and what’s typical?
Parents’ Day at summer camp is usually a kid’s first lesson in the art of spin, optics, presentation, veneer and varnish. This is the day the food is better, cabins are swept, and everyone’s smiling. As soon as the last car leaves, the gussied-up, rustic Eden reverts to its usual repose as juvenile hellhole. It’s still shocking how many times we’re in the field on store visits with retail executives and hear how great this particular location is—only to see later the abyss that it truly is when we’re reviewing video that’s been captured with “mom and dad” not around. When a regional manager happens to be in the store, customers are magically lavished with help and praise and good cheer. There’s a bustle about the store, with purposeful professionals doing the Lord’s work of selling and stocking and just being busy and fussy. Products are laser-lined on every shelf. It’s all quite—what’s the word?—lovely. Until it isn’t. Which is usually the next day. We see lots of non-sales winning behaviors as soon as stores return to “normal.” The customer greetings are weaker, contact interactions on the floor are less effective, and products look sloppier. Rote recitation often takes hold, where associates go through the motions. It’s no wonder when we’ve asked retail executives how much time they believe their associates are in direct contact with customers, giving assistance, the answer is sometimes in excess of 40 percent—a belief the staff is spending almost half its time attending to the needs of the shopper. This is their experience, and may well be what’s occurring when they’re in the field observing. But when we show them the day-in and day-out reality—sometimes at 12% or less—it’s an eye-opening experience. Kind of like sneaking a peek at camp the day after Parents’ Day.
Engaging with the Customer
“Can I help you?” “Doing okay over here?” “How’s everything?” We’ve all been on the shopper’s end of these low-value contact questions in stores, restaurants and whatever chain retailer trains its associates with the blunt instrument of “engage the customer.” It’s gotten to the point where such expressions are so empty, they’ve become little more than verbal tics on the part of employees—rote recitations they almost cease to be conscious of even asking. And there’s a perfect synchronicity to this, since customers are barely conscious of these low-impact greetings, either. In our work with retailers, we hear this literally thousands of times. As an example, associates are typically trained and expected by management to greet the entering customer. Too often, this requirement gets translated by employees into saying “hi.” From a courtesy standpoint, this may sound better than no acknowledgment at all, though we’ve yet to see a higher buy or conversion rate when comparing customers who get a “hi” to those who enter with the absence of any greeting. Not surprisingly, most customers don’t even acknowledge this greeting and walk right beyond the associate saying it—not even saying “hi” back. That’s a big bowl of nothing for a key component of a customer engagement initiative. “Doing okay over here?” is another low-percentage expression, a perfect invitation for the customer to say yes, fine, just looking. Once we diagnose how interactions like this are working or aren’t withvideo and audio behavioral analytics, we provide retailers with the approach to make contacts count more—not in a theoretical, one-off way, but with a selling model that can be scaled. Today’s Wall Street Journal has an interesting article on how retailers are pushing enhanced sales tactics to drive top-line growth. The realization to bring about more sophisticated training is sinking in, which comes from the realization these chains have a way ...
The Pleasant Shopper
A casually dressed but stylish woman enters the store with her pre-teen daughter and stops to say hello to the associate who’s stationed near the entrance. She’s extremely friendly, and has a large shopping bag of items from a neighboring store. She tries on many things during her hour-long visit. This woman is quite a shopper! She leaves her daughter in the store to run out to the car because she had forgotten her checkbook. During her visit, she approaches a salesperson at the cash wrap several times with questions about various items, and asks about returns. When we looked at the videotape, it was clear she had stolen five itemsduring this visit, totaling about $350. From the moment we saw her cross the lease line, she sold herself repeatedly and extremely convincingly to the store associates. Unlike most customers who are greeted at the entrance but keep walking to some real or imagined destination point within the store, she actually stopped to return the salutation and exchange pleasantries. She carried her shopping bag proudly – almost flaunting it to make sure it was in full view of everyone, as if to say you have nothing to worry about with me or my bag or my previous purchases or even my credentials as a spender. She sold herself by speaking with three different associates -– for her, there was no hiding or skulking around in the aisles like somecommon shoplifter. With more than a dozen cameras positioned throughout the shopping environment, we caught her every move. We watched as she waited to see where the associates were positioned, biding her time to make sure two of them were occupied with other customers. We watched her use the empty boxes in her shopping bag to conceal each item she stole. We watched her leave the store with ...
