Great At Delivering Service? The Best Strategy Is To Tell Everyone About It!

This morning I commented on a blog from the Harvard Business Review about "Understanding Customer Experience" written by Adam Richardson. He tries to define what Customer Experience is as well as to document steps to design the experience. He cites the usual suspects when describing companies that get it right--Zappos, Southwest Air, Google, etc.

This list got me thinking. Why do we always go to these companies when listing great service providers? How do companies break through to be viewed as "legendary?" I have cited Zappos, and yet I have never bought a pair of shoes from them. I have purchased numerous items from Amazon.com (Zappos new parent) and have been very impressed with them, but they rarely make the same list. Why?

Here is my comment:

Adam--

I think part of the reason that Zappos, Southwest and others are consistently cited as being prime examples of delivering premier customer experience is because the companies themselves tell you that they are. It is part of their image campaign that starts at the top and cascades down the organization. Even our mentioning those companies enhances their image.

One company I worked for years ago improved its customer satisfaction scores on an industry survey by writing a timely letter to its customers reminding them of the great job our firm was doing for them. In short, we gave them the words that they then echoed on the survey. The result--improved scores.

Companies that "full body commit" to their strategy and service image are more likely to gain this reputation. Have I had the same bad experiences flying Southwest as I have had at Delta? Sure. But I give Southwest the benefit of the doubt for a bad experience or two because I am bombarded with messages telling me they are great.

I would encourage any company that commits internally to designing a premier customer experience (which is vitally important) to spend as much time thinking through the external portrayal of their services. And then to aggressively play offense. If you keep telling me that you are the best, I might believe it, and maybe even tell my friends.

--Christopher W. Myers

My View

You can read the blog here:

http://blogs.hbr.org/cs/2010/10/understanding_customer_experie.html

I think, in addition to providing great service, these companies also market themselves as service champions. When you go on the Zappos website, there are dozens of reminders that are in your face telling you about their great service. From awards to customer testimonials to bumper stickers saying "I heart Zappos.com." They tell you they are great, and then we believe them.

Then bloggers and business writers and academians pick up the torch and run with it, citing the extraordinary service.

When companies decide to make the journey to becoming a premier service provider, and commit to designing a uniquely satisfying customer experience, they also need to commit to an aggressive campaign to tell everyone about it. That is almost as important as delivering the experience.

Designing A Customer-Centric Store: Thoughts About Best Buy

A Harvard Business Review blog entry http://blogs.hbr.org/hbsfaculty/2010/04/inside-best-buys-customer-cent.html describes how the electronics store Best Buy has seriously focused on designing its stores around the customer. Working on research about electronics purchasers, store management found that most buyers were women, and that women bought differently than men. They designed solution for women buyers. For example:

• women care about installation; men think they can do it themselves. Best Buy bought Geek Squad and packaged installation with all purchases.


• women care about bundles, like plugs and wire accessories; men think of these items as discrete purchases. Best Buy arranges its stores so accessories are conveniently located with the electronics.


• women often shop with children; men mostly solo. Best Buy has play areas in each store so Mom can get some quiet shopping time.

From shopping assistants greeting customers to selling solutions rather than products, Best Buy has transformed its experience in a way that has enabled it to survive the recent economic downturn in good shape.

The key to Best Buy's insight? It is the commitment of management to declare that to remain relevant in today's electronics marketplace, Best Buy needed to see the world throught he customer's eyes. Author Ranjay Gulati describes:

"Becoming customer-centric means looking at an enterprise from the outside-in rather than the inside-out — that is, through the lens of the customer rather than the producer. It's about understanding what problems customers face in their lives and then providing mutually advantageous solutions.

"It's the approach Best Buy took and it's a key reason why the company has survived in the tumultuous consumer-electronics marketplace, while Circuit City is gone. Best Buy took the time to understand who its customers are and what they need and then started selling solutions instead of products."

My View

As we examine the role that Perfect Service design plays in creating a successful sales process, it is useful to look at companies who have done so. Best Buy decided to take a traditionally price and features sales process and turn it into a needs and solutions process. It even targeted a specific buyer to make the experience even more specific!

The wisdom to do this is bold...and rare in business these days. Awareness is only part of the equation, since even with the knowledge, most managers do not commit to transform! States the writer:

"Even when a company and its employees try to make sense of what they are hearing from their customers, they often find themselves immobilized by their own organizational architecture — the internal "silos" that inevitably grow around specific units and functions.

"I hasten to add that there is nothing intrinsically wrong with silos. Division of labor, specialization, and departmental responsibility are necessities in any operation. But most firms today are still structured around product and geography. They have excellent perspectives on what they make and where they distribute and sell it, but poor views of customers and their problems. And these inadequate sight lines impede coordinated action toward solving these problems."

It appears that most companies desire to deliver a premium customer experience, some may even organize to gain insight as to what that experience entails. But too few actually do what is necessary to deliver that experience as a matter of competitive differentiation.

My comment on the HBR Blog:

"Great insight into a company that is taking its delivery of customer experience seriously. I took particular note of the comment that "it would be hard to find a CEO who would tell you that his or her firm isn't customer-centric already. And that's exactly where mass delusion begins for most companies."

"I have also found that many companies want to think of themselves this way, but do not have the nerve to walk away from any part of the market in order to focus on this perspective. So these campanies become pretty good at the customer experience, pretty competitive when pricing their products, and fast followers when it comes to product/service features. In short, they are pretty good companies on their way to long-term extinction.

"For companies to stay relevant and viable (read non-commodity), they must decide their market, and fully fill that market's needs in some dimension. For Best Buy, it may be service; for Apple, it may be product; for WalMart, it may be price. But in the end, management must decide and act."

Hampton Inn Gets Its Guarantee Right, And Customers And Staff Know It!

The Hampton Inn, a mid-priced, value national chain of hotels, is obviously trying to be thought of as a "satisfaction leader." When you stay at one of their locations, they are going out of their way to make you feel comfortable, with free hot breakfast, or even a breakfast bag for those who don't have the time to sit down and eat, free high-speed internet service, and comfy, fluffy pillows, mattresses and blankets. It is clear from all of the signage and messaging, they want you to enjoy your experience.

But it is the guarantee that separates Hampton from the pack:

100% Hampton Guarantee

Read Our Lips:

100% satisfaction or you don't pay. When it comes to guaranteeing your satisfaction, we're much more than lip service. Since 1989 we've offering the 100% Satisfaction Guarantee to each of our guests: Friendly service, clean rooms, friendly service, every time. If you are not satisfied, we don't expect you to pay. Real value from your friends at Hampton.

Think about this. This is not about the cheapest room or the plushest amenities. This is about pure satisfaction, against a presumed Perfect Hotel Service model. One can only imagine the satisfaction categories that are being measured: clean comfortable room, convenient breakfast, basics like breakfast and internet included in price, friendly desk people.

Also think about this. The employees at each Hampton Inn know what is important, and knows the consequence of failing to perform. It is as clear as can be for staff and customers.

My View

My parents and their friends are from the car-trip generation where everyone piles in the vehicles and drive to vacation spots or to family who live out-of-state. They have recommended Hampton Inn to me for years, mostly because it is a good room at a good value and you get free breakfast. It is not a resort or a destination hotel, but they feel it is a good one or two-day transit experience.

I took a look at TripAdvisor (http://www.tripadvisor.com/) to see how travelers write about their experiences. It is one thing to say you want to service customers, it is another to deliver it in a way that customers want to talk about it.

Bartlesville, Oklahoma:
I like Hampton Inns, because you know what to expect, and almost all of them adhere to at least a certain minimum standard of cleanliness and comfort. The Hampton Inn in Bartlesville, however, is one of the best Hamptons I've ever stayed in. I think it is a fairly new facility - maybe 4 or 5 years old, but it has been very well maintained. The pool, breakfast room and common areas are all very clean and neat. The rooms are spotless and the staff are very friendly and helpful. I rate this one as excellent, because they deliver in every category of what this type of hotel strives to deliver. Like all Hamptons, it is not a luxurious, full-amenity hotel, but is a nice, reasonably-priced road hotel, that delivers great value for the price paid. It wouldn't stack up favorably against a well-run luxury hotel (in any category except price), but then it doesn't try to, so I give them an "excellent" rating, for being very good at what they are trying to be.

Quite simply, Hampton Inn is an example of a company that has figured out the path to excellence. Can your company be as clear in its mission, its priorities, and its commitment?

Lessons In Service: Strive For Perfection, Don't Screw Your Customers

Yesterday, I had two experiences that triggered some thoughts about what companies have in mind when they act.
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First--

Watching television with my wife and a commercial appears for "Simply Orange" orange juice. The advertisement was clearly emphasizing the freshness and goodness of the product, features of a typical "product focused" sale. What caught my eye was the "Orange Back Guarantee."

According to the product's website:

"If, after tasting, you don’t agree that Simply Orange orange juice tastes as fresh as biting into a juicy orange, you may make a claim under the Orange Back Guarantee.....On a 3”x 5” card, state why you think Simply Orange orange juice does not taste as fresh as biting into a juicy orange in 50 characters or less.."

What do you get back? A free bag of the competition.....ORANGES!

I have been focusing a lot recently on guarantees, and how they make a market statement as well as focus an organization to deliver. So what does this guarantee do for the product? Well, it clearly caught our attention, more for being unique than anything else. Second, without tasting the product, my mind assumes it is a premium offering....why else would they guarantee such a thing. Third, it was not a true comparative offer, such as "we are guaranteed better than the other brands," yet it tried to position itself that way by comparing its taste to the ultimate competitor...the orange itself...against "the perfect competitor!"

My View:

The commercial worked for us. If you asked consumers to describe the "perfect orange juice," they would likely say that it should taste like freshly squeezed oranges. So Simply Orange guarantees its product is the "perfect orange juice," not that it tastes better than its competitors. I like that.

When trying to differentiate based on a premium offering, companies should look ahead toward perfection rather than simply staying ahead of competitors. Perhaps that's one of the reasons the Health Insurance industry, with its low service reputation, lacks a breakout service competitor...in their minds, it is okay to just beat competitors; they feel they don't have to strive for perfection.

Wrong.

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Second--

Poland Springs delivers bottled water to our house. Each month, we get a bill in the mail for about $40, which I am usually diligent in paying. A year ago, I noticed that a "Fuel Surcharge" had been added to the bill for about $2.50. I didn't pay too much attention to that since the cost of fuel had been going up dramatically. But I did notice that when the price of fuel went down, the surcharge remained. Well, unfortunately, last month I was two days late in paying my now $42.50 bill, and I see an additional $15 late payment fee. Now my bill is $57.50.

I was furious. So I called Poland Springs to cancel my delivery service. Between a Fuel Surcharge and now Financial Penalties, getting water to our home was getting expensive and complicated. Not worth it....

The Call Center representative transferred my call to a trained specialist who obviously handled all discontinuances. Noting my long tenure with with Delivery Service, she immediately offered to waive the Financial Penalty. As well, when I queried about the Fuel Surcharge, she said she couldn't remove the surcharge, but would discount my water 50% this month which would be the equivalent of about 9 months of fuel surcharge. So my bill goes from $57.50 to about $25.

Mission accomplished. I stayed. But I am not happy.

My View

There is an ugly business practice out there that I refer to as "The Appeal Process":

---Squeeze and underserve your customers and hope customers don't notice;
---Focus on recovery for those customers who do notice.

Like many companies, Poland Springs has set up a game of pushing the revenue envelope as far as it can (adding fees and penalties) to supplement its commodity product offering. For some companies, the money made on penalties, interest, and other charges can rival that of the product or service itself. (One has to question at this point what business these companies are in...is Poland Springs a bottled water company or a financial company?)

But Poland Springs understands that it can only push the envelope so far, and it tries to catch fall out during a recovery process. In the time of a 5 minute phone call and without my asking, the discontinuance specialist waived the penalty and discounted my water 50%. I am staying with the service, but am now wary of the company.

A company that wants to distinguish itself in service must not put its customers in such a predicament. By offering deals only to those who complain, or who know how to play the game, a company is creating a trust gap. I am not going to feel good about a service provider if I have to read and understand all of the small print just to not be taken advantage. Examples abound:

Health Care Insurers--deny coverage or prescription at first, but will accept if appeals are made. Model hopes insured people will not appeal.

Banks/Credit Companies--charge fees for everything but are willing to drop them if challenged or if accounts are threatened to be closed.

Everything Travel--the guy next to me on a vacation flight has paid half for his seat and hotel room because he knew how to work the process.

The true premier service provider would not have forced me to go through the humiliating process of threatening to stop my service before offering me the discount. If I was truly valued for my tenure, the discount or penalty waiving should have been automatic. Now that would have been impressive. I would have felt special rather than cheap.

Good Lessons here!

Companies That Service Their Customers Well Are Happy Companies...Like Zappos

Success Magazine has named Zappos CEO its 2009 Achiever of the Year, using the subtitle: Zappos CEO Tony Hsieh elevated customer experience to a new level

While this online shoe and accessory retailer has grown extraordinarily over the past five years and recently sold to Amazon, it is Hsieh's comments about delivering customer service that I find refreshing.

"The thing we realized this year that sort of ties everything together is that customer service is about making customers happy, and the culture is about making employees happy. So, really, we're about trying to deliver happiness, whether it's to customers or employees, and we apply that same philosophy to vendors as well."

It is refreshing to hear things like "create fun and a little weirdness" or "deliver wow through customer service." These are a part of Zappos's Core Values. Love that.

At one of my companies, we instituted "Wow Wednesday" when we celebrated the week's service victories...handing out magnets to be displayed on metal shelves like arrowheads on college football helmets--gold if a client recongized you, silver if a colleague recognized you. Every month, the division got together to count magnets and celebrate.

My View

When companies strive to compete by delivering superior service, they must transform their entire organization to embrace it.

You can't just perform customer service, you must be a customer service company.

It is very difficult for executives to accomplish, particularly in larger companies where each division may find itself in different competitive arenas. But it is clear that in order to be the best, the entire company's focus--from management to phone reps, from the technology department to the finance staff--has to be about delivering service.

Critical as well is having the inspirational leader like Hsieh leading the charge. This cannot be a mid-level initiative.

Can Zappos continue to prosper as a premier customer experience provider within a much larger Amazon? Time will tell, but the foundation is there.