What Target Is Doing to Regain Consumer Trust – – And One of The Most Effective Things They (and GM) Could/Should Do

by Michael Lowenstein on June 29, 2015

Michael Lowenstein, Ph.D., CMC, is Thought Leadership Principal for Beyond Philosophy

Target has issued press releases, and been on television, speaking to the fact that they are bringing in new senior IT execs to oversee customer data management. On the company web site, Target has begun posting information about initiatives and programs designed to offer customers greater purchase security. This is a small (it is not prominent on the site, requiring some searching) but much needed first step in rebuilding consumer trust:https://corporate.target.com/about/payment-card-issue.aspx Target would be well-served in building awareness of where to locate this information.

These efforts, however, only scratch the surface on what would help Target make large deposits to the severely depleted consumer trust account. While we’re on the subject, the same holds true for General Motors, which has recalled 6.1 million of its vehicles for operating problems going back almost a decade, at a cost (so far) of close to $1 billion, not to mention the many billions more in lost customer trust and brand reputation impairment, with little in the way of image recovery except notices to customers and an apology from the new CEO.

Here is one of the things they both could do to bring customers closer, and make them part of the image rebuilding effort.

An online community can be an effective lever for reconstructing and stabilizing brand reputation. That opportunity has been available for companies which have experienced negative press and impaired customer perception, such as Toyota, JetBlue, and FedEx. My colleagues and I have been observing how Target’s data breaches, which have impacted over 100 million shoppers during the 2013 holiday shopping season, resulted in a draining of the emotional bank account of customer trust. This has hurt the company financially, but there is also a ‘long tail’ of negative enterprise reputation and image to be addressed.

Online community has the power to help bring back customer and public trust in Target, through collaborative dialogue and assurances that the company is serious about taking responsibility for the data issues, and letting consumers know that strategic plans and processes are in place to fix the problems. Most customers appreciate and want more of this kind of personalization, a relationship, and an emotional connection. Community would provide this for Target, an integral element of its brand trust revitalization.

It’s up to organizations to a) identify the strongest emotional drivers for customers and b) effectively leverage them. Successful organizations have either evolved to do this as part of their operational and shared values DNA , or they have begun to recognize the importance of image and social responsibility in their communication programs, by placing customers’ interests ahead of the enterprise’s. They can build a veritable bank account of trust; and high trust, and the positive reputation and image it breeds, is an enduring strategic advantage, a definite competitive differentiator. And, personalization truly optimizes the overall customer experience, perhaps its most important benefit.

Doing this contributes to making an enterprise like Target feel more human, transparent, authentic and honest, and accessible to customers and other stakeholders. Community also enhances the branded experience, and it makes the customers active partners in shaping Target’s future reputation and image. It’s not the only trust-building answer for Target, but online community would be a major component of this effort.

The Target corporate site has a lot of info about mission and goals, giving and service, diversity and inclusion, the shopping experience, etc. But, unless I’m missing something (and apologies to Target if I am), there is no online community. And, that is an missed opportunity to have secure discussions, generate and track ideas, test or validate products and services, address issues, etc. – building trust and value for Target stakeholders.

Business-to-consumer companies such as Domino’s Pizza, Victoria’s Secret, and Starbucks are active users of information from their customer communities. Starbucks, for example, learned via its community that customers were not staying in the stores when the batteries on their smart phones ran out of power, leaving to go back home or to their offices to recharge. Time in the store equates to spending on coffee and other products, so Starbucks began testing wireless recharging mats at various locations. Domino’s learned from its community that providing a movie makes a great accompaniment to a pizza delivered to customers’ homes; and, in the U.K, Domino’s has partnered with Lionsgate Pictures to offer a code for free streaming movies when a pizza is ordered.

This is the proverbial tip of the iceberg for how insights from private online customer communities can be leveraged, and how communication with customers can be enhanced. Communities offer data that can be used to recruit advocates, address customer concerns and complaints (as in the cases of Target and GM), and provide customers with information on new product and service initiatives. Again, for Target as well as GM, an online community would be a major image-enhancing step forward, helping them regain trust and a positive image.

Not only could these companies establish customer communities, they should.

Michael LowensteinWhat Target Is Doing to Regain Consumer Trust – – And One of The Most Effective Things They (and GM) Could/Should Do

The ONE question to Ask When Making Decisions

by Colin Shaw on June 26, 2015

There are two keys to differentiating yourself from competitors. First, is to know in your bones that putting the Customer first is the right thing to do. The second key is to ask this ONE question every time you make a decision at the company:

How will this affect the Customers?

It’s so simple you would think everyone does this. The fact is, they don’t. Many companies aren’t convinced putting the Customer first is the right thing to do. With many clients we consult, a senior manager asks for a business case showing numbers to justify having more of a Customer focus before they go down that track. It’s safe to assume a company wanting this isn’t asking questions about what the Customers thinks about their latest operational changes.

Ricoh Canada, a wholly-owned subsidiary of Ricoh Americas Corporation, is an organization differentiating themselves from the competition by putting the Customer at the heart of everything they do. Headquartered in Toronto, the company employs about 2,200 people across Canada. It is a regular part of their business decisions to ask the question, “How does this affect the Customers?” However, that wasn’t always the case.

A little over ten years ago, the company recognized that their results were not where they felt they should be.  Mary Ann Sayers, Director of Corporate Sustainability and Community Relations, described a situation where the Customers were not the first consideration and the Canadian operations were being out-performed by a number of other Ricoh operating companies. It was time to figure out how to turn things around.

They started a cross-functional team called, “My Customer.” The participants trained on how to be a leader, to make decisions, and to delegate and manage time better. Once this program began, the team felt more comfortable making decisions for their business with consideration of how it can help the Customer. It was the beginning of their Customer-centric culture.

Over time, this culture reached all parts of the organization. Glenn Laverty, President and CEO, described how every part of the organization, from service and sales to Human Resources and accounts payable, felt connected to the Customers. It didn’t matter whether your job involved the Customer directly; every single member of the organization asked the question, “How will doing this that way affect the Customer?”

Ricoh believed in a continual commitment to pushing the Customer-centric agenda. In every meeting, every time a decision was reached, they asked, “How is this going to impact the Customers?” The senior management team would ask those questions in their meeting and would revel in how simply putting that question out there changed the direction of their actions. They learned by asking that question, their group would develop a different answer, strategy, or program that considered the Customer in a better way. They believed that you couldn’t be mindful enough because if they weren’t mindful of the Customer, they knew it would come back to haunt them later.

The sad thing is there are too many companies that don’t even ask the question. If you are one of the companies that are, however, you kind of hope that is the case—especially if it’s your competitors that aren’t asking!

The good news is that, as is the case with a number of our clients, the journey that Ricoh went got them where they are today. And organizations and the people that work there do have to go on the journey.  It’s not something that you can turn on overnight. It does take a period of time to understand what it means, change the culture, and help your people realize what it means to put the Customer at the center of everything you do.

Ricoh did a great job. They have consistently raised their Net Promoter score and held it there. Despite two recessions and a shrinking emphasis on copier use, they continue to experience year over year growth.

To learn more about the details of their journey from Laverty and myself, please sign up for our Webinar, RICOH – How We Moved Our Loyalty Score by 34 Points in 30 Monthson Thursday, July 23rd, at 11am EDT

 

 

If you enjoyed this post, you might be interested in the following blogs:

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author offour bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawThe ONE question to Ask When Making Decisions

When ‘Push’ Marketing Goes Too Far

by Michael Lowenstein on June 23, 2015

Michael Lowenstein, Ph.D., CMC, is Thought Leadership Principal for Beyond Philosophy

A couple of years ago, our local newspaper, The Philadelphia Inquirer, ran a disturbing story about how a mortgage loan company in Phoenix had sent spam advertising messages which appeared on the screens of thousands of wireless phone customers. Not only were the messages not requested, but these customers had to pay to retrieve them.

In the United States, phone numbers are allocated to wireless companies in blocks of 9,999, all beginning with the same three-digit prefix following the area code. The text messaging address for each mobile phone is derived from the phone number assigned to each customer’s handset and the wireless company’s name. This means that an advertiser can simply choose any three digit prefix in an area code and send a message to 10,000 people by changing the last four digits after the prefix

One industry analyst noted that this is just the tip of the iceberg. Spam techniques abound in online and mobile promotions. This particular type of spam is cheap and easy for advertisers to use. Wireless text messaging is widely used in the U.S.; and, while some carriers are taking precautions to protect their customers from text message advertising, so far neither the direct marketing industry nor the federal government has been able to control this form of spam. As the president of the mortgage company noted, the advertising had brought in new clients and “There still isn’t any rule against emailing.” Online, the core concept of “permission marketing”, and the rationale behind it, is similarly tossed aside each day with the receipt of unsolicited promotional emails.

We call this indiscriminate solicitation of prospective customers one variation of the “Casanova Complex” customer acquisition model, reflective of the 18th century Italian adventurer, perhaps best known for his many female “conquests.” In the haste to bring in customers, companies can often forget to court the right customers, those who represent the best long-term revenue potential, or who won’t overtax the company’s customer service and support structure.

If offline instances of the Casanova Complex are a disease, then it is an epidemic among Internet companies. Many online retail sites have engaged in sweepstakes and other customer generation programs. Their objectives, they say, are to create “viral” promotions which create excitement for their sites and build their databases of available names both inexpensively and quickly. In one instance, a portal site which runs more than 1,000 websites featuring links to other sites signed up 50,000 registrants in a “Win Up to $4,000″ game. Another sweepstakes program secured 126,000 registrants. An online travel products retailer, offering 1 million air miles to the winner, generated more than 60,000 names in 90 days, almost all of whom were new to the site.

The big issue for any of these sites is — do these promotions and schemes draw attractive customers who can then be cultivated over time through the various marketing tools available today? And, once these customers are on board, are companies doing enough of the right things to keep them? Or is this just another extrapolation of the Casanova Complex? As one site marketing executive said: “This is a great, low-cost way for us to acquire new names. The jury’s still out on how many of those new people will come back.” Companies involved in developing or using promotional tools like sweepstakes, unsolicited email, or wireless spam seem inclined, though, at least for the moment, to believe that these possibilities generally don’t apply to them.

For traditional offline companies, the Internet has the potential to ‘commoditize’ their industry or undermine customer relationships. Many brick and mortar CEOs say a key corporate goal is to transition more of their offline customers to online, self-transactional usage. Why? Because an online transaction costs dramatically less than a brick-and-mortar transaction, there is less risk for service error, and the company can more effectively capture and leverage information from an online transaction, to cite a few advantages. Certainly, the transactional advantages of e-commerce are very appealing. But what about the effects on loyalty behavior — especially for new customers?

One of the important ways both online and offline companies can discipline themselves to avoid the Casanova Complex is to apply personalization in all contact with customers, both new and established. This, at least, gives companies a better chance of establishing the basis of a value-based, viral relationship with these customers.

While it’s been estimated that more than 80 percent of e-commerce sites have customer and visitor email personalization capabilities, less than 10 percent of the sites used personalization in follow-on marketing campaigns. For websites favoring incentive devices like sweepstakes and frontal assault “push” email programs to attract potential customers, personalized communication is the perhaps the best opportunity to demonstrate ongoing interest in customers—especially new ones.

Personalization is at the heart of the “relationship” in successful online customer relationship and experience programs. Ultimately, it’s what makes any customer relationship management effort worthy of going viral.

Michael LowensteinWhen ‘Push’ Marketing Goes Too Far

Virgin Shows Links Between Employee Experience and Customer Experience

by Colin Shaw on June 21, 2015

Richard Branson, Founder of Virgin Group, led the charge for better parental leave benefits this week for his employees. The new policy at Virgin allows new parents one year of fully paid leave following the birth or adoption of a child. With Virgin’s announcement on Monday, they are one of only a few companies that offer this kind of benefit for its employees. However, their new parental leave policy represents something deeper than giving new parents time to adjust to their new role. It shows that Virgin values their people and their emotional state while working there.

I have written before of the link between a company’s employee experience and the Customer Experience they deliver on a company’s behalf.  Despite much evidence that points to this link, many organizations continue to keep the two areas separate in their efforts. However, the separate area strategy is not the direct path to success for either.

The Virgin parental leave policy is for parents in the first year following the birth of biological children or after adopting children. The year applies to one family, meaning that if both father and mother work at Virgin, they must take turns on leave over that year with their child. The full benefit, meaning 100% pay is available to employees that have been with Virgin for at least four years.

Many of you reading this might be shaking your heads wondering how on earth they are going to turn a profit with employee benefit packages like this in place? It is a fair question, and it stands to reason that the expenses associated with this new policy are high. However, Branson isn’t concerned about this. According to Branson’s statement about the policy, “If you take care of your employees, they will take care of your business.”

The paternity policy at Virgin reflects two critical elements for the link between Employee Experience and Customer Experience. First, it shows Virgin values employees and wants them to feel like their employer cares about their personal lives and needs. Secondly, it shows that Virgin understands that an employee’s personal emotional state carries over into the emotional state they present to and create for Customers.

Valuing Employees is the Foundation for Employee Ambassadorship

Let’s take a closer look at the first element. The idea that your company values you and cares about your life is an important foundation for employee experience. Furthermore, this kind of relationship is the gateway to employee ambassadorship, a term that describes the most dedicated employees at an organization. Employee Ambassadors are the employees that are the most active and committed to the company’s product and service value promise. They not only go above and beyond to deliver on these service values, but they influence the other employees around them to do the same. Without this foundation of trust between employer and employee, there can be no ambassadors, and these ambassadors are a key factor in creating the Customer Experience you want for your brand.

Emotions Play Big Roles in Both Employee and Customer Experiences

The second element reflected here shows Virgin understands how the emotions of the people involved in both Employee Experience and Customer Experience are essential to having a good Experience. By creating a generous employee benefit for the new parents, Virgin shows they recognize the emotional state of their employees is an important part of what Virgin considers success at their organization. Virgin knows that emotions play a large part in how the day-to-day interactions transpire and evoking the right ones is essential to having a good experience, whether looking at the Employee’s Experience or the Customer’s.

I always say that happy Employees make happy Customers. It is not just a quaint slogan; it’s a fact. When an employee is friendly and smiling, it’s contagious. It spreads, like a happy virus and it infects Customers. However, it takes energy on behalf of the employee to sustain the happy demeanor they display to Customers. Employers that recognize this and build it into their Employee Experience as part of their plans for a better Customer Experience are far more likely to achieve the results they want to move forward in the Experience Economy.

What can you do to create this type of employee environment in your organization? If you don’t know, just look to the leaders like Richard Branson. In other words, when it comes to your employees, maybe it’s time you started thinking like a Virgin.

Don’t miss Michael Lowenstein, thought leadership principal at Beyond Philosophy, as he provides valuable perspectives on B2B and B2C loyalty programs and offers practical and proven methods for developing consistent loyalty programs. Reserve your spot at this informative webinar presented Thursday, June 17th, 2015.

 

 

Special early-bird registration offer: Free Whitepaper Download, “Loyalty Programs vs. Loyalty Behavior: Do Marketers Get What They Intend?”

If you enjoyed this post, you might be interested in the following blogs:

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author offour bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawVirgin Shows Links Between Employee Experience and Customer Experience

When B2B and B2C Key Performance Metrics Flatline….

by Michael Lowenstein on June 20, 2015

Michael Lowenstein, Ph.D., CMC, is Thought Leadership Principal for Beyond Philosophy

This blog represents two true stories of what happens, or can happen, to an organization when its key relied-upon key, single number (CSAT, CES, NPS, etc.) performance metrics flatline and, for all intents and purposes, have little or no granular actionability.

The first, a B2C example, involves a major player in the cable television industry. Two years ago, they adopted, system-wide, one of the popular single number performance metrics. As they have moved from a customer acquisition focus to a more balanced approach between acquisition and retention, they’ve observed that, in endeavoring to leverage their key performance metric, there have been two major hurdles: a) the metric has flatlined across major customer segments, i.e. generated the same or similar results year over year, making interpretation and experience improvement a challenge, and b) the metric isn’t helping them improve the overall value proposition, especially in the area of price/value. This is of special concern in competing with providers who provide substantial content for a much lower price.

The company needs to understand the benefits, and overall perceived value, customers seek in the entertainment experience. This involves looking deeper into the emotional components of value delivery, as well as the functional. In short, the desired outcome is to de-emphasize price and de-commoditize the service, building value delivery advantage around the total experience. More important, it involves utilizing a metric or metrics reflecting real-world decision dynamics such as word of mouth and brand favorability which, along with more actionable forms of analysis, will help them to understand, and prioritze, the drivers of bonded, positive behavior.

The second, a B2B example, involves a major business services firm. In over a decade of performance measurement, only key driver (simple regression/correlation) analysis around a single number metric were reported. As basic customer experience processes were improved, the metric flatlined, offering no opportunity for further enhancement or competitive advantage. A new, more real world research protocol focusing on bonding behavior offered this company a means to understand the relationship between customer attitudes and behaviors, and business outcomes. Web-based survey invitations were sent to the company’s current customers. Close to 1,000 survey responses were received.

The study revealed that an overwhelming 75% of the company’s customers were communicating to others about the organization through offline and online channels. As a result, the new bonding behavior research framework helped classify customers into four behavioral segments, ranging from highly bonded/positive to disaffected/negative. Over 40% of the customers in the study emerged as highly bonded; and under 20% of the company’s customers were disaffected, a reflection of how positively the company was perceived. However, through analysis it was apparent that even mild negativity was driving customers to use competitive suppliers.

The next step in analysis and guidance to the company was to identify which tactics, diagnostics in the survey, could move the organization’s customers to a more bonded state. Applying a multivariate technique to the bonding level segments, it was learned that the company’s ability to anticipate a customer’s future needs truly distinguished the positive from the negative group. This element of performance was more than twice as high in terms of behavioral leverage as the next most important element, the customers’ perception of trust. This was essential to building bonded and positive customer behavior. It was particularly noteworthy that, although the company had measured “anticipates future needs” for some time, until bonding research and analysis was conducted, its critical importance as a positive and distinct decision-making driver had never been identified.

Passive performance has the potential to undermine bonding behavior. Maintaining a reputation as an expert in the industry and anticipating future needs are important values that must be performed well. Analysis identified these as the most critical steps to reduce the percentage of neutral or negative customers.

In order for the company to protect and build bonding levels, our counsel was that the organization must continue to find innovative ways to meet the emerging needs of its customers. This element of service performance was found to have almost four times the impact on driving customer bonding behavior when compared to follow-up regarding staff performance. Again, though the company had measured innovation and need anticipation for several years, its unique importance in driving bonding behavior had never been singled out.

As a core performance metric, customer bonding is very much alive and well in both B2B and B2C products and services. Scores of studies, in many verticals around the globe, have demonstrated that informal word-of-mouth and brand reputation are essential decision-making levers. If anything, due to the more critical nature of touch points, performance, brand perception, and relationships in B2B, bonding may well be more important in this arena than in the business-to-consumer world. Critically, in both B2B and B2C performance measurement, there is little evidence of flatlining.

Michael LowensteinWhen B2B and B2C Key Performance Metrics Flatline….

Science Proves What Really Makes People Happy

by Colin Shaw on June 18, 2015

Many of us would like to know the secret to lasting happiness. Everyone has ideas of course, and not a few of them involve material items. But science might prove that it doesn’t.

Dr. Thomas Gilovich, a professor at Cornell University, believes that material items might provide happiness—but it doesn’t last. The problem is as soon as we have the item, we slowly get used to having it. And…eventually, the thrill is gone.

I know this first hand. I have written before about my love of fishing lures. As a fisherman (whenever I have time, which is woefully never in long supply), the new fishing lure is the representation of the fish I have yet to catch. The anticipation of its arrival is exciting, followed only by the excitement of using it for the first time. Over time, however, the magic lure descends to “general lure” status until eventually, it is just another of way too many lures in my tackle box.  It loses its al-lure (Oh dear. That pun is tough to take, even for me!)

However, Professor Gilovich has some good news. There is lasting happiness to be found from shopping, although it doesn’t involve stuff. No, he suggests that you get more happiness from experiences. What he discovered is that while people’s large material purchases did not continue to satisfy them over time. When people spent money on a vacation or a special art exhibit, however, their satisfaction with that purchase went up over time.  Gilovich said this of the phenomenon:

Our experiences are a bigger part of ourselves than our material goods,” says Gilovich. “You can really like your material stuff. You can even think that part of your identity is connected to those things, but nonetheless they remain separate from you. In contrast, your experiences really are part of you. We are the sum total of our experiences.

So when you are designing your Customer Experience, remembering this concept is key to creating something that will evoke happy and pleased with your Customers. In a recent post, Zhecho Dobrev, discussed how some organizations are using this concept to create new experiences for Customers. From using the surrounding landscape of your hotel to create a one-of-a-kind experience for your guests like the Ritz Carlton in Tuscon, Arizona, to creating a movie experience unique to your venue, in Vienna, Austria, these types of activities are likely to create an experience that pleases Customers. It will also stay with them long enough to tell stories about it to their friends or families. In some cases, they might even return themselves.

An important part of Gilovich’s findings is that the experience becomes a part of us; through the stories we tell and share with the other who shared the experience. They become a bond in our personal relationships, a key to happiness for most people. This same shared experience is not achieved through owning a similar gadget, however. No matter how whiz-bang the gadget is, it is still set apart from us, not part of ourselves the way our experiences are.

To make these great stories and shared experiences, however, one must first have a great experience. How to do that? What better resource than a company that was #1 on Trip Advisor UK, the Royal Yacht Britannia.

Based in Scotland, the Royal Yacht Britannia is designed to give visitors an idea of what it was like aboard Her Majesty the Queen’s floating palace. Chief Executive Bob Downie understood the importance of creating a unique and memorable experience for his Customers. So much so, his efforts and the efforts of his team produced an experience that was #1 on TripAdvisor in the UK.  When it came to producing a great experience, he mentioned three key elements:

  1. A winning mindset. Commit to the mindset of creating an exemplary Customer Experience.
  2. Individual development. Find your team’s strengths and use those to create the experience—and also employee engagement (a key element to a great Customer Experience).
  3. Remembering the little things. Every little moment in the experience should be consistent and Customer-centered. These “little things” are often the difference between and experience that is “meh” and one that is “FANTASTIC!”

Happiness is in many ways an elusive goal, particularly if you try to achieve it with material items. While they are great at first, the happiness they create doesn’t last. Science is proving the better way to have a lasting happiness is through experiences. And who doesn’t want lasting happiness? I can tell you; your Customer’s do.

What are you doing to create happy experiences for your Customers today?

Don’t miss Michael Lowenstein, Thought Leadership Principal at Beyond Philosophy, as he provides valuable perspectives on B2B and B2C loyalty programs and offers practical and proven methods for developing consistent loyalty programs.

Reserve your spot at this informative webinar presented Thursday, June 17th, 2015.

 

 

If you enjoyed this post, you might be interested in the following blogs:

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author offour bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawScience Proves What Really Makes People Happy

When Marketing’s Goal is to Emotionally Connect with Consumers…Content is the Once and Future King!

by Michael Lowenstein on June 17, 2015

Michael Lowenstein, Ph.D., CMC, is Thought Leadership Principal for Beyond Philosophy

Defining the Objective(s) and Mechanics of Your Content Marketing Strategy

Content marketing continues to be on the upswing as a method of building connections and relationships with target audiences. Its goal is to drive visitors to a web site to identify, and obtain, desirable content. Arguably, content is the most effective form of digital marketing, building value and credibility. Like any proactive form of outreach to consumers, including classic advertising approaches, content must have discipline around investment and return. In other words, the resources of time, money, people, and technology have to be accompanied by stated financial objectives and actionable analytics to prove their worth..

Core to any good content strategy is the effectiveness of websites as information sources and relationship-builders. Without innovative and useful content, not only will Google not reward the site with high search placement, but associated efforts – email campaigns, social media marketing, and search engine optimization – will also fall short. Why? Because, even if they are attracted, visitors won’t have a good usage and emotional experience, and they will be less likely to return or convert. And, because return frequency and/or conversion are the twin objectives of any good content development program, that’ll translate to content ineffectiveness, or worse.

Pay Per Click (PPC) advertising, i.e. putting an ad or promotional blurb on another site, can drive traffic to a company’s site. It can often get quick results, in the form of brand visibility and site visits; but the downsides are that it requires knowledge about what partner sites will work best and it can also quickly become cost-prohibitive

Search engine optimization (SEO), the high placement of keywords that, when consumers are searching for content, will bring them to a marketer’s site, remains a core element of content marketing. It can help with page quality, especially with a well thought out title and description (determined by intelligent copy testing). Social media marketing (SMM), in turn, will help enhance search performance for the site.

For marketing planners, it’s a reality that SEO, PPC, SMM, and email must interconnect and mesh; but even the most well-designed communication plan will not yield desired results without innovation and good management So, yes, there’s a lot of Cirque de Soliel-level juggling skill required to make these content programs successful. And, it will only become more complicated as more companies invest more dollars in content marketing, competing for the consumer’s attention.

Where Is Content Marketing Headed?

Seth Godin has been quoted as saying “Content marketing is the only marketing left.” He’s reflecting the new dynamics of consumer decision-making in which push marketing has long since given way to social, educational, story-telling, and gaming/involvement content. All of this is designed to create and sustain emotionally-based relationships.

According to Contently, a content marketing company, 80% to 90% of U.S. businesses are making strategic use of content; and half of those companies invest one-quarter of their marketing budgets on content. So, it is critical to understand where content is trending and how marketers can capitalize on its benefits and avoid its pitfalls.

Contently has identified three principal content strategies:

  • Owned content – publishing through captive media
  • Rented content – sponsored, or paid, content through another comapany’s media
  • Social content – posting and publishing content through PR and social media

Contently believes that, in addition to “digital printing presses” for creating content and distributing it through social media channels and native advertising, more progressive content marketers will use detailed analytics to help plan and refine campaigns. The increased, and more refined, use of social networks is moving content from audience-reaching to audience-building, i.e. building relationships more than connecting with prospects.

Another trend noted by Contently is the focus on building opt-in email subscriber lists, so that the content moved through owned, rented, and social media can be more effectively managed and leveraged to build relationships. This will, increasingly, bring content software into play.

Contently has also identified what content techniques believe will not work going forward. What doesn’t work – indeed, has never worked – is self-serving, thinly-veiled brand promotional material masquerading as content. This isn’t objective news or original insights. It is another form of ‘push’ marketing, and it undermines a brand’s credibility and trust level.

Also, repeating material seen elsewhere, i.e. licensing content, can threaten trust because it is not original Though inexpensive and relatively easy for companies to obtain, re-purposing previously published content will do little to build consumer interest or relationships.

Finally, any form of content deception is sure to backfire on companies. For example, teasing consumers with inflated promises in headlines will reduce credibility and make it more challenging to build a relationship. As Contently notes: “We will see brands get better at writing engaging headlines, yes, but we will also see content that matches the expectations that those headlines set.”

All of these trends are part of the content maturation process.

One important lesson that marketers have learned about content’s power (to attract or repel) is that it is far from linear. In other words, consumers may shift back and forth from marketing to sales – and at their individual, emotionally driven whim. For targeted content to succeed in leveraging inquiry and page visits into sales, irrespective of whether the customer is new or established and irrespective of where they are in the current purchase cycle, developing and interpreting consumer personas has to become a priority. Simply stated, the name of the game has been, and will continue to be, targeting the right content to the right consumers at the right time. No small task.

Michael LowensteinWhen Marketing’s Goal is to Emotionally Connect with Consumers…Content is the Once and Future King!

Think There’s No Such Thing as Bad Press? Think Again!

by Colin Shaw on June 16, 2015

Jeff Bezos said, “A brand for a company is like a reputation for a person. You earn reputation by trying to do hard things well.” Amazon’s tries hard to provide an excellent experience for their Customers.  By consistently doing what it takes to build an excellent Customer Experience, Amazon enjoys an excellent reputation as a brand and continues to grow in influence and strength.

Other brands do not have the same commitment to consistently delivering a great experience. Inconsistency damages the brand—in as little as five minutes. Warren Buffet said:

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

Frankly, not knowing how your actions affect your reputation can be a disaster in today’s information age.

The Influence of Brand Reputation is Growing

You might think this type of thing doesn’t matter in the long run or that people forget the bad stuff when a new shiny object appears. Maybe you believe that there is no such thing as bad press. To some extent, this is true. However, these days, some headlines hang around longer than you would like, contributing to a reputation for the brand. And they have more influence than you thought, too.

According to their findings in a 2014 Nielsen study, 69% of opinion elite respondents try to learn more about the companies with which they are going to do business. That number was 66% in developed markets and a whopping 76% in emerging markets! And 54% of the Global Opinion Elites say they are increasingly finding out about a company through social media.  To see the chart click here.

In another chart, Nielsen shows 54% of Global Opinion Elites in the US and 50% of them in Canada have decided not to do business because of something they learned about the company conducts itself. The next two countries with the highest scores were Germany with 42% and the UK at 41%. To see all the scores,click here.

Reputations Start The Customer Experience

Brand are a lot of things to us. A brand is only a thought in your mind. Brands can reflect your lifestyle or at least the one to which you aspire. Because of this, we have emotional attachments to brands.

We are always trying to define for our clients when the Customer Experience begins. Most of our clients think it starts when the Customer first contacts their company, but this is not the case. Many times your Customer Experience begins with the positive or negative headline or social media post, or, in other words, that brand reputation you create by your actions.

Typically when companies advertise their brands they idealize it, portraying a wonderful experience.  It helps create the thought in our mind and builds that emotional attachment we have with it. However, when the Customer has the experience that falls short of the idealized version advertised, it disappoints them. Not a great way to start your experience with them…and in some cases a detriment to your social media reputation.

Building your brand reputation increases in importance according to the Nielsen Study. Having a deliberate design to your reputation is essential to your brand. Not knowing this reputation, or how your actions contribute to it is clearly detrimental to your brand. It starts the Experience because it creates an emotional response to your brand in the mind of the Customer—responses that might result in them contacting you first or not contacting you at all.

What kind of reputation does your brand have?

RICOH Canada had a vision: to be the most trusted brand with irresistible appeal in their market. Join us at our webinar at 11am EDT on July 23rd, 2015, “Ricoh Case Study: How We Moved Our Loyalty Score by 34 Points in 30 months” to learn from CEO Glenn Laverty how their focus on a customer-centric approach improved their Net Promoter Score by 34-points and grew their business 115%. Reserve your spot today!

 

 

If you enjoyed this post, you might be interested in the following blogs:

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author offour bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawThink There’s No Such Thing as Bad Press? Think Again!

Has Customer Experience Delivered the Goods?

by Colin Shaw on June 12, 2015

With all the focus on Customer Experience over the years, and the increasing resource that organizations have put into improving the Customer Experience, what have been the results?

Trend #1: Is it really getting that much better?

The American Customer Satisfaction Index (ACSI) uses an overall U.S. Customer satisfaction score as an indicator of the health of the economy. Since 1994, the ACSI Score rose from 74.8 to a high of 76.8 in 2013. To see the results for yourself, click HERE.

Given the focus on CX over the years and the resources allocated to it, the question becomes are organizations really getting the return on this investment? I also worry about the plateau/decline (from 76.2 to 75.2 over the four quarters of 2014). That’s a trend we need to keep an eye on before it goes down more.

Trend #2: Addressing the “How” of doing business as well as “What” of doing business.

Most organizations focus on transactional details of the Experience, for example, hold times at the call center. Transactional details are important; they just aren’t the only important part of the Customer Experience.

Successful Customer Experience addresses how you handle the transactional details. It is not only having a better “What” of the transaction detail but also a better or deliberate “How” of the transaction. For example, how you handle the call after you reduce the hold time. This article explains a little more what I mean by the “how” instead of the “what” matters in Customer Experience.

Trend #3: Creating a Customer Experience Team for your company.

We see that the number of CX professionals attending our training programs rise all the time. More people are interested in addressing the emotional side of the Experience. Furthermore, it indicates (at least partially) a level of commitment from a company to make Customer Experience a priority. However, it is important to remember that having a Customer Experience Team isn’t enough to prove commitment. Here is a list of 8 ways to make sure that you have what you need to succeed as a team.

Trend #4: Getting employees on board with your Customer Experience improvements.

Whilst we have seen from the ASCI results that the average Customer Experience has not moved significantly, there are many exceptions to this. Having a sound philosophy and detailed plan is great, but getting the people that actually work with Customers on board with this sound philosophy and detailed plan is essential to success. RICOH Canada recently increased their Net Promoter Score (NPS) from 25 to 59 in 30 months, an improvement of 34 points using many of our philosophies. Glenn Laverty, CEO of RICOH Canada, had this to say about how he used employee engagement to help facilitate that rise:

“We beat that drum almost incessantly in the organization simply because we wanted everybody to understand the impact that they have in the Customer Experience. It became part and parcel of our on-going communication and worked its way into the fabric of the organization culturally.”

To hear more about how RICOH accomplished their impressive climb in NPS score, be sure to attend our webinar next month.

Make Sure Your Customer Experience is “On Trend”

In my view most of the easy stuff has been done to improve Customer Experience and now the real work begins. What do these four trends mean to the industry of Customer Experience? To me, it means that Customer Experience is more than a passing fad. Instead it is an established platform for you to differentiate yourself from the competition.

What is your view of where the Customer Experience movement is?

RICOH Canada had a vision: to be the most trusted brand with irresistible appeal in their market. Join us at our webinar at 11am EDT on July 23rd, 2015, “Ricoh Case Study: How We Moved Our Loyalty Score by 34 Points in 30 months” to learn from CEO Glenn Laverty how their focus on a customer-centric approach improved their Net Promoter Score by 34-points and grew their business 115%.

Reserve your spot today!

 

 

If you enjoyed this post, you might be interested in the following blogs:

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author of four bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawHas Customer Experience Delivered the Goods?

Loyalty Programs!?! We Don’t Need No Stinkin’ Loyalty Programs!!!

by Michael Lowenstein on June 11, 2015

Without fear of (much) argument, it’s a fair statement that all companies want, and try to generate and achieve, optimum loyalty from their customer base. They should want this because study after study shows the financial rewards of having loyal customers. Some companies reach this goal through superior value delivery, built on quality products and services and positive, consistent customer experiences. For the past several decades, many companies have relied on customer loyalty cards or programs, by which they can track purchase behavior and give rewards for repeat and volume buying activity.

Customer loyalty programs are especially popular among retailers. Over the years, retailers have found these programs to be powerful business tools within their highly competitive markets. But, some retailers have completely disavowed loyalty programs, either never initiating them in the first place or canceling them, in favor of reduced pricing. In fact, this has become something of a trend. What’s behind it?.

Let’s start with the biggest retailer – Walmart. The company has long claimed that a loyalty program isn’t needed because their prices are so low. Walmart believes that loyalty programs can, indeed, provide excellent information about customers who participate; however, as one Walmart executive put it: “…some of the loyalty programs are very expensive, and we don’t think that serves everyday low cost and everyday low price.” Lower-than-competition everyday prices has been Walmart’s merchandising and marketing mantra since its inception. But, at least for groceries and sundry products, that often isn’t the case. Supermarket chains like Save-A-Lot and Aldi’s, neither of which has a loyalty program, will often beat Walmart’s item-for-item pricing by a significant margin. And, other competitors can use their loyalty programs to selectively pick products, and individual customers, to offer pricing which undercuts Walmart.

As for generating customer purchase data, Walmart has a ‘scan & go’ app for mobile devices, which allows customers to scan their own items as they shop; and this provides the company with valuable information on what customers are purchasing, the length of time they’re shopping in the store, and what offers and coupons might drive future purchase. Walmart uses additional methods of understanding individual customer purchases. One of these is Walmart credit cards. Another is reloadable MasterCard and Visa debit cards. A third is “Bluebird”, a prepaid debit card which functions as a Walmart customer’s alternative to having a checking account, with which they can make deposits, pay bills – – and shop at Walmart. Like Tesco is already doing in the U.K, Walmart, has been considering development of its own ‘house’ bank, which would provide even more customer data.

Asda, a Walmart-owned supermarket chain in the U.K, also has no loyalty program. It’s the second largest supermarket company behind Tesco; and, similar to the U.S., newer low-priced chains such as Aldi are actively competing with Asda. In place of a loyalty program, Asda believes it provides customers with what they want most, a “great multichannel retail experience”. The chain, according to executives, focuses on delivering the key fundamentals: prices, quality, convenience and service. Alex Chrusczcz, Asda’s Head of Insights and Pricing, offers explanations of how the organization is endeavoring to build customer loyalty behavior (http://blogs.terrapinn.com/total-customer/2013/07/25/asda-share-build-loyalty-programme/):

  • “Aspire to treat customers equally or you’ll create a fractured brand and shopping experience. If you have someone paying one price and another customer with a coupon paying a different price, the perception of the brand is becoming fractured. Make sure it’s consistent.”
  • “Be pragmatic in terms of technology and analytics. They aren’t a silver bullet. Use these tools and combine them with the experience of your team.”

From my perspective, the second explanation is good common sense; however, the first statement is really questionable, even counterintuitive if a subordinating goal of loyalty behavior is to help drive customer-centricity. Simply put, all customers are not equal in value; and marketing strategies which treat them so often create lower revenue.

In the U.S., regional supermarket chain Publix has no loyalty program. The company doesn’t have, as a result, the ability to track, at household level, what customers are and aren’t purchasing in their stores. What Publix does, instead of loyalty cards, is try different alternative approaches to build sales. One of these, for example, was to test a program where shoppers could set up an online account where they could digitally clip coupons; and then, in the Publix store, the discounts they’d set up online could be automatically applied by typing in their phone number. Publix also has a BOGO program for their own brands, and accepts competitors’ coupons in their stores.

Some retailers do more than emphasize the sales and service fundamentals. They build genuine passion for, and bonding with, the brand by creating a more human, emotional connection. And, though there are few organizations like this, retailers such as Trader Joe’s are the exception that proves the rule. Trader Joe’s does not have a customer loyalty program. What they have is an enthusiastic base, achieved and sustained through differentiated, ever-changing customer experiences, enhanced by upbeat, engaged, and helpful employees who are ambassadors for the brand. This has enabled Trader Joe’s to generate sales per square foot that are double the sales per square foot of Whole Foods. So, another way of stating that Trader Joe’s creates loyalty behavior without a program is to say: The holistic shopping experience is, defacto, the loyalty program.

Airlines, as well, are doing their part to diminish the perceived value of their customer loyalty programs. There has been so much reduced benefit for elite customers of late that, in reviewing the new higher miles redemption rates imposed by Delta and United, especially on international flights, it feels like these companies may regret they ever introduced their programs in the first place. Certainly, frequent flyers have been bitterly complaining about these airlines, and the “quite shameful” and “blow to the solar plexus” moves, on social media and online forums. And, none of this has helped the airline industry’s image and reputation. United’s score on the American Customer Satisfaction Index is a full 15 points below the U.S. Postal Service, and Delta’s isn’t much higher.

Now, we come to retailers which had customer loyalty programs, usually of long-standing, and elected to discontinue them. Actually, much of this pullback has been done by one organization, Cerberus Capital Group, the early 2013 purchaser of multiple regional retail supermarket chains from Supervalu (Shaw’s, Acme, Star, Albertson’s, and Jewel-Osco). Calling the new positioning ‘card-free savings’, and reflective of the first strategy stated above by Asda, each of the chains issued statements with themes like “We want buying to be simple for all, so that every (name of company) customer gets the same price whether a loyalty card has been used or not”.

Additionally, and again like Asda, these chains have said they will go back to the basics: clean stores, well-stocked shelves, reduced checkout time, clearly marked sale items, and creation of a more customer-focused culture. Some of their executives have also theorized that the chains will now adopt a more local level approach, rather than customer level, to their decision-making, and that individual store managers will now be more actively involved in driving successful performance.

So, the chains acquired by Cerberus appear to believe that ‘sunsetting’, or eliminating, these programs is a reasonable risk and that they would still find good ways of providing value to retain the more loyal customers, as well as incentives for those with the potential to move from purchase infrequency. Most analysts, however, felt that Cerberus eliminated the programs largely because the chains they purchased were either not mining card data, or not effectively analyzing and applying this material for better marketing and merchandising, thus making the loyalty systems too expensive to maintain.

Personal Note: Geographically, Acme is the closest supermarket to my home. Insofar as post-elimination of their loyalty program, my visits have dramatically reduced; and, when stopping at the store for odd items outside of regular supermarket trips, there is no evidence of a difference in pricing, product variety, operations, or culture.

Cerberus has entered into takeover discussions with California-based Safeway, which also owns Vons and Pavilion. If this sale takes place, it’s a good bet that these chains will also drop their reward cards, because Cerberus-owned supermarkets clearly don’t need, or want, no stinkin’ loyalty programs – nor, apparently, do they see benefit to a more customer-centric enterprise philosophy.

Michael LowensteinLoyalty Programs!?! We Don’t Need No Stinkin’ Loyalty Programs!!!