Happy New Year everyone! I hope you and family had an amazing holiday. Now that the holidays are behind us, you may be reflecting on the stress of the last minute shopping in December and then the anxiety of returns in January. You will realize that retail brands have not wasted a moment and have moved to the next event on their calendar, Valentine’s Day. After Valentine’s Day it will be Easter, then Cinco De Mayo, then Mother’s Day also in May and then Father’s Day in June. Retailers like to celebrate each of these days with a lot of energy, hoping it will bring them closer to us customers. Not only the special days, but brands want to get closer to our personal life too, and some brands go the extra mile to try to include themselves in our birthday celebration. A few years back, I started tallying all the nice gestures different brands were extending to me on my birthday. Here are few examples: A free cookie from a restaurant. That was a nice gesture but come on. Just one cookie and you expect me to go all the way to your restaurant to get that cookie? I have a suspicion that you are trying to trick me as you think I will also buy some food at your restaurant when I go to get my cookie. Even if your intentions are honorable, I am sorry that I do not think I can make a trip to your restaurant just to get a cookie. Another restaurant offered me a Buy One Get One Free offer. Hmm, this was interesting. I felt this meant I have to find someone who would like to go to this restaurant with me, and if he/she pays for their own meal (at full price), I get a free meal. I am still not sure how this was a birthday gift. Why would I be excited about this? You are using me on my birthday to make me introduce my best friend to you. The local Regional Transportation Department sent me four free passes for the light rail. When I got it, I started searching for the disclaimers. Do I have to use these passes at odd hours, say after 10 pm on weekends? Or, do I need to get a friend of mine to travel with me and pay full price for me to be able to use the free passes? I searched hard and realized that these passes were truly free; they were unconditional, and I could use them. I felt good giving them to my daughter who was excited to use the free passes. Thank you Regional Transportation Department for the nice gesture and useful gift. Then was the gift that totally startled me. A lingerie company sent me a personal letter with a classy printed card that said, “Happy Birthday Arjun. Here is a free sports bra for your birthday!” When I got this, I could not believe it. I thought it was a prank from one of my friends. But the more I thought about it, I realized that my daughter shops in that store and I had taken her there a few times. Here is my recreation of memory: Every time my daughter and I went to the store, I felt quite embarrassed. I simply wanted to do my task, pay and leave. In fact, when we left the store, I wish I had a brown paper bag in which I could carry the stuff my daughter bought from the lingerie store. On one occasion as I was getting ready to pay, my daughter discovered that the she gets a free product if we share our email address and other personal information with the store. I honestly did not care and was ready to do whatever it took to get out of the store. So I gave the email address and other personal information (like my birthday) and left the store. I then realized that this was the input the store had used. Even though the “free sports bra” offer initially had shocked me, the more I thought about it, I felt there were quite a few good elements to this gesture. Here are few: They put in the effort to find out my birthday and to remember it. The document that they sent me on my birthday was a classy one and completely customized to me. The gift, a free sports bra, was way more valuable than the free cookie or the buy one get one free offer. But then what was wrong with the offer? They automated their offer and sent the same offer to every customer. Did they not take the time to think that that teen daughters with dads (accompanying and paying) are a big segment? Hence, it is not the value of the gift but the relevance that matters. So I want to ask retailers around the world the following questions: We can be friends but why are you trying to force yourself into all aspects of my life? Can I not have my birthday celebration without you trying too hard to be included in the party? Why can’t some moments be left to the customer to enjoy? Offering a Valentine’s Day selection to help me is nice, but creating Valentine’s Day décor and having each employee dress up in the spirit of Valentine’s Day may make some of the customers uncomfortable. I know you may run all the numbers to “whoosh” my suggestions and keep doing all these promotions as I am sure some of them are profitable for your brand. But, can I please make one request to you? Can you please never ever send me a free sports bra again? As a single dad with a daughter, it is really embarrassing. Thank you. Arjun Subscribe to be notified of new blog postings ...
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Do consumers lie to mislead you? I was told they do not. Then help me understand what was wrong with the following picture when I was working for a bagel restaurant chain. 65% of customers stated that they wanted to try specialty bagel and flavored cream cheese. 55% of customers stated that they do not come to a bagel store to get plain bagel and plain cream cheese But actual sales from 500+ restaurants showed that more than 80% of customers were ordering a plain bagel with plain cream cheese. This made no sense, as I could not explain to the senior management team the consumer insights were not in sync with actual sales. As I thought more about it, this made sense only if the consumer’s buying situation changed from the time they answered the survey questions; and the only way to find out was to actually be at the store and watch customers buy a bagel. THE OBSERVATION PHASE: On a Saturday morning, I was the first person in the store and seated myself at a table close to the ordering area. By 8:00 am, the line started becoming long and soon, I saw something that completely baffled me. Here was the sequence of events: A customer stood in line. When his turn came and he was at the ordering counter, the store employee greeted him. The customer then started looking at the menu board behind the employee. The menu was nearly 30 feet long. The customer started browsing the menu, trying to identify what he really wanted to order. By the time the customer browsed the entire menu and wanted to ask the order taker a question, he realized that the order taker had “TAKEN EYE CONTACT OFF HIM & PLACED IT ON THE CUSTOMER BEHIND”. This was a very uncomfortable situation for the customer. In a way, the order taker announced in broad daylight, in front of all other customers in the store, that the customer cannot perform a simple task of placing an order at a bagel store. This is very humiliating. To get out of the situation, the customer goes for a plain bagel and plain cream cheese, something that is a default answer. This occurred over and over, and soon I realized that the customer had approximately 8 seconds to place their order before the order taker declared them a failure. And it was not easy to read the entire 30 feet of the menu in 8 seconds. TESTING A SOLUTION: The next morning, I was back at the same store, but this time I prepared a table mat that had the pictures of all bagels (with names) and all cream cheese lids (with names too). I moved to my observation seat and saw that the table mats changed the entire customer/order-taker interaction. Now the customer took the eye contact away from the order taker and focused on the table mat. The table mat allowed the customer total control to choose what they wanted to order. For groups, there were discussions centered on the table mat, which allowed each person in the group to get what they wanted. By the end of the evening, nearly 70% of customers in the store had ordered specialty bagels and flavored cream cheese. RESULT: Soon this idea was tested in more stores and then taken nationwide. The result was dramatic: Nearly 75% of customers were ordering specialty bagels and cream cheese. The profitability and customer satisfaction scores increased significantly. RETROSPECTION: As I think back I realize the following: The marketing team built a 30 feet long menu but did not know that the customer had only 8 seconds to read the menu. This was bound to create problems for the customer who had to either ignore a big part of the menu or be “reprimanded” for taking the time to read the entire menu. Nearly ½ the customers were leaving the store ordering things that they did not crave; in fact when this group ordered a plain bagel and plain cream cheese, they settled for something that was just an “OK Solution”. I do not think it is a sustainable business model for a brand to force ½ of their customers to settle into ordering what they did not come in to get. BEYOND BAGELS: This is a situation faced by customers nearly every day in different restaurants and industries beyond. Here are a few situations where I would request you to think of how the customer was made to feel: Drive thru restaurant, when a customer wants to pause to make sure the food order is correct. The order taker does not have time to go into the details of the order. When a customer is picking up a prescription at a pharmacy and wants to have a discussion about the side effects of the medication. The pharmacist makes the customer aware that all the information is on the 8 pages of instructions and is simply interested in getting a signature from the customer that shows that he explained to the customer everything about the medication. Specs for electronic goods, especially digital cameras. Instead of training the employees to help the customer make the right decision, employees are referred to the description of each camera. Hence when a customer wants to understand the difference, and asks a question, the employee starts reading to the customer the descriptions. Come on, the customer can read, and the customer wants to know what the descriptions mean. In short, businesses surviving on making customers feel like goofballs, and hence there is an opportunity for competition to step in by solving for this; and be rewarded big. Subscribe to be notified of new blog postings ...
Read MoreHow can an idea so good not work in increasing loyalty? During my days with one of the top three pizza companies, my team came up with a brilliant loyalty building idea. “You buy 10 pizzas and after that, you can buy pizzas for the rest of the year, at a special price of $7.” Now, to put things into perspective, those days, a large pizza was valued at $10 and this was a 30% off offer, without any coupons. Also, I had followed the cardinal rule of loyalty programs, as this offer was the best deal the customer can get from the pizza company. Before rolling it out, I was in a focus group where the idea was presented to loyal customers. During the focus group, I was my usual self. I was romancing the customers, making them feel excited by being there and getting their feedback. It was evident that this idea was working, as nearly every customer was buying more pizzas from my company and was not even thinking of going anywhere else. Isn’t that the ideal goal of a loyalty program? But there was something missing. Is there something more a brand should seek other than customers buying more? I got the answer when, towards the end of one of the focus groups, I asked the respondents, “What else can we do to make sure that you never ever buy pizzas from anyone else? Do not hesitate. Do not hold back!” An older woman in the group said “Son, looks like you are not that smart. In fact, you may be a little slow to get things.” I had no clue where she was going. She went on, “Look son, not once, not twice, not just five times, but ten times (she showed her ten fingers as she said this), I have shown you that I can afford to buy your large pizzas for $10. I had no problems with the price. But do not get me wrong; I like the fact you reduced the price to $7. But you know what it made me realize? It made me realize that earlier, you were really really ‘hosing me’ at $10. Even now, you are making a lot of money at $7. So the deal made me question everything about your restaurant.” Wow, that was some insight. By reducing the price and offering a ‘sweet deal’ only to people like her made her doubt my brand and in fact, weakened the connection between her and my restaurant. That means, I gave up profits for my brand to fail in her eyes. After the price drop, she was visiting more often as she was handcuffed by the $7 price point. But the connection was not strong enough to survive if I could not offer that $7 price point in the future. I paused and then looked at her and asked, “What one thing can I do for you that will make you come to me every time you order a pizza?” She was ready with her response. “Treat me special. Find out about me. Give me things that I want. Give me things that you do not give everyone else.” “And what might that be?” I asked. She gave me a look and the only way to describe that was, “wait and be patient, I am telling you.” She went to say, “If I am truly so special, why not put my pizza at the front of the line every time I order. Put me and the rest of the people in the group first.” Another wow. How could I miss it? I have experienced every time I have flown. Even on a flight which is delayed, the super fliers get to board first, effectively saying ‘na na boo boo, you cannot have this’ to the rest of the customers. Yes, special means getting things that the person feels are special and that are not what everyone gets. MY REFLECTIONS ON THIS LEARNING, LOOKING BACK: I am sure that the results (measured by increase in sales) achieved by my marketing team using the ‘after 10 pizzas, get a large at $7’ idea is one of the best loyalty ideas to ever hit the pizza industry. But did the team put this idea to sell more pizzas or reward the customer? Marketing had identified an idea that was easy to track and implement. And in some ways, since it was topped with a deal that was so “incredible” that result, measured by sales increase, was bound to happen. But in the process, the brand’s connection with the customer was not getting any stronger. It was just transactional where the barrier to leave was high. But we were also eroding the brand equity as the loyal customer was now looking at us as a $7 pizza company. Is that what was the intended positioning of the brand? Looking back, I would like to ask myself the following questions, if I had to do it all over again: Was it a true gift or a bribe? Did we give the customer what was easy or convenient for us to give? Did the customer feel special getting the gift? Were we excited all the way from our heart to give the gift? What kind of future expectation did we set? May be after 20 pizzas, get a large at $6? Was the whole idea driven by driving short term transactions without understanding the consequences of us becoming a $7 pizza company to our loyal guests? Based on all these reflections, I see this “loyalty idea” similar to me telling my date, “Now that we have gone out on 10 dates, I want to buy you free dessert on all future dates.” I am sure the response to the free dessert offer will not be favorable, nor will it increase her loyalty (connection) with me. The dating example truly puts in perspective the grandma in the group saying “Son, looks like you are not that smart. In fact, you may be a little slow to get things.” Subscribe to be notified of new blog postings Email Address // ...
Read MoreFlawed poll results the new thing to move golf ratings? By Arjun Sen, President and Founder, ZenMango April 2015: Just before the Master’s golf tournament, ESPN.com released a survey as PGA Tour Secret Survey Data. Here is the headline: When we twisted the arms of (golf) pros on the topic of whom they wouldn't help in a fistfight, the reigning Masters champion stood out from the rest of his peers. By a lot. Bubba Watson was declared the “winner” of the survey with 23% of the pros picking him. Source: http://espn.go.com/golf/masters15/story/_/id/12598860/pga-tour-secret-survey-data The survey was quoted in media all over the world and most headlines were similar to a blog by Jay Coffin on Golfchannel.com: “Bubba on negative survey: 'Need to improve as a man'. Watson reacted to the survey and was quoted before the tournament to say: “I take it as I need to improve as a man.”. “I need to get better. And I think over my career, since my rookie season to now, I’ve gotten better. But obviously there’s more room for me to improve as a man. “I’m glad that people call me out when they do; that’s the only way I can get better. If I don’t know about it, then I can’t improve.” Wow, it seems to me that Bubba reacted to the survey with intent. But before he reacted, should he not have questioned the validity of the data? Here are my takes on the survey: What is the meaning of the question? When golf professionals were answering the survey, what was the actual question they were thinking of? Was it: Select the person who would not be in a fist fight? Select the person who (is strongest) and will not need help in a fist fight? Who I do not like to help if he was in a fist fight? What was the context of the survey? Should the survey have clarified the following issues: How likely are you to help anybody if he is in a fist fight? Are you selecting from all golf players, all players who are playing in Masters or players who are in the news? The results will be published to portray the “winner of the survey” in a negative light. As you can see by now, this survey was flawed completely from the moment it was launched. Now what could Bubba have done differently? Here are some of the options I would have recommended: Realize that this feedback was flawed and did not deserve a serious response. He is the person who has the most success at Masters in recent times. Maybe this was another way the rest of the golfers in the field were trying to bring him down. After that he could have used the survey to his advantage and spun it any way he wanted: Positioned himself as a family person: “I guess I need to get extra hugs from my family to make up for the lack of love from the field”. Showed attitude: “Did they only consider two time Masters winners when choosing a winner?” “It is not had as 3 out 4 players will come to my rescue.” “I guess, if I was to be in a fist fight, I have to pick on someone who I take on.” Or “At least I could get a list of the 23 players so I know who not to count on.” Showed confidence by saying “I am glad most of my peers feel that I am the strongest among the group, as I am the least likely to need help in a fist fight. I guess I have to work harder in the gym to make sure I live up to their expectations.” Understanding this is a flawed research, Bubba had every opportunity to define the survey instead of letting it define himself. May 2015 Poll In an anonymous poll conducted by Sports Illustrated, PGA Tour pros voted Rickie Fowler and Ian Poulter as the most overrated players in golf with both receiving 24 percent of the vote. This time the survey was even more flawed as “overrated” must refer to some rating against which the two players are being compared to. There is no rating of players other than their performance on the golf course. This survey question was so baffling that I am not going to even try to guess what the question even meant. As reported in an article by Jason Sobel, Senior Golf Writer: (Rickie Fowler) he didn't smash his phone against the nearest wall in reaction. Didn't vow vengeance against his peers. Didn't type a snarky response and press the send button. "I laughed," said Fowler, who shot an opening-round 69 at the Players Championship on Thursday. "I thought it was funny." This is exactly what one needs to do when a flawed survey is put out. Now let us try to understand why the reputed golf publications are indulging in flawed research. Is it an effort to create news when ratings are down? PAULSEN wrote in a golf column on 05/08/2015: Final ratings for the conclusion of the WGC Match Play were the second-lowest in the past 14 years. The semifinals and finals of the WGC Match Play Championship earned a 1.5 final rating and 2.1 million viewers on NBC last Sunday, down 17% in ratings and 16% in viewership from last year opposite the Olympics on CBS (1.8, 2.5M) and down 17% and 19%, respectively, from 2013 on NBC (1.8, 2.6M). Shouldn’t the players and the rest of the media completely ignore the survey as something ridiculous? As I am writing this, Rickie finishes the last six holes six under to put himself at the top of the leaderboard. I truly appreciate the television commentators now refer to the survey as the most “ridiculous” thing ever. MY POV: The learning from this goes way beyond the golf industry. Brands in every industry must hold their own and not let other “polls” simply define them. It is very important to understand the purpose of the poll, how it was gathered and what it said, before reacting to it. I strongly urge brands to listen to consumer input, but reacting to flawed surveys is simply like chasing a mirage, which cannot do much good. On a lighter note what is coming next from the golf media; “The player who made us look most silly?” Will wait and see....
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