Should E-Commerce Sites Open Physical Stores?

Should E-Commerce Sites Open Physical StoresThe answer is yes, if you are Warby Parker and have a developed a successful online business model.

I read The Wall Street Journal and The New York Times Business Section everyday; both papers have excellent articles.  Front page of the Journal a few weeks ago was a story by Douglas MacMillan focused on Warby Parker, the popular fashion eyewear manufacturer.  The company was a startup in 2010 and only an ecommerce site until 2013 when their first store was opened in New York City.

Warby Parker was new to me.  Our friends told us about their website when we complimented their new glasses one night at dinner.  They were excited about Warby’s business/service model and explained about the home “try-on” program allowing customers to select five favorite pairs and wear them for five days.  Then one or more frames can be selected and ordered with a customized prescription.  Our friends were impressed with Warby’s donation of one frame to charity for every pair they sell.  We discussed their mission to be socially conscious and creation of good will.

Reading The Wall Street Journal article further piqued my interest.  My focus is customer service so several things stood out and got my attention:

  • By having physical stores, Warby Parker is able to significantly reduce costs for shipping and handling.  The retail store locations have been selected in cities that match their target market. That makes sense.
  • Brick and mortar stores have the potential for more personalized service. Retail consultant, Bruce Cohen, from Kurt Salmon, says “Consumers want to be talked to in a personal way – Once you get a good retail Sherpa – your curator of good taste and fashion that knows you- you become incredibly loyal.”
  • Dave Gilboa and Neil Blumenthal, the original Warby Parker founders, learned early on that customers wanted to try on frames before they bought them. When the company first started, the two invited customers into Mr. Blumenthal’s apartment, where they laid out glasses on the dining room table. “They loved being able to touch and feel the product” providing the foundation for online choices and brick and mortar store locations.”
  • Their newest store in San Francisco will have sales people, called “advisors” who will roam the showroom “in designer jackets and fine-tuned spectacles.”  I’m confident these sales associates will not only look good, but know their merchandise and customers too.

Amazon plans to open its first physical store in New York any day now. I know they will learn from their successful online retailer counterpart.  Warby has focused on personalizing service and giving the customer what they want, no matter the channel.  Warby Parker is in the eyewear business and has its eyes focused on creating the best customer experience.

What the Coffee Shop can Teach Us

What the Coffee Shop can Teach Us  I love to go into a neighborhood coffee shop, stand back and observe.  Watching the interactions between regular customers and the staff behind the counter tells a wonderful story.  There are big smiles in every direction and the associates know each customer’s preferences: how the coffee should be prepared, really strong or not, little milk, half and half, natural or artificial sweeteners. The best and most important thing is that everyone knows each other’s names.  Most towns have more than one coffee house; Starbucks, Dunkin Donuts, Mary’s Bakery, Harry’s Deli but more often than not, customers will drive that extra mile to get their cup of joe and make sure that their own special person behind the counter will be there to start their day. The coffee shop has created a customized customer experience.

There is more to generating customer loyalty than customer satisfaction.  A critical component of loyalty is creating a human connection. The more automated our society becomes, the greater the need to determine how, where and when that human connection can be made. Technology has made our lives easier, more productive and yes, more fun, but we miss out if we don’t take time to smell the roses. What’s the point, if we don’t take a moment and reach out, literally, to touch someone?

How does this translate to customer service?  I think that our human spirit cannot be removed and customers are not happy with endless robotic encounters.  In my first book, The Welcomer Edge:  Unlocking the Secrets to Repeat Business, I tell the story about working in my dad’s clothing store when I was young.  It’s where I learned my passion for customer service.  My father saw all customers as people first, customers second.  He would never ask first, “ How can I help you?”  He would find out about their weekend or recent vacation, if their son is doing well in college.  My dad was much more interested in the customer’s state of mind than their method of payment.  If my father was alive today and still had his store, I know he would be successful even with the competition of large retail malls, cool websites and the technology revolution.

Create your own learning experience.  Stop by a local coffee shop and survey the landscape.  Watch what’s going on.  You can learn a lot about the customer experience, perhaps even more than reading the newest best seller on the subject.

15 for 2015 – Customer Service Trends

Customer Service Trends for 2015A new year is approaching and time to tap into what’s here and now.  What should your company focus be to make it the best?  All businesses, any size, any industry should examine some of the trends I see.

1.    Chat is here to stay

More brands than ever before are offering chat as an option to ask questions and discuss issues. This doesn’t mean that fewer consumers will be emailing or calling; it indicates that companies will now have the opportunity to interact with more people who would have not contacted them at all.

2.    Customers expect help when they need it and that means 24/7

Customers have the expectation of around the clock service.  Whether or not you’re a global organization, sunrise to sunset service is what’s in. Corporations may need to extend hours or outsource their calls for after-hour support to accommodate this growing desire for 24/7 service.

3.    Reward your employees who reward your customers

It will be a vital component of every business model to calculate the ROI of frontline associates and determine those who should be rewarded.  Businesses are developing targeted programs to recognize employees who are instrumental in creating and maintaining customer relationships. Since loyalty can begin and end at the employee level, these reward programs are essential to success.

4.    Brick and mortar and online retail is blending

Companies recognize that shopping online and in the store must not only be consistent but integrated. Whether the initial interaction was online or at the retail store, the experience should be seamless. Every interaction must be easy, personalized and coordinated to meet the needs of the individual customer.

5.    Customers want to be brand loyal, but will quickly jump ship

It’s simply human nature to resist change.  Therefore, customers are predisposed to loyalty but will seek out the competition if they are not welcomed, listened to and treated with respect. It’s almost impossible to get customers to return once they feel unappreciated.

6.    NPS, Customer Effort Score, and CSAT are all valid but…

One measure is not enough when it comes to customers because one size doesn’t fit all.  It is vital to evaluate the customer experience. Obtaining specific feedback and using it to improve is golden. One number doesn’t always tell the whole story in spite of what any proprietary research may show.

7.    Response time has become just as important as the actual response

This is a critical piece of the puzzle.  A major indicator of an organization’s efficiency and commitment to customer service is the lag time between a customer’s question and the answer.  The longer it takes to respond can directly impact how a customer feels about your company.  Make your customers feel important and respond timely.

8.    Establish customer service guidelines, not rules

Inflexibility breeds unhappy customers.  Creating adaptable, thoughtful guidelines and eliminating stubborn rules is a cornerstone of good customer service.  Empowering your employees to make decisions within those guidelines completes the package.

9.    Text messaging is the new business tool

The banking and airline industry have been leaders in leveraging text messaging to proactively service their customers.  In 2015, more businesses will begin to follow suit.   But beware of going too far. Use your judgment and utilize text messaging wisely.

10. Customer reviews are king

Where are customers getting their information about hotels, restaurants, etc.?  They look at reviews on sites like Trip Advisor to evaluate where they want to stay or eat.  More establishments are concentrating on increasing their reviews in all business arenas. But be cautious, consumers are wary of paid ads on review sites that tout doing business with certain recommended establishments.

11. Invest in technology to improve the customer experience

Even budget conscious organizations are finding the need to invest in technology to enhance the customer experience and create seamless service delivery for an integrated channel approach. Spend the dollars to differentiate yourself.

12. “Please call us” responses in social media are so 2014

When consumers post a question or complaint on a brand’s social media site, the days of asking them to call you are coming to an end.  Consumers expect a response in the same channel of communication.  If your brand has a Facebook, Twitter, Pinterest, etc. page and you invite consumers to interact, then companies truly need to respond; that’s the definition of interaction.

13. Once you opt-in, you can never opt-out?

The answer is NO.  I can’t stress this enough.  Customers expect it to be as easy to opt-out of communication as it is to sign up. Having a transparent and simple way to opt-out for all channels; text, email, and phone will eliminate frustration.

14. Engage your employees to get the competitive edge

According to a recent Gallop survey, 63% of global workers are not engaged and 24% are actively disengaged.  Employee engagement, creating an environment of participation and involvement goes a long way to generating a competitive edge and research has shown a positive impact on customer satisfaction.

15. The customer experience continues after the transaction

Last but certainly not least, it makes good business sense that a transaction does not end when the cash register closes.  In fact, it’s only the beginning. Customers must be shown they are still relevant when the transaction is complete.

Competition is stiff and companies have to be on the cutting edge.  2015 is around the corner and the choice is to rocket and climb or just maintain. Which option does your company want to choose? Here’s to a great new year!

Would Your Customers Work for Your Company?

Would Your Customers Work for Your Company?Content and satisfied associates make happy customers. When I shop, it’s easy to know if employees are being treated well.

An article was written in the Wall Street Journal by Eric Morath, detailing that many retailers are using their Twitter feeds to find prospective hires.  According to Kelly Purves, VP of Human Resources at BevMo, the strategy is helping to attract customers that “have the passion for the products” and that passion is wanted in employees as well.  Kevin Knapp, Container Store’s head of recruiting, says, ”Our customers are huge proponents of our brand.  If they’re not looking for an opportunity (to work) they might pass it on to someone who is.”  Carter’s Inc., began advertising seasonal jobs this year through an email blast, asking customers to be a “holiday helper.”

With the understanding that it is the holiday season and additional employees are required for the short-term, it is important to recognize the underlying theme of hiring people who have a passion for your product.  Passion produces engagement, which in turn creates satisfied customers.  Years ago, my wife was working for a large company that sold fabric to the Garment Industry.  She travelled a great deal and used National Car Rental because she loved the service and the people at the counter who helped her.  When a position for an Account Manager became available at National Car Rental, she immediately applied and was offered the job on the spot.  If a customer wants to work for a company they do business with, that’s a real feather in that company’s hat.

My son started a successful business called Peace Love Tacos. He sells tacos at large music festivals such as Bonnaroo, Coachella and Electric Forest.  This September he was a vendor at the Maker Faire in Flushing Meadow in New York so we had the opportunity to see his operation up close.  The tacos were delicious!  His staff worked hard and they all were lively, happy, singing.  Almost tasted like the food was infused with their enthusiasm.   I knew his frontline associates were a strong, satisfied team and I was very proud of my son for creating such a positive working environment. His long line of customers were glad, too.

Executives should ask themselves the question: “would our customers want to work for us? “ The answer should be yes, during the busy holiday season and every other day of the year, too.

Selling Beauty Products: The Customer Experience in Reverse

Selling-beauty-productsIn the lucrative cosmetics business, it has been documented that many customers first go online to look for products and then travel to the store to find real experts.  Nancy Hastings, Vice President for Sales & Education for Tom Ford Beauty, said the company sells double the items per transaction at the beauty counter as it does online.

Bee Shapiro (no relation) recently wrote an article in The New York Times, sub-titled, “with technology and star talent, brick and mortar stores offer perks to compete with online retailers.”  Beauty products that enhance always hold great allure for both men and women and many high-end retailers are investing in the customer experience at the store.  “Customers, perhaps inspired by how-to videos, now expect better-trained counter staff,” and many companies are complying.  Alexandra Papazian, the Senior VP for marketing at YSL Beaute says, “in some ways the lines between the department store beauty shopping and e-commerce are blurring. A customer might notice something on a website first and then go to the store. You need to excel in both areas.”

All retailers should take note. Brick and mortar can still flourish and be profitable but experienced, tenured employees are a must.   Communicating with a live chat agent while visiting a website is helpful, but when it comes to selecting products for your skin and face, there is no substitute for the personal touch.

Does this concept only apply to those companies selling pricey cosmetics that have equally pricey profit margins?  No, personalized service by an experienced and service-oriented associate helps sales today and tomorrow no matter what the product.  Building customer loyalty takes multiple steps.  It requires a welcoming attitude, listening to what the customer needs and inviting them to return.

According to the article, customers reported, that, “gentle guidance, more instructive than the old-fashioned hard sell is worth the trip to the store.” If retailers want to survive and be successful it is necessary to make every customer feel that traveling by car, train, bus or subway, taking the time to go to the store, is worth the journey.

6 Reasons To Pay Your Frontline Associates More

6-reasons-to-pay-frontline-associates-moreKip Tindell, CEO of The Container Store, a home-organization retailer, says frontline associates should be paid more. Although Container Store sales and stock recently took a hit, he has no plan to change his employee compensation philosophy or policy, according to a Wall Street Journal article by Rachel Fentzeig.

I think Mr. Kip Tendell’s credo regarding his employees is sensible; in fact what he espouses just makes good common sense.

  1. One Person is Worth Three: Kip says that a foundational principal of The Container Store is that “one equals three;” one great person can be as productive as three others.  He goes on to say that if a company believes in that rule then by definition an employee can be paid 50 to 100 percent above the industry average.
  2. Let’s keep our super stars: The Container Stores wants to keep good people. That makes sense too. With services and products becoming so much more complex, consumers relish experience and want to interact with confident frontline associates.  In The Container Store paradigm, employees are given large annual increases based on their individual contributions.  In other words they are rewarded on their ROI.
  3. Provide Employees Quality Feedback: Employees are reviewed on an annual basis and their managers spend four or five hours not only providing feedback, but discussing each of the performance criteria in detail. This allows the manager and employee to study the overall assessment and create improvement plans that work.
  4. Motivate Entry Level Associates: Entry-level associates are reviewed and given increases after the first three months. While everyone appreciates a salary bump, Kip says getting a raise when first starting a career is a great motivator. It’s another way that The Container Store attracts good people to apply for positions within the company.
  5. Employees Recommend Future Co-Workers:  The Container Store does not rely on Human Resources for the employee pool but encourages current associates to recommend individuals.  This system has worked well. There are no rules about relatives not being recruited.  Kip’s wife, Sharon, is the Chief Merchandising Officer.  Certainly this is thinking outside the box.  Associates have suggested interviewing a waiter they met at a restaurant whose customer service skills were great or a friend who they know would be a good fit for the company.
  6. Maintain Your Principles During Good Times and Bad: When asked about the recent stock decline, Kip states emphatically that he will not compromise his principles even when same-store sales are lower.  There is always fluctuation and bumps in the road.  Doing what a company believes is right is the constant.

Kip Tindell will become the new incoming Chairman of the National Retail Federation in a few months.  It will be interesting to see if his leadership will influence those retailers who are satisfied with paying frontline associates either minimum wage or slightly above to meet the P&L. The Container Store epitomizes “Penny-wise, pound foolish.”   Kip understands “you get what you pay for.” I’m looking forward to reading his new book, Un-containable. I know it will be an interesting read and a great tutorial for all retail establishments.

The Customer Experience Continues After the Transaction is Complete

Customer experience starts when the transaction is completeIn order to develop true customer loyalty, the shopping experience must feel like more than just a transactional exchange. Gestures of appreciation are important to remind customers they are important.

It is innate in human nature to be suspicious of someone who does not express interest in us after money has changed hands. Reaching out to express appreciation provides an opportunity for a true human connection. Pick any company customers say they “love.” You will find they make sure their customers know they matter. Customers will not want to pursue a “love affair” unless they know they are important.

Remembering customers after the transaction is rarely included in a company’s overall customer service strategy. This is a mistake and should be an integral part of the master plan. Companies think that sending emails on a regular basis, providing discount coupons and announcements of future sales is a way to keep in touch with customers. However, it’s not enough, especially the constant email bombardment; that is more annoying than anything else.  What is needed are procedures, policies and training for staff to show customers they matter in the regular course of doing business.

Companies recognize that it is important to have processes in place to react to issues. However, what is less obvious is the neglect that customers feel when a company can’t be easily reached when a problem or question arises.  Telephone contact numbers are not published or difficult to find and contact pages hidden.  Customers are in a holding pattern for long periods of time and return policies are inflexible.  All these send a message to the customer that the company really doesn’t care about them or if they remain loyal.

A good example of furthering the connection and making a customer feel important is as follows.  A mother of the bride purchases a beautiful dress for her daughter’s once in a lifetime occasion. The boutique does all the right things; they have knowledgeable sales professionals, excellent fitters and tailors and meet all the time commitments. That may be sufficient, but perhaps not. To really show the customer they matter, the salesperson should pick up the phone a week later and ask about the wedding and the gown. How was the party? Was it everything she envisioned and hoped for?  Tell your customer that she and her daughter were in your thoughts.

Those questions would make the customer feel good and know that her money was well spent. I can promise you that even if this customer won’t be buying another evening gown, she will recommend your store to all her friends.

Have your staff come up with ways to show customers that they are still important after the transaction has been completed. Add the human element and touch. That sale might be over, but the customer experience will continue to flourish.

Five Ways to Poise Customer Service for the Future

Five Ways to Poise Customer Service for the FutureIt’s Monday and the first day of Customer Service Week. Let’s begin by setting goals for a long-term strategy to make sure that customer service is one of your company’s competitive differentiators.

I think it’s a fair estimate that a typical customer service representative handles more than 10,000 calls a year. That’s 10,000 interactions, 10,000 opportunities to positively influence the customers’ loyalty toward the brand and the company. There is no other department so uniquely positioned to achieve this goal. The Customer Service Department must take its place on the C Suite level to have the greatest impact.

Here are five ways Customer Service can demonstrate its value and be a top rung in the organization’s ladder.

  1. Turnover in Customer Service is extremely high. According to Forrester’s analyst, Kate Leggett, having less than a 20 percent turnover for call centers is considered good, with some experiencing over 100 percent. As issues become more complicated and communication instantaneous, organizations must have agents who are competent and well trained with comprehensive information about your company’s products and services.  By definition, this requires longevity.  Representatives should be appreciated and compensated for their expertise. It’s important to include representatives in the decision making process.  They are an integral part of the bottom line profitability.
  2. Stakeholders are critical to Customer Service.  Many departments within a company rely on Customer Service to support them with information not easily obtained otherwise. Consider getting feedback from stakeholders to assess their satisfaction levels. Discover additional services that Customer Service can provide to stakeholders to further support their functions. This will result in additional exposure and help secure supplemental budgets for personnel, training and technology.
  3. Customers demand a personalized experience. There are new innovations in technology almost daily and multiple products and services from which to choose. Delivering a unique customer experience becomes even more crucial.  Hiring customer service agents with specific skill sets and providing ongoing training is mandatory.  The customer service representative must have the necessary tools to accommodate an individual’s specific needs and requirements.
  4. Executives need to walk the talk. Posting letters from C-Level executives highlighting the importance of Customer Service doesn’t mean anything.  Company executives should spend at least a half of a day a year responding to telephone and email inquiries. Feedback should be provided about what they learned from the experience and the processes.  Sending wave files of selected calls won’t achieve the same goal.
  5. It’s more than just putting an empty chair in your meetings. Jeff Bezos, from Amazon, placed an empty chair at all meetings; that represented the ”customer.”  This was to keep in the forefront that the customer is central and what would they think of any new ideas suggested.  But is that sufficient?  The person or team in charge of Customer Service should also be in those meetings. That department has the direct connection to the customer. An empty chair can’t talk. Customer Service has its finger on the pulse of what customers want.

Bottom line:  Customer Service is responsible for customers, a company’s most important asset.  Let’s celebrate Customer Service Week by acknowledging both the customer and those who represent them and make sure we give representatives the tools, authority an recognition they well deserve.

@Uber Customer Service Matches Their Car Service

@Uber Customer Service Matches Their Car ServiceMy son told me to download the Uber app.  I did as he suggested but never had the need to use the service.  I live in Manhattan so there is usually a taxi available.

Last weekend we were going into Queens and I thought it was time to contact Uber.  The car arrived within five minutes, right on schedule.  In fact, the app provided a countdown; I liked that.  We got into the black Toyota and were on our way.  Almost, immediately, I received a text from another Uber driver saying he was waiting for us in front of our building.  Whoops!  Apparently, another resident requested a car at the same time as ours.  I looked at the confirmation text and yes, it said Toyota, but a Corolla and we were in a Camry.  I told the driver about our mistake and he said, “don’t worry, just tell the driver to cancel your trip.”

The next day, I get an email from Uber.

Dear Richard

Did you mean to contact Uber Support?

Please reply to this email if there were any issues we need to look into. I’ll be happy to help.

Happy Ubering!

All the best,

Les

Uber Support

Somehow I must have hit “support” in error when I was trying to reach the other driver.  Mistake #2.  Uber got my message without any content.  It could have been ignored, but instead:

  • Sent me a personalized email using my first name
  • Asked if I still needed assistance
  • Offered to help and assured me I wasn’t a bother
  • Wished me a good day – Happy Ubering!
  • Personalized the email with a signature, Les

They treated me like a person. They were proactive. They could have sent me an automatic response that read,  “If you need help, please call us, but don’t reply to this email.”

I emailed Les to tell him that it was our first experience and we accidently got into the wrong vehicle and I hit Support in my haste to contact the driver.

Les replied almost immediately:

Hi Richard,

Thanks for writing back and letting me know. Happy to help.

So sorry to hear about the trouble here! I’ve gone ahead and refunded $8 back to your method of payment and requested an updated receipt be emailed to you. You should see the change reflected in your account within 1-3 business days.

Thanks for letting us know and please let me know if I can help with anything else. Happy Ubering!

All the best,

Les

I appreciated his response and felt comfortable that I would get a refund within a few days; he even provided a timeframe. I also knew I could contact him anytime with other questions.

Uber has a unique model that is proving to be highly successful. But, coupled with the car service is their customer service, both providing a smooth and hassle-free ride.

When Setting Customer Expectations Backfires

When Setting Customer Expectations BackfiresOne of the most important ingredients for delivering service excellence is setting a customer’s expectations. I live in Manhattan and use the subways for transportation.  When a station has an electronic sign telling me when the next train will arrive, I’m happy. I, along with everyone else, have important information that helps us make decisions.  We are in control.

I also use OpenTable, a website for making reservations at restaurants.  It’s easy to navigate: click on the city, date, time and restaurant of choice and hit enter.  The table is reserved. Repeat customers on the site are rewarded; certificates can be redeemed to use at certain restaurants after enough points are accumulated.  It’s OpenTable’s policy to recognize loyal users.

So far, so good.  I decided to cash in some points for an upcoming night out.  I received a pop up message that I should expect my coupon in three weeks.  That sounded ridiculous.  Why should it take that long to send my reward?  That was the turnaround in 1970, not 2014.  Then to add insult to injury, I got the following email:

“We have received your request for an OpenTable Cheque. While most requests are processed in fewer than 3 weeks, please allow up to 6 weeks for delivery.”

I was not happy with that communication as you can well imagine.

Setting customer expectations is a “must do.”  Creating the process to back up the expectation is just as important.  In this case, the company must determine how to deliver their reward in a timely manner.  Tell customers using the website that it could take up to a month and a half to receive their “cheque” so plans could be made in advance.

I read recently that Priceline.com acquired OpenTable earlier this year. I hope management looks into an electronic system to send customers their coupons.  At least that’s what I would expect.