Five Ways to Destroy Customer Goodwill

5-ways-to-destroy-customer-goodwillMillions of dollars are spent each year attracting new customers.  Once a company procures that customer, an investment is made to deliver an excellent customer experience. However, all the money on advertising, social media exposure, and staff coaching, goes right out the window with the word, “NO!”  There are other variations as well: “can’t, won’t, not allowed.”  All have the capacity to destroy customer goodwill.

  1. In August, I went into a men’s store and asked if they had their winter gloves in stock yet. The answer was “no.” Period.  It could have been,” What were you looking for? Let me check with my manager if we will be getting the style you want.  Please give me your number or email and I will contact you tomorrow.”  When an associate just says no, the customer is being told we don’t care and you’re not important.
  2. We recently had our bathroom renovated.  The contractor had promised that he could install a 4-inch deep medicine cabinet.  When the sheetrock was removed, he discovered the studs were not where he thought they were and wouldn’t allow for the cabinet we wanted.  Did he say, “No, we can’t do it?”  Actually not; he said, “We have a problem and don’t worry, I have two solutions. You can decide which one will work better for you.”  When customers can make a choice, they feel better.
  3. I called my credit card company with a question.  I tried to resolve the issue on their website, but could not.  The recording that answered my call said,  “We are experiencing a high volume of calls and customers should contact us another time.”   That’s a terrible message.  It’s telling me I’m not important and my question can wait.  There must be enough representatives available to help customers without a long hold time or calling back.
  4. Many restaurants require a reservation. How many times have you called and were told,” Sorry, we are booked.” Is the restaurant booked for life?  A better response would be, “ Is there another time or day that would work for you?  We would like for you to dine with us.” Let a customer know their business and loyalty is valued.
  5. The founder of CitiStorage, Norm Brodsky, instructed his staff never to say “no” to a co-worker or customer without speaking to him first.  In the early 1990’s the company was only storing furniture and “stuff” from peoples’ homes. A customer called and asked if he could store 27 boxes of business records. That request had never been made and Norm had not considered that kind of service.  Because of the customer’s inquiry, Mr. Brodsky decided to start a new division of his company, storing business records.  Today, that is a significant part of his sales and profits. The opportunity may never have presented itself if company policy was just to say no.  How much money is your business losing?

It is vital that customers feel valued and appreciated.  Telling customers no defeats that purpose.  Don’t lose a customer’s loyalty with a negative.  The relationship may end and never be recovered. 

The Perfect Retail Associate at @Macys

The Perfect Retail Associate at @MacysTwo years ago at Christmas, a friend gave us a gift card to Macy’s.  For whatever reason, one of the largest department stores in the world was not on our radar. Maybe because of its size and crowds or its location in Manhattan, we never shopped there.  However, armed with our gift and needing new sheets, we decided to go to Macy’s after the holiday rush to find new bedding.

We arrived just as the store opened and was greeted by Rochelle with a big smile and welcoming attitude.  It was really cold that morning and the first thing she said to us was, “ I’m glad you’re inside where it’s warm.  How can I help you?  Something important must have made you venture outside on this frigid day.”  We told her what we wanted, that we had our gift card and she responded, “ You came to the right place.”

Immediately we liked Rochelle.  Not only was she a delightful person, she knew her stuff. There was no question she could not answer about all the merchandise on her floor.  She was on a first name basis with every associate working in the department.  Rochelle asked us many questions too: what was our color scheme, what kind of furniture did we have, what about photos of our bedroom to give her a better picture of what we could purchase.

Rochelle had many suggestions.  She pointed out every pro and con.  We selected merchandise and she kept all the items at her cash register so we could see everything together and know how much it all would cost.

We learned that Rochelle had been working at Macy’s for years, not months or a season, but for a long time.  She shared some stories from her extensive career and told us about her family.  We were so happy to have met her and she was excited as well.  Rochelle gave us her email and said we could reach her anytime with a question or concern.  She invited us to return to Macy’s.

Fast forward to last week.  We decided that new towels for the bathroom would be nice and without any hesitation, emailed Rochelle.  We knew she would still be on the sixth floor of Macy’s and asked when she would be there.  We were looking forward to seeing her again and relying on her expertise.

Our second experience was just as fabulous as the first. Rochelle was our tour guide as we walked from one bath department to another.  If she didn’t know the stock in a particular area, she asked one of her fellow co-workers to check the inventory.  As we browsed and brought things to her register, she not only took care of us, but other customers as well.

We bought our new towels and a few other things too and when we said goodbye to Rochelle, it was like leaving a good friend.  Of course she said she hoped to see us soon and not to let too much time go by before another visit.

Rochelle has the perfect personality to create and build a customer relationship as well as the knowledge of her department to give us confidence that we were in good hands.

Both components are important.  Expertise coupled with a welcoming smile and listening to the customer and paying attention is the formula for great customer service.

How much is Rochelle worth to Macy’s?  I don’t know the dollar amount but, as the MasterCard commercial says:  Rochelle and the customer experience she creates is priceless.

 

Do C-Suite Executives Really Want Customer Feedback?

Do C-Suite Executives Really Want Customer Feedback?In the 1970’s and 80’s I worked for ADP. The CEO for most of my tenure was Josh Weston. Josh was brilliant. He knew every financial indicator for each region. He could quote specific numbers for overall satisfaction, customer churn and profitability.

Josh was interested in customer feedback too.  Not just the numbers, but what customers were really thinking: what did they feel was good, what wasn’t working, were they confident that ADP could handle their future requirements?  At ADP I was Vice President of Client Retention and Customer Satisfaction and responsible for the National Account Manager Program.  When I returned from customer field visits around the country, I would prepare a detailed analysis about what I learned from customers and document any suggestions customers had to improve service delivery or product features. Encouraged by Josh, senior executives were eager to read the report because it contained valuable customer insights that could be turned into actionable data.

Now I find most C-Suite executives are only interested in one number. It could be the company’s Customer Effort Score, NPS, or overall CSAT. They can probably quote any of those in their sleep. But, if you ask them how customers really feel or what specific changes their company is making to promote customer loyalty, they probably don’t have answers.

When customers rate a company on customer satisfaction, they are primarily basing their overall perception on their transactional experiences. Many factors are involved: how easy is it to reach the call center; is resolving a billing issue difficult; what is the company’s return policy? The frontline associates who handle these transactions can be the catalyst to move the loyalty needle. Unfortunately, I think most senior level executives don’t spend enough time learning what’s behind the numbers and fail to invest to customer service.

Numbers are meaningless without backing them up with what customers are thinking and feeling.  The saying is, “the devil is in the details.” Customer feedback can provide the details creating the roadmap to make improvements at every point in the customers’ loyalty journey.

The Human Touch vs. Self-Checkout

The Human Touch vs. Self-Checkout Walmart is replacing their self-service checkout this holiday season.  Instead, they are employing people to provide a personal touch and customer service at the point of purchase. I’m happy to hear that at least one retailer recognizes that self-service and reducing costs are not synonymous.

Shelly Banjo, a Wall Street Journal reporter, wrote an article about Walmart execs trying to stave off further quarterly declines.  The executives have been quoted that it is well known people are frustrated waiting in long lines to pay for their purchases.  They understand that self-checkout can be a slow process when customers can’t figure out the process or the equipment malfunctions.  Often there is no staff to help.  Walmart had experimented with a program called “Scan and Go,” allowing customers to scan items on their mobile devices as they walked through the store.  Then, with a scan of their phone, the items could be purchased at any kiosk, eliminating the cashier line altogether.  The result was a disaster.  The process was complicated and confusing and the pilot a failure.

How many times have I become irritated with a long wait and left my purchases to go to another store.  I am personally pleased that Walmart is taking this step to improve their customer service.   I have some suggestions for Walmart and other retailers.  The checkout counter should not only be the place for customers to pay for their purchases but the spot where frontline associates can make a connection and create a personal relationship.  The checkout counter should not be the end of the retail transaction but the beginning of the customer loyalty journey.

Some suggestions for transforming checkout into a “Welcome Counter” include:

  • Hire frontline associates who can personalize the encounter.   Just by noticing items purchased or what a person is wearing are important first steps. I appreciate when a representative says to me, “I like that yogurt flavor, too, or that’s a great tie you are wearing.”  Of course, it has to be genuine.
  • Cashiers who introduce themselves even if their name is on their badge, helps create a connection; “Hi! I’m Mary. I’m happy to help you.”
  • Thanking customers for their purchases and using their name. Many times customers pay with a credit card. The associate knows their name. Saying: “Thank you, Mr. Smith and have a great rest of the day,” can make customers feel special.

Walmart is on the right track. The purpose of having people at the checkout counter is to reduce the wait and have fewer complaints.  Human beings are great when they act human.  If the cashiers at the checkout counters behave robotically, the process may be more efficient and the lines a bit shorter, but the opportunity to generate repeat business will be lost.

Many customers love self-service counters. I use them when I have to, but often think that a big smile from a person would make my day. What do you think?

Surprise Customers in Good Ways

Surprise Customers in Good WaysToo many companies take their customers for granted.  Appreciation is rarely conveyed.  My credo is that it’s vital to continually show customers they matter and surprising them in good ways after the sale helps to build upon the initial relationship and create repeat business.

Lands’ End, the primarily catalog mail order and online business is known for conservative, sturdy clothing and has built a solid reputation for both quality merchandise and excellent customer service for over fifty years.  The company wanted to reward their customers with a surprise to say thank you; a good idea. However, in this case, Lands’ End did not think about how their gift would be received or know what was even being given.  The entire campaign backfired.

Lands’ Ends co-partnered with New York publisher, Condé Nast, to send male customers a copy of the July issue of GQ Magazine. The company specifically wanted to include men; in the past female customers had received copies of Glamour or Vogue, popular fashion magazines. A few weeks ago, when GQ was received in mailboxes across the country, on the cover was scantily clad Emily Ratajowski, a model and actress. There was an outcry from Lands’ End customers to the company and on social media.  Customers were offended. What was intended to extend gratitude and appreciation had the opposite effect.

What was Lands’ End thinking? I don’t believe they were and didn’t do their homework and know what the cover of GQ was going to be that month. They apologized profusely, and decided in the future to send Condé Nast Traveler, with photos of far-away places and beautiful landscapes or historic buildings, not racy women.

Will Lands’ End be forgiven?  Probably.  But as with any promotion or opportunity, it’s vital that it be pursued with thought and care and the outcome considered in advance.

Surprising your customers is a wonderful gesture.  Just make sure the surprise is a good one and appropriate for those same customers whose relationship your company wants to nurture.

How have you surprised your customers in good ways or been surprised as a consumer yourself?

Where Have All The Shoppers Gone?

Where have all the shoppers gone?According to Moody’s Investor Service, sales at retail stores have declined.  There are many reasons:

  • Shift to on-line sales
  • Less impulse purchasing
  • Pre-sales research about who has the best prices/coupon offerings
  • Low income consumers who cannot afford even discounted prices

While I agree these are contributing factors, I think there is a more compelling, underlying reason why customers are not going shopping.  Customer service at the brick and mortar store has become almost non-existent.  There is no staff in place knowledgeable or capable of creating and building a relationship.  Repeat business is generated by personalized service.  Without individualized attention, why take time to visit a retail store?

When I was a teenager and worked in my dad’s men’s shop, he knew every customer’s name and if he didn’t know the person when they walked into his store, he certainly knew them by the time they left.  Even if nothing was purchased, customers would always return to buy something for themselves or a gift for a friend or relative.  My father made an impression and was remembered and people wanted to do business with him.  He welcomed everyone into his store as if they were visiting our home. He understood how to make people feel comfortable and important.

Unless more of what I just describe becomes routine, retail sales will continue to decline. Specifically:

  • Turnover is rampant.  If you do return to a store where the associate was helpful, the chance is that person is no longer there. He or she jumped ship because they weren’t appreciated or given a well-deserved raise
  • Frontline staff are more interested in their text messages than in making a connection with a customer
  • The customer is looking for a particular item and is assured by the sales person that they will call when it comes in. Rarely or never does that happen
  • Stores are understaffed, especially during peak times and lines at the checkout counters are long.  Customers drop the merchandise they had in hand and leave to look for the item online
  • Repeat customers are not recognized. Who wants to spend money in a place where their business isn’t valued?

There are many reasons why retailers are struggling. It is a complicated issue and there is no simple answer. However, when I find a retailer who values me, understands I’m a good customer, knows the merchandise and calls me periodically to share information about special sales or something that might interest me, they win my business.

Customer Service is the glue that keeps me going back. If that bond is non-existent, I will look for another store or site not only for that particular day, but for the long-term.

What’s your opinion?  Am I the only consumer who shops on-line because retailers have lost their customer service mojo?

Gimmick or Heartfelt? TD Bank “Thank You” Campaign

Gimmick or Heartfelt?  TD Bank “Thank You” CampaignLast week with over six million views on YouTube, TD Bank of Canada received tremendous press on their new customer experience campaign. They handed out more than 20,000 envelopes each containing $20 to customers, deposited surprise funds to on-line accounts and donated heartfelt gifts to people who are going through difficult times. The video can bring tears to even the most stoic.

I am a tremendous advocate of saying thank-you, not only to customers, but to employees too. I think, however, that appreciation doesn’t need to be a monetary reward or gift. In some instances, it is almost an insult when a company offers compensation for your loyalty or a dollar for providing feedback on a survey.  Your opinion is worth more than that.

For the most part, appreciation is more meaningful when it is between a specific associate at a company and the customer.  This happens over time.  In the promo video TD produced, some of the gifts were tailored to the customer’s individual circumstances. TD Bank deserves credit for the associates developing a relationship with the customers and knowing what their problems were.

However, the campaign seems to be a gimmick drummed up by a marketing team.  Video shots and background music get emotions in high gear complete with a beautiful flower bouquet, Disneyland tickets, and checks for $1000 all coming out of the ATM with the press of a button.  Every news channel carried the story the day TD Bank released it.  The real test of TD’s commitment to thanking their customers and extending customer appreciation as part of their goal to improve the customer experience, can only be evaluated over time.

Recently, I had my newspaper rerouted during a two-week summer vacation with our family.  When I received the last paper the day we left, there was a yellow sticky attached. “Thank you so much and I hope your family enjoys the rest of their summer,” signed, Sandra.  That was totally unexpected, felt sincere, and put a smile on my face.  I’m confident she didn’t need a company-wide program to know the impact of a genuine thank you.

There were many positive comments by the public commending TD Bank. I may be a bit of cynic about their idea for customer appreciation; what do you think?

Should You Incentivize Employees to Improve Customer Retention?

Should You Incentive Employees to Improve Customer Retention?There is the saying, “money talks, nobody walks.” There are many different ways to interpret this quote, but in the business world, I have always construed it to mean if you want associates to obtain a certain goal, provide a financial incentive.

In the early 1980’s, I worked for Automatic Data Processing (ADP).  ADP hired a C-level suite executive to focus on customer retention. Retention at ADP was a consistent key metric that was measured and incorporated into every General Manager’s bonus plan, which was quite substantial. The Executive VP developed a “bank book” incentive plan, company-wide, and it was my responsibility to implement the program with my account management team.

The program was a success. The account manager position was an excellent entry-level position for a person with a college degree who wanted to work for one of the fastest growing and profitable service organizations in the world. The average starting salary was approximately $25,000 a year and the incentive program had a maximum payout of $12,000. That definitely received the participants’ attention.

At the beginning of the year, each account manager received a savings booklet with a $10,000 opening balance. Every time a new account was sold in their territory, one percent of the annual revenues were added, averaging about $20 based on a yearly revenue of $2,000. However, if an account was lost, the associate had ten percent of the revenues or approximately $200 deducted from their bankbook.

The program made the account managers focus on retention.  By design, they paid a great deal of attention to their largest accounts, knowing if they were lost it would cost them $500 to $1000 a pop.  Clients were consistently called, planned periodic visits made or surprise spur of the moment check-ins.  They frequently brought their clients fresh donuts or candy which everyone appreciated. If there were an issue, the account manager would speak to every internal department and not only resolve the specific problem, but act as a detective to discover the underlying cause. When there was a particularly major complication they would sometimes send a bouquet of flowers at their own cost after the matter was totally resolved as a way of saying “sorry.”

The program was a winner! There were certainly some accounts lost that were totally out of the control of the associate, such as bankruptcies or acquisitions. However, those were few in number.

In most organizations, sales people are compensated for new revenues, but very few companies pay incentives for retention. It costs at least five to six times as much to bring in a new client as it does to keep existing ones, so this doesn’t make good business sense.  Willie Sutton, the notorious bank robber from the early 1900’s had a famous saying when he was asked why he robbed banks. He said, “that’s where the money is.”  Customer retention is where the money is too.

Set up a program to pay for customer retention. You have nothing to lose and everything to gain. You may have to continually tweak it to fit your needs, but that’s with any new program that you try.

Let me know what strategies have successfully worked in your experience and any advice you have for our readers.

7 Tips to Retain Your Best Talent

7 Tips to Retain Your Best TalentMy experience in the corporate world taught me it made sense to hire smart people and continue to give them responsibility so there was an opportunity to grow.  Providing financial incentives and allowing time to pursue higher education also contributed to company loyalty.  So, the question: how do you keep your most valued employees from either seeking another job, or in our age of an online presence, preventing another company from poaching your best?

LinkedIn founder, Reid Hoffman says “you are no longer in charge of your resume in an interconnected online world, but neither is your boss.”  In the weekend edition of the Wall Street Journal, Mr. Hoffman was interviewed for an article, Job Hunting in the Network Age, where he said the idea for LinkedIn was simple. “He wanted to take the resume digital, but that was just the beginning. As in the real world he sensed your true reputation is what of everyone else thinks of you.” He went on to say, “that your identity is now constituted by the network. You are your friends, you are your tribe, you are your interactions with your colleagues, your customers, even your competitors. All of these things come to form what your reputation is.”  As paraphrased by the article’s author, Andy Kessler, “In short, you are no longer the only one in control of your resume.”

The following are my tips to retain your best talent:

1.    Encourage associates to take on additional responsibility – Tell company associates to seek additional responsibilities. This will help the company and the employee feel more invigorated. But this cannot be accomplished in an environment where everyone is overworked. Having a platform of work-life balance will facilitate people wanting to learn and do more to keep themselves challenged and their minds fresh.

2.    Travel to other corporate locations – Insure that your associates don’t work in a vacuum. Have managers visit various company locations to meet with others who do they same type of job. It’s one of best ways to learn. It opened up an entire new world for me when I worked in a highly structured corporate environment.

3.    Continue their education – Encourage your employees to seek additional college and advanced degree courses. Bring in Lunch and Learn speakers on various subjects. Find internal associates who have become experts in their field to give periodic courses to their fellow associates. It could be workshops on exercise, nutrition, travel, six sigma, etc.

4.    Foster an environment of performing volunteer or charity work – There is no better way to network and help others along the way than by giving back to those less fortunate. In general, people who like to help also make the best service oriented thinkers. Those who give of themselves make their own rewards.

5.    Let associates make mistakes – The only way to grow personally and business-wise is to make mistakes.  Albert Einstein said, “anyone who has never made a mistake has never tried anything new.” If people are afraid of what can go wrong, a level of greatness can never be achieved to give your company a competitive edge.

6.  Keep them involved in your business – Share results with your staff. Let them see how your department is performing against others within the company. Competitive spirit works great in sports and it can work even more effectively in a business environment. Sometimes the devil is in the details and having staff focused will help uncover new opportunities for success.

7.  Provide LinkedIn training – When I started using LinkedIn many years ago, I didn’t quite grasp the value of the tool; connections, obtaining recommendations (not endorsements), or what to include in my profile, etc. Companies should bring in outside consultants or utilize internal experts who can train their associates on how to create and maintain the ideal LinkedIn profile, connect with their network and understand the protocol of accepting invitations from people they may not know.

In my opinion, the most important and actionable component of Mr. Hoffman’s interview is included in one of his summary quotes. “ For individuals, it’s trading lifetime employment for lifetime employability.  The company should invest in you to keep you employable, by always offering more training, expanding responsibility, even if you never leave. Employees, in exchange, will work to keep the company adapting and valuable and growing over the long term. Adaptive employees keep companies vibrant, but those same employees are much more likely to stay if they know they’ll get to keep adapting, gaining responsibilities and expertise.”

Treat your employees as you would your best customers and make them feel valued. Compensate them fairly. Provide them with the utmost respect. Ensure company employees have the most prolific LinkedIn profiles based on their robust experience. This might make them prey for your competitors. But, as Mr. Hoffman has suggested, your staff will appreciate how you have taught and coached them over the years and will think more than twice about leaving an environment where their contributions have been welcomed.

Walmart is Reinventing Itself: Is Customer Service in Its Plan?

Walmart is Reinventing Itself: Is Customer Service in It’s Plan?In the July 8th issue of The Wall Street Journal, was an article, “Walmart Scrambles to Reinvent Itself as Sales Slump.”  Why the hurry?  Even with nearly half a trillion dollars in revenue, the company reported its fifth straight quarter of negative sales in the US with dwindling traffic heading into the next.

Walmart has a new CEO; Doug McMillion.  At one of the first meetings with top executives, he assigned homework.  Everyone had to read, The Everything Store, by Brad Stone about Jeff Bezos of Amazon fame.  According to the Wall Street Journal, Amazon initially replicated Walmart’s business model of acting fast and experimenting often and now Walmart is learning from its protégé in preparation for the company’s new strategic plan.  Today, one of the basic foundations of Amazon is customer service; it is the differentiator.  Is improving customer service part of Walmart’s new initiatives?

So how is Walmart going to reinvent itself?  For the first time in its history, Walmart is going to open smaller and convenience type stores rather than supercenters.  The thought is that smaller is better.  My thought is that no matter what the size, personalized customer service is what will make a difference.  Smaller doesn’t mean better unless the formula for service delivery is changed.

About ten years ago, I went to our local Walmart in Northern New Jersey to look for plastic storage units. I found the bins, but no tops to go with them. I searched high and low for a person to help me, but to no avail.  It was like a game of hide and seek. Unfortunately not only did I lose, so did Walmart.  I walked out and thought to myself, why would I ever go back again?  I found exactly what I wanted with some assistance from a person at Target.

About six months ago, I was on vacation in a small city in North Carolina, where Walmart is the only major store in town.  I wanted to get some board games the family could play together.  I checked the aisles and found what I wanted – Clue, Monopoly, Scrabble.  But, I was unimpressed when I got to the check–out counter with my purchases. The staff was indifferent and just robotically took my money; there was no interaction, eye contact, or a smile.

A few days ago, I went to another Walmart in rural Massachusetts where the experience was a repeat performance; no one to help me and disinterested employees.  I’m still baffled.  Most of us reading this blog already know that in our competitive world customer service is and will be the primary driver that differentiates one company from another.

I have five recommendations for Walmart to personalize customer service for their new, smaller and more intimate store models. I’m sure that all of us could offer Walmart other suggestions.

  1. Insure that many of Amazon’s customer service strategies to improve the customer experience are incorporated into their strategic plans.  (just adding additional staff here and there is not enough to insure repeat business)
  2. Don’t replace people with self-service options that not every customer wants. (I love when I see frontline associates operating self-service machines that frequently don’t work.  It would make more sense to have those same staff members just check out the products themselves for the customer, thanking them for the business and loyalty too)
  3. People hate long lines (have management available to fill in when lines get too long.  A line with three people is long enough in my opinion.)
  4. Hire people who want to build relationships with their regular shoppers and treat them like neighbors and friends. (customers will return, again and again to cashiers who know their name and get to know them personally. Selling grocery products lends itself to frequent store visits which is one of the reasons Walmart stocks them. They want people to go into the store for milk and end up seeing a TV on sale that they can’t resist. I know I will go out of my way to stand in a cashier’s line who recognizes me, gives that big smile and asks about my recent vacation)
  5. Have easy to find intercoms throughout the aisles where customers can ask a simple question or get a front-line associate to assist them as soon as possible. (People get frustrated when there is no one in sight)

In a recent blog I wrote,  5 Reasons to Pay Employees to Stay, Not to Go, I was impressed with the number of thoughtful comments  people wrote. Some said I was right on target and others felt I simplified a complicated subject.  I’m not suggesting that Walmart can double their business by implementing my suggestions or any others that people like me might recommend.  But, maybe they should experiment by replicating the personalized service at one of their new smaller stores to match the service of a neighborhood coffee shop, shoemaker or hair salon. It might open some doors they haven’t envisioned. Smaller is better when the customer’s expectations for more personalized service are met or exceeded.