Archive for the ‘Customer acquisition’ Category
I’m over at Eli Rose Social Media this morning thinking that maybe Abercrombie CEO Mike Jeffries is smarter than he seems. Detestable, maybe, but still smart. Come find out why!
I’m over at Eli Rose Social Media today with a post on blind spots, and why you need to monitor them. Come on over!
Breaking up really is hard to do.
A couple weeks ago, we moved our kids from the only daycare center they’d ever known. It was a tough decision and we agonized over it, painstakingly talking through the pros and cons – should we stay or should we go? And in the end, we decided that yes, we were going to make the big switch. Goodbye Daycare A, hello Daycare B.
With a few weeks of the new daycare under our belts, it’s easy to look back and feel confident we made the right decision. As I reflect on the decision and the events leading up to it, I can’t help but do so through the lens of a researcher. And what I see is a great illustration of the importance of research throughout the customer life cycle, from acquisition to retention to defection. Here’s why…
1) The reason we chose Daycare A is not the reason we stayed at Daycare A.
When we were originally searching for a daycare provider, a few centers met all our requirements. What stood out about Daycare A was the management team. The director and assistant director were welcoming, enthusiastic, and downright tenacious in recruiting us. It was clear they wanted our kids at their facility, and we felt comfortable leaving our kids with them. That sealed the deal.
Months later, both the director and her assistant were promoted to positions outside our center. A new director came in, with a completely different management style and a different way of interacting with parents, teachers, and children. We didn’t like it, and we talked about leaving. But we didn’t leave, because by that point we had gotten to know the teachers who cared for our kids every day, and those relationships were more important to us because those people were closer to our kids.
The lesson: Acquisition and retention are different animals entirely. The things you do to keep a customer are often very different from the things you do to get a customer.
2) The reason we left Daycare A was not the opposite of what made us stay at Daycare A.
In other words, we stayed because of good teachers but we didn’t leave because of bad teachers. In fact, the teachers were the biggest argument for staying at Daycare A. They just weren’t enough to keep us there.
The lesson: Loyalty is about more than not screwing up. Don’t assume that the reason customers leave you is related to the reasons they stuck around so long.
3) The reason we left Daycare A is not the reason we thought we would leave Daycare A.
I mentioned the rocky relationship with the new director. Well, her management style brought us very close to leaving on a couple occasions. If you’d told me six months ago that we’d be leaving Daycare A for a new center, I’d put money on the director being the cause. But she wasn’t.
The lesson: loyalty is unpredictable. On an individual basis, you can’t ask a customer to tell you why they’ll eventually leave. On a macro basis, you can’t deduce the mindset of the defector by surveying the loyalist.
4) The reason we chose Daycare B was outside the control of Daycare A.
So why did we leave? Our relationship with the director didn’t help. But there were other, more immediate factors. The new center is right on the edge of our neighborhood, so we have more of a connection to the other parents. And while both are within 3 miles, taking our kids to Daycare A was a stressful experience every single day: heavy traffic, inconvenient location, cramped parking lot, drivers littering and cutting each other off. Daycare B is the complete opposite.
In other words, the “big picture” experience surrounding Daycare B was better. There’s not much Daycare A could have done about that.
The lesson: You aren’t always in control of how your customers feel. But you can, and should, do everything in your power to understand how you fit into their lives. You might find a vulnerability you can’t address, but you might find an opportunity you can leverage.
5) The reason we chose Daycare B is not the reason we chose Daycare A.
We originally chose Daycare A because of the management. However, our two years of experience with Daycare A gave us a new perspective on how to evaluate a daycare center. So while we find the new center director to be quite friendly, we’re not looking to her to give us a sense of reassurance and confidence. Instead, we’re being more active in communicating with the teachers so that we know them and they know our kids. And if we ever have any concern that the teachers aren’t up to par… well, that’s probably when Daycare C will enter the picture.
The lesson: It’s not enough to know how your customers feel about you. You need to understand what previous experiences they bring to the table so that you can effectively address their expectations and needs.
So there you have it. From one breakup, five important reminders that you never know what’s going on inside your customer’s head… unless you ask them the right questions at the right time.
And the award for the best commencement speech of the year goes to…
David McCullough Jr!
Mr. McCullough, an English teacher at Wellesley High School in Massachusetts, took to the stage a couple weeks ago with an extraordinarily blunt reminder for hundreds of high school graduates. It’s a 12-minute address (and worth it!), but here’s the gist:
The reaction has been amazing. It’s a message that resonated with many – parents, college professors, employers, curmudgeons, you name it. The address has garnered over a million views (and plenty of colorful comments) on YouTube. And while some view it as unnecessarily harsh, most seem to see it as a healthy dose of tough love.
But what happens when we take that message to our customers?
If you think we don’t, you’re wrong. We do it all the time…
Airlines and hotels treat you well when you reach Platinum or Diamond status. Fail to keep up your activity, though, and watch those upgrades disappear. You’re not special anymore.
Some software companies offer “white glove onboarding” or unlimited technical support to their new customers for a limited time in order to encourage adoption. Try calling months later with a problem and you’ll get a different reception. You’re not special anymore.
Pretty much every renewable service (Netflix, magazines, lawn service, bug service, cable, etc.) doles out generous promotions for non-customers, whatever it takes to get you to sign up. Once you’re a customer, though, regular rates apply. You’re not special anymore.
This isn’t to say that those aren’t perfectly valid promotions. Yes, customer acquisition is important. Yes, good customers should be recognized and rewarded.
This is just a reminder that at some point, your customers are going to wake up and realize hey, I’m not special anymore. And when that time comes, it’s up to you to cushion their fall.
Preferably without taking cues from Mr. McCullough.
I’m over at Eli Rose Social Media today contemplating easy buttons, airplanes, and sausage vending machines. Come on by!
A Doberman was robbed last night. At least that’s my opinion.
Malachy the Pekingese won Best in Show at Westminster. No doubt a deserving dog, Malachy beat out my favorite (a Doberman) and several other gorgeous dogs to win it all.
Yet for some reason I couldn’t quite put my finger on, the decision bugged me.
It’s not because I felt Malachy was undeserving. I’m no expert, but I know enough to recognize that each of the dogs in contention was at the top of its class.
It’s not because I felt the judge was unfairly biased toward certain breeds or sizes. With a constituency as rabid (heh heh) as Westminster, you couldn’t get away with that. This is waaaay more serious than the Olympics and their “Soviet judge gives her a 7″ nonsense.
And it’s not my predisposition toward specific sizes or breeds (I’m more a herding dog guy usually, but this Doberman… wow).
After a while, it dawned on me. It was two things.
One, I couldn’t tease out the specific subjective elements that led the judge to make her decision. What standards did she emphasize and why?
And two, even if I’d known the standards… the Pekingese was an unknown quantity. A big ball of fluff. You could look at the Doberman or the Dalmatian and see every contour, really appreciate posture and gait. The Shepherd and Setter were almost as easy to get a read on. But the Pekingese? The judge reached and poked and squeezed under that floppy coat, but we viewers at home were clueless.
Why does this bother me? Because of my job. Every day I work with my clients to demystify these types of decisions. Except it’s not a judge, it’s a customer. And it’s not a dog, it’s a product.
Clients come to us with questions like…
- Why aren’t people picking my products?
- Why are they choosing a competitor?
- What’s going through their heads?
- What can we do about it?
These are big questions, and the answers can be make-or-break for companies struggling to retain and attract customers. Fortunately, unlike the opaqueness of the Westminster judging process, we’re able to help our clients understand what’s driving customer decisions.
If you don’t know the standards that customers use to judge your products, or how you perform on those standards, you’re in trouble. And if it stings a little to watch a Pekingese waddle off with Best in Show honors, it hurts a heckuva lot more to watch your competition walk off with your business.
Especially when you can do something about it.
I’m over at Eli Rose today to explain why your kitchen smells like rotten fruit. Drop on by!
It’s always fun to watch movies from the pre-9/11 era that have an airport scene. Talk about simpler times… a couple airport cops and a metal detector set so low you could walk through wearing medieval armor.
Nowadays, we’ve got the good old TSA to deal with. Personally, I think the agents get a bum rap a lot of the time. I like to give them the benefit of the doubt and imagine they’re just as unhappy about enforcing stupid rules as we travelers are about following stupid rules. Of course, there’s always a few bad apples in every bunch, and yesterday I found one. She was finding it difficult to stifle her disgust for the cattle she was herding through the checkpoint, and this gem slipped out:
“People! Stay with your items until YOU push them into the machine. YOU have to push them in. The belt doesn’t go automatically like at Kroger. It’s called manual labor, folks!”
Wow. Thanks for that.
Pretty impressive sarcasm, especially coming from an agency that claims to provide “world-class customer service.” Not that TSA really cares about customer service. Sure, they have to pay lip service to the idea, but as long as they have a monopoly on airport security, they can do pretty much whatever they want.
Still, as I reflected on that experience, it got me thinking about the rest of us (who do want our customers to like us): is it ever okay to be insulting when you communicate? When are sarcasm, snark, or even outright rudeness appropriate?
It seems obvious that a company shouldn’t insult its own customers. Very few companies have the right mix of brand, communications, and customer base to pull it off… although the stars do align occasionally. Take Woot, one of many deal-a-day sites on the Internet. They’re equal opportunity snarkists, splitting their time between making fun of the products they’re selling, making fun of themselves for selling the products, and making fun of their customers for buying the products. When you call your “grab bag” special a Bag of Crap, and your customers crash your servers trying to buy them whenever they’re offered, you know you’ve got a match made in marketing heaven.
Clearly, though, Woot is the exception. For the typical brand, insulting customers (even in fun) is too risky.
What surprises me, though, is how readily companies insult their prospects. Like…
- Samsung’s new ad for its Galaxy S II phone. It’s a direct bashing of iPhone users, who would seem to be a good target group for conversion.
- Apple’s “I’m a Mac/I’m a PC” ads. Sure, they were funny, but as a PC guy myself, having a smug hipster point out my nerdiness doesn’t make me want to buy a Mac. And if Apple doesn’t sell Macs to PC users, where’s the growth coming from?
- Miller Lite’s “Man Up” campaign. Because if you’re drinking any other light beer, you might as well be wearing a skirt. Boy, I sure am thirsty after having my masculinity questioned!
In general, if you want someone to buy from you, it’s not a good idea to insult them. So when does snark work? When you’re not insulting them. When you’re insulting yourself. Like Ally Bank’s smackdown of banking. Or Domino’s Pizza and their “we sucked, then we got better” campaign.
Want your customers to feel good about themselves? Want them to feel good about you? Then ditch the snark and stick to something genuine.
On the other hand, if you don’t really care about your customers… I know just the place for you!
I’m an NBA fan.
Not a “my team made the playoffs so I need to buy a t-shirt” fan. No, I’m an “I can tell you where every player on my team went to college” fan. And a “wow, a doubleheader of the 1993 Western Conference semifinals on NBA Classic, I’d better go heat up some cheese dip and settle in for a while” fan.
It’s lonely sometimes, being an NBA fan. Living in the South means you’ve always got someone to talk college football with. And once the bowl games are done, college hoops is a suitable way to pass the time. But the NBA? Let’s just say the appeal isn’t quite as universal.
And why not? Maybe because it’s not as family-friendly as MLB or the NFL. Maybe because the style of play is too “selfish.” Maybe because off-court issues like the Donaghy scandal and the lockout have alienated fans.
Ahh, the lockout. For all of you who haven’t noticed and/or don’t care, the 2011-12 NBA season should be underway by now. Unfortunately for us fans, it’s not – because players and owners can’t figure out how to share billions of dollars in league revenue. Honestly, who among us hasn’t been there?
It doesn’t seem that either side is in a huge hurry to find a solution. They’ve established their positions, they’ve postured and grandstanded, and now they’re content to lob insults and leak snippets of failed negotiations to the media to make the other side look bad. What fun.
As much as I love the NBA, I’ve got a few other things on my plate right now. Plus, NBA Classic is on my TV pretty much whenever I want it. So while I’m bothered by the delays and cancellations, I’m mostly content to shake my head in disgust and turn my attention to other things. I suspect I’m not alone in this.
So if the owners aren’t in a rush… and the players aren’t in a rush… and the fans aren’t in a rush… who cares?
Mr. Grizz, that’s who. That’s my Memphis Grizzlies account rep. No, his name isn’t Mr. Grizz, but for blogging purposes that’s what I’ll call him. Mr. Grizz has a great sense of urgency. So great, in fact, that he has launched a full multimedia campaign to get my attention.
He called my cell phone last week and left a message. Sample quote:
“It’s 3 o’clock on Friday afternoon. It is very important that I speak with you by end of day today.”
He mailed me a letter. Sample quote:
“Enclosed is my business card for your reference; you will need it this season.”
He sent me an email describing the team’s new deposit plan. Sample quotes:
“I’m going to lay this out plain and simple. Almost EVERYONE is planning to wait out the current NBA lockout situation instead of lining up your tickets in advance. While I understand your reasoning, it is not a good idea. You will NOT get the seats you have in mind.”
“You will pick seats ahead of other people in the order of the time deposits are placed, so first come first serve. If you told me you’d be interested in something, now’s the time to prove it.”
Now, don’t get me wrong. I admire Mr. Grizz’s initiative and I get what he’s trying to do. He’s a salesman, and he needs to sell something. If he can’t sell me a seat, he can at least sell me a place in line.
But here’s the problem: the middleman is the only one with a sense of urgency. I’m not losing sleep over whether I can get tickets to NBA games. And the NBA apparently isn’t losing sleep over whether those games get played anyway. So what’s the rush?
It’s a good reminder for anyone in sales: you can tap into urgency, you can harness it, you can bring it to the forefront. But you can’t manufacture urgency. It either comes from the customer or it doesn’t come at all.
Which means Mr. Grizz may be out of luck. And if I have to spend this NBA season reliving past NBA seasons over a bowl of cheese dip… well, there are worse fates.
Fill in the blank: there’s no such thing as too much _____.
I had my own thoughts, but did a Google search on the phrase “there’s no such thing as too much” to see what would come up. Top answers included bacon, barbeque, TV, cheese, information, and pie. In related news, if current trends persist, by 2025 about half the US population will be obese.
But I digress. My search actually started with “there’s no such thing as too much generosity”, but since I only got 5 results, I was curious what a more general search would bring.
So why “too much generosity”?
Before I get to that, here’s a little story about a guy named Nicolas Fouquet. Fouquet was a wealthy patron of the arts in the 1600s and served as superintendent of finances for King Louis the 14th. In 1661, Fouquet had the boss over for dinner. It was a lavish party thrown at his estate, Vaux-le-Vicomte, designed to impress and flatter the king. Unfortunately, the event sent the wrong message to King Louis, who thought the party was a bit too fancy and the estate a bit too impressive. Suspecting Fouquet of misappropriating government funds, old Louie had him jailed for life.
That story came to mind a few weeks ago when I received a referral offer from a service provider that we use. I’ve received similar offers from other companies in the past, and normally they are pretty modest – for instance, refer a new customer who buys our $99 software and you’ll get a $20 gift card. In this case, though, a referral was worth $500.
Five HUNDRED dollars for referring a new customer. Wow. It got my attention, for better and worse.
My first thought: Who can I refer? So in that sense, it served its purpose. While I never ended up referring anyone, it wasn’t for lack of thinking about it.
My second thought: We must be overpaying. If they can afford to shell out $500 for a referral, customers must be pretty darn profitable.
That’s probably not what they were shooting for with their offer. And maybe it’s not a legitimate interpretation on my part. There’s lots of reasons such a big referral bonus might be offered. Maybe other customer acquisition efforts are even more expensive. Maybe the company is on the cusp of some pretty big efficiencies and is looking to quickly add a few more customers to take advantage. Maybe they know they can lock in new customers for years and eventually see a payoff. Maybe they just need some quick cash flow and it’s worth a steep fee to get it. Who knows.
And maybe I’m a cynical jerk for reading too much into what seems like a really generous offer. But to me, this crossed the line between generous and too generous.
Am I suggesting that you stop being generous? No. I’m suggesting you think about how you mix generosity and marketing. Think about the signal you’re sending when you…
Give absurdly ostentatious holiday gifts to clients (“Please don’t leave! And yes, my margins are padded enough that I can afford this!”)
Sponsor every community event that comes along (“Sure it’s expensive, but we pass the cost along to our customers!”)
Accept one pro bono project after another (“No one’s willing to pay me for what I do, so I have plenty of time to donate my services!”)
Peg your charitable contributions to customer purchases (“We’re holding our donations hostage until our customers pony up some dough!”)
So the next time your marketing efforts include a generous gesture, give yourself a pat on the back for being a good person. But while you’re at it, ask yourself (or even better, grab some cynical jerks and ask them):
What signal am I sending?