Customer Retention
A Customer Service Story
It’s a crazy week, and I’m busy setting up my MoBlogging module so that I can add content while I travel for the next three weeks. First, I’m headed to India, and then will stop in France on the way back for the Cannes Lions. In preparation, I had to go to the Indian consulate this morning, because I had a small problem with my passport.
Last month, while returning from London, I was looked over very suspiciously by the immigration officer. I smiled right back, hoping that it was just his way of being intimidating just for the heck of it. He then cleared his throat, and proceeded to ask me a few questions...keep reading.
Things I Want
I want my dry-cleaner’s to barcode all the clothes I send them, and scan it in every time it comes in. Eventually, I’ll have an online repository of all my suits and shirts, and information on when I bought them, and how often they’ve been cleaned. I can add notes on special care for individual garments on the secure page provided by the dry cleaner, and as a result, will not go anywhere else, ever again, for my cleaning. If I move, a consortium of cleaners could have access to my data, and I’d only want to move within that network, because I don’t want to lose the information on all my clothes and their care. Purple Tie does some of this in the northern California, but not enough.
I want Starbucks to mine its cash card transactional data and create a premier-customer line between 8:00am and 10:00am for high value customers, in select stores, reducing the wait time for these customers to get their coffee. Value could be determined by a combination of frequency, longevity and margin (some drinks make more money than others.) This will increase sales of the cash cards, where they’ll get better margins because of breakage, and it’ll push morning traffic to stores that can handle them better. Of course, all of this has to be done under some kind of new Starbucks loyalty program umbrella, and have other benefits as well. I’d recommend creating a program construct with only a few national benefits, like the coffee premier-customer lane. The rest of the benefits should be administered at the local store level, with benefits coming from neighborhood vendors who want to share in Starbucks’ traffic.
I want my local home improvement retailer to start a replenishment program so that I don’t have to go buy lightbulbs or filters anymore. I want a subscription to my every-week home necessities. Come to think of it, they could also send things like garbage bags, disinfectants, laundry detergent and toilet cleaner. I want to be able to manage my subscriptions online, and turn them off when I go on vacation. And when I move, I want to be able to go to my local home improvement retailer, punch in my new address into a kiosk, and have it spit out data on how often the house needed replacement bulbs, filters and other essentials.
I want my wireless carrier to have a push-button option that allows me to upload all my phone numbers to some secure network location that they host. That way, if I ever lose my phone, (and I don’t backup my phone numbers to my computer,) I can use a simple push button with the same provider to download my numbers again. I’d pay for this service, but if I were my phone company, I’d give it to me for free—because with all my 600+ numbers stored securely on their network, I’m not going anywhere.
The Business of Weddings
Come June, I will descend into sweltering monsoon heat somewhere in India, where the air is so sticky you can slice it open with a butter knife. I will make my way through a teeming throng of travelers at an overcrowded airport, and the musty swank of stale sweat will leave me dizzy and annoyed with the world. If you were there, at that airport, sipping on cool lassi and swinging your sandals, you might notice, despite my anglo-trained need for personal space and my constant grimaces at smells afoul, a skip in my step, and a lightness in my being. You might notice a wiggle in my brow, and a song on my lips...continue reading.
Wireless Providers: What’s Your MHz?
Monday, July 12, 2004
If you’ve been following this blog for the past month, you’ll remember my frustration with AT&T Wireless in my post about loyalty versus appreciation.
This weekend, in an irony of decent proportion, my service improved drastically, along with my annoyance with the company. Let me explain.
In Decmember of 2003, I purchased a new “smart phone” from AT&T Wireless, in the hopes that I wouldn’t have to carry around two devices—the device was going to serve as my PDA as well as my cell phone. The Motorola MPx200 is AT&T’s current flip-phone offering in that arena.
I moved to Minneapolis in the spring of 2004, and noticed a considerable drop in service quality. I had dropped calls in dozens of locations: downtown, Uptown, outside the city, in the city, in the car...everywhere. I called customer service to find out if they had any plans to upgrade or better the GSM service in MN, because I figured I’d move back to TDMA, if there were no plans in the near future to improve the state of reception quality.
I was told that I should wait just thirty more days, because the company was making a major announcement, and drastically increasing and improving their GSM network.
So, I waited.
Sure enough, in May 2004, I received a note from AT&T Wireless saying that they had exponentially increased their GSM coverage through partnerships with other carriers, and that in order to use the service, “..you, Mr. Menon, have to do nothing—your plan will automatically use the new enhancements.”
I could swear that I had even more dropped calls after that.
I called customer service again, and spoke to a very polite lady who took a look at my account, and said that everything looked good: I had a good phone, an appropriate plan, and she wasn’t sure why I was having difficulty. She suggested, very nicely, that I try to turn the phone off and on again. I replied, equally politely, that I did that every day.
Dead end.
Until this weekend. I was at the Mall of America looking for new clothes (I dropped four inches off my waist in the past six months—more on the marketing machine behind that later,) when I happened to wander past the AT&T Wireless store. I decided I’d go in, cancel my service, and switch to Verizon, located just a few stores down.
Jeff, the sales rep who couldn’t have been more than twenty years old, took a look at my phone, listened to my issue, and smiled broadly. Turns out that the Mpx200 does not work on the 850 MHz network. It only uses the 1900 and 1150 networks, and 90% of the service enhancements use the 850 network. He was so convincing that instead of leaving the company, I bought a new phone to test it out.
Sure enough, he was right. 4 bars all the way home.
What frustrates the dickens out of me is that AT&T Wireless had all the data to upsell me a new phone, increase my satistfaction, and strengthen a relationship. They knew, for instance:
- My phone type—they knew I had a phone which didn’t work with the new service rollout.
- My service call code, which identifies the category of complaint.
- My usage areas, and how that related to their enhancement.
If they had just personalized their communication in the note of May 2004, I’d be a customer with a completely different story right now. They spend $100MM a year on their advertising campaigns. What do you think personalizing a high-response communcation would have cost?
Here’s why I think I don’t get any such communication from AT&T, and that my hold times on their customer service line always tops twenty minutes, and that their advertising is all about new account acquisition: 2-year service contracts.
AT&T Wireless’ typical customer cannot afford the $250 or so it would take to switch providers. In terms of hard ROI, there’s more immediate benefit in acquiring new customers, than there is in keeping old ones. It’s a short-sighted viewpoint that will be the failing of the company.
And that’s a predicition from a frustrated top-end customer, as well as a professional customer relationship marketer.
Cultural Context in Loyalty Initiatives
Some brands are cultural phenomenona. They serve not just as the counduit to a product or service, but fulfill a deeper, greater need that customers have, one that satisfies a more intangible yearning. In the book Trading Up: The New American Luxury, Neil Fiske and Micheal Silverstein conducted a survey of “New Luxury” buying habits, and categorized those intagibles into:
- Taking Care Of Me: Goods that make them feel better about themselves immediately.
- Connecting: Things that make them feel more attractive, connected, and foster a sense of belonging.
- Questing: Experiences that make the consumer feel like they’re venturing out, and pushing personal boundaries.
- Individual Style: Goods and services that provide self-expression and signaling.
Loyalty initiatives by companies that provide these intangibles can’t afford to follow the traditional mold of rewards, points and unrelated merchandise. It’s vital that they focus on extending the overall brand experience into their loyalty services and benefits. I call this moving from Transactional Loyalty to Relationship-based Loyalty.