After a couple of examples of non-customer centric encounters, I thought it might be time to provide some positive examples. The timing is perfect as I recently was reflecting on how I went from not using Netflix to paying $8.99 per month. It didn't happen overnight but it did happen because they made it ridiculously easy for me to business with them.
I started Netflix as do many people - with a free trial. Midway through my trial I started noticing a button on my home page. The button was my door to Netflix. No pressure, no sales pitch. They didn't even tell me about all the other membership levels. Just a simple click to become a Netflix member at their entry level of $4.99 per month. I clicked.
Then a few month later, just as I was wishing that I could get more than one movie per month, I started noticing another little button. This one told me that I could start getting unlimited movies per month (still one at a time) starting that day. It showed the amortized price for the rest of the month and then subsequent monthly price that I'd be paying ($8.99). Again, no major pitch, I didn't have to go to a separate screen that showed all of the other subscription options. Just a simple button. I clicked and continued this painless and seamless journey into Netflix membership.
I am currently holding steady at $8.99. But, I keep seeing the next button. I'm sure when the time is right I'll hit it and up my membership yet again.
Ironically, I would have never signed up for Netflix at $8.99 per month. I probably wouldn't have signed up if I didn't get the free trial. And I certainly wouldn't have signed up if I first had to talk with a sales person about Netflix. But, Netflix is smart. They didn't make me do any of that. They just offered me a simple button, a little information and left the rest up to me. It was almost too easy.
Sunday, July 19, 2009
Wednesday, July 15, 2009
United: 0 for 3
Well, my saga with United continues. They still aren't proving to be very customer friendly.
They went 0 for 2 with the on-line check in process. You would expect that once you log in you can hit a button and check in. But, that's not the case. I had to go through three screens of advertisements for things that I didn't want when I bought the tickets and suprisingly still didn't want. First screen - more legroom. Thanks for offering to upgrade me to a confortable seat. I appreciate it. Not! Actually, not only did you waste my time, you just reminded me how uncomfortable this trip was going to be. Next screen - the "premier" line. If I don't want to wait in a long line at security, etc, I can pay extra to get into a speedier one. Interesting. Maybe I should take some lessons from United and apply them to my business. I'll do the work. But if you want me to do be good (e.g., more legroom) you've got to pay more. And, my processes are pretty clunky, but for an extra $50, I'll try to be more efficient. That's brilliant. It used to be that companies invested in improving their inefficient processes. United seems to have found a way to make a profit from them.
I don't even remember what the third screen was. At that point, I just went straight to the bottom and said "skip this offer".
So, United has successfully violated most of the principles that Paco Underhill talked about in "Why we buy", United has designed a process that is clearly optimized for their needs and desires rather than their customers.
But, the story doesn't end. They then went for 0 for 3. Once I actually got past the commercials and "checked in" I printed by boarding passes. Much to my suprise, the seats weren't the ones I selected when I purchased the tickets. I guess they figured that I didn't really mean it when I took the time to specifically select five seats during the purchase process. Who knows, maybe these new tickets have a better view. I did see a button that would have let me change my seats. However, it never occured to me that the ones I had at check in were going to be different than the ones I selected in the first place so I didn't even check. I guess that's my fault as a customer. I shouldn't just assume that because I select something that I'll actually get it. Shame on me, right?
So, in my book, United is currently 0 for 3 in being customer-driven.
I just cant' wait until the actual flight. Ugh.
They went 0 for 2 with the on-line check in process. You would expect that once you log in you can hit a button and check in. But, that's not the case. I had to go through three screens of advertisements for things that I didn't want when I bought the tickets and suprisingly still didn't want. First screen - more legroom. Thanks for offering to upgrade me to a confortable seat. I appreciate it. Not! Actually, not only did you waste my time, you just reminded me how uncomfortable this trip was going to be. Next screen - the "premier" line. If I don't want to wait in a long line at security, etc, I can pay extra to get into a speedier one. Interesting. Maybe I should take some lessons from United and apply them to my business. I'll do the work. But if you want me to do be good (e.g., more legroom) you've got to pay more. And, my processes are pretty clunky, but for an extra $50, I'll try to be more efficient. That's brilliant. It used to be that companies invested in improving their inefficient processes. United seems to have found a way to make a profit from them.
I don't even remember what the third screen was. At that point, I just went straight to the bottom and said "skip this offer".
So, United has successfully violated most of the principles that Paco Underhill talked about in "Why we buy", United has designed a process that is clearly optimized for their needs and desires rather than their customers.
But, the story doesn't end. They then went for 0 for 3. Once I actually got past the commercials and "checked in" I printed by boarding passes. Much to my suprise, the seats weren't the ones I selected when I purchased the tickets. I guess they figured that I didn't really mean it when I took the time to specifically select five seats during the purchase process. Who knows, maybe these new tickets have a better view. I did see a button that would have let me change my seats. However, it never occured to me that the ones I had at check in were going to be different than the ones I selected in the first place so I didn't even check. I guess that's my fault as a customer. I shouldn't just assume that because I select something that I'll actually get it. Shame on me, right?
So, in my book, United is currently 0 for 3 in being customer-driven.
I just cant' wait until the actual flight. Ugh.
Sunday, July 5, 2009
United Airlines: Charging a premium for decreased service
Today I contacted United Airlines to change a return flight on trip. The total came to $230 ($150 change fee and $80 difference between the price of my old and new ticket).
Fortunately, I checked on-line before making the call and saw that the one way trip on my new date was only $194. The agent and I both agreed that it made more sense (for me at least) to keep my old reservation and book the one way flight. I wondered why, at that point, United would choose to go with the process that was less cutomer friendly (me booking the one-way on line versus them changing the flight for the same price). The outcome would have turned out the same. Either way they would have $194. But, for some reason, they chose the business-centric rather than customer-centric response.
This was a clear lose/lose in my book. As a customer, United made it hard for me to do business with them. If I can book a one way flight for $194, why charge me $230 to do it? At that point, they already paid the sunk cost of the agent's time. It wasn't lke they were getting any process savings for me booking on-line.
But did they gain anything? I now have a reservation on two return flights and I am only going to use one. So their supply and demand planning is off. They have one less seat that they can sell for full price (and make a lot more than the incremental $40 they would have made by charging me $230). So, I think they lost too.
At some point, trying to squeeze every penny out of your customer backfires, especially when customers are in control and have other choices. It's one thing if there wasn't an on-line flight that cost less. But given the circumstances, it seems like they consciously chose to provide poor service.
United had the choice to be customer-centric. The outcome in this case didn't change. The only thing that changed was the process. And they chose a process that placed the burden on the customer without getting any actual benefit for themselves. Now why would anyone do that?
Fortunately, I checked on-line before making the call and saw that the one way trip on my new date was only $194. The agent and I both agreed that it made more sense (for me at least) to keep my old reservation and book the one way flight. I wondered why, at that point, United would choose to go with the process that was less cutomer friendly (me booking the one-way on line versus them changing the flight for the same price). The outcome would have turned out the same. Either way they would have $194. But, for some reason, they chose the business-centric rather than customer-centric response.
This was a clear lose/lose in my book. As a customer, United made it hard for me to do business with them. If I can book a one way flight for $194, why charge me $230 to do it? At that point, they already paid the sunk cost of the agent's time. It wasn't lke they were getting any process savings for me booking on-line.
But did they gain anything? I now have a reservation on two return flights and I am only going to use one. So their supply and demand planning is off. They have one less seat that they can sell for full price (and make a lot more than the incremental $40 they would have made by charging me $230). So, I think they lost too.
At some point, trying to squeeze every penny out of your customer backfires, especially when customers are in control and have other choices. It's one thing if there wasn't an on-line flight that cost less. But given the circumstances, it seems like they consciously chose to provide poor service.
United had the choice to be customer-centric. The outcome in this case didn't change. The only thing that changed was the process. And they chose a process that placed the burden on the customer without getting any actual benefit for themselves. Now why would anyone do that?
Please fill out this form to request that your discount be terminated
Recently I wrote about customer-centric processes. In early posts, I've discussed the idea of the "path of least resistance". That is, if there is something that you want someone else to do, you need to make that action easier than doing something else. To many, path of least resistance and customer-centric processes are a no-brainer. At least, intellectually they are. But sometimes, our internal policies and processes get in the way.
Today, I was reviewing my Verizon Wireless bill and found a mistake. I was receiving an employee discount for a company for which I no longer worked. I called Verizon to let them know so that they could make the appropriate adjustment to their records (and unfortunately to my account).
After a few minutes, the customer service rep told me that I had to submit an email formally requesting that my discount be removed. He then gave me a very user-unfriendly email address and a list of information that I was supposed to include in the email:
Today, I was reviewing my Verizon Wireless bill and found a mistake. I was receiving an employee discount for a company for which I no longer worked. I called Verizon to let them know so that they could make the appropriate adjustment to their records (and unfortunately to my account).
After a few minutes, the customer service rep told me that I had to submit an email formally requesting that my discount be removed. He then gave me a very user-unfriendly email address and a list of information that I was supposed to include in the email:
Discount code
Corporate id number
Group id number
ECPD (which he never actually defined)
I explained that I didn't know the values for any of those codes. They weren't on the bill (In all fairness, he did tell me I could just give my discount amount rather than the code - that was on the bill). In the spirit of true service, he offered to look them up and give them to me.
I'm sure that if I asked people at Verizon if they were customer-centric and if they tried to make themselves easy to do business with, they'd say yes. Yet somehow through a set of small discrete decisions, they've create a situation which is just the opposite. They are asking me to jump through hoops to provide them with information that they already have (and I don't) in order to do something that isn't in my self interest (economically) and only benefits them.
It's easy to nod your head and agree with being customer-centric and creating the path of least resistance. It's another thing to actually do it.
Wednesday, July 1, 2009
Being nice to your customers doesn’t make you customer-centric
During a recent meeting, I made what I thought was a casual observation. The group of people with whom I was working weren’t very customer-centric. That message was not received very well (by most of the group). They assured me that they are very empathic toward their customers. They treated them with the upmost respect. Finally, they argued, this particular meeting wasn’t about customers. It was about the relationship between two providers in the supply chain. The issue was how one of the provider’s relationship with the customer impacted the other provider’s relationship. That’s when I knew they didn’t get it. Every conversation needs to be about the customer. The right question to ask was how these two provider’s relationships impacted the customer.
Being customer-centric isn’t the same as being nice to your customer. It isn’t even the same as providing good customer service. Being customer-centric is about whether your business is designed around the needs and expectations of the customer.
In Why We Buy, Paco Underhill provides example after example of stores which are not customer-centric. Their layout, flow, processes, and information attempt to control the customer’s interaction and experience. Underhill points out that such strategies often fail. Customers are persistent. They’ll make the system work for themselves. Trying to manipulate their process doesn’t stop them, it only frustrates them.
A 2008 Harvard Business Review story provided an excellent example of a customer-centric decision at Amazon.com. Amazon used to list the products that it sold separately from the products sold by its affiliates. When searching for a new digital camera, you got a page of the cameras available from Amazon. To see cameras from affiliates, you had to click a link and navigate to another page.
Bezos decided that this was cumbersome for the customer. They didn’t care who sourced the camera. They just came to Amazon.com to get one at a good price. Despite objections from his purchasing and sales people, Bezos made the change. He said that the most important consideration was meeting the customer’s need. Overall revenue for Amazon increased. Optimizing for the customer rather than the business (or perceived needs of the business) won out.
Customer-centric organizations are aware of three major changes in consumer behavior.
Some companies and industries seem to be resisting these trends. Sometimes there is large-scale resistance in attempts to legitimize their experts through regulation and laws. Other cases are more subtle such as a simple website design or process that forces the customer to see the description of a product before show him or her the price”.
Ultimately, I believe that these industries and companies are going to lose out.
It’s time to move from focusing on being nice to customers to adapting to their needs. There are no longer decisions that don’t impact your customer. If you don’t start out by asking how a decision helps or hurt your customer, you are not being customer-centric. And this doesn't just apply to external customers. Many enterprise-based departments are working to become better partners with the front-line business. The problem is that while they are trying to improve service, they still have processes, tools, and policies that are optimized for their function rather than the need of the customer.
Being customer-centric isn’t the same as being nice to your customer. It isn’t even the same as providing good customer service. Being customer-centric is about whether your business is designed around the needs and expectations of the customer.
In Why We Buy, Paco Underhill provides example after example of stores which are not customer-centric. Their layout, flow, processes, and information attempt to control the customer’s interaction and experience. Underhill points out that such strategies often fail. Customers are persistent. They’ll make the system work for themselves. Trying to manipulate their process doesn’t stop them, it only frustrates them.
A 2008 Harvard Business Review story provided an excellent example of a customer-centric decision at Amazon.com. Amazon used to list the products that it sold separately from the products sold by its affiliates. When searching for a new digital camera, you got a page of the cameras available from Amazon. To see cameras from affiliates, you had to click a link and navigate to another page.
Bezos decided that this was cumbersome for the customer. They didn’t care who sourced the camera. They just came to Amazon.com to get one at a good price. Despite objections from his purchasing and sales people, Bezos made the change. He said that the most important consideration was meeting the customer’s need. Overall revenue for Amazon increased. Optimizing for the customer rather than the business (or perceived needs of the business) won out.
Customer-centric organizations are aware of three major changes in consumer behavior.
- Formal expertise is now distributed and the expert’s role has changed from being the ultimate source of truth to being one of many opinions.
- Customers expect a lot of information about the products and services they are buying
- Customers control the process
Some companies and industries seem to be resisting these trends. Sometimes there is large-scale resistance in attempts to legitimize their experts through regulation and laws. Other cases are more subtle such as a simple website design or process that forces the customer to see the description of a product before show him or her the price”.
Ultimately, I believe that these industries and companies are going to lose out.
It’s time to move from focusing on being nice to customers to adapting to their needs. There are no longer decisions that don’t impact your customer. If you don’t start out by asking how a decision helps or hurt your customer, you are not being customer-centric. And this doesn't just apply to external customers. Many enterprise-based departments are working to become better partners with the front-line business. The problem is that while they are trying to improve service, they still have processes, tools, and policies that are optimized for their function rather than the need of the customer.
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