Like most people, I order a lot of stuff off the Internet, and I have an automatic renewal set for a lot of them, including magazine and on-line newspaper subsriptions, software (like the software that I use to write this blog) and even energy bars.
But I don't always remember what I've set to "auto-renew," until I receive the order confirmation from the company. In other words, they "remind me" by sending me an email, notifying me that they've just charged by bank account or my credit card.
I recently received a reminder from the Daytimer Company (see below). Instead of waiting until after they shipped the product and charged me for it, they're telling me before they ship, and before they charge me.
In other words, they're giving me an opportunity to change my order, or even opt out, if I choose to.
Now, I suspect that most companies don't take that approach for fear that they'll lose customers, and lose revenue. That's certainly a valid concern, but it's clearly not a customer-focused approach.
Daytimer is being more customer-focused, by being more transparent. And I respect that in a vendor. Sure, they may lose a few renewals, but I suspect they'll gain a lot more trust.
Go ahead, Daytimer - process my order and charge my credit card - I'm glad to continue doing business with a company that's up front with me.
The point is this:
If a customer will be impacted by somethign you're about to do, notify the customer. Even if you're not contractually bound to notify the customer, do it because the customer would want to know. Do it for the customers' sake - not for your own.
Because that's what customer-centricity is all about.
When the lights went out during this year's Superbowl, my immediate thoughts were, "New Orleans will have a hard time convincing the NFL to let it host another Superbowl."
I immediately thought of Jet Blue, and its systems failures on Valentines Day in 2007, causing thousands of flights to be cancelled, and stranding more thousands of customers. How does a company restore its reputation, after such a public catastrophe?
Entergy New Orleans did what Jet Blue did: They handled the situation in a way that will not only restore any lost trust, but potentially increase the level of confidence among their customers. They were candid, specific, and put forth a plan for resolution.
Entergy New Orleans was open and honest in taking the blame. They openly said, "It's our fault." Too often, a company will offer statements that show some remorse, but don't explicitly say, "We're the ones to blame." Customers need to hear statements of ownership. That's the first step in rebuilding trust.
Identify the Root Cause
Once you've taken the blame, explain exactly what caused the problem, and be specific.
David Neeleman, founder and CEO of JetBlue identified specific factors within outdated information systems, that prevented the airline from taking steps to adjust to the storm.
Similarly, Entergy New Orleans identified a relay setting within the switching gear, as the ultimate cause of the power failure. Offering detailed, plausible explanations for what went wrong change the focus from emotional finger-pointing, toward problem-solving.
Present a Plan for Resolution
You need to give customers a concrete reason to believe that things will be better in the future; that the problem won't happen again. David Neeleman vowed to replace the outdated systems, and immediately established and communicated a new "Customer Bill of Rights."
Going public with a specific plan to prevent the issue from recurring will be the next step for Entergy New Orleans, and SMG, which manages the Superdome.
Execute on the Plan
A plan is just a plan, until it's put into action. That's when real change happens, and that when future potential problems are prevented. Once a clear plan is established, Entergy New Orleans anad SMG will need to carry out that plan, and communicate to their consitutents what's been done.
Jet Blue is a stonger company today for having endured t he Valentine's Day Massacre in 2007, because of the way they handled the situation. Entergy New Orleans will likely be stronger, more trustworthy, and supplying the power to more Superbowls, by continuing down the path of candor, causality and action.
It's summer on the coast of Maine, and people are eating lobster - lots of it.
Lobster prices have hit record lows, due to a glut in the supply. But if you go into a restaurant, don't expect to pay any less than you normally would - it appears that restaurants are still charging top dollar for the highly-craved crustacean. Should their customers be upset? Should they feel cheated? Is the restaurant risking its customer-friendly reputation, by not sharing?
When there's a glut of oil in the market, gasoline prices drop at the pump, and the consumer benefits. But when there's a glut of lobster in the market, the prices are no lower at the plate than they are when the supply is "normal."
Should a restaurant lower their prices on lobster dishes, when the restaurant pays less - a lot less - for the lobster? Should customers expect to share in the savings? Does a business risk its trustworthy reputation by not sharing the savings with its customers?
When a company reduces its costs through its own innovative efforts, it's "earned" the savings, and can more easily justify keeping those savings as profits. But when the savings were not "earned" by the company, is there any "marketing obligation" to pass those savings on to the customer?
In the August 2012 Issue of CRM Magazine, "The Guiding Assumption" by Lior Arussy describes how many (too many, in fact) business create policies to prevent customers from ripping them off, or "abusing the system." Building business operations in response to those few bad apples can be a bad idea, because it unjustly punishes the masses, and over time, will limit the growth of business.
By my own experience as a customer, I've realized that the converse of this - extending the benefit of the doubt to all customers, despite the behavior of a few bad apples - can be a pretty powerful catalyst in growing a business.
Don't let that one bad apple determine how you run your business.
Does that give you an easy way to make a few bucks off the unsuspecting guest? That’s not what you intended? Well, that’s how it felt to me, your customer…
I stay in hotels often enough to know that in-room refreshments, like the ones in those well-stocked mini-bars are not free. People expect to be charged for stuff like that. It’s made obvious by those placards that are placed right inside the door. They’re made visible so that the guest can’t miss them.
I’m OK with the fact that you charge $4.00 for a bottle of water. You have a right to charge whatever you want, just as I have the right to not buy it, if I think it’s too expensive.
But I’m not OK with your presumed attempt to hide the high price through your creatively deceptive label design. If you’re going to charge me 4 bucks for a bottle of water, make that as clear as the word “Thirsty.” (Hint: If you're looking for the price, think "under water.")
A business grows a loyal customer base by delivering value, and building trust. Trust and dis-trust are generated in infinite ways. Even through the design of a water bottle tag.
Weigh all decisions, large and small, from the customers’ point of view. How will it impact your perceived trust-worthiness?
I've been a frequent reader of the New York Times on-line eddition for as long as I've been a frequent user of the Internet. And I still am, even though it's no longer free. But for those laggards among us - people like me who don't want to ante up, but know they eventually will - the Times is taking a smart and considerate approach.
When the Times began the transition to paid access to online content, they imposed a limit of 20 free articles per month, per "subscriber." Earlier this week, the Times entered another phase of the transition - they reduced the number of "free articles" from 20 per month to 10 per month. The fact that they've added this phase reveals how they're sincere about making it easy on the customer, by smoothing the transition, to help customers to adapt to the new subscription fee.
Over the past several years, we've seen a lot of companies in a lot of industries alienate a lot of customers by charnging for some things that were once free. Airline baggage fees, Netflix doubling its fees in last July, Bank of America's proposed $5 debit card fee,and others have been publicly demonized for suddently announcing fees in a way that infuriated customers.
But new fees don't have to alienate customers - sometimes, it's all in the delivery.
As a frequent reader of the New York Times on-line, I was initially frustrated and disappointed when I learned that they would soon charge customers for continued unlimited access to their on-line edition.
Frustrated, and mostly disappointed, but definitely not angry. Here's why:
The Times explained in simple, logical terms why they made the decision to charge (a logical, believable economic reason). And they gave notice early and often (several months in advance, and every time I logged on.)
When their new on-line fees began (or, the number of "free" views became limited), it wasn't a surprise, and the reason was clear. I wasn't happy with the situation, but I accepted it.
If you do have to begin charging your customers for something that they didn't pay for in the past, take a tip from the Times:
Explain in simple, human terms why you have to make the change.
Be honest and be sincere. Don't say it through a stuffed-shirt executive, but say it through a casually-dressed, mid-level employee; an every-day person to whom your customers will relate.
Offer a Transition Period.
And don't shock your customers by imposing the entire fee suddenly like an ice-cold bath tub, but give them a way to transition gradually, to minimize the pain.
Give them early notice in straight, honest language, and transition gradually, so when it does happen, it's old news.