Church of the Customer: March 2004 archives
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March 10, 2004
Case study updates
Two of our case-study companies, Krispy Kreme and Southwest Airlines, are in the news today.
Krispy Kreme reported sweet profits. For the three months ending Feb. 1, the doughnut maker earned $16.4 million, or 26 cents a share. A year ago, the company earned $5.6 million, or 9 cents a share. Total fourth-quarter sales increased 36 percent to $185.5 million from $136.7 million the same time a year ago.
Systemwide sales were driven by an increase in company-store sales of 36 percent to $124.7 million. At stores open at least a year, company store sales increased 10.7 percent. Not bad for a company that sells doughnuts and coffee.
In other news, the A&E television network announced it will broadcast a second season of "Airline," which chronicles the life and times of Southwest and its customers.
Talk about Napsterizing your knowledge: Unblinking television cameras portray the good, the bad and the ugly of airline life. The can-do spirit of Southwest's good-humored personnel show up in each episode, as well as the ugly; the usual suspects here are petulant, drunk and obnoxious customers. It's easy to see how each episode of "Airline" could be used as customer-service training.
Ultimately, airline work can be demanding, if not rewarding, and "Airline" shows us why.
March 08, 2004
The missing men party
The Chicago Tribune found a a group of people who have been missing for months: 18- to 34-year-old men. Well, they have been missing from network TV-watching, to the tune of a 21% drop in viewing this last fall. This narrow band of young men is the most coveted demographic by big advertisers because they're usually the first to buy most products. Theoretically, they have the most money to spend, too.
In a quest to understand what these men really want, the Tribune chatted with a group of them and discussed loyalty to companies, media habits, and what influences them. It's a long piece, so here are three key things to know:
- They like to discover new, little-known products, music, etc. themselves vs. seeing them advertised on TV.
- They distrust mainstream media. Many would rather get news from independent web sites.
- They rely on word of mouth to learn about products or websites.
The article quotes their converstation:
Matt: I frequently just get recommendations from my friends on what to read. With the exception of a few magazines, I really don't seek out anything independently, but rather someone will say to me, "Check out this Web site" and the next thing I know it's on my [Internet] favorites list. I check that every day.
Herman: Word of mouth has more of a power over my decisions than any type of advertising. Hearing from people you respect -- your interests expand from there.
March 06, 2004
The idea of 150 promoters
John Battelle of Business 2.0 writes about the Net of Influence and how one researcher believes it's largely centered around 150 people.
March 04, 2004
Cowboy branding
At Disney's extraordinary shareholder meeting this week in Philadelphia, former board member Stanley Gold said in his prepared remarks: "In recent times, there's been a tendency to refer to us as 'the Disney brand.' Branding is what you do to cows. Branding is what you do when there's nothing original about your product."
Ouch. But indications are that Gold touched a nerve, which is: Companies are often addicted to their "brand." Chief marketing officers telegraph their addiction by earnestly discussing "brand awareness" and "brand equity." Visible evidence of their affliction?
* They bet worrisome amounts of money on ad campaigns whose measure of success is "increased brand awareness."
* With straight faces, they calculate the contribution of "brand equity" to the bottom line.
With slavish, internal devotion to "the brand" like an infallible corporate deity, companies often cast aside the true gods: customers. Rather than hiring unbelievably helpful customer-focused employees, or improving products or services, or lowering prices, brand crack is fired up and inhaled by mass media campaigns devoted to "brand building." With brand crack now coursing now through the bloodstream, the marketing chief dedicates most energies toward feeding the addiction: company ego.
Taken to extremes, as Gold argues in Disney's case, "the brand" supercedes everything, and the company loses its soul.
A candle by any other name is not as cool
One of the benefits of an email newsletter signup system vs. a blog's RSS feed is knowing who your subscribers are. Yesterday, the proprietor of Candlelicious signed up for our newsletter. Love that name!
March 03, 2004
Real men and women ask for feedback
Is asking for feedback a sign of weakness?
According to a reader of our MarketingProfs.com article about customer feedback, it is. The reader writes on the comment board below the article:
One could easily argue that asking for feedback shows that a company is weak, especially if it is very prominent. Whenever I'm asked for feedback, I get a sense that the company is insecure. In addition, for companies like Sony, Godiva, Versace, and most elitist companies, asking for feedback definitely does not fit their personalities. I see them as professional, completely sure of themselves.
This is a good opportunity for further discussion... Just because Sony and Versace don't ask for feedback doesn't mean they're doing everything right. (Godiva makes emailing the company or talking to a live person via their website extremely easy.) For instance, I would LOVE to give Sony feedback that:
- Most, if not all, of its software is terrible.
- I won't buy another Sony Vaio PC again because too much has gone wrong with it, and I tell others to avoid the Vaio.
- The Sony website with information about my Sony products is a slow-moving swamp fraught with too much useless information.
Does Sony know any of this? Maybe, if it tracks random conversations or monitors what customers say on various websites. But without a formalized customer feedback program, it will probably keep producing crappy software, poor-quality PCs and an average website.
There is no failure, only lack of feedback.
At the same time, I would tell Sony that I love my DSC-P5 digital camera along with a few ideas that might make it even better.
Our research into companies with strong word of mouth shows they engage their customers frequently with feedback systems, and the influential, early-adopter customers love to provide it. That doesn't mean every customer will, or wants to, but upwards of 25 percent might. Maybe even half of all customers.
It takes courage to ask for feedback. Doing so is not, by any means, a sign of weakness.
The addiction of Amazon rankings
A funny and mostly true (OK, very true) piece on why authors are addicted to Amazon rankings:
In its user-friendly way, [Amazon.com] taps into what is apparently all writers’ need to quantify and compete and, yes, fight back. Even the few book-review outlets that still exist usually don’t give an outlet to authors. And about those rankings: Since most publishers are vague (even with their authors!) about how many books have been printed and shipped, let alone sold—and since BookScan, the closest thing the book world has to a real-numbers tally, charges six figures for access—the lowly, anxious writer has nowhere else to turn to see how he’s doing.
March 02, 2004
The fear of customer feedback
MarketingProfs.com has a new piece from us on the 10 Golden Rules of Customer Feedback. (Free registration required.)
March 01, 2004
If you love it, set it free
Authors giving up copyrights? The latest trend in generating book buzz, especially for self-published tomes, is giving it away for free. Or giving up many traditional copyrights.
Some authors and indie-publishers favor the Creative Commons copyright license which stipulates some rights are reserved. One flavor is called an "Attribution-NoDerivs-NonCommercial" license. Meaning: readers can make as many copies of the book as they want as long as they give attribution to the author, don't create derivative works, and don't sell any copies they make.
Seth Godin understood this concept in 2000 with his book "Unleashing the Idea Virus." He first released the book on the web for free. It's been downloaded more than 2 million times. (Months?) after its e-release, the exact same book came out in hardcover form for $40, reaching #5 on Amazon.com's bestseller list. He grew his audience of potential buyers significantly by providing up-front value.
The lesson here: the more that we share information, the more valuable it becomes. Napsterize your knowledge and watch how it jumps from person to person, creating value along the way.
NOTE: And what of our book? Do we eat our own dog food when it comes to Napsterizing knowledge? First, we weren't as smart as Seth in planning that strategy before signing a contract with our publisher, which wasn't too keen on giving away the entire book for free. However, with their blessing, you'll find large portions of our book in various MarketingProfs.com articles we've written, which are available for free.
Update on the blog tour
Here's an updated schedule on the Business Blog Book Tour (#2), where Jackie Huba and I will spend a day chatting about customer evangelism issues, goals and ideas with the best business blogs on the Internet today.
Many thanks to Todd at A Penny For for managing the tour.
