Tuesday, July 6, 2010

Apple Store lavishes service on disgruntled iPhone 4 user

The customer enters a teeming Apple store one week after the release of the new iPhone with a head of steam built up over a seven-day period of unalloyed product frustration.

“I want my money back,” the customer says to the first associate by the door. “This phone is a complete failure on every level. And don’t even try to tell me I’m holding it wrong.”

The associate in harm’s way, a maybe-at-most-23-year-old woman, changes her bright smile into a look of sorrowful concern.

“That’s terrible you’ve been having trouble. I’m so sorry. Let me help you right here if you want to return it and get your money back,” she says. “One thing, though--you don’t have to, but would you mind telling me what’s been going on with it? I’d really like to know.”

This initial rejoinder is a pitch-perfect response. She apologizes before doing or saying anything else. She is immediately acknowledging there is not going to be an argument or hoops for the customer to jump through to get satisfaction—in this case wanting his money back. She then does a quick verbal pirouette to express genuine interest in what the problems have been.

After the customer finishes his description of dropped calls, email issues, lost data, and more, the associate again apologizes, sympathizing with the customer’s plight. “I know that must be really tough when you’re on a business call or sitting waiting for an important email,” she offers. “If you have a minute, there’s something I can do that might help quite a bit by just resetting the connection—you won’t lose any data—want me to give it a try?”

The customer, now not wanting to be an impediment to a sincere attempt at correction, agrees to the idea, and at least has temporarily abandoned the idea of getting his money back. The associate returns a few minutes later with a manager—he’s maybe all of 24 years old.

“I’m Andy,” he says. “I hear you’ve been having trouble. We’re going to do a couple of things.”

He tells the customer they’ve done the reset, explains how some of those people who bought the phone in its first few days have experienced connection issues (“it’s about one in 20”), that he wants to give the customer a complimentary “bumper” to surround the outer antenna (“should you want to give the phone another chance”) and that he’d like to do a phone call and email test. The customer obliges and the phone performs perfectly in both sets of tests.

As the customer departs, happy, Andy tells him he still has 21 more days to return the phone, but to watch it carefully over the next week to see if it’s performing as it should.

There are plenty of amazing lessons here. It’s possible the customer happened upon the two greatest sales people in the known universe, but it’s unlikely. It’s also unlikely these two 20-somethings had the years of experience to know exactly how to handle this difficult situation. More believable is an unequalled set of training protocols and logical steps in a selling model that have made Apple stores the envy of retail.

Getting these glimpses into customer and associate interactions is critical to success on the sales floor. One of the reasons we are brought in is to give our client partners the full measure of activities and actions within the environment, and to help them understand enterprise-wide opportunities and persistently occurring barriers to the sale. Video and audio enabled behavioral analytics is our prime methodology for doing so, and it’s often a fascinating way to see how loyalty can be built or ruined on one turn of a phrase.
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Monday, June 28, 2010

Cruel, unusual and effective?

In our assessments within retail stores, we often see the actions of shoplifters through our video cameras. Though shoplifting is not typically on the list of behaviors we look to capture and code (we only half-kiddingly say our cameras are placed for the business purposes of good - like pinpointing barriers to the sale and identifying new opportunities to increase performance and the customer experience), it’s an activity that is impossible to ignore. These shrinkage incidents have become so prevalent, in fact, that we’ve developed an expertise in the observable assessment of how dishonest people behave when they’re in a retail environment—often in interesting ways that suggest an earnest attempt to look honest. This is, of course, its own tell.

The old rule of thumb that potential shoplifters get spooked when approached by an associate (unwilling to look them in the eye, for example) stays true — but not always. We’ve seen a new breed of brazen behavior that almost reads as sociopathic: chatty, superficially charming customers who show no fear in front of associates, almost “selling” themselves as a way to throw off the scent or any hint of wrongdoing, like they’re just that jovial long-lost friend coming across the lease line.

But if certain stores have their way, even these wily coyotes might take up another hobby. The New York Times reported yesterday that a number of stores in the region which cater to Chinese immigrants are now adopting shoplifting procedures borrowed from mainland China retailers. Essentially, if you’re caught, the stores seize your identity cards, and you pay the retailer a steep fine (up to hundreds of dollars) in return for getting your cards back and to insure your picture does not get displayed on a prominent wall of shame for all to see. While there are a host of civil liberty issues at play with these tactics (it would be hard to imagine chain stores playing this style of hard ball), it will be interesting to see if retailers do adopt more aggressive approaches to the problem.
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Monday, June 21, 2010

Science of the Churrascaria

If you’ve visited Chicago recently, you may have bumped into the burgeoning churrascaria movement—where at last count four of these Brazilian-style steakhouses manage to thrive within a five-block radius. They’ve splashed themselves over cities and suburbs alike, beckoning diners with an all-you-can-eat concept far removed from the buffet chains and those sometimes frightening strip mall Chinese joints. If you haven’t been, the different churrascarias are remarkably similar. $50 gets you dinner, which includes an over-the-top salad bar (think prosciutto, hearts of palm, smoked salmon, and artichoke hearts—not cottage cheese with pineapple chunks) and at least a dozen varieties of steak, chicken, lamb and pork—all brought to your table on giant skewers and sliced to order by servers dressed in gaucho garb. Cheese bread is brought to your table first (irresistible, but the centerpiece of a fill-you-up-early-fast-and-often consumption strategy on the part of the house). Dinners are accompanied by equally rich whipped potatoes and plantains. Patrons can select the salad-bar only, generally about half the price. But nobody goes for this option (it’s less than two percent of all diners, which may seem low, but since the show is all about the meat, not a complete surprise).

For what are higher-end restaurants, it’s an amazing formula to behold, and works on a broad volume of business. Where you might think the table of 10 college-aged guys would eat the place out of house and home since there is no end to the high-cost food offerings as long as you continue to want more, such a table doesn’t cause a ripple. In fact, restaurant managers and chain executives of these places never look at the behavior of individual tables—they’re looking at the 2,000-odd covers per week per store. They want to make sure 32.5% of guests order dessert (who are these people?), that the average tab per head stays constant at $67.50, and that there’s no variability across days and weeks when it comes to per capita meat consumption (2.25 pounds per). In fact, they’re quite happy to seat “we’re-going-to- stuff-our-faces-and-get-our-money’s-worth” revelers since, in the end, they’re outweighed by lots of customers (especially women) with dramatically less robust appetites—especially after a few helpings of cheese bread and mashed potatoes.

Volumetric understanding of real customer behaviors in situ is the secret to any business. Much can come from the hands-on experience of retailers, store operators and restaurant execs who discern important patterns and lessons over time. One way we’ve been able to help them drive business to greater success is to be their eyes and ears across multiple locations, days, day parts, and weeks, with video and audio enabled behavioral analytics—giving them deeper looks and insights into the bricks-and-mortar realities of their stores. There’s no doubt a reality-driven behavioral segmentation study of customers on premise is a meaty treat—no matter what business you’re in.
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Saturday, May 15, 2010

When the execs come to visit the store: what’s real and what’s typical?

Parents’ Day at summer camp is usually a kid’s first lesson in the art of spin, optics, presentation, veneer and varnish. This is the day the food is better, cabins are swept, and everyone’s smiling. As soon as the last car leaves, the gussied-up, rustic Eden reverts to its usual repose as juvenile hellhole.

It’s still shocking how many times we’re in the field on store visits with retail executives and hear how great this particular location is—only to see later the abyss that it truly is when we’re reviewing video that’s been captured with “mom and dad” not around. When a regional manager happens to be in the store, customers are magically lavished with help and praise and good cheer. There’s a bustle about the store, with purposeful professionals doing the Lord’s work of selling and stocking and just being busy and fussy. Products are laser-lined on every shelf. It’s all quite—what’s the word?—lovely.

Until it isn’t. Which is usually the next day.

We see lots of non-sales winning behaviors as soon as stores return to “normal.” The customer greetings are weaker, contact interactions on the floor are less effective, and products look sloppier. Rote recitation often takes hold, where associates go through the motions.

It’s no wonder when we’ve asked retail executives how much time they believe their associates are in direct contact with customers, giving assistance, the answer is sometimes in excess of 40 percent—a belief the staff is spending almost half its time attending to the needs of the shopper. This is their experience, and may well be what’s occurring when they’re in the field observing. But when we show them the day-in and day-out reality—sometimes at 12% or less—it’s an eye-opening experience.

Kind of like sneaking a peek at camp the day after Parents’ Day.
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Monday, April 19, 2010

Engaging with the customer

“Can I help you?”

“Doing okay over here?”

“How’s everything?”

We’ve all been on the shopper’s end of these low-value contact questions in stores, restaurants and whatever chain retailer trains its associates with the blunt instrument of “engage the customer.” It’s gotten to the point where such expressions are so empty, they’ve become little more than verbal tics on the part of employees—rote recitations they almost cease to be conscious of even asking.

And there’s a perfect synchronicity to this, since customers are barely conscious of these low-impact greetings, either. In our work with retailers, we hear this literally thousands of times. As an example, associates are typically trained and expected by management to greet the entering customer. Too often, this requirement gets translated by employees into saying “hi.” From a courtesy standpoint, this may sound better than no acknowledgment at all, though we’ve yet to see a higher buy or conversion rate when comparing customers who get a “hi” to those who enter with the absence of any greeting. Not surprisingly, most customers don’t even acknowledge this greeting and walk right beyond the associate saying it—not even saying “hi” back. That’s a big bowl of nothing for a key component of a customer engagement initiative.

“Doing okay over here?” is another low-percentage expression, a perfect invitation for the customer to say yes, fine, just looking.

Once we diagnose how interactions like this are working or aren’t with video and audio behavioral analytics, we provide retailers with the approach to make contacts count more—not in a theoretical, one-off way, but with a selling model that can be scaled.

Today’s Wall Street Journal has an interesting article on how retailers are pushing enhanced sales tactics to drive top-line growth. The realization to bring about more sophisticated training is sinking in, which comes from the realization these chains have a way to go before they can gain more traction on the sales floor.

Home Depot is doing something simple and smart by training cashiers (sometimes the only store personnel who shoppers interact with) to ask customers if they found everything they were looking for—and if not, to call the aisle to determine whether the item is in stock (the secret to success will be if the cashier has better luck finding someone than the customer perhaps did—but the idea of the cashier backstopping the sales process is a good one). While “did you find everything you need?” runs the risk of becoming a new verbal tic at Home Depot, it certainly has a fighting chance of success because the inquiry is offered at an important moment of truth, and requires a specific action step for the cashier to take should the customer be wanting.
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Monday, April 5, 2010

The pleasant shopper

A casually dressed but stylish woman enters the store with her pre-teen daughter and stops to say hello to the associate who’s stationed near the entrance. She’s extremely friendly, and has a large shopping bag of items from a neighboring store. She tries on many things during her hour-long visit. This woman is quite a shopper! She leaves her daughter in the store to run out to the car because she had forgotten her checkbook. During her visit, she approaches a salesperson at the cash wrap several times with questions about various items, and asks about returns.

When we looked at the videotape, it was clear she had stolen five items during this visit, totaling about $350.

From the moment we saw her cross the lease line, she sold herself repeatedly and extremely convincingly to the store associates. Unlike most customers who are greeted at the entrance but keep walking to some real or imagined destination point within the store, she actually stopped to return the salutation and exchange pleasantries. She carried her shopping bag proudly – almost flaunting it to make sure it was in full view of everyone, as if to say you have nothing to worry about with me or my bag or my previous purchases or even my credentials as a spender. She sold herself by speaking with three different associates -– for her, there was no hiding or skulking around in the aisles like some common shoplifter.

With more than a dozen cameras positioned throughout the shopping environment, we caught her every move. We watched as she waited to see where the associates were positioned, biding her time to make sure two of them were occupied with other customers. We watched her use the empty boxes in her shopping bag to conceal each item she stole. We watched her leave the store with the now-full shopping bag to put the loot in her car before returning.

Who would suspect? She was nice, she looked associates in the eye, and even entrusted them with her daughter for the three minutes when she ran to her car. And what was suspicious about leaving with the same shopping bag she came in with? She was, after all, going to return to finish her shopping and get her daughter.

While our studies are typically designed to increase conversion, items per basket, or sales per square foot—we call them the "forces of good" -— we often encounter shopper behaviors like this one and work closely with our clients to diagnose the problems and prescribe solutions.

What do you think are the most immediate lessons to be learned from this woman’s caper?
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Thursday, March 4, 2010

Mmm, mmm, soup shopping

Last week, The Wall Street Journal ran “The Emotional Quotient of Soup Shopping,” an interesting behind-the-scenes piece on Campbell’s redesigned soup labels. Campbell, in an effort to connect with customers (and boost sales), uses new neuromarketing techniques to measure physiological reactions to their marketing. A few years back, the company uncovered the idea that customers’ reported reactions to ads bore little relationship to actual soup sales. Campbell is hoping that biometric tools measuring factors like perspiration and heart rate, combined with deep interviews, will more accurately measure the effectiveness of the company’s package design and advertising. Based on this new research, Campbell will hold onto the iconic red and white label for its three biggest sellers, but other varieties will feature “larger, more vibrant pictures of soup.”

We’re a little skeptical about the benefits of neuromarketing research alone, since it measures emotional intensity without content or context. However, Campbell’s is onto something here. By combining biometric data with carefully crafted deep in-store interviews and store observations, they have been able to zero in on how customers really perceive their cans. As Campbell and other companies are increasingly realizing, there is no substitute for in-store research and moment of truth observation, questioning, and analysis. After all, when asked why they eat more soup or not, people tend to “say they don't think of it,” according to Doug Conant, Campbell's chief executive.

Other methods, like focus groups and surveys can also provide valuable information, but they often need to rely on the shoppers’ unreliable short-term memory or their projection of future behavior and intent. When companies rely too heavily on focus groups and survey data and neglect to closely observe how shoppers interact with their designs in the store, like Tropicana did with their short-lived redesign, they run the risk of damaging their brand and alienating consumers—or simply half solving the same question year in and year out.

What do you think--will customers respond to Campbell's well researched redesign? Or will they clamor for a return to the familiar red and white label?
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