in competition, Marketing, Strategy
It’s not the most obvious one.
Do you think Zappos is in the online retail business? Not according to Tony Hsieh:
“We’re in the experience & emotions business — the stories & memories business.” @zappos #zappos
— S Max Brown (@smaxbrown) March 15, 2011
Because they’re in ‘the stories & memories business’ they operate differently than traditional retailers. In their eyes they don’t compete with Amazon, they compete with the Ritz Carlton.…
in competition, Marketing, Strategy
In the past month I spent close to 9 hours with support representatives from a couple of companies with whom I’ve had issues with. One is Sprint and the other is Dell.
While 9 hours in a month doesn’t seem like a lot, believe me it’s a lot. When I was in high school I worked at a call center as a tech support representative for Verizon Wireless, so believe me when I say that spending a lot of time on the phone trying to resolve an issue is incredibly annoying for both the customer and the support representative. Especially when you (the customer) doesn’t get the issue resolved. As a support representative you can either make a customers day or you can become the focus of their anger.
One question I ask representatives all the time, which they have no idea how to answer, is: Why do I have to repeat myself every time I’m transferred from one representative to the other?
Wouldn’t it be easier if the first person you talk to took your information, entered it onto ‘the system’ once and it remained there for everyone to access until your matter is solved? This way the next person who gets to talk to you knows what’s going on before you even open your mouth. No seriously, we’ve got the technology to do it we just need someone to start acting differently and do it. Vendor and clients messaging system in Woocommerce has figured this out and does it in their own kind of way! by having wordpress chat- fastest way to respond to your customers.
Believe me when I say that people take these calls for granted. As customers we know that whenever we call customer support we’re probably going to spend a good amount of time on the phone. What if you (the biz) broke this expectation and actually made it less annoying when we call? Customers are annoyed before they even call! We often find ourselves too busy to deal with answering the phone too so we have started to use an answering service. It’s been a huge help, so if you’re strapped for time then give a service for that call answering a go.
The issue I had with Dell also got me thinking about the element of time. I was without my laptop for 2 weeks and more is coming because another hardware issue came with the fix so I have to send it back. As I was telling my friend Arnold Beekes about it he suggested that Dell should have provided me with a temporary laptop while mine was being fixed, similar to how car dealerships do when you bring your car in for a check up.
These are the types of things that make a difference in the customer experience but some companies don’t figure it out until it’s too late. What if companies got annoyed when they felt they’ve wasted their customers time? What type of behaviors would emerge? In what ways would their business strategy change? How would their business model change?
Personally the issue of wasting people’s time does not sit well with me, so whenever I feel others (can be company or person) are wasting my time it annoys me. It also works the other way, if I feel that I’m wasting your time it bothers me.
My point is that time is such a precious resource and if you (the biz) mindlessly waste the customers time, you are ignoring a valuable opportunity to exceed their expectations because now more than ever we are more time constrained; we have more activities vying for out attention. If you can make the time customers do spend with you more valuable, you will make a small difference in their lives and that really matters 🙂
Imagine that you are a pilot and you have to fly through a 5 mile canyon upside down. It’s actually kind of hard to imagine because it’s not something you’re trained to do but it’s something that could happen in a real life situation. It’s a scenario that’s outside your direct experience, you find it hard to accept it as possible and even worse adapting to it.
Now think about it this way:
What if businesses were judged on their ability to create ‘happiness for customers’? What if all those like buttons had less to do with becoming a fan and more to do with specific actions an organization took to actually make a customer happy? What if you hired people based on how happy they’ll make your customers? What if there were a ‘customer happiness index’ dashboard (Tweetdeck) and we’d all have access to it just like the stock market? What if businesses were penalized for wasting people’s time?
Imagine how every business would behave.
Same thing right? How can this be possible?
These may seem like outrageous scenarios but it’s definitely something we should be thinking about. As I argued before, delivering happiness is not business as usual, all it takes for things to change is for someone somewhere to start acting differently. This someone is Zappos, and pretty soon others will join their crusade.
This is not a new idea, but it’s been so long since it was replaced by impersonal mass marketing that it seems like new and it has taken everyone by surprise.
Zappos ‘delivering happiness’ strategy didn’t come out of a week long brainstorming session, it came about by the desire to build a company that’s designed for both life and work happiness.
This is a dramatic change from the familiar and it does provide a useful lesson for both identifying and exploiting change:
The importance of recognizing when the system is stuck. In this case the idea that businesses exist purely to make a profit. If you flip that script upside down, other options reveal themselves. Options nobody else can anticipate, strategies nobody can think of, ideas waiting for an owner to call their own.
Just like scripts become obsolete, so to do ideas have an expiration date. Think about what would be the opposite of doing what you currently do, how would that look and what options reveal themselves.
Key takeaway: Prepare for the unexpected and learn to recognize when an idea has reached it’s expiration date because if you don’t, you’ll be caught in an unfamiliar situation.
in competition, Strategy
Pay attention to this McKinsey Quarterly interview of Richard Rumelt, professor of strategy at UCLA’s Anderson School of Management:…
The gap between what is right now and where others are become very obvious when you go from one extreme to another. This past week I spent a little time with a friend I’ve known since kindergarten as he just opened a restaurant in Mexico and I went over to see how he was doing. This is his second restaurant venture for him, his first one closed after a year and a half.
While I was there he was telling me how he’d just bought a new restaurant management software homemade in Mexico. The incentive for him was that the top Mexican restaurant chains, such as Sanborn’s, also claimed to use the same software to manage their operation so in his eyes it was good decision to buy. Nonetheless he asked me if I could give it a test drive to see if it was worth the buy…
Before I dig in I just want to say that with any kind of business if you have pitiful customer support you are in a whole lot of trouble no matter how great your product or service is. With that in mind, here we go…
What you see in the picture above is restaurant management software made by Nationalsoft. The software is still delivered in a package, the serial number is taped on the inside (post it note inside the CD) which registers a single computer. The software is less than 15 MB and takes less than a minute to install. Feels like you’re back at the end of the 90’s huh? Wait it gets better!
If a user loses their password (which did happen) they have to call support who then has them create a .dat file which they then have to send back to support by email so they can ‘do something to it’ to unblock it. After support does something to the file, they’ll send it back to the customer so he may add it to a folder and overwrite the previous one. Are you kidding me!? What happened to the ‘forgot password’ link that is not a default setting in any kind software?
If these people were doing business in the US they would be out of business. But wait, it gets even better…you have to pay them to get the software unblocked.
A modern software company not only provides support by phone but also provides customers with online resources such as FAQ, forums or wiki with answers to common problems. Seems Nationalsoft forgot to add this to their checklist because they’re nowhere to be found. Ironically they do have a Twitter account and a Facebook Fan page! None of which are used as customer support touch points. Promote first, serve later right?
There’s more but I think I’ve provided you with enough information to see how frustrated I was when I was seeing this happen before my eyes. The way this software company is designed to operate is to deliberately waste their customers time, not to help them get going as fast as possible.
Businesses in Mexico still operate by the logic of ‘forcing customers to do what I want them to do’ not ‘I make it easier for my customers to do what they want to do’. The result of operating by this logic is that people who may be interested in your product or service have been programmed to expect ‘below average service’, they expect to be treated like crap. They put more obstacles in place for the customer, never taking into account that the customer is a human and therefore ignoring the fact that humans do make mistakes. In a world where software is as ubiquitous as water, the days of bloated software are over. Today every piece of software (including websites) are designed for humans, not robots. As an example see Facebook’s platform, which now 500 million people use, it epitomizes software designed for making social interaction as simple as possible.
Point: Design your operation so that every interaction your customer has with you helps him do more by making it simple. You’ll not only have happy customers but also angry competitors. Here’s how to do it:
Barriers to entry is what you do to make it difficult for competitors to compete with you (like doing everything in your power to make your customers happy). Barriers to use (such as having weak customer support, no online Q&A, making customers pay because they lost their password) is what you do to impede customers from getting on with it and start using your products, and if all goes well they’ll be very happy and tell their friends about it.
Humans make mistakes, in the online world it becomes even more obvious because everything they do online has to be done through a digital interface. As software has evolved from being used exclusively used on the desktop to be used on the web, it’s become important to focus on designing your software to anticipate the fact that humans need things to be spelled out for them just like children, therefore making it easier for them to do what they want to do. For example humans will also forget things, including passwords, so make sure you cover the basics.
No seriously I’m being honest. If you want to make competitors really angry and therefore put them in a disadvantage, focus your efforts on making your customers really happy by actually giving a damn about them. That’s Zappos secret weapon 
What do you think, is making customers happy an unconventional strategy?
Here’s my latest post on @Oninnovation: Make your own game
Enjoy!
The essence of strategy is choosing to perform activities differently than rivals do; and the most vital competitive weapon is not lower price, but new ideas.
Across the border in Mexico, we have a taco shop in every corner. They all sell the same thing and their business name usually starts with the name of someone plus “tacos.” It’s safe to say that their businesses all operate very much the same way; the only difference between them is where they get the meat and ingredients.
We live in a world of sameness, and the only way out of it is to innovate.
There are brave souls who choose to question the dominant logic of competition; who chose to do something entirely different. There is one taco shop in Tijuana which doesn’t follow conventional logic; it doesn’t sell tacos, but rather, art.
Tacos Salceados created what is known as the “Quesataco,” which starts with flakes of cheese spread across the flat iron stove. Your choice of cuts are then lined down the middle and then ultimately encased in the crisp golden cheese. The stuffed crisp cheese roll is then placed in a fresh thick tortilla, and topped with house dressings and avocado. The Quesataco later spawned other creations, such as shrimp tacos covered in a sweet tasting sauce.
It is this fresh perspective which makes it stand out among the rest of the taco shops.
The thing people forget when they compete, is that you must stand out in some manner. Too many people copy their competition too much. They assume if it is working for the competitor, then it will work for them. Passion for what you are doing, consistency, and a sprinkle of uniqueness is just the start. Sticking with it and always looking for that unique tweak is key.
Here are 4 ways to help you think about defeating sameness:
Conventional logic says that businesses exist to make money. Why not exist to deliver meaning? The difference between you and competitors is nothing more than how you answer the ‘why’ of your intentions: Why are you doing this? Online retailer Zappos knows why they are in business; not to sell a lot of shoes, but rather to deliver the best customer service in a meaningful way.
Your customers have interacted with your competitors, as well as with other businesses, and have an idea of what to expect. These same expectations will be put into play when they interact with you, and if you deliver the “same,” then you’ll be easily ignored. You must reset those expectations by going above and beyond the normal, delivering equal or more value in a faster, more convenient, easier and meaningful way.
Over the time your business has existed you have accumulated a portfolio of abilities and strengths. Think about these bundle of skills that you have accumulated over time, things that you are good at and that when combined provide new value to your customers. Stop looking at your company as a provider of specific products or services for specific markets, and start seeing it as a reservoir of skills and assets that can be exploited in different ways or different contexts to create new value.
In order to compete businesses follow the logic that they have to target the middle of the market, the mainstream consumers. This also means they configure their business just like competitors who are already ahead of them. The problem is that everyone else is going after the same market and with so many choices, so many brands, so much noise it isn’t enough to be good at everything. You have to be the most at something. What are you the most at? Are you the fastest? The most responsive? The most innovative? The most transparent? Look up field or downfield, go to the edges, to the extremes where you can be the most at something.
Key Takeaway: Compete differently and play the game you know you can win.
What do you think?
in competition, Strategy
Do you know what else is a game-changer? Effort.
Check out Celtics point guard Rajon Rondo’s effort at the 18 second mark of last night’s win over the Magic, Kevin Garnett described it as a "pure, I-want-it-more-than-you type of play." This play right here completely altered the dynamic of the game.