Saturday, September 27, 2008

Marketing Wisdom for Tough Times

Books to Check out:

The Marketing Minute


Brace your business for the bumpy road

Posted: 18 Sep 2008 09:17 AM CDT

26548894

Banks failing, gas prices rising, and the credit crunch pinching -- no wonder business people are nervous. These are scary times.

But they don't have to be disastrous times. We've weathered recessions (even though we are apparently not in one) before and we will weather this one too.

There's been some very smart writing on the topic, from a marketing perspective and I wanted to point you to a couple excellent posts.

John Rosen at Stopwatch Marketing (have you read his book?) tells us how to thrive in a slowdown.

John Jantsch at Duct Tape Marketing (have you read his book?) gives us 7 time-tested ways to dig out from a recession.

Hang in there...this is the time to invest in the relationships you have with current customers, stay visible in the marketplace (especially if your competitors are cutting back), build and protect your brand and overall, think long-term in your strategies.

The businesses that keep focused and recognizes that this a just a bump in the road (albeit a good sized bump) will be in stride to really take off once we're on better ground.

Better times are around the corner, we just need to keep keeping on to get there.

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Naming your Business


In my email recently I received this bit of advice:

Hey Scott,

I don't think I've spoken about this too much, but Lord knows I
sure give loads of advice about it in my consulting practice,
so let's get on the stick.

People often get stuck on naming their business right. The
problem is, for some reason people have loads of personal
vesting in the name of their company -- they feel the name
should somehow personally identify with themselves.

That by naming the business after yourself, it shows you have
pride in what you do, and this is going to be communicated to
your prospects. (Hint: If you hit them over the head with a
sledge hammer, they could still care less about your company's
name.)

You know, the integrity you have, the pride of ownership you
take when you put your name on something -- all that mushy
stuff.

But see, here's why this doesn't work. All that mushy stuff
only matters to you, no one else.

Your prospect isn't sitting there thinking, "Oh, since Craig
named his company after himself, it means he's got a great work
ethic and loads of integrity."

In fact, if the name of your company is something like, "Craig
Garber and Associates," you're not even a blip on their radar
screen because they have no idea what the hell you even do for
a living.

And don't think you endear yourself any more by calling your
company "Craig Garber Real Estate Associates," because this
too, is vague and egotistical.

When you name your business, you want to think about three key
things.

One, you want to tell your prospects what it is you're doing for
them.

So for instance, calling yourself "Tampa's Favorite Home Roofing
Company" pretty much removes any doubt about what it is you do,
right?

Two, you want to give your prospects a benefit in your name.

To do this effectively, you've got to know what their biggest
problems are, that you're in the business of solving. So maybe
it's "No Hassle Luxury Automobile Buyers Of Tampa" for a firm
that goes out and buys cars for you. Since people looking to
buy luxury automobiles are most likely to be concerned about
saving their time and avoiding hassles, this is a great example
of what I'm talking about.

And lastly, you want to be thinking about bonding with your
prospects. This is sometimes a combination of both of the
above criteria, but it also has to do with the emotional
component of what you're selling.

So if you're looking to have a party for one of your children,
you'd feel very comfortable with "Safety First Children's Party
Planners."

See, this deals with the big pink elephant in the room no one
likes to talk about, but is ever-present.

So there you have it. Your name is definitely as important as
the rest of your marketing...

Or not.

Now go sell something, Craig Garber

P.S. 15 Free Gifts -- watch 'em on the goofy video. This
month, 12 live copywriting and marketing examples, including
the unusually evasive "lift letter" - yours free when you try
Seductive Selling at http://www.kingofcopy.com/ssnl

Check out all the King's products at
http://www.kingofcopy.com/products
(c) Copyright, Craig Garber & kingofcopy.com(R) 2008

Craig Garber
kingofcopy.com (R)
3959 Van Dyke Road #253
Lutz, Florida 33558 USA
813-909-2214 Phone
954-337-2369 Fax
cgarber@KingOfCopy.com
http://www.kingofcopy.com

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Cell Phones are like Oxygen

At least for today's teens. Click on the charts to make them Bigger:

Cell Phones Key to Teens’ Social Lives, 47% Can Text with Eyes Closed

Nearly half (47%) of US teens say their social life would end or be worsened without their cell phone, and nearly six in 10 (57%) credit their mobile device with improving their life, according to a national survey from CTIA and Harris Interactive.

harris-ctia-teen-cell-phone-use-die-without-cell-phone-august-2008.jpg

Four out of five teens (17 million) carry a wireless device (a 40% increase since 2004), finds the study titled “Teenagers: A Generation Unplugged,” which probes how the growing teen wireless segment is using wireless products and how they want to use them in the future.

Impact on Teen Life

  • A majority (57%) of teens view their cell phone as the key to their social life.
  • Second only to clothing, teens say, a person’s cell phone tells the most about their social status or popularity, outranking jewelry, watches and shoes.

Providing Entertainment and Security

  • More than half of the respondents (52%) agree that the cell phone has become a new form of entertainment.
  • One-third of teens play games on their phone.
  • 80% say their cell phone provides a sense of security while on the go, confirming that the cell phone has become their mobile safety net when needing a ride (79%), getting important information (51%), or just helping out someone in trouble (35%).
  • Teens carry cell phones to have access to friends, family and current events.
  • Though only one in five (18%) teens care to pinpoint the location of their family and friends via their cell phone, 36% hate the idea of a cell phone feature that allows others to know their exact location.

Texting Replacing Talking

The study also confirmed that texting is replacing talking among teens. Teens admitted spending nearly an equal amount of time talking as they do texting each month. The feature is so important to them that if texting were no longer an option 47% of teens say their social life would end or be worsened - that’s especially so among females (54% vs. 40%).

Teens say texting has advantages over talking because it offers more options, including multitasking, speed, the option to avoid verbal communication, and because it is fun - in that order, according to the study.

With more than 1 billion text messages sent each day, it is no surprise that 42% of teens say they can text blindfolded, the study found.

“Teens have created a new form of communication. We call it texting, but in essence it is a reflection of how teens want to communicate to match their lifestyles. It is all about multitasking, speed, privacy and control,” said Joseph Porus, VP & chief architect, Technology Group, Harris Interactive. “Teens in this study are crying for personalization and control of exactly what a wireless device or plan can do for them.”

Devices of the Future

The survey asked teens what future changes they’d like to see in wireless services and devices and found that respondents want cell phones that break boundaries and are personalized to fit their lifestyles.

Teens remain excited and openminded about the wireless possibilities and their ideal future mobile devices would feature five applications - phone, MP3 player, GPS, laptop computer and video player, according to Harris.

harris-ctia-teen-cell-phone-use-future-features-august-2008.jpg

Also on teens’ wish lists are phones that…

  • Guarantee secured data access to the user only (80%)
  • Provide accessibility to personal health records (66%)
  • Present opportunities to be educated anywhere in the world (66%)
  • Bring users closer to global issues impacting teens’ world (63%)
  • Are shockproof and waterproof (81%)
  • Have endless power (80%)
  • Feature a privacy screen (58%)
  • Are made of flexible material and fold into different shapes and sizes (39%)
  • Have artificial intelligence - ask it questions and it gives answers (38%)

“In the future, mobility for teens means mobile banking, mobile voting, location based services, personal entertainment - the sky is the limit for how mobile our lifestyles can be,” said Steve Largent, president and CEO, CTIA - The Wireless Association. “We’ve certainly come a long way in 25 years and expect teens to be a growth driver for the industry and have a major impact on the wireless landscape for years to come.”

About the study: The study was conducted online in July 2008 among a nationally representative sample of 2,089 teenagers (age 13-19) across the US who have cell phones. More than 100 questions were asked on mobile phone usage, attitudes, behaviors, and teens’ desires and aspirations for the future of mobile communications, entertainment, and other features.

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Nity Grity Email Marketing Details

This is from MarketingProfs.com:

Who Knew??

In late August, eROI released the results from its latest email marketing survey. The figures might surprise you. What the competition is and isn't doing could help you identify missed opportunities—or reinforce your own best practices. Here's a roundup of eROI's findings:

"From" Names: Of the survey's total respondents, 50% use a company name in the From line; 31% say it depends on the campaign; and 20% use an individual name.
Authentication: A full 60% of marketers don't know how to authenticate email. Of those who do, most use Sender ID, while fewer rely on Domain Keys and DKIM.
Accreditation: Only a quarter of email marketers use services specifically designed to avoid blacklists.
Preheaders: Two thirds of the respondents offer a "view as a webpage" option. Though a scant 13% use snippet text, this represents a significant increase in the last few months. A full 80% skip whitelist instructions, while 25% do not use a preheader at all. Subject Lines: An impressive 75% of marketers report an emphasis on relevant subject lines, but only 50% say they try to keep them short. Just 25% test them on a regular basis.
Site Nav: Nearly 30% duplicate site navigation within an email; of those, 15% find it more effective in driving clicks, and 11% experience superior conversion rates.
Email Footer: A clear majority, 75%, include links for profile and subscription management.

The Po!nt: There's room for improvement. We were surprised by some of the eROI numbers—especially the fact that only 10% of emailers offer mobile versions of their messages.

Source: eROI. Download the survey results here.

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Business Know How Articles


Click and Read!

Business Know-How's 10 Greatest Marketing Hits
Could your business use a boost? This special edition newsletter features our top ten most popular marketing articles ever. They've helped countless Business Know-How visitors and newsletter subscribers attract customers and increase sales, and they're sure to help you, too.
10. 12 Sure-Fire Steps to Improve Your Retail Sales

9. Top 10 Marketing & Sales Strategies for a Slow Economy

8. 4 Easy Ways to Boost Your Sales

7. 10 Ways to Get Prospects to Return Your Calls

6. A Referral Tactic to Quadruple Your Business

5. 24 Low-Cost Ways to Promote Your Business

4. How to Steal Your Customer's Heart Away

3. Unforgettable Business Cards in 4 Steps

2. Words to Avoid in Proposals

1. 7 Unusual, Uncommon and Unexpected Networking Secrets

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Friday, September 26, 2008

Friday Night Marketing News


Catch up on the latest by clicking through the links:

Financial Services
by Sarah Mahoney
How consumers will channel generic rage against individual companies, Ries says, depends on how responsibly companies maintain their visibility during the crisis period. "While it's important for companies to get out in front of consumers," she says, "the best thing is to fight a PR war with PR, not with advertising." ... Read the whole story > >
Automotive
by Karl Greenberg
Three TV spots, keeping the "Fit is Go!" tag, will air during NFL games and on appointment-viewing network TV shows. The ads make fun of gas-guzzling cars with visual metaphors based on old American cars from the 60s and 70s. In each ad, the Fit escapes being "attacked" by the carnivorous vehicles. ... Read the whole story > >
Electronics
by Laurie Sullivan
Apple communicates well with its target audience by tapping an unmet need for self-expression through customizing music playlists, says Brand Keys' Amy Shea. "Apple knows the generation they communicate with speaks in visuals, color and music. They are a less language-oriented generation and more visual and musical." ... Read the whole story > >
Retail
by Sarah Mahoney
One way retailers may try to goose sales, predicts Mediamark Research & Intelligence, is by targeting the 62 million consumers who start shopping before Black Friday. That group--about 35.1% of the population--is more likely to be female, a Baby Boomer, and heavy purchasers of toys. ... Read the whole story > >
Beverages
by Karlene Lukovitz
Next month, Heineken USA's Dos Equis beer starts a 14-city tour of the show, featuring Jim Rose as emcee. Rose is the creator/emcee of "The Jim Rose Circus," a modern-day version of a circus sideshow that's become a cult phenomenon since its inception in the early '90s. ... Read the whole story > >
Strategy
by Karl Greenberg
Panelists said the risks are worth the reach. And they said that the space is becoming friendlier to advertisers because the sort of shock video that defined online humor--low-quality, user-generated clips--is being supplanted by much higher-quality, original content, with less shock value. ... Read the whole story > >
Kellogg Unveils Michael Phelps Packaging

KFC Issues Veiled Threat to Racy '90210'
Advertising Age
Sometimes it is pretty easy to read between the lines. In a written statement KFC spokesman Rick Maynard says, "Our media department has been in touch with CW regarding "90210," and we are closely monitoring its content going forward to determine if additional action is required on our part, including potentially pulling our advertising from the program."

KFC has spent about $5.4 million on the CW so far this year, per TNS.
,br> According to several media buyers, advertisers have been examining programs thoroughly this fall, with several "more conservative" marketers asking to monitor programs on an episode-by-episode basis. "There's more scrutiny. Everyone is looking at everything much closer," says one buyer. - Read the whole story...

TNT, Lincoln Tell Crime Story in Microseries
The Hollywood Reporter
TNT has teamed with automaker Lincoln and Mandalay Television for a crime-thriller microseries "RPM," starring Jonathan Schaech.

"RPM" will air as 20 two-minute episodes within the commercial breaks of four prime-time episodes of "Law & Order" from Oct. 21-29. The series is about a husband and father of two trying unsuccessfully to move past his former career as a homicide detective. He drives a Lincoln while tracking down a key suspect.

Mandalay executive producer Elizabeth Stephen brought the project to TNT and Lincoln. It marks the first time a TNT microseries has been developed so closely with a brand. She says Mandalay approached it as if it were an hourlong drama series and is hoping it could eventually become one. - Read the whole story...

Fewer Job Titles At Rebranded Mindshare
Adweek
WPP Group's Mindshare was restructured in April; five months later, it is implementing a global rebranding effort to support its new identity. For starters, about a dozen of the agency's North American senior executives are giving up their formal job titles.

"Relinquishing our titles signifies the breakdown of silos and a new spirit of openness and equanimity throughout the upper ranks of our agency," says Mindshare executive Scott Neslund, formerly CEO. "This new identity heralds our next stage of growth as a new model agency, one that focuses on partnerships, consumer exchanges and collaborations."

The updated brand uses a new custom-made word mark and symbol, and the name no longer uses an uppercase "S" in the middle of the word. - Read the whole story...

Oscars Hire Condon to Beat Emmys' Fate
Wired
The Oscar producers apparently hope to avoid the fate of this year's Emmys broadcast, which earned the lowest rating of any Emmy Award show in the last 18 years. The Academy of Motion Picture Arts and Sciences is hiring Bill Condon, writer/director of "Dream Girls," to executive-produce next year's Oscars telecast.

Awards shows in general have lost their luster over the past few years. Critics of the Emmys, including outspoken talk-show host Craig Ferguson, have railed against producers for wasting time on an opening featuring five reality-show hosts, while limiting stage time for comedy legend Don Rickles. - Read the whole story...

Paramount Begins Net Foray Tied to Brands
The Hollywood Reporter
Paramount Digital Entertainment is putting together a team to produce original programming for digital platforms that will integrate global fashion and lifestyle brands. The studio says it is interested in "high-concept, genre-driven" fare aimed at the youth market.

Alexandra Milchan and David van Eyssen have signed three-year contracts to produce the online programming. They will be working with former IMG executives Angelo Moratti and Massimo Redaelli on weaving products and brands into the content.

Milchan is an independent producer of films including "Righteous Kill" and "Street Kings." Her father founded New Regency, where she worked for 14 years. Van Eyssen's credits include BMW Films, the 2001 brand-integrated short film series for the Web. - Read the whole story...

'WSJ' Hires McGarryBowen For New Projects
Editor & Publisher


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Baby Boomer Research- The Internet

Click on charts to make them BIGGER:

Boomers Network Online and Stream Video, Ripe for Web Entertainment

A majority (61%) of Baby Boomer internet users in the US have visited sites that offer streaming or downloadable video, while 41% have visited online social networks, according to a report from The NPD Group.

Those figures show significant usage of online entertainment media among Boomers and make them a key demographic segment for more digital products and marketing, NPD said.

The “Entertainment Trends in America” tracking study also finds as follows:

  • More than half of all web users (57%) visited a social-networking site, such as LinkedIn, Facebook, or MySpace, in past three months:

npd-boomers-social-networking-visits-friends-september-2008.jpg

  • Although young web users (age 13-34) are significantly more likely to visit social-networking sites - and to visit them more often - more than half of Baby Boomers (age 44-61) visited a social-networking site in the past three months, with users averaging 15 days in one-month period.
  • Boomers who visited social-networking sites did so an average of eight times over the previous three months.
  • 72% of all web users visited a video streaming/sharing site - such as YouTube or a TV network website - in the previous three months. These types of sites were visited more than gaming sites, on average:

npd-boomers-streaming-video-gaming-september-2008.jpg

  • Among video streaming/sharing site visitors, the average usage frequency is eight days in a month.
  • Males and those age 13-34 show significantly higher penetration than females and individuals age 35 and older.

Regarding the web’s effect on traditional entertainment content, NPD found that Boomers who engage in activities such as networking or video streaming are also more likely to buy DVDs and CDs and go out to the movies. On average, Boomers who stream video are 15% more likely than their non-streaming counterparts to buy a CD, DVD, or movie tickets, NPD said.

“As more consumers of all ages spend more time online, there’s potentially going to be less time for them to consume entertainment content in traditional ways,” said Russ Crupnick, entertainment industry analyst for The NPD Group. “These findings underscore the growing need for entertainment companies to promote and distribute digital entertainment content online, in order to keep pace with the changing needs and desires of consumers of all ages. ”

The use of email and web surfing was nearly universal among web users surveyed by NPD (97%). Online shopping was also prevalent across age groups; with 80% of web users reporting shopping in the prior three months. Teens and young adults reported less online shopping activity than older consumers, perhaps because many teens do not have access to credit cards, NPD said.

About the survey: Data is based on a sample of more than 11,000 consumers. Results were balanced to reflect the internet-connected US population age 13 and older.

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How to Handle Complaints


The Wall Street Journal featured this in depth article on handling customers this week:

Making the Most
Of Customer Complaints

Dealing with service failures means a lot more than just fixing the immediate problem. Here's how to do it right.

Nobody's perfect. That's a fact, not an excuse.

Which is why it's crucial for companies to realize that the way they handle customer complaints is every bit as important as trying to provide great service in the first place. Because things happen.

Customers are constantly judging companies for service failures large and small, from a glitch-ridden business-software program to a hamburger served cold. They judge the company first on how it handles the problem, then on its willingness to make sure similar problems don't happen in the future. And they are far less forgiving when it comes to the latter. Fixing breakdowns in service -- we call this service recovery -- has enormous impact on customer satisfaction, repeat business, and, ultimately, profits and growth.

PODCAST: Thunderbird's Stefan Michel describes what he calls the Titanic effect -- when a company believes it's not subject to customer-service problems -- and how to tell if your company has this mind-set.

ONLINE DISCUSSION: At your company, do tensions between departments get in the way of dealing with service problems? What strategies can address that and foster effective service-recovery management? Share your thoughts in a forum with Stefan Michel.

The Journal Report

[The Journal Report: Business Insight]

But unfortunately, most companies limit service recovery to the staff who deal directly with customers. All too often, companies have customer service sort out the immediate problem, offer an apology or some compensation, and then assume all is well. This approach is particularly damaging because it does nothing to address the underlying problem, practically guaranteeing similar failures and complaints.

What businesses should be doing is looking at service recovery as a mission that involves three stakeholders: customers who want their complaints resolved; managers in charge of the process of addressing those concerns; and the frontline employees who deal with the customers. All three need to be integrated into addressing and fixing service problems.

Tensions naturally arise in and among the groups. For example, customers can be left feeling that their problem wasn't addressed seriously, even when they've received some form of compensation. Service reps can start seeing complaining customers as the enemy, even though they point out flaws that need fixing.

Managers in charge of service recovery, meanwhile, can feel pressure to limit flows of critical customer comments, even though acting on the information will improve efficiency and profits.

However, successfully integrating these three perspectives is something that fewer than 8% of the 60 organizations in our study did well.

Based on our research and our own years of work in service management, here is a look at the three stakeholders in service recovery, focusing on their different perspectives and the tensions that arise among them. We then make recommendations on how to address these tensions and integrate the aims of all three to achieve better -- if not perfect -- service.

anies can empower frontline service workers.

The Customer

Fairness is typically the biggest concern of customers who have lodged a service complaint. Because a service failure implies unfair treatment of the customer, service recovery has to re-establish justice from the customer's perspective.

Say a bank customer requests a deposit receipt from an ATM but the machine fails to print one. The customer becomes worried and goes to one of the bank tellers. The teller checks the account, and assures the customer that there is no problem, that the deposit was made. But if the teller only focuses on the fact that the account was credited, he or she has ignored what in the customer's view was the most severe and critical aspect of the service failure: the worry initially felt, and the extra time it took to verify the deposit.

Customers often want to know -- within a reasonable time -- not only that their problem has been resolved, but how the failure occurred and what the company is doing to make sure it doesn't happen again.

A customer's faith can be restored using this kind of approach -- once. We have even noted something referred to as a "recovery paradox," in which customers can be more delighted by a skillful service recovery than they are by service that was failure-free to start with.

But there is a flip side to this as well: Customers have more tolerance for poor service than for poor service recovery. And if a customer experiences a second failure of the same service, there is no recovery strategy that can work well. In all likelihood, that customer will be lost forever.

Our research suggests that after a failed service recovery, what annoys -- and even angers -- customers is not that they weren't satisfied, but that they believe the system remains unchanged and likely to fail again.

For Further Reading

See these related articles from MIT Sloan Management Review.

  • Linking Customer Loyalty to Growth

By Timothy L. Keiningham, Lerzan Aksoy, Bruce Cooil and Tor Wallin Andreassen (Summer 2008)
The authors argue that there is no single metric that equates the entire customer experience.
http://sloanreview.mit.edu/smr/issue/2008/summer/14/

  • Listening to the Customer: The Concept of a Service-Quality Information System

Leonard L. Berry and A. Parasuraman (Spring 1997)
The authors advocate a listening system that uses many research approaches in combination to capture, organize and disseminate information.
http://sloanreview.mit.edu/smr/issue/1997/spring/5/

  • Understanding Customer Delight and Outrage

By Benjamin Schneider and David E. Bowen (Fall 1999)
The authors base their conceptualization on people's needs rather than the more conventional model that focuses on customer expectations about their interactions with a firm.
http://sloanreview.mit.edu/smr/issue/1999/fall/3/

  • Recovering and Learning From Service Failure

By Stephen S. Tax and Stephen W. Brown (Fall 1998)
Effective service recovery is vital to maintaining customer and employee satisfaction and loyalty, which contribute significantly to a company's revenues and profitability.
http://sloanreview.mit.edu/smr/issue/1998/fall/6/

  • Giving Customers a Fair Hearing

By Anthony W. Ulwick and Lance A. Bettencourt (Spring 2008)
The authors studied 10,000 customer need statements from many industries and discovered that companies have not even established a definition of what a customer need is or how user input should be standardized in terms of structure and format.
http://sloanreview.mit.edu/smr/issue/2008/spring/14/

The Manager

The chief aim of managers in service recovery is to help the company learn from service failures so it doesn't repeat them. Learning from failures is more important than simply fixing problems for individual customers, because process improvements increase overall customer satisfaction and thus have a direct impact on the bottom line.

But companies generally obtain and study only a fraction of the service-failure data that could be gathered from customers, employees and managers. Even when managers agree that customer feedback is essential, there is often poor information flow between the division that collects and deals with customer problems and the rest of the organization.

In some cases, one study revealed, the more negative feedback a customer-service department collects, the more isolated that department becomes, because it doesn't want to be seen by the company at large as a source of friction. Some companies even create specialist units that can soak up customer complaints and problems with no expectation of feeding this information back to the organization. Others actually impede service recovery by rewarding low complaint rates, and then assuming that a decline in the number of reports indicates customer satisfaction is improving.

Some managers in our study saw conflicts between providing great customer satisfaction and achieving high productivity. For instance, incentive structures sometimes placed equal values on sales and on customer service. But as one manager noted: "If you want to achieve 100% [satisfaction], you don't have time for selling. It's questionable whether you can score 100% on service quality and 100% on [sales] objectives."

In any kind of business, there comes a point at which a service recovery can become excessive in the company's eyes, and be seen as giving away the store. However, many customers don't want a payoff. They simply want to have their problem fixed and to be reassured that it won't happen to other people in the future.

The Employee

Frontline service employees have the greatest job satisfaction when they believe they can give customers what they expect.

These workers have the difficult task of dealing with customers who hold them responsible even when the failures in question are completely out of their control. The attitudes of customer-service workers, positive and negative, spill over onto customers.

Yet companies do surprisingly little to support them.

To be successful, these workers need to feel that management is providing the means to deliver successful service recovery on a continuing basis. Alternatively, when employees believe management doesn't support them, they tend to feel they are being unfairly treated and so treat customers unfairly. They display passive, maladaptive behaviors and can even sabotage service.

This alienation is compounded when the workers believe that management is not improving the service-delivery process, which keeps employees in recurring failure situations. Even though complaining customers represent an opportunity to fix problems and improve satisfaction, alienated employees often see them as the enemy. In a study of a major European bank, employees in Switzerland consistently indicated that they did not consider reports of missing account statements to be complaints. As one said: "These things happen. There is nothing we can do about that."

At companies that reward low complaint rates, frontline employees become tempted to send dissatisfied customers away instead of admitting a failure has occurred.

[Business Insight] Craig Frazier
Resolving the Tensions

Our experience with managers interested in improving service recovery indicates that most hope for a quick fix of some specific tensions. But quick fixes only treat the symptoms of underlying problems. Real resolutions should involve closer integration among the three stakeholders, such as gathering more information from customers and sharing it throughout the company, and adopting new structures and practices that make it easier to spot problems and fix them.

We suggest the following five strategies:

  • Create a "service logic" that explains how everything fits together. This should be a kind of mission statement or summary of how and why the business provides its services. It should integrate the perspectives of all three groups:

What is the customer trying to accomplish, and why?

How is the service produced, and why?

What are employees doing to provide the service, and why?

The results should serve as a guide both for delivering service and for help with service recovery. It should include a detailed study of internal operations; map out how the company responds to customer complaints; and describe how the company uses that information to improve service-recovery processes. Similar mapping should detail every step of customer experiences, including those of real customers with complaints, highlighting their thoughts, reactions and emotions along the way. Highly skilled managers and employees who can think outside the box are a must.

TNT NV, a Netherlands-based global delivery company, developed a service logic to help it grow in a mature market. Using a small, high-powered management team backed up by customer discussion forums, the company mapped its processes from a customer point of view, including a map of customer emotions during both regular processes and service recovery. The mapping exercise and the service logic that it produced led to a redesign of processes by managers and field staff that cut across traditional functional boundaries.

For example, previously a driver running late for a scheduled delivery had to call into the control center, which would then contact customer services, which would then contact the customer. Such calls often arrived after the delivery already had been made, thus further annoying the customer and embarrassing the driver. Since the process redesign, however, a driver running late is allowed to contact the customer directly. TNT drivers frequently visit the same customers almost every day, so their customers know them and appreciate the personal contact. The drivers also appreciate being able to make the calls directly.

  • Draw attention to the successes of customer-service groups. Companies use in-house publications, intranets and training programs to share stories that emphasize their values and culture. Employees who come up with cost-saving ideas, for example, are often singled out for praise. But rewards and recognition also should flow to heroes in service-recovery stories. Such heroes can be on the operations side, helping to develop cost-efficient systems for handling complaints, and on the marketing side, giving a customer extraordinarily helpful treatment after a service failure.

Recovery Mode

  • The Issue: Every business can expect complaints from customers. It's how a business handles the complaints that matters most, and many do so poorly.
  • The Problem: When companies don't give upset customers a fair hearing or some assurance that the problem won't happen again, they are putting repeat business, profits and growth at risk.
  • The Solution: The key is to address tensions that arise among front-line employees who handle complaints, the managers of those employees, and the customers themselves. Steps include starting a complaints database that managers can analyze and use to improve service, and rewarding service employees not for reductions in complaints but for providing exceptional solutions to problems.

Singapore Airlines Ltd., in its in-house magazines, frequently tells stories about employees who have provided not only outstanding service, but exceptional service recoveries. Senior managers, too, will not hesitate to swoop in anywhere there is an issue, creating more stories about internal vigilance.

When customer-service employees believe that their goals are in line with the organization's values, they are more willing to exert the extra effort required in a failure-and-recovery situation.

  • Give customer-service staff as much freedom as your business strategy allows. When a business has very few routines and its ties to customers are based on individual relations, service representatives should have more autonomy in resolving complaints. For such businesses, spending more time on service recovery -- and retaining customers -- has a clear effect on the bottom line. By contrast, in a highly standardized business with purely transactional customer relationships, such as a fast-food restaurant, employees should adhere to procedures in resolving complaints. Customer satisfaction in such businesses is closely aligned with high productivity, so there is less to be gained by customizing resolutions of complaints.

Ritz-Carlton, for example, the luxury brand of Marriott International Inc., authorizes personnel at the front desks of its hotels to credit unhappy customers up to $2,000 without asking a supervisor's approval. On the other hand, in one of our consulting projects, a client reacted very negatively to this approach, claiming that such a policy would be too expensive for his company. We replied that the high cost of poor service is exactly what makes this system work so well: It forces management to eliminate service failures in the first place.

  • Collect as much data as you can, and share it widely. Companies must gather more feedback about poor service, record it and make it accessible. Managers and other employees have to be armed with strong information to be effective at resolving disputes.

It should be easy for customers to file complaints. One way to achieve this is by offering many communication channels. A regional airline in Asia, for example, uses annual passenger surveys, interviews with frequent fliers, focus-group discussions, customer hot lines, critical-incident surveys, onboard suggestion leaflets and even live call-in radio shows.

Software should be used that serves as a database for both positive and negative communications with customers. Employees and managers should be trained to mine the data and put it to use easily and quickly.

  • Use meaningful measures of employee performance -- rewards and demerits. Positive reinforcement and incentives should be offered for solving problems and pleasing customers. A system for measuring customer satisfaction should be devised to help rate employee performance. Salary increases and promotions then should be linked to an employee's achieving certain levels. There also should be disincentives or demerits for poor handling of customer complaints. Performance reviews thus may include a balanced scorecard -- one that recognizes the need for both productivity and customer satisfaction.
—Dr. Michel is associate professor of marketing at Thunderbird School of Global Management, Glendale, Ariz. Dr. Bowen is the Robert and Katherine Herberger chair in global management and a professor at Thunderbird. Dr. Johnston is professor of operations management at Warwick Business School, University of Warwick, Coventry, England. They can be reached at reports@wsj.com.

Copyright 2008 Dow Jones & Company, Inc. All Rights Reserved

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More New Ads for the week

AdForum sends this to me every week:

View these FREE until October 2nd:



Ideas
for Invesco PowerShares

Euro RSCG Chicago
Chicago, United States
United States
Thinking big.






Nightmare
for Comcast

Goodby, Silverstein & Partners
San Francisco, United States
United States
Worst nightmare.






Follow
for Metropolitan Police

Miles Calcraft Briginshaw Duffy
London, United Kingdom
United Kingdom
Cutting admonition.






Line Up (60 sec)
for Nissan

Lew'Lara\TBWA
São Paulo, Brazil
Brazil
Off the record.






Suitcase
for British Airways

Bartle Bogle Hegarty
New York, United States
United States Stowaway.



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Wizard Wisdom

All kinds of great insight, compiled by Craig Arthur in Australia:


Wizard-Chronicle-Newsletter.jpg

Dear Scott,

If your business was a car, marketing would be the accelerator. If you want your business to continue moving forward, you must keep your foot on the pedal.

In this issue:

4 Things Never to Do When Writing Ads

Cost Cutting...Should it be an Ongoing Process or an Event?

How Well Does Your Business Rate on the Customer Visual Checklist?


4 Things Never to Do When Writing Ads

by Roy H. Williams (Edited from original)

First the Conclusion:
Each of us lives in a private world alone, trapped by our own opinions, limited by our own attitudes, guided by our own experiences. Sometimes I wonder how we’re able to relate to each other at all.

And yet we create ads under the assumption that customers are all alike.

When writing ads:

1. Never assume that other people think like you do. You’ve got to be willing to see your own opinions as those of an irrelevant freak.

2. Never assume that other people make decisions using the same criteria you use. EXAMPLE: A product comes in two sizes. A ten-ounce package costs a dollar. A forty-ounce package costs two dollars. Half the people will buy the ten-ounce package because it’s cheaper. The other half will buy the forty-ounce package because it’s cheaper.

3. Never assume your ad to be relevant to more than 10 percent of the people who encounter it. There is no such thing as the general public.

4. Never write to “everyone.” An ad written to an individual is always more effective than an ad written to a faceless mob.

Now read the introduction.

Cost Cutting...

Keeping a check on expenses should be an ongoing process... not an event.

When done as an event, it is normally a blood spilling exercise where staff, marketing and training are hit first and hit hard.

These are the three areas of a business that have a direct impact on company moral and ultimately the customer experience. Short-term the bottom line looks good. Share holders are happy. However, it eventually causes a decline in sales. So out come the razors again and the downward spiral begins.
"Whenever I read about some company undertaking a cost-cutting program, I know it's not a company that really knows what costs are all about. Spurts don't work in this area. The really good manager does not wake up in the morning and say, 'This is the day I'm going to cut costs, ' any more than he wakes up and decides to practice breathing." - Warren Buffett , the world's greatest investor.

How Well Does Your Business Rate on the Customer Visual Checklist?

"By eliminating as many negative visual cues as you can up front, you will help her mind relax, focus on the task at hand, and be more open to developing an ongoing customer relationship with you." - Michele Miller

Wizard Partner and Marketing to Women specialist Michele Miller has kindly prepared a FREE quick visual checklist for you to download and complete. The link to the download is at the bottom of Michele's article titled "What Her Eyes Tell Her About Your Business."

The Editor: Does your business group wish to learn how to attract and delight more female customers? Michele is available to speak to your group. But get in quick she has limited days available. Fees start at (US) $5,000 plus travel expenses.


Previous stories, just in case you missed them:

How to Write Ads That Make the Phone Ring

7 Tips for Surviving a Resession

5 Ways to Attract People to Your Store (without advertising)

The Extraordinary People Myth


A Closing Thought
"If at first you don’t succeed; call it version 1.0." - Bryan Eisenberg

See you next week.

Craig Arthur
Wizard of Ads

PS. Need help to attract more customers and grow your business?

Australia Call (07) 4728 4866 or email craigarthur@wizardofads.com

North America

Call 308-254-2732 or email daveyoung@wizardofads.com

Call 440-610-9746 or email tomwanek@wizardofads.com

We will never try and sell you. You may punch us in the arm really, really hard if we do.


Call or email to book a FREE alignment meeting. No obligation. No pressure. It is at this meeting we both decide if there is a fit between our 2 companies. It is only then can we explore your options. We will never try to sell you. Call (07) 4728 4866.

Wizard Partners Australia. Call Us: (07) 4728 4866

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Another Test for your Email Marketing

Take a look at this:

Do You See What I See?

It would be terrific if email marketers had universal standards for the creation of all their html messages. In the absence of such comprehensive guidelines, Winston Bowden offers some fundamental design rules as a jumping-off point:

  • Aim for a width of 600 to 620 pixels. Use CSS inlinks rather than external CSS style sheets.
  • Optimize images for quick loading.
  • Avoid Flash.
  • Link to forms and surveys rather than including them in the body of the email message itself.

Now, let's say you've developed a great layout with these tips in mind. Sadly, that's still not the end of your design job. The reason? A recipient opening your message doesn't automatically see what you designed on your computer. Ensuring that they do requires testing. Here are two areas Bowden suggests you focus on:

If you target B2B customers, you must be well-versed in a quirk of Microsoft Outlook 2007, which renders html emails in Word, not Explorer. If you aren't, it may pay to hire an expert who is.

If you're targeting a B2C audience, testing on other clients—primarily Entourage, Apple Mail, Gmail, Hotmail, AOL, Thunderbird and Yahoo—will prove especially useful.

The Po!nt: Learn from the past. Even though a design "bible" for email marketing doesn't exist, you can still find the guidance you need to avoid the mistakes others have already made.

Source: MarketingProfs. Click to read the article.

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Closing or Annoying?


Wrapping up this week of sales training with Jill Konrath is this article from her Selling to Big Companies Blog:

Why I Hate Closing Techniques

"My salespeople need to get better at closing," the Vice President of Sales said to me shortly after I arrived in his office.

If I've heard that line once, I've heard it a hundred times. Despite being on an important sales call, I couldn't help but cringe. You see, I will never, ever train people on closing techniques if they sell to the corporate marketplace.

Why not? When you analyze what happens when you teach sellers how to be great closers, you'll understand my perspective.

--

So right now, I want you to imagine yourself as a decision maker in a large organization. Perhaps you're a manager or even an executive.

You agree to meet with a seller who's been trying to set up a meeting with you for several months. When she mentioned the business results her firm was achieving with your competitor, you decided it was time to learn more.

But you're still a bit leery. You're absolutely swamped with a workload that's so big you can't seem to get out from under it.

After a 10-minute discussion with her, you start to notice that nearly every other sentence ends with a question: "Don't you agree?" or "I'm sure you've experienced that?" or "Is that true here?"

(Because she's been trained to "always be closing," she starts using the "Constant Close Technique" right away. This method is designed to get your head bobbing up and down. The more "yeses" you say, the easier it'll be for her to get your business.)

After sharing a bit more about her offering, she begins to implement the "Little-Decision Close" by asking:

- Do you usually start out with weekly or monthly orders?
- Can you get this through purchasing fairly easily?
- Do you agree that this methodology would be helpful?

(By getting you to agree to small things first, she's warming you up for the big close.)

Inside, your head is spinning and these thoughts are racing through your mind: "I'm not ready to get started on anything right now. I'm just learning. Besides, I don't know if it's even worth it to make a change. Shoot, it could be really disruptive right now with all the new initiatives going on in our company."

But the sales rep persists. She's really good at closing. She moves into the "Assume-the-Sale Close." With a winning smile on her face, she says to you, "We can get going on this by mid-month."

If you're normal, by now you're feeling a little pushed - or maybe even a lot pushed. You're not ready to make any kind of decision on the spot like this. Who does she think she is???

Trying to politely get out of this mess, you ask, "How much money are we talking about?" No matter what she says, it will always be too much!

When you tell her that, she chimes back in with the "Better-Act- Now Close".

Petulantly, she looks at you and says, "We're really busy right now. So many people are ordering. If you don't go ahead right now, I have no idea how long it will take or even if the pricing will stay the same. I've heard it's going up."

You tell her you'll have to take your chances, because it's out of the question for you to make decisions so quickly.

Not to be deterred, she comes right back at you with her best "Referral Close." Pulling a list of testimonials out of her briefcase, she lays them in front of you one-by-one.

"Look at all the great companies who we work with," she says. "They love us. We've done great things for them."

Glancing quickly at your watch, you say, "I'm sorry. I have to run to a meeting right now. Thank you so much for your time."

"If you act now, we've got this great promotional offer," she says using her best "Last Ditch Close". "We'll throw in 20 hours of free training and a new iPod."

Enough already! At this point, all you can think about is, "Get this woman out of my office."

--

That's what happens when you train someone on closing skills. They close and they close. At the same time, they tick off their prospective customers royally.

Whenever someone talks to me about their salespeople needing to be trained on closing skills, I have to redirect their thinking.

The inability to close is a direct result of poor needs development. It is the symptom of the problem, not the actual problem itself.

The very best salespeople don't employ any special closing techniques at all. They simply focus on understanding their customer's business and helping them achieve their desired outcomes.

Instead of talking about their product or service, they ask a ton of questions. They keep their focus on their prospect's business challenges and the gaps that need to be closed to achieve their objectives.

Then, knowing that corporate decisions take a while to make and often involve many people, they simply suggest the logical next step.

So please, don't talk to me about your salespeople needing to improve their closing skills. I can't help you with this.

If they're selling to big companies, the more they close, the less successful they'll be.

Jill Konrath helps salespeople get their foot in the door and win big contracts in the corporate market. Sign up for her free e-newsletter at http://www.sellingtobigcompanies.com . You get a free "Sales Call Planning Guide" ($19.95 value) when you subscribe.

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