Poor Customer Service is Alive and Well

Filed Under (Uncategorized) by Don on 30-07-2007

We talk a lot about providing a positive customer experience and great service but how about an example of poor customer service.  Let’s take a moment and examine an experience I have ‘endured’ lately.

At my home we subscribe to a local daily rag called The Charlotte Observer.  It is the largest paper in North Carolina circulation and we get it via home delivery.  We have had a few delivery issues in the past but late last year the service began to decline significantly.  We were supposed to receive the paper seven days per week and most days we didn’t receive one and the weekend usuall meant my running out to get a Saturday and Sunday morning paper from a box somewhere because our never came.  We called the Observer customer service ‘hotline’ seven times and each time were assured the carrier would be informed of our missed papers and our service extended.  Eventually we went two and a half months with no paper delivery even though we had paid for six months of service.  Finally in desperation my wife called one day and after numerous requests to speak to a supervisor she was finally ‘granted’ an audience!  The supervising agent promised that the credit would be issued and she would extend our service for 13 weeks to make up for the errors. 

That was three weeks ago.  Suddenly last week we get a phone message from a fellow who said that we needed to contact him as soon as possible to discuss “our options” for continuing delivery and that he was looking for some payment to comtinue deliveries!  I nearly hit the roof I was so disgusted.  When we called this fellow he said there were numerous notes on the account about our delivery issues and the reason they had not been acted upon was because “we didn’t call the right person!” What?!? We didn’t call the right person?  We called YOUR customer service at the number represented in YOUR newspaper!  Obviously there is a highly secretive department at the Observer that only the few and privledged know about.  I’m positive this department is on the governments list of Black Ops programs that have those classified $500 hammers.  The guy even said in his message that he was ‘difficult’ to reach and we may to try several times to reach him.  Bah!  This is why newspaper circulation rates are in decline and people choose to get their news online.

Super secretive customer service departments, hidden contact numberscontact people and supervisors who don’t or can’t supervise much less make a decision and be empowered to make it happen!  Now that’s what I consider a customer service nightmare!  They even admitted that there have been “issues” with their deliveries.  We finally did reach an agreement on our subscription but I confident that we will not renew the subscription.  I have subscribed to this paper for over 25 years  and as a long time customer my only requirement is that I receive my daily newspaper, every day.  I will discontinue doing business with these folks because they don’t take their customers, or their customer service, seriously.  Their customer service staff is apparently not empowered to make decisions, the communications channel is non-existent and they have no corporate mandate for providing genuine customer service. 

Four Star expectation and one-star performance.  The end result?  The loss of another loyal customer.

Office Max Layoffs Continue

Filed Under (Uncategorized) by Don on 26-07-2007

I hear that once again the folks at Office Max/Boise still just don’t get it.  They are laying off employees again and the sad part is they are dismissing folks that generate real revenues.  Many of these unfortunate folks are high volume producers within the OM commercial group and bring in substantial dollars in sales every month.  One must ask what in the heck are these people thinking when their sales and profits are already suffering yet they layoff their best producers, why? 

I can only venture a guess that OM is trying to appear “good on paper” to a potential buyer or investment group.  But at what cost?  Some of these folks have over 20 years experience in the office products industry!  I’m sure there is someone out there far wiser than I that can explain this tactic in a way that makes sense because I am dumbfounded by the stupidity of moves like this.  At the rate OM is going I will be surprised if they are still in business a year from now, at least in the form they are at present.  I would imagine the shareholders would have some strong opinions about where their investment dollars are heading.

When Boise purchased OM some years ago they never really got it right after that.  Office Depot and Staples also had their problems early on but have managed to overcome many of their obstacles.  (Their customer service still sucks though!) Apparently the culture between the retail and commercial folks at OM just didn’t meld very well.  One of their first bad moves was to immediately play around with the commission structure for the sales people.  You should never play around with a commissioned rep’s pay if they are producing and especially when it lowers their income and doesn’t give them anything in return such as added benefits.  You can’t take and not give back somewhere down the line.  Sadly, many corporate ‘shirts’ don’t understand this simple concept.  Probably because they have never been in sales and don’t understand the sales mentality.  They are operations people and it is a rare occasion that an operations person has a clear perspective and appreciates the sales mentality and processes.  They have forgotten that nothing can happen until the sale is made!

Of course OM changing the commission structure had an immediate result of a mass exodus of many of their most talented reps.  I don’t blame them (the reps) either.  It will take someone coming into OM that has a very clear understand of what it will take to blend commercial and retail environments and to instill the fact that without good people and a Mission Statement that carries some weight plus some other factors they are doomed to continue this downward plummet.  Plus, they will need to fix the critical component of the sorry state of their customer service.  Basically, they have no corporate mandate and no one apparently gives a crap about providing quality service to their customers on a consistent and established basis.  I don’t mean there are not OM employees that really care, I’m sure there are many who do.  What I do mean is that they (corporate) have not established the importance of customer service and that the service mandate and philosophy has not been directed from the boardroom down to the showroom.  Come on OM.  Providing great service isn’t that difficult, it’s a culture that you have to nuture and encourage and reward.  I guess I need to come up there and explain to your board the importance of this critical component!  Good luck to those who have lost their jobs, our prayers are with you.

How Do Customers Define the “Experience”?

Filed Under (Uncategorized) by Don on 20-07-2007

Heartfelt Teddy

A recent survey of customers by the think tank group CustomerThink tells us what is important to customers when it comes to the customer experience.  The top five responses, in order were as follows: 

  1. Well-trained and helpful employees
  2. Excellent Customer Service
  3. High Quality Goods and Services
  4. Friendly and Caring Employees
  5. Personal Attention (recognition for being a loyal customer)

Some companies utilize loyalty rewards or a points based rewards system, but that only rewards the behavioral loyalty.  I have expressed my opinions about this previously.  Although there is some value in these programs (only when they create real loyalty) most of them are not ran properly nor do they create anything that really rewards the customer in a way that is constructive to building new business much less creating a meaningful experience.  What these programs do not create is an emotional connection. That is the area where real opportunity lies.

Customers are just like other people in that they want to receive personal recognition. Especially for long term loyalty to a business.  Many customers feel they don’t receive anything ‘extra’ for being loyal to a company for ten, fifteen or even twenty years.  Therefore it isn’t enough to just say “thank you” to your customers, it is necessary to express your sincere appreciation for years of loyalty in more meaningful ways such as extra discounts, free goods or some other form of heartfelt recognition.

In a perfect world you want a rewards program to stimulate buying, unfortunately in our world that isn’t always the case.  The most successful people, and/or companies, that can accomplish this in more natural ways will continue to harvest the loyalty based repeat business.  This kind of loyalty comes from recognizing the real value the customer brings to your company and relating that gratitude in a heartfelt, personal and sincere manner.

That’s brings us back to the relationship, doesn’t it?  Sincere relationships create emotional bonds, that kind of loyalty can’t be rewarded with a points program.  Have you “hugged” your customer today?

ASI and Office Max say “Let’s Make a Deal”

Filed Under (The Competition) by Don on 18-07-2007

Office Max

When I first heard of the ASI/Office Max deal that gives ‘discounts’ to all ASI members the first thing that came to my mind was “What about the hundreds of independent office products dealers that are ASI members?”  What a slap in the face to these dealers!  ASI (Advertising Specialty Institute) if you haven’t heard has inked a deal purportedly to the benefit of all ASI members for a discount on office supplies purchased from Office Max.  The Office Max (OM) folks gave their usual spill about how great their discounts were and of course how it benefits ASI members.  What a load of crap that is. After listening to the ASI podcast of the announcement I couldn’t help but chuckle because it is the same old pitch we hear from the big box dealers.  Here are the highlights:

  • 30% Discount off their Retail Priced commercial catalog of 12,000 products (that’s right, a paltry 30% discount off List Price!  I wonder who sets their inflated List Prices?)
  • They get the same core list of 100 heavily discounted everyday products
  • There is also a discount at the OM copy center (Woopie!)

That’s it!  So what is the big deal with that?  I’ll use our own dealership as a comparison.  We are a medium sized dealer of around $8M/yr is sales.  We have over 60,000 products available with our mega catalog containing over 29,000 products alone.  Our core list contains nearly 6,000 products.  That doesn’t even begin to recognize the Jan San (janitorial) and furniture catagories plus the printing division and we haven’t even touched the ad specialty products yet!  We are always giving away product samples and we have account specific customer service professionals and ‘personal drivers’ that are assigned to each account.  So like most independent dealers we have many times over the product selection and service capabilities that Office Max can claim on their best day.  OM (or any other Big Box store) can’t even compare with the quality and committment of service and customer experience that we provide.  I’m confident that the majority of independent dealers are just as compasionate about their service and support as we are.  (I could teach seminars on this topic alone!) Perhaps all the ASI office products dealer members should quit ASI and join PPAI instead! 

Their (OM) returns and credits department is complicated and NOT customer friendly.  Their credit card services are provided by a third party vendor (HSBC) just like the other Big Boxes so they can’t control their credit service quality either.  What about furniture delivery charges?  Furniture setup and install fees?  That is an area that the Big Boxes really stick it to customers.  They have a limited selection, will only deliver inside their service area or they sub-contract the service out.  They will only deliver to the first floor with no setup.  No systems installations at all.  They have more add-on fees than Carter’s has pills!  I could go on for pages about how this isn’t a deal at all for ASI members.  The ASI members can get far superior service and just as good if not better prices from the independent dealers.  So someone tell me where the “deal” is for the members?

Then I also question why would they make a deal with a company who is and continues to have poor stock performance and almost non-existent earnings.  Personally I don’t see any advantage and if the ASI members are as smart as I know they are, they will figure this out soon enough!

For the independent dealer an educated consumer is your best customer!

Firing Customers

Filed Under (OP Sales Training) by Don on 13-07-2007

Fire the Customer!   I didn’t really want to jump into the foray regarding the news this week about Sprint 1000 – Nextel firing 1000 high demand customers.  However, Tomi Ahonen’s blog over at Communities Dominate Brands made some excellent points with regards to the sheer stupidy of the Sprint move.  I am certain that you probably can share your own stories about a less-than-impressive event that you have had to endure with your own mobile service provider.  But that makes me think about our own industry.  Many independent dealers are strictly commercial dealers but there are those that have retail storefronts as well as a dedicated commercial sales staff.  There is no doubt that Sprint made a bad move and exhibited very poor judgment handling this issue.

While researching information on consumer retail buying habits I ran across a study from Accenture Institute for High Performance Business entitled Act Now! Customers are Limited.  Although it is concentrated primarily on the retail experience it is worthy reading because it’s findings tell us about what is really important to consumers.  The most commonly cited problem annoyances revolved around customer service and delivery issues and secondly is providing too little information to consumers and treating customers rudely.  Also noted was a low single digit percentage amount of customers believed the problem issues would be eliminated by the offending retailer.  Now, when I think of offensive retailers one of the worst buying experiences I ever had was in a “B.Buy” electronics store which was second only to CompUSA.  Each of these retailers have had difficulties in maintaining good customer service for many obvious reasons.  I can only assume that they have made some progress to improve but I will not shop at these store because of my previous experiences. 

The difference here is they didn’t fire me as a customer I elected to leave of my own free will.  Sprint should have done something similar.  What about your business?  Have you experienced high demand customers that are a constant drain on your staff and resources?  Did you fire them or get to the root cause of the problem?

I have had customers that were a real pain.  I’ve wanted to tell them to take their business elsewhere but in the end they are still a customer and they deserve my attention.  One option I’ve used is to increase their prices to cover the additional expense of their service requirements.  If they are unhappy with the pricing they are welcome to go elsewhere, it’s their choice.  Some customers simply require more dedication, and that’s fine too but, if they only purchase $250 per month then your time is better spent with your more loyal, more profitable customers.  Deliberately loosing a customer can be done gracefully but you have to make that choice based on the overall profitability of the account.  If the account has thirty different buyers then you know in advance that you are dealing with a potentially high-maintenance account but that isn’t true for a small account with one buyer and one or two employees.

Some customers can be a pain but they are still a customer.  Perform your due diligence and make sure their complaints don’t warrant some kind of action on your part such as customer service training or product knowledge.  If you can’t meet their needs in a cost effective manner then consider your options.  But don’t fire the customer.  Let them make the choice to exit gracefully because you will know that you always gave them more than they expected.

Why Loyalty Programs Won’t Work

Filed Under (Uncategorized) by Don on 10-07-2007

evil-button.jpg

 Ahhh, a few days off for a brief but welcomed vacation.   I hope you had some time with family or friends over the Independence Holiday too.  In a few short weeks schools will begin another year and I am already seeing Staples promoting back-to-school supplies heavily.  In our local paper over the weekend their ad stated $29.99/ctn for Staples brand copier paper, limit five cartons for in store pick-up only.  Isn’t that brilliant?  They require you to come in the store, buy the paper and load it in your own vehicle, knowing that you will most likely purchase something else while you’re in the store.  Of course you could just go to their website and make your purchase and they will deliver it but that point isn’t mentioned in their paper advertisement.  How about Staples venture into the grocery stores?  They can be found selling Staples brand products in select Kroger, Safeway and Aldi grocery stores plus several other more localized chains in other states.  They will apparently continue their experiment in this sector.

Someone asked me the other day about why I don’t utilize some sort of loyalty card or program.  In my humble opinion I think these programs stink!  They tend to segregate customers and in the end the only real value is in the data acquired from their purchasing habits.  In essence it is just another discount program.  According to recent surveys people join loyalty programs to receive special treatment.  Yet, only 7% of those respondents state they ever received any special treatment.  I really hate rebates, prebates and discount cards.  Like I have written in the past if you want loyal customers you have to treat them like they truly are special.  Loyalty programs have been around for a long time but the one thing they don’t create is loyalty.  All you are doing is rewarding repeat behavior.  How does a loyalty program define your value proposition?  It doesn’t, at best it only rewards those who constantly beat you up over being the cheapest in price.

Ideally a loyalty program should capitalize on the frequency of the buying habits of the customer allowing you to better develop your relationships.  You want your customers to be emotionally committed to your company.  If you can create a loyalty program that accomplishes these tasks then your program may have a chance at success.  The data you acquire from their purchasing habits, cycles, products, etc. contain strategic data that can be used to target specific customers and to better create sales programs targeted at their needs.  So my question is why is it necessary to even implement a loyalty program?  Your back office system should have the capability to generate reports that contain similiar data.  Do you really have the extra time to monitor and run this type of program?  Don’t you think that your time is better spent demonstrating your value proposition?

Bottom line here for the independent dealers is we must have loyal, emotionally committed customers.  We accomplish this task with our emotional committment to them by being consultants to their business success, building our relationships and providing them with a unique buying experience where they know, beyond doubt, that we are committed to them.  I have customers that have been loyal to me for over 20 years because I have demonstrated to them time and time again that I sincerely care about them, their families and their business.  Your entire staff has a responsibility to acheive this same committment.  Your delivery personnel, CSR’s, everyone in your organization has a connection to your customers.  Your primary loyalty driver is your smile, attitude and your committment to the customer!  Here is your first loyalty driver idea:  Your delivery people are on the front lines every day and have more personal interaction with your customers than anyone in your office.  That gives you another edge over the Big Boxes, use it! 

What is your opinion and how do you get your customers emotionally committed to you?