Co-designing your customers’ experience with customers

I am following the Barclaycard Ring credit card concept very closely since inception.  It is a very good example of how a company is co-creating a product with a community of customers:

Barclaycard Ring is a credit card that’s driven by its community of card members. The community is a forum where you can exchange ideas, share knowledge and make Barclaycard Ring whatever you want it to be. It’s also a place where we can hear you out and better understand what you need from us. After all, if it’s your card, why should we have all the say in how it works. It’s time to put you, the customer, back in the driver’s seat.”

Barclaycard Ring is particularly collaborating with its customers on designing their customer experience:

“The second vote asked whether or not we should keep the servicing calls in the United States. Here are the blog and community comments from last year’s discussion. The comments overwhelmingly favored the idea of keeping the calls stateside, despite the fact that moving calls offshore would lower operating costs by roughly $4 per active account, per year.

The results are in and 84.4%, an overwhelming majority of voting community members, stated they’d like to keep Barclaycard Ring calls routed to the U.S. based call center. We hear you loud and clear on this one!”

Posted in Consumer-Driven Innovation, Crowdsourcing, Customer Co-Creation, Customer Collaboration, Customer Communities, Customer Experience | Leave a comment

What is the best way to prevent customer failures?

I still find this 2006 Sloan Management Review article on How to Prevent Your Customers From Failing very timely.  Please note particularly:

Research indicates that about one-third of all service problems are caused by the customer.  As companies increasingly shift work to customers and incorporate more self-service technologies, customers will take on even greater responsibility for service quality. As a result, their failures will become more critical.”

The Fifth Third NextJob practice is one unconventional example of preventing a certain customer failure.  More specifically, Fifth Third is preventing their unemployed mortgage customers from losing their homes by helping them find their next job.

Posted in Customer Collaboration, Customer Experience, Customer Insight, Customer Loyalty, Customer Retention | Leave a comment

Placing your products in your customers’ natural habitat

I found this Lowe’s Holoroom concept by the Lowe’s Innovation Labs very intriguing.  Please note particularly:

“We know that for many homeowners, the struggle to visualize a completed home improvement project or to share that vision with others can stop a project in its tracks,” said Kyle Nel, executive director of Lowe’s Innovation Labs. “The Holoroom is our solution, enabling consumers to visualize their project and share that vision with family and friends.”


See also the similar Place IKEA furniture in your home with augmented reality concept:

Posted in Customer Co-Creation, Customer Experience, Personalization | Leave a comment

Should companies focus on customer acquisition or customer retention?

The choice between customer acquisition and retention is a false choice.  I recommend instead employing a diversified and balance customer lifecycle management approach with customer acquisition, onboarding, development and retention elements.

Customer Acquisition, Development and Retention are very connected and have many downstream and upstream implications.  For example, many Customer Retention challenges are embedded in downstream poorly designed Customer Acquisition and Onboarding programs.  Therefore, focusing on any one element and not the others can produce underwhelming results.

Posted in Customer Acquisition, Customer Loyalty, Customer Retention | Leave a comment

Does customer behavior speak louder than words?

I found this note on “Don’t listen to what your customers say, watch how they behave” by Rita Gunther McGrath very thought-provoking. Please note particularly:

“I am often asked by companies with whom I work whether focus groups, surveys or customer panels are useful in learning what customers want and more importantly, what they will pay for. Sure, these techniques are helpful and sometimes can lead to useful insights. But it is usually a huge strategic mistake to base investment decisions or innovation projects on data gathered through these means. Why? A benign explanation is that we are all massively unaware of what really does drive our behavior. A less charitable explanation is that when people are asked questions, they tend to respond the way they think the person asking would like them to (which is one reason why doctors always double the number of drinks per day patients report consuming).”

See also a similar perspective from Russ Ackoff: There is no point in asking consumers -who do not know what they want – to say what they want.

Posted in Customer Insight | 2 Comments

Are customers loyal to your brand or to your points?

I found the following observation by Niraj Dawar very instructive.  Please note particularly:

“From a brand manager’s perspective, the question is what is a consumer loyal to — are they loyal to the brand that you’re selling or are they loyal to the points? If they’re loyal to the points the moment you stop those points your product will stop selling,” Dawar cautions. “Or the moment a competitor offers an equivalent amount of points on a slightly different program, the consumer will switch.”

There’s a better way to attract customers, he says. Companies that can make product “easier to buy, easier to find, easier learn how to use and then eventually dispose,” tend to retain its customer base for longer periods of time, Dawar says.

“It’s in the interaction. It’s in how the customer buys rather than what we sell them,” he adds.

Posted in Customer Loyalty | 2 Comments

When sales and marketing goals go wild

In his Harvard Business School working paper, Max Bazerman argues that:

The harmful side effects of goal setting are far more serious and systematic than prior work has acknowledged.

Goal setting harms organizations in systematic and predictable ways.  The use of goal setting can degrade employee performance, shift focus away from important but non-specified goals, harm interpersonal relationships, corrode organizational culture, and motivate risky and unethical behaviors.

In many situations, the damaging effects of goal setting outweigh its benefits.”

Sales and Marketing goals, in particular, often produce similar harmful side effects as evidenced by the following cases:

The first case describes a retail practice of “walking the [empty-handed] customer” out of the store to facilitate meeting a “market basket” goal:

“With the ever-present risk of bringing down a store’s Market Basket average, several employees said, upper management instructs store management that staffers who think they won’t be able sell $200 worth of add-ons should tell the customer the computer is not in stock

“It’s called ‘walking the customer,’ because we let them leave the store empty-handed.” said Ms. Shah, who works in a Staples store in Fountain Valley, Calif.”

The second case outlines how sales goals [quotas] can actually reduce profits by producing certain counter-productive gaming behaviors:

“While [sales] commissions may spur effort in unequivocal ways, the quota [...] can sometimes result in agents gaming the system. “Those who have already made the quota in a current compensation cycle may have an incentive to postpone additional sales,” says Nair. “Alternatively, those who perceive they have no chance of making the quota in the current cycle have a perverse incentive to postpone their effort to the next cycle.”

In any case, managers should systematically anticipate, discover and counter-measure the harmful side effects of goal setting.

For a third such case, see also: When Persistence Backfires

Posted in Uncategorized | 1 Comment