Category Archives: Customer Loyalty

Citigroup’s new bailout plan: Me

Received my Citi credit card statement today. Tucked away on Page 3 was a notice that my interest rate had been changed from 8.99% 14.99% to 28.99%. Hey Citigroup, do I look like Henry Paulson?

12/18 update: Just received this in an email from Citi:

“We are pleased to inform you that we have raised the credit line of your Citi(R) Diamond Preferred(R) Rewards account to $xxxxxx. This increase was a result of our ongoing credit review program. We wanted to acknowledge the responsible way you have maintained your account.”

Sorry Seems to be the Hardest Word

After hearing the latest regarding consumer electronics chain Tweeter’s bankruptcy, I went to their site to see if they were having a fire sale. I was greeted by this:

Bad earnings. Store closings. Bankruptcy.

You’re thinking, Tweeter’s going the way of the hula-hoop, right?

Wrong. Dead Wrong.

Find out more>>.

OK, I’ll bite. The link takes you to an open letter to customers – basically a mea culpa page – explaining the root of the company’s struggles and its commitment to make things right:

We’re down, but don’t count us out.

Here’s the problem: Over the past several years we stopped doing the things that made us successful in the first place. For thirty-five years our stores were famous for cool products, people that you could talk to and service that made the competition look pale.

We strayed from what made us great.

How we’ll get back on course:

Best Products
We will only carry the newest, coolest, best products in each of the categories we sell.

Smarter People
Technology is changing fast. We’ve stepped up our training program to keep us ahead of the curve. When our salespeople, technicians and installers are smarter, everyone wins.

Outstanding Customer Service
We are renewing our focus on taking care of you, our customer, like never before. You are our number-one priority.

All this means nothing unless you are there to notice.

So give us a shot. The only way to get better is to both be better and have you there to tell. One without the other is futile.

So come and pick our brains and see if we have any. Whether you want a home theater that rivals the local cinema or one “command and control” system that’s easy to use and controls everything from your lights to your thermostat to your security camera, we’ll come up with something that’s sure to fire your imagination.

The rest is on us.

Impressive. A frank acknowledgement of past mistakes, an action plan to do things better, and a plea to give them another shot. As someone who drifted away from Tweeter over the past couple of years as their in-store customer service declined, I understand where they’re coming from. Tweeter used to be my only choice for big-ticket consumer electronics, because I knew I could get straight answers from their salespeople and never felt they were just trying to upsell me. That changed as the service fell below the premiums they were charging for their products. My last visit was at least 8 months ago, when I couldn’t grab the attention of any of the half-dozen clerks talking to one another to ask a simple question about an HDTV (LCD or plasma?). I bought one the next day at Best Buy.

Tweeter’s management finally figured out that their best asset was their loyal customer base, which they let drift away to Best Buy and other big-box retailers without a fight. The epiphany may be too late to pull them out of their death spiral, but at least one former customer is willing to give them another chance.

 

Innovations in Cookie Packaging

I’ve been working with a client on an article about innovation, specifically how companies can identify not just the best new ideas, but the ones that are most likely to succeed in the market. In other words, you need to figure out which innovative ideas – for new products or marketing programs or packaging or distribution or whatever – will actually make money and help your company grow.

Sometimes the smallest innovations have the biggest impact. Consider the new packaging for the bag of Oreos we bought last week. You know how it used to work: You rip open the wrapper around the plastic tray or Oreos, and a week later any cookies that are left are stale, because there’s no way to re-seal the bag. (Not that Oreos last too long in our household, but hey, it happens.) But now Kraft has added a re-sealable Easy Open Tab to the top of the packgage – you pull it back to grab a few cookies and it sticks back in place when you’re done. Freshness preserved!

Apparently Kraft’s Snack ‘n’ Seal design has been around since 2005, debuting on a package of Chewy Chips Ahoy, and the design won an innovation award last year. I don’t know how much the packaging will add to Kraft’s bottom line – who knows, it may actually hurt profits by extending the life of every purchase – but the company certainly wins a few customer appreciation points.

oreo-packaging.jpg

Negative Influencer

My 9-year-old son Conor was engaged in his usual hypermultitasking activities last night – simultaneously watching TV, building something out of Legos, visiting the Webkins site, hugging the dog – when a Circuit City commercial came on. He stopped everything he was doing and proclaimed to no one in particular, “I will never shop at Circuit City again!”

You see, Conor and I had a bad experience at a local Circuit City store when an overmatched and undertrained sales clerk couldn’t figure out how to ring up the three items we were purchasing. His incompetence was both comical and frustrating. Twenty minutes into the transaction, I gave up, stopped a manager on the way out of the store, and ripped him a new one for putting staff on the floor who obviously weren’t prepared to do their jobs.

Not a big deal, right? Especially for Conor, who as a consumer-in-training is endlessly bombarded with brand messages and has trouble remembering where he left his socks 10 minutes ago. The negative memory will surely fade into the background, and all will be well. Except for one thing: That in-store experience happened nearly four years ago, when Conor was 5. No amount of slick advertising will ever convince this young consumer to spend his allowance in a store that wouldn’t let him buy a PlayStation game.

How To Kill Video on Demand, Chapter 1

Stupid media tricks: MediaPost reports that ABC and ESPN have struck a deal with Cox in which the cable provider will disable the fast-forward feature for some of the on-demand content it offers from the two Disney properties.  That means Cox cable subscribers won’t be able to skip commercials and zoom through the programs they watch via Cox’s VOD (video on demand) service. (The agreement does not apply to programs that subscribers record on their own using Cox’s DVR box.)

This a classic horse-has-left-the-barn overreaction to the media companies’ ad-skipping angst. There are two main benefits of VOD: convenience (you can watch anytime you want) and control (you can pause, skip and rewind). Removing one of those elements will absolutely kill VOD. Disabling features that customers have already embraced is a surefire way to make them hate you.

JetBlue Fallout

JetBlue is taking steps to restore its image in the wake of its scheduling implosion last week that left passengers stranded in airports for days and in some cases sitting in grounded planes for more than 10 hours at a time. A day after trotting out CEO David Neeleman to the New York Times (who said he was “humiliated and mortified” by the delays), the company plans to unveil today a customer “bill of rights” program and new operating procedures. A YouTube video from Neeleman is also front and center on JetBlue’s website – a good use of the medium to speak directly to customers.

For a company that has developed a loyal following despite its low-frills approach to flying, this is a critical juncture. It seems to be aware of the damage control it must do. Here’s Eric Brinker, JetBlue’s director of brand management and customer experience, quoted in the Poughkeepsie Journal discussing the new passenger bill of rights:

“We’ll be reaffirming ourselves as a leader in this industry. It’s something that’s going to hold JetBlue financially accountable to a much greater extent than airlines have today. It’s something that really forces us to do right by our customers.

The airline already has pledged full credits or refunds to passeners whose flights were cancelled. So far, so good. But the next few months – and the steps the company takes to fix its apparently deep-seated operational problems – will determine just how much equity JetBlue has built up with its customers.

More broadly, some observes are calling the JetBlue fiasco a tipping point for airline travel, as the blogosphere heats up with calls for legislation to protect travelers’ rights.  Before the JetBlue troubles, a real estate broker named Kate Hanni had formed the Coalition for a Passengers Bill of Rights and is collecting signatures on a petition to spur Congress to enact new legislation for airline travelers. The JetBlue incident will no doubt feed those efforts.

Another great example of the power of social media.

The Right Way To Do Customer Service

Last night, I cancelled my premium membership to TheLadders.com, an executive job site (since I’m not actively looking, I couldn’t justify the $30-per-month fee). Cancelling online was a breeze – one click to get to my account info, one click to cancel, plus a question or two on why I was bailing. No hard push to keep me on board, no making me call a customer-service rep for a cross-sell attempt, just a nice “thank you.” This morning I received an email acknowledgement from a community manager named Kathy Wu confirming the cancellation, with a bonus:

Just a head’s up. Your account was auto-renewed for another 4 weeks last Wednesday. Did you want those extra weeks or had intended to cancel before the renewal took place?

I replied that I did not want the extra four weeks and would they mind crediting my account. A few hours later I received this reply:

Hi Rob,
Thanks for getting back to me.
You’re all set! Please check your next American Express statement to see the $30 refund reflected. You’re now a free, Basic member and won’t be charged again unless you re-upgrade to our Premium level of service.
Best,
Kathy

Proactive, friendly customer service. No muss, no fuss. What a concept! I will certainly use their service again, and I will recommend TheLadders.com to my friends and colleagues. This is customer service done right.