Archive for June, 2016

Superior CX Is Not About Who’s Right Or Wrong

Friday, June 24th, 2016

I’ve long believed that commitment to CX is a matter of mindset.

I recently read about how some brands / companies went out of the way to deliver superior CX.

#1. AMAZON INDIA

Excellent-Customer-ServiceThe Indian subsidiary of the global ecommerce giant offers a liberal returns policy just like it does everywhere else in the world. It’s a reflection of the notion that returns policy is a marketing tool, designed to make the customer loosen their purse strings by assuring them that they can get their money back if their purchase goes bad, no matter whose fault.

#2. MEDIUM

A user complained to MEDIUM that they were not able to load the post “Advertising Is Not For Geniuses.” While the complete details of the problem and the solution can be found in the article titled “The Unluckiest Paragraphs: A Tale of CSS and Why Parts of Medium Sometimes Disappear”, suffice to say that the problem was caused by an overzealous ad-blocker installed by the user. MEDIUM didn’t shrug this off as the user’s problem. Instead, its engineering team took the trouble to resolve the problem so that the user had a great experience.

#3. JET BLUE

When a passenger jokingly griped about being unable to stop for coffee during a tight travel connection – something that wasn’t JetBlue’s fault – the gate personnel in the second airport ran to a Starbucks for him. Recounting the incident to Fortune, JetBlue vice president Jamie Perry quipped, “We cannot control the way customers come to us.”

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cx-rw-fiFrom the above examples, I’m strongly inclined to believe that lack of bickering about who is right or wrong is the most important aspect of mindset that helps businesses deliver superior CX.

Lest skeptics think that these things are not possible in some countries because customers there will game the system, let me narrate an anecdote: A friend bought a handycam in USA, visited UK to get married, used it to videoshoot his wedding, went back to USA after one month, returned the product, and collected full refund! No questions asked!! This shows that customers game the system everywhere in the world. That hasn’t stopped the Amazons of the world from delivering superior CX with their customer-friendly returns policy wherever they operate. That shouldn’t stop others – after all, people game a system once or twice, then get bored and move on (to greener pastures!).

Some might think only global giants like Amazon can afford to follow such CX-enhancing policies. That’s absolutely not the case:

  1. The above anecdote about my friend and handycam happened in 1995, when Amazon was only two years old and a long way from becoming the global giant that it has today!
  2. Closer home, we offer a money back guarantee for our SAP Mailing List product. The policy provides comfort to buyers about list quality. In six years of its existence, no one has sought a refund. We’re not exactly known for modesty but even we wouldn’t claim that we’re a global giant!

As for whether superior CX delivers ROI, you betcha: “That guy raved about us for weeks”, said Mr. Perry about the passenger who started getting his caffeine fix as a result of JetBlue’s commitment to delivering superior CX.

Who The Heck Outsources Product Management?

Friday, June 17th, 2016

The typical tech startup’s backstory goes as follows: dilbert-product-management-fiFounders observe a problem in the real world, find a way to use technology to solve the problem and build a product around the technology. According to common wisdom, sales, marketing, HR, finance and other functions can come later but product management is the bedrock of any startup.

Therefore, whenever we tell technology companies that we provide “outsourced product management services”, many people raise their eyebrows. When we happened to mention this recently to one of our customers, Atul Narkhede, Co-Founder and Advisor at kPoint Technologies, it went beyond raised eyebrows. Atul almost rasped, “Who the heck outsources product management?”

Valid question.

Since the same thought may be running through others’ minds, we thought of providing a gist of the explanation we gave Atul.

It makes sense for startup founders and product managers of established companies to seek external help for product management under the following scenarios among others.

#1. Create Global Appeal

Different countries have different ways of doing business, taxonomy, cost versus revenue consciousness, tolerance to friction, availability of external sources of data, regulations, and so on. Therefore, it’s but natural for a software developed for one country to need changes to suit another. Creating a world class product is a fulltime job in itself. Product managers lacking internal bandwidth to do it can outsource the project to us.

#2. Elevate Product to New Heights

In the course of packaging a software, we often discover new ways to position the product that are considerably more compelling than the way it’s currently positioned. The repositioning often calls for new functionality. Startup founders wishing to leverage the new positioning entrust us with the task of spec’cing the required modules and underlying features. We did this recently for a company that began life as a developer of a loyalty rewards management software. We worked with the company to raise its product to the next level and provided specs for additional modules for enrollment, engagement and analytics. After developing the new functionality, the company has been able to position itself as a leading provider of Customer Engagement Management software.

#3. Outflank Leader

aha-momentsMany founders assume that the first version of their product should be an MVP and spec their v1 to support a certain percentage the category leader’s feature set. There are two problems with this approach. One, going by an MVP’s purpose to “ensure that the market wants the product before a large time and monetary investment is made” (Source: Wikipedia), founders shouldn’t take the MVP route unless they’re launching the first product in a new category. Two, while latecomers can still become market leaders – as the legend goes, Word was not the first word processor, Excel was not the first spreadsheet and Google was not the first search engine – there’s no way a new product can breakthrough into the mainstream market by supporting a subset of the incumbent leader’s functionality. Why should a prospective customer bother with a newbie’s truncated v 1 when they can very well buy a richer product from the incumbent leader? That said, it’s impossible for a fledgling company with limited resources to match the functionality of the leader developed over years or even decades. This conundrum catches new product developers between a rock and a hard place. Playing the incumbent leader’s experience against itself is the key to getting out of there. We help companies in this situation to outflank incumbents by delivering differentiated functionality and providing “aha moments”. We did this recently by tacking on a social selling module on top of a new Configure-Price-Quote product.

#4. Enhance CX

By now, most products have appreciated the need to go beyond core functionality and pay attention to UI. However, as competition intensifies, good UI is no longer sufficient. UX and CX have become critical to ensure customer success.

SaaS and Internet services product managers that are challenged in these areas can turn to us for help. See “Retail Bank Sees Strong Uplift In Online Customer Acquisition” and “Leading Insurer Boosts Sales” for more details of how we helped a bank and an insurer increase conversion and enhance usage of their cloud solutions.

#5. Migrate From Onprem to Cloud

Many companies port their onpremise software to the cloud, treating the migration as a mere change in the deployment method. Accordingly, they don’t envisage any change in functionality. While this approach might be technically right, it often has the unintended consequence of curtailing the adoption of the software. While not desirable, this is not end of the world for an onprem vendor who typically collects the entire license fee upfront. But stymied adoption can be catastrophic for a cloud vendor who relies on enhanced usage to drive subscription renewals and earn ongoing revenues. We can remedy this situation by re-speccing the functionality for the cloud version. See “LCMS Vendor Accelerates SAAS Subscription Revenues” for a case study on this topic.

#6. Productize Repetitive Services

Through years of providing services to dozens of customers, many IT Services companies have gathered massive expertise and built proprietary frameworks in many areas. Their leadership often wishes to translate their internal capability and IP into one or more products, with the twin goals of moving up the IT value chain and enhancing their company’s valuation. However, lacking an inhouse product manager and unsure of the business case of hiring one on a full time basis for this exercise, they’re stuck. We pull such companies out of the rut by providing end-to-end product management services comprising portfolio analysis, hot-product category clustering, selecting the appropriate category, outlining functional blocks of the solution and providing high-level specs for v 1 of the product. Portfolio analysis is also applicable for product companies that have ended up developing too many products and want to prune their portfolio before increasing their market reach.

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It’s clear from the above scenarios that our outsourced product management services can range from tweaks and enhancements through to new versions and products. In all these cases, we provide specifications in the form of a “Product Feature Document”. The actual coding and other technical work is always done by the product or services company we work with.

Whose Customer Am I?

Friday, June 10th, 2016

I read the following question on Quora recently:

You buy a pen from a store. Then, are you a customer of that store or pen manufacturing company?

Normally, my answers on Quora are rather short.

Going by that standard, I should have simply written “Store” and left it at that.

But this question gave me the opportunity to let loose on some new sales and marketing best practices like Secondary Sales and Customer Engagement. Therefore, I decided to write an atypically long answer. For the same reason, I’m repurposing my answer into this blog post.

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There are two perspectives to the answer. Legal / accounting, business.

Legal / Accounting Perspective

If you buy a CROSS pen from a STAPLES store, you’d probably like to be treated as a customer by both Cross and Staples. However, customer means sale, which means goods and money exchange hands. This happens only at the store, between you (i.e. consumer) and the storekeeper (i.e. retailer). So, you’re only a customer of the store (i.e. Staples).

Business

Consumer goods like pens are distributed via a multi-tiered distribution channel comprising of C&F Agents, Distributors, Wholesalers, Dealers and Retailers. In its simplest form, a channel has two members, namely, Wholesaler and Retailer, as illustrated in the following diagram:

DISTRIBUTION-CHANNEL-LEVELS-fi

As illustrated above, the manufacturing company (“Brand”) sells its product to a Wholesaler, who then sells it “down the channel” to a Retailer, which is the store where you bought the product. For the Brand,

  • The sale from Manufacturer to Wholesaler is Primary Sale;
  • The sale from Wholesaler to Retailer is Secondary Sale;
  • The sale from Wholesaler to End Consumer is Tertiary Sale.

The unit of sale becomes smaller as you go down the channel. That is, Manufacturer sells in large volume (say, in crates) to Wholesaler; Wholesaler sells in smaller volume (boxes) to Retailer; Retailer sells in the smallest unit (piece) to Consumer. The declining thickness of the red arrows from left to right in the above diagram represents this common CPG industry practice. But I digress.

As soon as the Brand ships the goods to the Wholesaler, it recognizes revenue (and may even collect the payment in many cases) – regardless of whether the item lies in the Wholesaler’s warehouse / Retailer’s shelves or has been purchased by an End Consumer. Therefore, the Brand’s customer is the Wholesaler and it has no incentive to bother about Secondary Sales / Retailer or Tertiary Sales / Consumer.

Over time, the first sentence in the above paragraph has remained intact but the second one has changed drastically. Competition has heated up in many product categories. Consumers have a much wider choice compared to 10-20-30 years ago. If a Consumer buys more quantity of Brand B than Brand A, it’s no skin off the Retailer’s back: He simply replenishes more stock of Brand B than Brand A. The Wholesaler couldn’t care less, either: Many of them stock products from multiple brands, so what they lose in reduced volume of Brand A they can make up with the increased volume of Brand B. But Brand A has a big problem since its market share would dwindle if this change in consumer preference goes unchecked.

As a result, Brands are no longer blase about what happens to their product after it leaves their factory gates. In other words, they have the imperative to bother about Secondary Sales and Tertiary Sales in recent times.

ziggy-logo-jpgToday, it has become customary for a Brand’s rep to go on joint sales calls with Wholesaler’s salespersons to Retailers to push their own brand (over competing brands), monitor shelf space for various products, and so on. This trend has intensified so much that it has triggered a fast growing category of software that help brands manage their secondary / tertiary sales process. Ziggy, one of the leading products in this space, is developed by a customer (Click here for more details).

Some Brands have started going one step further by reaching out to End Consumers and treating them as though they were their direct customers. While brands have always tried to influence consumers to purchase their products via mass media advertising, they’re now drilling down to a more granular level and trying to connect with consumers as individuals. As a result, Brands which didn’t even know the names of their Consumers in the past are now trying to learn a lot more than just their identities in order to engage with them. This practice is called Customer Engagement. I’ve come across two examples of brands running Customer Engagement programs in the recent past.

  1. Deodrant brand Adiction’s customer engagement campaign featuring “date with Sunny Leone” as the incentive to connect with end consumers. More at Drive Engagement With Error Messages!.
  2. Pharma company Allergan’s customer engagement campaign for a prescription drug. This is interesting because end consumers aka patients play no role in choosing the brand of a prescription drug. To find out the rationale of this campaign, see Big Pharma Turns To CEM For Cure.

Customer Engagement seeks to drive repeat purchase, boost brand loyalty and build customer advocacy. The new breed of Customer Engagement Management software helps brands and their consumers to enroll, engage and encash at scale. Click here to find out more about a leading CEM solutions provider who is also our customer.

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Traditionally and in modern times, from a legal / accounting standpoint, the Consumer is still a customer only of the Retailer from where they buy a consumer product. They still don’t figure in the manufacturer’s PL/BS. However, from a marketing / business standpoint, the Consumer is increasingly treated as though they’re a direct customer of the Brand.

So, if you get a call from the manufacturer of your favorite pen or soap out of the blue one of these days, don’t be surprised – it’s only a sign of their CEM organization burning the midnight oil to engage with you as though you were their customer!

Perils Of “Shoot Yourself In The Foot” Retargeting

Friday, June 3rd, 2016

Since the time I published Retargeted Ads or Retarded Ads, I’ve come across many more retargeted ads exhibiting retarded behavior.

Take for example the ones from Cleartrip.

Well after I’d booked my tickets on its portal, I kept seeing its retargeted ads. I hinted to the OTA that it could try setting frequency caps on its campaign so that it doesn’t waste money or invite my ire by stupidly retargeting me even after I’ve converted. I got an apology from someone in Cleartrip and stopped seeing its retargeted ads. But the relief was fleeting. The moment I visited cleartrip.com the next time, the spate of retargeted ads started once again. This time, I took a different approach:

Let’s see how it goes.

Cleartrip is not the only one. DNN, PropelGrowth and PunchOut2Go are some other brands I’ve come across that engage in a similarly-retarded manner of retargeting.

pbr-fi

But these are all cases of unnecessary retargeting. While they momentarily irritate customers, they don’t do any serious damage to the brand (at least IMHO).

SILICA-FB-ADI recently came across retargeting of a different type that can actually kill a brand (again, at least IMHO). Technically it’s called Facebook Retargeting. But, a more apt term for it in my context is “shoot-yourself-in-the-foot retargeting”.

There’s this famous institute that provides coaching for entrance tests of NID, IDC, SID and other leading design universities of India.

I’d recently bought the institute’s kit for the NID studio test. When I opened the package, I found a DVD. I mumbled to myself about who uses DVD nowadays. I had a tough time finding a working DVD drive at home. At last I found one and inserted the DVD into it. The DVD ran automatically and reached a landing page, which said that there was “no movie in the language”. I couldn’t make any sense out of this error message. I ignored it and tried everything I could to make the DVD play. Nothing worked.

I then called the helpline number printed on the back of the DVD case.

The person who answered my call told me that I need to call another number since there was a printing mistake on the jacket. The customer support lady was hopeless. I then visited the company’s website and called the number mentioned there. The guy who came on the line promised to have a senior person call me back within 15 minutes. Nothing happened. While I was peeved with the company, I moved on and soon forgot about the incident.

SILICA-FB-COMMENT

Until I saw a retargeted ad from this company on my Facebook Newsfeed later that night.

I guess when I had visited the company’s website to find out its telephone number, a cookie was placed on my laptop, which triggered the retargeted ad.

The ad irritated me no end and brought back memories of my earlier interactions with the company. I vented by leaving a long and detailed comment about my lousy experience with the company on its FB Wall. You can see it on the left.

The next day, all hell broke loose. A couple of people from the company called me to inquire what prompted my caustic remarks and asked me what they could do to remedy the situation. I told them to simply fix all the issues I’d raised in my comment.

The problem was eventually sorted out amicably. But, by then, enough damage was done to the brand. (I know this because I can’t find the post or my comment any longer on Facebook. I’m guessing the company deleted them when they got too hot beneath the collar for it to handle.).

Blind retargeting was responsible for this damage. Repeated incidents of such “shoot yourself in the foot” retargeting can sink a brand.

Advertisers using retargeted ads can escape this fate by planning their retargeting campaigns with finesse. Instead of showing retargeted ads to all and sundry, they should analyze their clickstreams, chat scripts and call logs to identify cohorts that should be excluded from their retargeting campaigns.

I hope advertisers realize that retargeted ads could be a double-edged sword.