On March 6, 2008, I called one of AT&T company’s call centers located in Georgia requesting two business class phone lines with fast access DSL. Over the phone I was originally quoted the price of over $180.00. I immediately responded that I could not afford that amount monthly. I then informed the representative that I currently had Comcast who offered me the package for much less. I told her that if she could quote me a price within my budget that I would sign a contract. Shortly after, she e-mailed me a “quick quote” offering me the services for $162.00 monthly including discounts which would be provided after signing a two year agreement. I responded that if she could quote me at $130.00 a month; I would then sign up. Over the course of a week she sent me various quotes, and finally quoted me a price of $123.00 monthly. She also made me aware that my first bill would be higher because it would be prorated, plus parts and labor. I told her I understood that and I was looking forward to being an AT&T customer.

After I reviewed and signed the contract I received a courtesy call from AT&T. This representative basically asked me if I was satisfied with my services. After reviewing my file, she was helping me to set up my phone book listing. When I told her I wanted to be listed under web development, she mentioned to me that I had signed up for a slower DSL speed. She let me know that I needed to upgrade because the speed I signed up for was to slow to handle the type of services my business would be providing. I responded I was sure I had told the previous rep that I needed a fast internet connection for what I was doing. In fact we talked extensively about it, because she (the first rep) also did graphic design. I asked how much it would cost to upgrade. She said my bill will be about $150.00. I told her I was stretching it, but I really needed the faster speed. She also sold me other features “at a fraction of the price”, because of the misunderstanding. She said my total monthly bill would be about $162.00. I agreed and signed another contract.

On May 5^th 2008, I called AT&T again. This time I was checking on my bill. I know I had signed up in March and I did not receive a bill for April. I was told that I did not have any charges yet, but my next bill would be in the mail soon. I assumed all of the “discounts” I was promised had been applied to my first month’s bill. Shortly after, a third representative called me. He informed me that because I was a new customer I was entitled to receive a new promotion that AT&T was offering. He said that he had been reviewing my account and saw that I already had two lines and fast access DSL. He also told me that if I added a third line it would put me in a package instead of having individual services (I thought I already had a package deal), thus giving me greater savings. I asked him how much my bill would be with this “package deal” He said about 139.00, which was less than what I was paying with 2 lines. I said it sounded good and I accepted via phone confirmation. He also made me aware that my first bill would be slightly higher because of the prorated amount, I said I understood. He promised to send me papers in the mail. I did not receive anything. I never used the phone line, and I never even knew the phone number. I only agreed to add it in order to be eligible for the “package deal”.

Time went on. I checked my P.O. Box weekly, but the bill had not come yet. The last couple of weeks of the month I did not check my mail because I was very busy. By June, I knew that I had not yet paid a bill so I paid $400.00 at a local pay center thinking that would cover two monthly bills of $139.00, plus any extra charges. The next day I made it to the post office; I had received a $100 discount coupon, and my bill which was over $500.00. When I returned home I immediately redeemed my coupon on line, and called AT&T. I questioned the rep about the charges on my account. At first she could not see why the bill was so high. She assumed that it was the charges from the first month’s bill. When she double checked she saw that those charges were included in the first billing, and that my current bill was from all the extra services I had been sold. I again asked her why it was so high, because my bill should only be 139.00, plus prorate and labor. She informed me that my actual services cost me 249.00 not 139.00 like I believed. There were also charges for labor over $200 for adding the third line. I could not believe it. I told her that I had been lied to twice already (to my knowledge) and I wanted to cancel my contract. She replied that I could not get out of my contract but she could take my services down to one phone line plus the DSL. She put me on hold has she “took care of it” for me. After about 30 minutes she then informed me to wait four days then unplug the DSL from the second line and plug it into the first line and everything else should be fine. So I thanked her and did as she said.

On July 22, 2008, my services were interrupted. $100 was paid in order to get the phone back on. I was informed that I had to pay the full amount of over $1000 to keep from re-interruption. I could not believe it. How could my bill be so high? I had just paid $500 last month (with the coupon). How in the world could I owe over $500 in just another month? Besides I had canceled everything but one phone line and the DSL. At least I thought I did. After getting my service restored, I called in again to figure out why my bill was so high. Talking to my sixth representative, I learned that no changes were made to my bill. To my understanding, the information was documented but nothing happened. So I was charged again for 3 phone lines and DSL. She said that she could not give me credit for that, but she could remove the extra lines and transfer the DSL from the second line to the first, as I had previously requested. She put me on hold as she “took care of it for me” and then transferred me to collections. After being on hold for almost twenty minutes I decided I was going to speak to someone in person, and hung up the phone. I called a couple of my friends to see if they knew any place I could go, none did. So I called AT&T again hoping to get information. After another ten minutes of holding I finally got someone. I asked her if she could give me the location of an office in my area. She told me that there were none, only call centers. Then she asked if she could help me. I was hesitant because so far everyone who offered to “help” me had lied. I began to tell her the whole situation and why I wanted to speak to a REAL person.

After listening to me explain the situation, she asked me for my account information and then began to review my file. She warned me not to get frustrated as she explains to me what had “really” happened. She kindly let me know that my original bill was never for $123.00. That it was really $222.00. The price I was quoted was false. She also made me aware that each time I make a change to my account (which I had done numerously because of deception and company errors) I receive a charge of $50.00 or more. As she continued, she explained that the last person I talked to only added a second DSL to my first line and never cancelled the original that was on my second line, which gave me another fee! She told me that I probably would not get my bill under control for another two to three months because of all the changes. She told me the best thing to do was to try and set up a payment plan to avoid getting disconnected again. She informed me that each time a service is interrupted there is a fee of $50.00. In my case it turned out to be $200.00 because I was still being charged for three lines plus DSL. I said that I had been lied to and should be able to get out of my contract. She assured me that I would not because the contract was for the discount only and not the price I was quoted. She gave me step by step instructions on what to do next as far as removing the DSL from line two and putting it on line one as the other two reps previously failed to tell me. I wrote down her instructions and called the number she gave me in the DSL department to set things straight. I then called collections. I told the representative that I was calling to set up a payment plan to keep my services from being disrupted again. She told me (in a very nasty way) that I could not keep up with my current bill so they would not work something out with me. I begin to explain my story yet again, and she told me “that’s not her business, and there was nothing she could do”. In tears I hung up the phone. As I recollected myself I tried get in touch with a supervisor only to discover it was five o’clock. I had been on the phone all day and only half the problem was resolved.

Two days later, July 24, 2008, I finally got a hold of a supervisor who patiently listened to the whole situation. She received my account information and began to make a review. She did credit me $400.00 from line three and labor cost. She also took of the second DSL charges. She said that was all she could do. She then transferred me to collections, which allotted me the discount and said I now owed $679.00. The collections rep told me I had to pay $304.00 by the 30^th to have my DSL restored, and after that the amount will go up. I told her I did not have the money because it is way beyond my means. I begged for some kind of payment plan because I need the internet to operate my business. She said there was nothing she could do and ended the conversation with I’m sorry. The supervisor was still on the other line and asked me if I could come up with the money. I replied I have nothing to sell; she sincerely apologized and hung up the phone. I began to calculate the amount I was quoted I would have to pay and divided it by what I had already paid. It turns out that if I would have been accurately charged I would be current on my bill.

I only signed the contract in order to have a reoccurring bill of 123.84 per month. Even after reading over both contracts I was not aware that the contract was for the discount only and not the price quoted. Because of the deceptive tactics of six of AT&T's employees and the misleading dialogue used in their company’s contract I have acquired a bill that is beyond my means. I clearly stated many times how much I could and could not afford. AT&T's employees deliberately lied to me in order to make a sale.

So far I have filed to complaints with the FCC and written a letter to AT&T. I started this blog to keep tract of what happens next in order to warn others out there.

"Why don't they sell swim trunks in July?  That's when I need them.  Seems like stores aren't very focused on what their customers need!"

Now, I know all you folks out there in retail-land have your reasons for why this occurs.  Seasons for the industry are not the same as the seasons for consumers.  Inventory needs to be cleared out for next season's merchandise.  I am sure you can share more.

However, let's look at this from a customer's perspective.  It took driving to 6 stores and over 50 miles (total) to find a pair of swim trunks that fit.  This is due to the fact that most swim trunks are no longer in stock.  If we had wanted to find a winter outfit, or something for back-to-school, we would have been set!

Putting Customers First

There needs to be some type of balance between the needs of the business and the needs of the customer.  Sure, it is difficult when a whole industry is set up to operate on a certain schedule.  However, our next generation is looking for a new, practical approach to business.  They want to feel important, like they matter to companies.  This will be key in building relationships with them.

We can build all the cool social media sites we want, connect with our customers on Facebook and MySpace, and even get them to spread our message virally.  But if they come into our shops and retail spaces and we don't have what they need, that creates shaky ground for any relationship already built. 

Organizations need to stay in tune with what their customers need, want, and desire.  One of the best ways to do this is with ongoing customer conversation.  Keep in touch, remind them you are there, and meet their needs.  These steps will help strengthen any shaky foundations that may have developed due to thinking more about ourselves than our customers.

1. Continue to benefit from the CE industry's steady growth of 6 percent over time.
2. Open new stores and develop categories where it presently has limited share. These include Apple computers, a relatively recent brand addition; major appliances, which are benefiting from a differentiated assortment and a dedicated sales force with increased training; and mobile phones, which have been reinvigorated by a new business model developed with Carphone Warehouse.
3. Introduce new categories, such as musical instruments. While all Best Buy stores carry a smattering of keyboards and guitars, the company is experimenting with extensive, "top-shelf" collections in several locations around the country.
4. Develop completely new business models, such as the planned national rollout of Pacific Sales, the company's West Coast chain of premium appliance stores.
5. International growth. Best Buy has already established itself in Canada, China and Europe, and soon plans to open its first stores in Mexico and Turkey.

My take:  None of these 5 points focus on customer experience.  So I am very concerned about a degradation of Best Buy's customer experience.

Later in the article it says: "Separately, Vitelli said the company is working hard to engender more personalized service on the store level in order to combine the scale benefits of a national chain with the hands-on attention of an independent dealer." But if Best Buy does not see customer experience as one of the core components of its growth, then it will under-invest in this critical area. As it says in the 6th law of customer experience: You Can't Fake It.

In Forrester's Customer Experience Index, 2007, Best Buy was ranked #34 out of 112 firms -- and 23rd out of 27 retailers on the list. So the retailer needs to adopt the 1st principle of Experience-Based Differentiation: Obsess About Customer Needs, Not Product Features.

I'd like to see Best Buy invest in several areas as a core part of its growth strategy: (1) Product training for employees (similar to The Container Store's commitment to training); (2) Voice Of Employee systems (to capture and attack problems and issues at the front line); (3) Product selection tools (to help customers make product decisions in major categories); and (4) Improved Web-Store cross channel experiences.

The bottom line: Customer experience needs to be a core objective.

I had written last year about how customers are lot more tolerant of a vendor's mistakes or shortcomings if the vendor keeps them informed. It is nothing but courtesy, professionalism and respect. One of the companies that I respect a whole lot in this regard is CitiCards. Twice in the last 5 years, my credit card has been compromised because of data theft at two retail stores. They proactively called me up, put my account on hold so that no fraudulent charges get made using my credit card. Do I sleep well that they are looking out for me? - oh ya ! Do you think I will ever switch credit card vendors? - oh No! Do you think I will talk great about them and recommend them? - you know the answer to that.

Doing this takes a whole lot of effort and the will to make it happen. Unfortunately companies are busy chasing new dollars, that they forget the adage "Bird in hand is worth two in the bush!".

Customer Experience Matters is a good and educational read. A recent post was particularly compelling and inspiring for businesses aiming at better customer loyalty and branding. For instance Walt Disney once said:

You can design and create, and build the most wonderful place in the world. But it takes people to make the dream a reality.

Here are some implications of this law:

Don’t under-spend on training. You can’t just change some business rules and processes and hope that customers will be treated better. Just about any change to customer experience requires some employees to change what they do and how they do it. So don’t skimp on the training effort.

Make it easy to do the right thing. If it’s hard for employees to do something, then they are less likely to do it — and more likely to get frustrated. That’s why enabling technologies need to be designed for employees to easily accomplish tasks that help customers.

Communicate, communicate, communicate. If you want to have employees feel like they’re a part of something, then you need to tell them what’s going on. So develop a robust communications plan that not only tells employees what the company is doing, but also explains why you’re doing it. And it helps if you sincerely solicit feedback!

Find ways to celebrate. If employees do things that help customers, then find a way to celebrate those actions. These celebrations can take many different forms: a handwritten note from the president, acknowledgement in a company newsletter, or an on-the-spot bonus. Look for opportunities to catch people doing the right thing.

Measure employee engagement. Firms need to put the same rigor in monitoring employee relationships that they do in monitoring customer relationships. So they need to develop a relationship tracking measure like “likelihood to recommend as a place to work” that is used to gauge progress and to identify corrective measures.

The bottom line: Customer experience depends on employee experience.

You can read his 6 Laws of Customer Loyalty here.

How can you do a better job of creating a better customer experience and of making customers feel less like numbers?

"Experiência é a nova realidade."

No Youtube, um dos vídeos mais pop do momento, a animação denominada "Prometeus" faz sucesso pelo seu tom profético.

Prefiro prestar atenção nas entrelinhas. Repare nos momentos quando o locutor fala sobre: fim dos textos estáticos; convergência de mídia; mudança de consumidor para prosumor; e geração de experiências.

Enfim, vejam e opinem.

Yesterday I’m at La Guardia airport getting ready to come back to FL. The flight at the next gate bound for Tampa is in and almost ready to board when I hear ground attendant begin to hawk $100 first class upgrades.

 “We’re pleased to offer upgrades to first class for only $100 that is, if your class of service is any other than L Q U V or W, for only $100. Wha??

Who actually knows what class of service their ticket is in? The point? There were 5 exclusions to their offer (even if I got the letters wrong – there were 5 of them.)

I shook my head thinking – not a very friendly invite and that $100 is a lot to pay for a short flight upgrade. I stuck my head back into my paper until the next announcement came from that gate.

“We are in an oversold situation. We need 5 volunteers. We guarantee a seat on the next flight and we are offering $400 in Delta vouchers." Hmmm. A few minutes ago they had seats up front and now they have too many people on the plane. Curious.

Next announcement: “Once once again ladies and gentleman, we are offering upgrades to the first class cabin at only $100 ..”

My brain is engaged now and I can’t wait to hear what comes next. You guessed it.

“We are in an oversold situation and offering $400 in Delta vouchers and a guaranteed seat on the next flight.” Okay, I’m thinking, why don’t they just upgrade a few medallion members from the back – or even complete strangers – and put them up front. Then they’ll be room in the back (and a few people will be pleasantly delighted.)

I shook my head and started paying attention to my own flight announcements.

When I boarded the plane I heard that they were still looking for 2 volunteers to get off the flight and offering $400 in vouchers plus meal tickets for a dinner anywhere in the airport to sweeten the pot.

What’s wrong with this picture? At my count Delta paid out $1,200 in vouchers when they had some seats available up front. Do the math. This is dumb. Upgrade people from the back to the front and then do a head count. Maybe it would cost less. Greed makes you stupid. Or maybe, to be fair, I should said fear makes you stupid. Gas prices aside - the airlines are in trouble for a reason.

Travel sanely, oops I mean safely...

Not that it usually comes to this, but an ultimate reason to be nice to a customer (or even a vendor) is the off chance it'll be the last time you interact.

Opening the Times this morning I saw the sight no business owner wants to see: my customer's face looking back at me from the obituary page.

A customer we were all fond of here, a well-loved veteran of our industry.

In a somber mood, I took a moment to look over my notes of his last interaction with us, hopeful, at least, that that had gone well.

What I found in my notes: a project with a small initial bump in it, but a man who was gracious in giving us a chance to make things right, on what nobody could have known would be his last project.

To speak more precisely, he made the issue seem small and merely bumplike, because that was his way: He started out a letter of very valid grievance with "First the good stuff-- your staff has been excellent" before getting to the meat of what needed to be addressed.

So the transaction felt roundly satisfactory in the end: through his gracious way of bringing our attention to the issue, and, I'm hopeful to think, our way of resolving it.

That's a nice way of leaving things, because you're a long time gone.

En dit zijn de 6 wetten. Bestuurders mogen er geen één onderschatten, maar sommige zijn belangrijker om in de gaten te houden dan anderen. Daarom hierbij mijn rangschikking:

1. Onbetrokken medewerkers maken klanten niet betrokken.
2. Neppen gaat niet lukken.
3. Medewerkers doen wat gemeten, beloond en gevierd kan worden.
4. Familiariteit met de klant versterkt het collectief van een organisatie.
5. Elke interactie met een klant creëert een reactie.
6. Van nature zijn mensen egocentrisch.

Zoals je ziet hangen twee van de eerste drie wetten samen met mensen en het bestuursbeleid van een bedrijf. Je kunt als bedrijf de mooiste Website hebben ontworpen, of met de meeste gelikte IVR opereren, medewerkers geven uiteindelijk de kleur aan het merk, de belevenis en de waarde van het gekochte produkt.

Heb jij een andere rangorde, of wet?

Beeline Labs, Deloitte LLC and The Society For New Communications Research recently partnered to conduct a first-of-its-kind study of how more than 140 organizations are employing online communities dubbed "Tribalization Of Business."

Francois Gossieaux (Marketing 2.0 and Beeline Labs honcho) sent me this pretty killer summary of the report last week, and I am just now getting to it. Fantastic stats and insights for any company, large or small, looking to incorporate community interactions into their business model. (Customer communities, user communities, thought leadership communities, etc.) You really owe it to yourself to click on the links and read up on this. It won't take a lot of your time, and you will learn some pretty interesting (dare I say actionable ?) stuff in the process.

The report and summary also include some pretty killer best practices, so take note.

The summary: http://www.beelinelabs.com/files/TribalizationStudyrelease.pdf

The Tribalization report's web page: http://www.beelinelabs.com/tribalization/

Additional reading:

• The importance of scale to make in communities
• Understanding the power of communities - even when you do not have a critical mass of users
• The Importance of Affiliating with Others in Corporate Community Efforts
• Are customer communities changing the marketing department?
• Observations from the Community 2.0 Conference
• Communities are still so young - many people still confused
• Why wrong measurements can be bad for your community’s health
• The long tail effects of business communities

Have a great Tuesday, everyone!

Since it's not really a novel (only 11 pages), I'm giving it away for free. Just click on the picture of the cover below. You can then print it out or save it to your computer. Go ahead and share this book(let) with as many people as you'd like. Spread the word!

The bottom line: Hopefully this book is worth more than it's price.

As Adam observes, ethnography was one of the first new methods incorporated by design research to meet these challenges in the market. However, he thinks ethnography is, on its own, unable to provide the kind of information needed to validate product and service ideas across wide audiences. He notes: 

Ethnography breaks down at the moment we ask not just for depth of knowledge, but breadth. Anyone who’s struggled to conduct a massive ethnographic study across multiple time zones can tell you this firsthand. While ethnography facilitates the generation of ideas in relation to specific users and use scenarios, it leaves us clueless as to which among these will satisfy a wider audience. Ultimately, we need complementary methods that scale more effectively and validate our work in a way clients can understand. What we need is quantitative research...

But how? Just as ethnography borrowed heavily from academia while applying a looser, more liberal lens, quantitative research can be similarly engaged. When individual observations can be contextualized within a data-driven knowledge of the market at hand, designers can have the best of both worlds. And there are many analytical tools that work well in this context. Segmentation analysis can be used to challenge thinking around current and prospective users, sorting consumers into salient, sometimes unexpected groups that hold together based on survey data – groups that defy traditional demographic segments can be linked by more relevant factors, such as behavioral patterns or attitudes towards technology.

Adam makes several very good points in his analysis of what quantitative methods can bring to design research. Though he recognizes the importance of sustaining a focus on users, I suggest that Adam's discussion does not give enough explicit recognition to the role of empathy in maintaining a productive relationship between qualitative and quantitative methods in research for experience design. Making methods serve empathic purpose in the design of products and services is a key underlying principle, regardless of the quantitative or qualitative nature of the techniques.

Consider the project example Adam offers involving a redesign of a corporate Intranet for a Fortune 500 company. 

Without the ability to individually question the organization’s hundreds of thousands of employees, spread across some thirty countries, we did the next best thing: we interviewed 10,000 of them online. We asked them what was wrong with their current Intranet experience. What did they love? What did they hate? How could things be better? We did an online “card sort” in which we asked users to prioritize the content that mattered to them, then posed a series of free-response questions, in which they could say whatever they wanted.

Without knowing the strategic purpose behind the project it is difficult to gauge whether a traditional ethnographic approach might have worked as well as the methods chosen. Adam's point seems to assume a need to interview all employees for ethnography to work well. I don't think most ethnographers would agree that the expectation is either realistic or necessary for the participant observer method to provide effective results. Adam's critique also seems misplaced unless the 10,000 online interviews resulted from random sampling, which he does not say. Regardless of the answer, I suggest that either approach can incorporate principled empathic consideration for the meaningful experiences of the users of the Intranet.

Adam obviously recognizes the point made in the last paragraph since the techniques taken at the front of the project, before applying quantitative analysis to the data, were informed by an empathic concern for those using the Intranet, though Adam doesn't explicitly take note of it. The questions the team asked tapped into the meaningful experience of those users, and the online "card sort" provided additional qualitative information. Whether participant observation with carefully chosen ethnographic subjects might produce the same insights is a fair question. After all, Adam urges design researchers not to get hung up on the academic roots and concerns of quantitative methods, such as sampling, reliability, validity, etc. And I really do agree with his point on that issue.

Once the Intranet project collected all the responses to its open-ended questions from the online survey, Adam notes that:

We then tapped a vendor to break this sentence-level data into quantitative codes, creating a massive tally for common response themes like “It’s slow” or “I can’t find what I’m looking for.” Once we were able to look at this feedback quantitatively, common themes emerged...Some insights were limited to specific regions or business units, while others resonated with nearly all respondents, revealing the unique considerations of various user groups within the organization. Together, we synthesized 4,000 pages of tabs into fifteen slides, weaving in insights from secondary research, stakeholder interviews, industry best practices, and our own perspective to make a strategic recommendation to the client. When possible, we showed quantitative responses side-by-side with quotes from respondents to illustrate nuance and context while summarizing key themes.

It seems to me that the importance of the approach Adam advocates for using quantitative data in design research does not come down to traditional academic concerns about whether the results reliability predict this or that outcome from proposed design changes. Gerald Zaltman made a similar point in How Customers Think, noting that, "the various pieces of information that we gather through statistics, personal observations, and other data sources...are all stimuli that influence out thoughts, feelings, and behaviors. By viewing data in this way, most managers suddenly see the value of collecting multiple kinds of data" (p. 275).

Data don't speak for themselves, as much as stimulate meaningful conversations between design research, users/customers, and client management. Those conversations can result in interpretations that make a difference for the design of products and services offered by the business. In my reading, this is the main point offered in Adam's article. And it is a key point to make. I suggest that design practice works best when the research team doesn't choose between artistic and scientific techniques, whether qualitative or quantitative. The most effective design practice crafts a meaningful experience for users/customers from the tension between the two (art/science), and offers insights managers can relate to regarding the likely benefits for the business, e.g. ROI, time to market, product differentiation, cost containment, market share, etc.

Thanks to Mark at Putting People First for the pointer to Adam's article.

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You can fool some people for some of the time, but most people can eventually tell what's real and what's not. This shows up in a couple of areas. First of all, employees can sense if customer experience is not really a top priority with the executive team. The second place this shows up is in marketing efforts. No matter how much money you spend on advertising, you can't convince customers that you provide better experiences than you do.  

Here are some implications of this law:

• Don't hide behind a 4th priority. While it's possible to come up with a long list of priorities, there's no way that many will get a great deal of attention. A good rule of thumb: Anything below your 3rd priority is not a priority at all. So make customer experience one of your top 3 priorities.
• Sometimes it's better not to start. If you're not committed to customer experience, then don't start a major initiative; it's a lot of hard work. And if customer experience isn't a top priority, then the effort will likely fail. The result: Frustrated employees who are increasingly reluctant to re-engage in these types of efforts in the future.
• Advertise to reinforce, not create positioning. Since customers ultimately know how you treat them, the best you can do with marketing is to reinforce the truth. If you want to change how you are perceived, then start by treating customers better; and then use advertising to reinforce the new way that they're being treated.

The bottom line: If you're not committed to customer experience, you can only fool yourself.

P.S. Here's a link to all 6 laws of customer experience.

The essence of rich internet applications

An experience planner's blog

Financial Services in 2010 - Deloitte Touche Tohmatsu [produced June 2006]

The worldwide market for financial services is evolving rapidly, and is likely to look very different by the year 2010. This study from Deloitte Research identifies major market drivers and operational challenges that financial institutions will likely face over the next four years and pin-points the strategies and practices recommended to create the "Hallmarks of Success."

Hallmarks of Success
These are characteristics Deloitte Touche Tohmatsu (DTT) expect to be exhibited by the winners in 2010:

1. Global markets and a business model to match
2. Mass efficiency and focussed premium service
3. Consolidation (mergers) with a purpose
4. Winning the struggle for growth through stronger customer relationships
5. Transparency and compliance as a performance springboard
6. Cracking the IT value code

Market drivers

1. New asset classes
2. Aging population
3. Payments
4. Emerging markets

Some key quotes:

• on customer retention and growth: successful organisations will embed innovation into ... strategy, processes, people ...
• on transparency and compliance: .. using transparency and compliance as a way to win hearts and minds of investors
• on general observation: we expect evolutionary progress ... unlikely to see revolutionary change ... highly regulated and high barriers to entry
• on market driver - new asset classes: the major impact of new asset class firms is likely to be on the business models of traditional capital players
• on market driver - aging population: .. large influx of retirment related funds .. people who neglected their nest egg trying to catch up ... seeking higher than average returns
• on market driver - aging population: next wave of retirees .. more
• will the consumer identify their relationship with the FI as peer to peer? [Anyone from Deloitte care to explain this one further?]
• On market driver - payments: each market area of the financial services marketplace has its won separate infrastructure .. plumbing is duplicated .. opportunity to eliminate or truncate paper
• on market driver - emerging markets: exportable, repeatable model
• more top performing FI's need to commit themselves to enhancing customer experience through service innovations .. even where the cost is high [example Commerce Bank - 30% annual growth / exceptional service/ below market returns offered on products]

Summary:
DTT see a shift to payments and away from product. Product margins in traditional products will continue to become thinner, with greater competiion for yields. The markets will be awash with boomer money, and this will both force competiion for returns, and development of new assets classes that offer better returns.

People still need to move money however, and the focus on payments and revenue from that source, as well as eradication of duplication and costs will be a focus.

The few, and getting fewer big Banks (DTT expect to see 700 banks disappear worldside by 2010) will require globalk scale to achieve growth targets.

Relevance to Bankwatch:
I see the market drivers as a mix of drivers and outcomes:

1. New asset classes - outcome
2. Aging population - driver
3. Payments - outcome
4. Emerging markets - outcome

This where I get on my internet bandwagon. Internet changes everything, and now that it is pervasive it is easy to forget that. Internet has flattened old hierarchies, made information free, and eliminated distance. That is a revolutionary driver of customer expectations, and customer buying methods. It has also had the impact of opening previously closed kimono's and exposed old style advertising for what it is ... management of peoples opinions. Internet has allowed people to form their own opinions and that empowerment is fundamental to many changes we see now.

I would respectfully suggest one market driver is therefore 'customer empowerment'.

Another driver, comes from the way customers are continually required to manage their own affairs, at the ATM, the pin pad, online banking, bill payments, office card access, airport check in, car rental drop off, quick hotel checkout, travel booking. This frequency of self service is now pervasive and required several times daily for everyone. Organizations have become impersonal and are represented by their self service touchpoints. Self service has been underway for a long time, and internet has only sped up that process.

Customers apppreciate self service, but the sheer pervasiveness of it, means customers are contunually, comparing and evaluating it. Without realising it, customers are comparing your bill payment web process flow, to the Hilton quick check out, the credit card pin pad machine to your ATM, etc etc. People do not interact with products; they interact with self service touch points, and that is where the vlaue is experienced, or value is lost.

So my next driver is the advent of 'the experiential economy'.

Why are customer empowerment, and customer experience important? I believe they help us understand why the items I marked as outcomes above.

Payments come across as obscure to many, but if we think of them not as SEPA, or as interchange, but as customer experience, the complexity falls away. If ever anything is crying for innovation it has to be payments.

Similarly the need for new asset classes is driven by a surplus of worldwide liquidity seeking higher returns, but those new classes do not just apply to the hedge fund type money referred to in the report. In fact the report mentions the current vlaue of hedge funds at $700 Bn, and 15,000 funds so its relatively small. The real money, and the war for Banks will be in the new asset class expectations of the mass affluent (as the report recognises). Their experential needs must be taken into account, and that includes how they expect to interact with their FI. I note one item mentioned in the report 'peer to peer' [refer above] and I suspect that while it was not discussed, one of the authors may have intended this point.

Anyhow, great report, worth taking the time to read and digest, and hope this was of some value.

• "The internet still skews pretty young, especially with MyStarbucksIdea.com." The company's online suggestion box gets input from mostly a younger audience, so they can't assume that it's fully representative of their audience. My take: Make sure that you understand this phenomena for any online feedback mechanism that you use.
• "There's another new tool we put in place... the customer passion panel." Starbucks uses this demographically representative online panel to test ideas. My take: All firms should think of developing a standing panel like this to lower the hurdle for getting ongoing customer feedback on a wide range of product and marketing ideas.
• "It's <the cup> one of the best marketing tools we have." Starbucks switched the logo on its cup from green to brown and will be switching it back to green again. My take: Don't underestimate the potential of branding on all of your packaging: product containers, shopping bags, and shipping boxes.
• "Vivanno has been in the innovation stream almost a year now..." Davenport talked almost nonchalantly about the company's stream of innovations. My take: Companies should have pipelines of innovations and a consider a reinvention goal like having 30% of revenues come from products that have been introduced in the previous 3 years.
• "Sorbetto we saw from a couple of different angles in Italy." Sorbetto is a new product that is currently being launched in Los Angeles; it was developed during a trend-spotting trip to Italy last year. My take: Make sure you develop some approaches for innovation that get people in your company to periodically think outside of the box.

The bottom line: Keep an eye on Starbucks' reinvention efforts

So this evening I went back to the site to do this and I was unable to log in. Error messages indicated that either my investor number or PIN were not valid. Triple checked my entries. They are correct. Now I have to call them again tomorrow. I'm too busy for this.

Geeeeeesssssssh.

I have flown with Singapore Airlines many times before and have always been impressed by all aspects of the travel experience from the leg-room, to the entertainment systems, the food quality and beyond. But this time the contrast between the newness and luxury of the A380 and the other Singapore Airlines plane was stark. To be frank the experience of the second flight seemed simply average by comparison.

Having redefined my expectations for airline travel, Singapore have set high standards that their other planes don't yet meet. I have heard that they will be refitting many of their other planes to match the quality of the A380 - I hope this is true and that they do it soon.

Think beyond individual products and services

This highlighted to me the importance of thinking beyond individual products and services. Organisations need to consider the holistic brand experience offered by the range of products and services customers encounter in a single interaction. Why make one product a market leader without plans to improve related products and services?

Organisations need to develop holistic customer experience strategies rather than thinking about products in isolation - after all it is rare that a customer will interact with one aspect of an organisation without the need to interact with other aspects of the organisation.

I was speaking with David Pickering, CEO of Charteris at a breakfast briefing recently when the subject of Jessops came up. We both agreed that we didn't want Jessops to go out of business as we found their stores a really useful source of advice and information but were equally worried about how they would survive given the financial performance they had been experiencing [when we spoke]. So yesterday when I read that Bloomberg reported Jessops losses had widened my concern increased and I decided to carry out some desk research of my own.

Sales in store have fallen 11% in the past three weeks. That is not that surprising when you consider the prevailing market conditions and gross profit percentage is up. A year ago the company announced that it would close 81 stores, 31 of which were loss making and with these changes in place the company still expects to report improved EBITDA figures on last year. A big problem however is the level of debt they need to service. Borrowings are at £52.26m and although they managed to restructure the debt with HSBC they will have to make a payment against the £49m of senior by spring next year according to FT.com. Even a year ago Jessops was being referred to as a 'Private Equity Disaster' although despite the results Chief Executive David Adams is optimistic about the future.

So they have a lot of big problems and have taken extreme measures to cut costs and do the normal things companies do when they are going slowly down the toilet. But in my view, they are still worth saving. Why? Because they are one of the few high street retailers that are truly specialist. If you visit Jessops and you are interested in photography you will be met by employees who on the whole are passionate about photography and happy to spend time with you helping you. The problem is this doesn't make you any money when the product has become commoditised and online competition is fierce. And it is this, the multi-channel elements of their retail strategy that in my view they get most wrong.

On Saturday I tried to do my bit to save Jessops. I had 3 digital photos to print: two 10" x 12" and one 7" x 5". Online, including delivery in 24 hours (which is real as I have used photobox before) the price £4.09. At Jessops each of the large photos was over £4 (the 3 day services £3.49 and 1 hour £6.99). These prices are available on the website as the link in the last sentence indicates.

On the same website I can link to Snapfish, Jessops online photo business and be offerd an 8" x 10" print for £1.25. Snapfish is in fact an HP business and the arrangement with Jessops has existed since 2006. Jessops have actually done something quite innovative by connecting the web with stores and providing a 'reserve and collect' services. The problem is the pricing and also the lack of specialism. Why would you pay a premium to order one day and pick up in store when it is cheaper to order and have a home delivery where they have no differentiation?

The website is completely "off" brand experience. There is no content beyond products for sale. If you type 'advice' in the site search you get a message that "nothing was found matching your search criteria". The only link with the store are the prices of products or so it would seem. In fact when I navigated to the photos tab and then once in selected 'photos home' I was presented with a range of specialist in-store services. The usability of the website surrounding this content is so poor however that I can't believe many find it. Interestingly there is listed here a further service that I have experience of.

I wanted my wedding video transferred from VHS to DVD. I went to Jessops (another opportunity to save them) and was told by the incredibly helpful and knowledgeable assistant that a store round the corner did it and Jessops didn't. Thanks I said and took my £40 round the corner. According to the website this is a specialist service provided in store and a further demonstration of multi-channel strategy being poorly implemented.

Nor is the website well marketed and I wonder if this is an indication that where online is concerned, Jessops are not expansive in their thinking about what business they are in. If you search for "photography" in Google.co.uk, Jessops don't appear on the first page at all. Changing the search phrase to "camera" and they come second in natural search, but have no paid for advertising. It is no coincidence that there is no photography content on the site.

In 2007, when commenting about the cuts Jessops were making David Adams, said: "The strategy allows us to re-position Jessops as a true multi-channel retailer, building on our core strengths in the digital imaging market place."

It appears to me they have precious little strength in the digital imaging space and are not a multi-channel retailer. For sure they have multiple channels but they may as well be two separate businesses. I want to save Jessops but as a consumer I am struggling to work out what I can do to keep them alive.

So, I want to take a minute and highlight some businesses that are doing great.

Smallworld Tickets (www.smallworldtickets.com)

They buy and sell tickets, essentially like an online version of a scalper.  But the information is all presented in a clear, up front way.  And they will sell tickets on your behalf (for a reasonable margin).  Nothing earth shattering here, but it is a good service and they are cordial in the process.

Classique Class Rings (www.classiquerings.com/)

I bought a ring from them when I graduated from Dalhousie in 2003.  Almost immediately the band got a gouge out of it.  I have never figured out how but it looked like it had partially corroded.  Five years pass and I find the company’s flyer in a box in my basement.  The flyer said that their products have a lifetime warranty.  So, without the receipt or any proof of purchase I email the company asking for their assistance.  They assure me that if I send them the ring, they would fix it.  I figured it was worth the risk, so I sent it to them.  About a month later I get a package in the mail.  It is my ring, looking new and shiny.  No charge.  That is a good experience.

Priceline.com (www.priceline.com)

I am a convert.  When I began planning for my trip to California this winter I did not know what “naming your own price” was all about.  Like I say, I am now a convert!

Essentially, their TV ads are true.  I went to their site, selected the date and city I planned to be in.  Then I selected the region of the city I wanted to stay and the type of hotel (1 through 4 stars).  Finally I picked a price I would be willing to pay to stay there.  After some testing (I tried really lowballing them to no avail) a booking worked for me. 

Four star hotel in San Diego for $110.  Very reasonable.  From there I booked all of my hotels on their site.  They all turned out to be as good, or better, than I expected with few surprises.  One drawback which I anticipated was the parking fees (up to $35).  However, I also anticipated the hotels would charge me extra for anything they could.  They did not. And, I expected they would treat me like a second class citizen; I paid less so I expected they would treat me like a K-Mart shopper.  They did not.  In particular, Hotel Solamar in San Diego treated me like gold.  I was very impressed.  And finally, I realized when I reached San Francisco that I had erred in my hotel bookings and missed a night.  I had no Internet access so I called Priceline figuring I would wait a lifetime to get through to someone who could not help me.  Not the case!  I got through within a few minutes and the agent was able and agreeable to book me for an extra night at the hotel I was at.  Needless to say, I do not hesitate for a second to recommend friends try Priceline.

See, now that wasn’t so hard was it?  The businesses had a good idea for how they could serve.  They executed the plan and made sure to avoid taking short cuts on some areas where others might have tried to save costs.  As a result you have now just heard about the experience and may well try their service as a result.

This is how it is supposed to work.

Some executives struggle to understand why their company doesn't deliver better experiences to customers. But it shouldn't be such a big mystery. It's all about how you deal with employees, who tend to conform to the environment that they're in. What are the key elements to the corporate environs? The metrics that are tracked, the activities that are rewarded, and the actions that are celebrated. These three items collectively drive how employees behave and how they ultimately treat customers.

Here are some implications of this law:

• Don't "expect" people to do the right thing. While employees may want to treat customers well, you can't just expect them to do it. Why not? Because companies want their employees to do a lot of things. But organizations often hone their measurements, incentives, and celebrations to achieve short-term growth and profitability targets. So without any explicit intervention on behalf of customer experience, the environment will push employees to focus on just about anything except customer experience.
• Clearly define good behavior. Before you just adjust the environment, it's important that you define/describe the type of behavior that you want from people in every role. Do you want customer service reps to spend whatever time they need to on the phone to solve a problem or do you want them to cut down the average handle time on each call? The measurements, incentives, and celebrations should be adjusted to reinforce those behaviors.
• Watch out for mixed messages. You can only get consistent behaviors from employees when all three levers (measurements, incentives, and celebrations) are working together. If you celebrate things that are different than what you measure, for instance, then employees aren't sure which signals to follow.

The bottom line: Don't blame employees, fix the environment.

P.S. Here's a link to all 6 laws of customer experience.

I called the toll free number and listened to a series or prompts, none of which matched the instructions on the mailer. Eventually I got to the "for all other issues press 5," So I did. I entered my ID number and PIN and was promptly told, "We're closed.

Lots of things wrong here.

• The mailer lists the phone option first vs. the cheaper online channel.
• If you are going to drive people to the phone as a first choice, you better be on the other end when they call.
• The online certification process was full of financial jargon and unclear.
• The system would not accept my valid PIN.
• No phone hours of operation were printed on the mailer, which is fair since they say the have an Interactive Voice Response system, but the expected prompts never came.

I am an experienced Internet user and work in financial services, and I failed to complete the transaction in both channels. Now I have to take the mailing to work, find time to call, wait in the cue and then conduct the transaction. So frustrating. True, the cross channel game is tougher to master, but it's not that hard. Get it together Mellon.

I will give them one positive. When I logged off after being shutout they asked for feedback through an online satisfaction survey. Do you think I took it?