Thursday, September 29, 2011

Benefits' marketing: You want my money, I want benefits.

It's an exchange: Money vs. benefits.
And I’m not trying to oversimplify things. Or at least, I don’t pretend to do so. In every transaction, there is an exchange of something, even in personal relationships.

If we focus on business relationships, it’s really simple: In exchange of your product, your customer gives you money.

But there’s more to it than that, and that’s where, on my opinion, you really have the best opportunities, or the only opportunities if we think about being immersed on a recessional environment.

What happens when all products are the same? When pricing differences are not significant, and product features are basically the same and all products fulfill your basic needs the same way?

I’ll explain myself a bit better: a sandwich wipes off your hunger, and any sandwich, for that matter, will do the same thing too. So, if two sandwiches are priced the same and have the same "amount of sandwich”, what makes the difference?

Unintentionally, you have come to a fascinating land: that of value added to your product. Yes! The difference between both sandwiches is going to be the service you are provided with, if you like how the sandwich looks on the plate, how the waitress services you, the store’s ambiance, if in addition to the sandwich you get some snacks to take while you wait, in a few words, the difference will be on what you, as the restaurant’ owner, are willing to do to make yourself different from the restaurant across the street. It’s what knowledgeable people refer to as “differentiation”: making yourself different from competitors, moving away from them!

¿How many times have you kept yourself from going into a store where you know you can find good prices, just because you don’t like the way you have been treated before? Or, on the other side, ¿how many times have you gone into a store knowing the prices are a bit higher than in other places but you know you are going to receive the best service every time?

It’s a very simple concept, if we want to look at it from the basics: Your company works because your customer pays for the product you offer. Your only tool is basically your product and your customer’s experience with it. That’s why you have to do your best to make your product unique to your customer when he compares it with your competitor’s. There you have the secret: you make yourself different because you offer customers benefits that no one else does.

And what’s on your customer’s side? Well, just think for a bit how you react when you become a customer for someone. What do you do? Do you buy just because the product is cheap? Or, you choose the one which offers you the best mix of benefits at a price you are willing to go for?

It’s an exchange relationship that must be beneficial for both sides: yours and your customer’s.

What about you? Do you put your energies on making your product different from those offered by your competitors? Do you offer added values so that your customers forget about others and trust only in your company?

Wednesday, September 21, 2011

Already bought your product, now what?

¿And now what?
Have you ever felt as if you’re entering a long, dark hall, calling someone’s name only to listen the echo of your own voice? Have you ever felt left alone on your own after purchasing a product? Have you ever emailed a company asking for assistance about a product you bought and the response has came a few days later, even weeks? Have you ever been left without a response at all?

It really puzzles me to see how different the customer service situation is before and after the sale. Please be aware: I am not making it a general statement, but it’s sad to realize it does happen too frequently as to not bring it to the table.

Before the sale, and depending on the product you are buying, everything is happiness, smiles, positive energy. The sales rep does his best effort in assuring you it’s a great decision, showing you why it’s the best product for you and how, to your complete satisfaction, it’s going to fulfill your every need, from top to bottom. He even found for you a financing plan to keep you from making a huge down payment. What else could you ask for?... It’s simply great! Do you have any reason to complain? Obviously, at this point, you have none, because so far everything is picture perfect.

You make the decision, buy the product and already have it at home. Now what? Where did everybody run away? Is there the same energy and positivism between you and the company as it was before you bought the product? In most of the cases, the answer is no, and that’s unfortunate. Just at the very moment in which you’ve the opportunity to share with the company your satisfaction (or not) with using the product, at this special moment, there is no energy, enthusiasm, contact. There is no one there to share with.

What happened then? Why the change? Is it because the transaction is already done, the money out of your pocket, the sales rep already made his commission and reached his sales goal of the month, and that’s it? Is it that the company’s goal was simply to make you buy the product to generate profit for them and nothing else?

Companies spend around 90% of their marketing budgets talking to their clients instead of listening. And that’s the problem. Once the sale is closed, very little effort is done to stay on the client’s side. Sometimes it’s fear of having a customer complaining, other times companies are scared of having customers changing their minds and returning products… and we can keep going on mentioning reasons, some better than others, but at the end of the day what it indicates is how little importance companies place on customer service after the sale.

A few days ago I was on the phone with my local mobile carrier sorting out a technical issue I had. It caught my attention to listen to an automatic message with something like “Before your call is finished, we will give you the opportunity to evaluate our services” and even though I do find such option awesome and different from what I normally receive, it didn’t go unnoticed the fact THEY were giving ME the opportunity to evaluate their services.

Shouldn’t it be something like “Before your call is finished, WE will have the opportunity to know YOUR opinion in regards to our services”, because to be completely honest, I do believe the opportunity is not for me but for them.

If I don’t have such an opportunity and their service is bad, I switch companies and go to their competition and that’s it. It’s really simple, isn’t it? If you, as the company, think that having me share with you my experience with your product, is an opportunity for me, you got it all wrong. It isn’t. Or at least, there is something you do not understand completely: after-the-sale customer service is not a favor you do to your customers, it’s your obligation. You have to service your customers after they buy from you.

Only through real post-sale customer service you, as the company, will have the opportunity to get to better know what your customers’ experience is with your products, if they like it or not, if they will recommend it to others, if they will buy it again, etc. Bottom line, that opportunity is not for them, is for you. At the end of the day, your customer doesn’t care if, after calling your 902 (about which we’ll be talking later) for the hundredth time, he doesn’t get a response.

If he gets upset just a little bit, you might have a second chance. If he gets really upset, you lose a client and that’s it. A happy customer will recommend you to 1 or 2 more people at least. An unhappy customer, on the best case, will talk with 10 and putting a strong effort in showing how bad it was. In either case, you don’t get to know! Your customer moves on to your competition and that’s it. It’s really simple without further complication.

I do believe it’s important to realize you don’t get a happy customer BEFORE the sale is done, but afterwards. If you clearly understand this, you’ll make a better effort in your after-sales customer service area and will probably stop thinking that offering good customer service is a favor you’re making to your clients.

It’s the other way around. It’s you who has the opportunity to gain a customer for life.

What do you think? Do you make your best efforts before or after the sale? Have you noticed how important post-sale customer service can be?

Tuesday, September 13, 2011

ROI in Social Media: When 2 + 2 doesn’t equal 4.

When you listen to people talking about “Return On Investment” in social media, you will realize is kind of a complicated subject.

And it’s so because there are several different opinions: some people want to measure your social media efforts the same way they did newspaper’s ads or commercial spots on TV. Others talk about brand recognition, influence and recommendations.

My opinion is that we are not dealing with an exact science, like mathematics; therefore I have to say that 2 + 2 is not always 4. I will try to explain myself through an example:

You set up you social media promotional campaign with a 50 € budget. That’s all you have. You place your ads in Google and they do generate 1,000 impressions, out of which 100 people click on the ad, and out of those, 2 become your customers and buy 75 € each. Total: 150 € on sales! Easy, isn’t it?

We then calculate ROI for this campaign. You are thrilled, really happy because it turns out you ended up putting down less money than expected and the total campaign cost is only 45 €, (keep in mind, it’s just an example) and you made 150 € on new sales. Awesome, right? Your campaign has had a 233% ROI.

Up to this point, lovely, everything adds up: 2 + 2 equals 4!

Now, let’s continue a little bit further and see what happened with those two customers you made.

Customer A is a regular human being, like you and me. He bought your product and a month later he did have some difficulties using it. He then called customer service and was treated on a wonderful way. He was so pleased that he emailed three of his closest friends recommending your product, and his friends showed up directly in your store, also a month later, and each one bought 100 €!

Were you able to measure these results within your campaign? No, you weren’t. Would you’ve been able to predict these results to some extent? Well, if you weren’t listening to what was going on with your customers, you couldn’t. Were these results positive for you? Of course they were. In this case, 2 + 2 was even better than 4, much better!

And what happened with customer B? Well, more or less, the same with a slight difference: When he called customer service to request assistance in solving his problem, he was treated like nobody deserves, basically being told to work things out by himself. Results? Of course, customer B got really, deeply upset, so upset that he promised not to buy from you again.

But he didn’t stop just there. He felt so frustrated that he twitted about his bad experience with your company to more than 500 followers and commented it on his blog, which gets around 1,500 visitors a month, because it happens customer B was a very influential person.

So, what happened then? Well, you’ll never know, because there is no way for you to find out how many of those 500 followers or 1,500 visitors will take his advice and not buy from you. Maybe just a few, maybe all of them, in the worst case, all of them. You will never know.

Unfortunately on this case, 2 + 2 didn’t make 4. It did much less than that!

Return on Investment is a subject you should look at carefully and consider analyzing your social media efforts from a different prospective, and based on your goals. It’s for sure you’re going to get measurable results. That is definite, but you shouldn’t measure results the same way it was done on traditional venues, like newspaper, magazines, TV or ecommerce.

Social media have something that makes them unique: they allow you to build bi-directional, mutually beneficial relationships with your customers, listening to what they’ve to say about your product, offering them relevant information so that they become loyal customers, or in the worst case, to be able to predict any potentially negative situation and act accordingly.

What does it have to do with you? Had you been monitoring what people were saying and sharing about your company or products online, you would have been able to do two very valuable things:
  • Thank your customer “A” by referring you with his friends, turning him into a loyal brand prescriber.
  • Offer your customer “B” an early compensation for his bad customer service experience, keeping him from turning the situation into a reputation problem.

What do you think? It’s 2 + 2 always 4? Or it depends on…?

Wednesday, September 7, 2011

Who follows who in Social Media?

Who follows who in Social Media?
Over the last few days, a thought has been circling on my mind, endlessly: Who follows who in social media?

As I understood, and according to many bloggers I regularly read and follow, today’s market is about “conversations”. We all agreed on that. And that the consumer is now The King. We all agreed on that too!

But apparently, there is a gap between what is said and how it gets done. ¿Why do I say so? I have been noticing that what I thought was supposed to be a conversation has turned, again, into a monologue: the company’s monologue!

Word of caution: I am not trying to say, neither I mean, everybody does it. Of course I don’t. As a matter of fact, there are companies doing an exceptional job, but they are the few. I want to go through, with you, what the new trends are indicating, especially among those companies which embark in social media efforts with no guide, no plan, not even properly defined goals, and they do it only because it’s trendy and everybody is doing it.

¿Which appears to be the goal of those companies just getting started to experiment on social media? To have a lot of “fans” or “followers”, who get connected with their company’s social media accounts and start to virtually eat all content, relevant or not, generated by the company. The more “fans” you have, the more “followers” you get, the more successful your campaign is going to be. That appears to be the goal.

You, as the user, get to receive whatever the company you became “friend” or “follower” with produces, supposedly with you on their mind, and that’s it. That’s the conversation. That’s why I consider it a monologue: the company proposes its content (funny, entertaining, dynamic, innovative, etc.) and you simply digest it.

And I ask myself: What’s the difference between this and Web 1.0? Weren’t we supposed to be on a 2.0 environment? Would it be that we are on 2.0 environments with 1.0 mentality?

¿Where is the other side? Where is the user? Where is the conversation?
In all conversations there must be an exchange, an interaction: I tell you something, you either agree or disagree, like it or not, understand it or not, but there is always a reaction on the other side. Conversation takes place right there when you, that have been listening to me with all your attention and respect, then have the opportunity to say what you think, feel, believe, whatever comes to your mind in regards to what I said.

At that point, real interaction happens and conversation takes place: the real heart of social media. How could it be different? It’s about a social behavior, interactivity, exchange, mutually, freely and transparent.

That is why I think something is not being done properly. We’re missing the company looking to “follow” its customer, to become “friend” with its customer. We’re missing the company which is really interested in “user generated content”, not “company generated content”. Where did we leave the “active listening” part of the social media story that is so highly recommended?

You, and your company, can also learn a lot if you become “follower” and “fan” of your customers on social media networks. There is so much to learn from a consumer who is willing to engage with you, participate, relate, because now he knows that, due to the Internet and multiple 2.0 existing tools, he’s got a voice and that you, as the company, and if you wish to, can get to know him really close, truly.

And by knowing him really close, you will have a better chance to strategically relate with him, offer added value to the relationship, differentiate yourself from competitors, and develop a long lasting relationship based on mutual benefits.

Now that you are approaching social media, or if you have already been doing it for a while, don’t forget that it’s not about your customers following you or becoming your fans. It’s about you following them, to get to know them better.

Have you ever thought about this before, while developing your social media presence? Have you been willing to follow your customers or have concentrated your efforts on having them follow you?