Learning from Others’ Mistakes

Prague Food Festival took place for the 4th time back in late May of this year. It had been in a number of different locations over the four years and this year it was in arguably the most prestigious – the Royal Gardens of Prague Castle.

The weather co-operated and the sun shone throughout. Many of the city’s top restaurants were there serving tasting-size portions of their best dishes.

All sounds great apart from the fact that the organisers made some basic mistakes that led to much disgruntlement amongst visitors to the festival. As opposed to previous years there was very little in the way of ‘built-in’ furniture for sitting on at the venue. The grass was off limits even for walking on and there were nowhere near enough tables. Nobody thought to co-ordinate with the restaurants leading to lots of places serving very similar dishes. When the whole point of such an event is to try out lots of different things this was a disappointment for many. Other organisational mis-steps were cited, such as requiring advance ticket purchasers to go to one specific entrance, where the queue was longer than for people purchasing on the day, and a lack of toilet facilities. These concerns were all posted on the PFF’s Facebook page (some of them were removed to, a whole other level of fail) along with annoyance at how the prices for dishes had become excessive – though they were little changed from the previous year. The overriding criticism was that the organisers of PFF were only in it for the money and didn’t care about the visitor experience.

Marquees at Prague Food FestivalThis weekend saw the first FoodParade – an alternative to Prague Food Festival, featuring some of the same restaurants as PFF and whole load more from outside the central square mile of the city – up and coming places, or places with strong followings of locals but with a desire to expand their customer base. The festival was located out of the centre of the city but still just as accessible by public transport. As a visitor to both the difference can only be described as like night & day:

  • The odd PFF practice of giving you a set of chromed plastic knife & fork when you enter, that you are supposed to re-use (or find somewhere to wash, incidentally not very easy), gave way to an altogether more sensible ‘metal cutlery available at every stand’ approach.
  • The festival currency, “chefs”, had a conversion rate of 1 chef to 10 crowns, which was printed on each ‘chef’ whereas at PFF, each “grand” was worth 25kc, which you had to remember. A little touch that was aimed to be more transparent about how much dishes were costing you.
  • Tables were conspicuous by their abundance not absence.
  • All the restaurants and food retailers were treating the event as they should – a marketing exercise rather than trying to make out like bandits. Some even gave coupons for money off when you go to their restaurant.
  • The weather forecast on Sunday predicted rain. In anticipation of this the organisers put up marquees and posted pictures of the marquees to their Facebook page so people could visit without worrying about getting rained on while they ate.
  • FoodParade’s Facebook page is full of enthusiastic compliments from visitors, already looking forward to next years.

Without a doubt FoodParade’s organisers saw what was wrong with PFF and have put together an enjoyable event that stands as a true festival of food.

The marketing takeaway?

Keep an eye on what your competitors’ customers are saying in social channels:

  • Watch their Facebook pages (you can subscribe to a Page’s updates as an RSS feed)
  • Create saved Twitter searches
  • Set up Google alerts for their company names or product names + words like review, complaint, feedback.

And of course you’ve already got this kind of monitoring set up for your own brands and products haven’t you?

Group-buying local deals site fever

Team HuddleEver since Groupon started making a big noise in the US, and Livingsocial moved into the one-day sale market, similar sites have cropped up around the globe.

There are the blatant rip offs in Russia and China to the more subtle US based me-toos and German-backed startup MyCityDeal, now acquired by Groupon. Other UK and European competitors like KeyNoir and Groupola and more show that the market is big enough for a number of players. Even Prague has a Groupon clone: Slevomat.

How it works

Merchant approaches/is approached by deal site to be featured for a day. Merchant sets a price for their deal they want to charge, compared to the original price, and a minimum (and optionally a maximum) quantity of the deal to be sold. The customer is motivated to get the deal to ‘tip’ so that they get it, so they are very likely to share the deal with friends on social networks. Once enough people have pledged the cash, the deal site takes the payments, sends the purchasers their coupon/voucher and tells the merchant how many were sold.
How much the featured merchant gets from the total varies from site to site and even based on product or service category. Numbers reported from Groupon are as much as 50%, so if a deal is offering $150 worth of service for $75, the merchant can be making as little as $37.50.
If you’re considering using a deal site to promote your business or product, here’s a short list of the pros and cons:

Advantages

  • Reach a lot of potential new customers
  • Business when you might otherwise be quiet, especially if bookings are required and you’ve set the expectation that your busy times are excluded from the offer
  • Search engine link juice – a link from a fairly high pagerank site – the previous deals pages hang around for a while
  • Able to set minimum and maximum quantity, overall and per person
  • No initial cost outlay

Disadvantages

  • Unless you can turn those customers into repeat business you may be losing money on each one
  • Need to give a large discount to capture attention
  • Deal site may keep a large percentage of the sticker price
  • Might have to wait a while to receive payment from deal site
  • Can’t be overdone or you risk undermining your revenue permanently

Questions to ask

  1. What’s the revenue split?
  2. How soon is the money transferred to me?
  3. Do I get the customer’s email addresses (or have to acquire them myself)?
  4. Do you have any data on whether deal customers become regular customers?
  5. What percentage of businesses have expressed an interest in running another deal?

For consumers, this is a good list of caveats.

Have  you tried one of these sites for your business? How’d it go? Care to share in the comments section below?

Just looking for a global list of daily deal sites?

image credit: Megan Soh via Creative Commons on Flickr

OK, so you’re remarkable, now what?

Why local business and tourist venues should enable customers to remark about them

Purple CowWhy local business and tourist venues should enable customers to remark about them

We should by now all be aware of the importance of being remarkable, but one thing that’s often missing is making it REALLY easy for people to share that “remarkability” with their friends with the simple act of giving them a free wifi connection.

Mobile devices are getting smarter, more capable, high-speed mobile data is becoming more widespread, but that doesn’t mean businesses are off the hook when it comes to hooking their customers up to a fast, free internet connection (yes, I’m looking at you Hilton, Marriot and any other short-sighted money grubbing hotel that bilks their customers up to $20 a day for internet access). In fact sometimes the free wifi in itself is remarkable enough for a mention.

Given that very few data plans remain unlimited and in many cases a lot of people at a venue may be from out-of-country so have no data plan or desire to rack up huge roaming charges, it’s the very least you can do to be a good host.

If you’re responsible for the marketing of a local business, tourist attraction or pretty much anywhere people go and have an experience that you’re confident enough in that you want them to talk about, how about handing them that megaphone?

You want people shooting video, taking pictures, geotagging it and uploading it to Facebook, Twitter, Flickr, Youtube and all the other social media sites. You want people checking in on Foursquare, Gowalla, Loopt or whatever (bonus points for making sure that your wifi access point has been submitted to SkyHook Wireless to give accurate geolocation). Enabling this is a matter of installing a public-access wireless network (segregated from your internal one) on a decent internet connection.

You can DIY it if you wish, taking care to block file-sharing ports and the like, or have a consultant install it for you if your needs are more complex. It may cost a few hundred dollars or pounds (up to a few thousand for a multiple access point setup for larger locations) but it’s a lot cheaper and more effective to have your customers spread the word than what you spend on interruption marketing.

Image credit: sunclover via Creative Commons on Flickr

Logitech and a fundamental failing at Customer Service 2.0

I’m reading Joseph Jaffe’s Flip The Funnel at the moment and it got me thinking about how corporations do customer service. The book cites the usual examples of those who are getting it right (Dell, Starbucks, Comcast). How do the rest shape up though?

I have a Logitech ClearChat Wireless Headset. It’s a great product, all-in-all, it uses RF (infinitely better than Bluetooth) and a USB receiver that plugs in to your computer. This arrangement means it’s free from the pairing headaches that you can get with Bluetooth devices (and the need to have Bluetooth turned on the whole time on your computer, a battery-suck when you’re unplugged).

The one gripe I have with it (as do everyone I know who has one) is that to charge it you have to use a mains power adapter. That means one more adapter to take with you when you travel (and a plug adapter for it if travelling internationally), one more thing to forget or leave behind when you pack.

I wondered if this had come up on Logitech’s support forums before. It had:

Customer: Is it possible to charge the Clearchat PC Wireless headset via USB, or does it have to be with the standard 110 cable it came with?
Logitech: Hi,
If you look the connector on the headset is not USB.
Thank you for your post.

That’s it. Not ‘it doesn’t but we take your point’. Not ‘other people have mentioned that’. Just a plain slap in the face to someone who bought a $150 product and by extension everyone else with this opinion.

So I took a look at Logitech’s Get Satisfaction page to see if it was mentioned there. It wasn’t and even though this Get Satisfaction page, unlike many others, is monitored by Logitech employees, I can only choose one of 6 products to categorise my new topic – none of them being the one I want. For a company with well over a hundred active products at any one time, this is poor. Couple that with the note at the bottom of that GF submission form “We’ve estimated the likelihood of your question getting noticed: LOW” and I figured I just won’t bother. If someone else comes out with a similar product that doesn’t require a power brick, I’ll get that.

All in all a long way from the concept of Customer Service 2.0 as outlined in Jaffe’s book and this case serves to highlight that if you’re going to use the new tools of customer service, you’d better be serious about it.

Image credit: amandabhslater via Creative Commons on Flickr

Nobody seeks out vague promises

As marketers we all love to promise the earth but you need to be able deliver on what you’re offering. If you need to use weasel words and internal jargon to qualify your promises, you’re doing it wrong.

When you see an advert for flatscreen TVs offering a ‘free Blu-Ray player with selected TVs’ – what’s your thought process? Is it ‘ooh, I’m gonna get a free Blu-Ray player’ or is it ‘I bet the one I want doesn’t come with a free Blu-Ray player’. How about a sale sign that offers ‘Up to 50% off’? I guess it depends on whether you’re a glass half-full or half-empty kind of person. Maybe you get a nice surprise or maybe you’re disappointed. The one thing that word ‘selected’ doesn’t do is fill you with confidence because it immediately creates a doubt in your mind.

Customers don’t know what ‘selected’ means in that context, they don’t know what a company’s ‘primary service areas’ are. All they know is that the company wants their offer to sound good whilst leaving some wiggle room. Customers don’t care about a company’s ability to squirm out of providing something. They want what they’re promised.

Under-promise, over-deliver
That’s what we should aim for. That’s what gets customers telling their friends about us. The opposite can make people talk about us for all the wrong reasons.

If you’d prefer to state up front everything people can expect from you as part of your service or offering, then go ahead, but don’t hide behind puffery and ambiguity. If there are limitations, don’t be afraid to state them – you’ll only be called on it later if you don’t.

Image credit: kjpm via Creative Commons on Flickr

Lifetime Value, Caveat Vendor

carriage clockSeth Godin urges businesses to consider the lifetime value of a customer, not just the value from the first sale (or indeed the latest sale).

Go and read it, it makes sense, but bear in mind his argument is based on a particular kind of product or service, one where lifetime value of a customer can be calculated with some value of reliability, and expending what seems like a disproportionate amount on acquisition or retention is a much safer bet.

If you’re serving a specific geographical area there is a limit to the amount of competition for that customer’s business that you face – a customer is by necessity more likely to be loyal. If your product naturally has some lock-in (like a mobile phone contract) then you can work out how much a customer is worth to you very easily. Barriers to entry (by competitors) or exit (for the customer) create an environment with a relatively low churn rate, a predictable level of repeat business and a limited number of other places for a customer to take their spending.

If however you’re an online merchant, selling a product you don’t have an exclusive on, your competition is almost infinite and made up of players with different agendas. Not everyone is motivated by the need to make a profit, their goal may be market share. If Amazon enter your niche, there’s every chance you’ll get wiped out, just as dedicated greengrocers and butchers shut down all over the UK as supermarkets expanded. Calculating that lifetime value has to be tempered with the likelihood that a lower priced competitor will take their business regardless of how much effort you put in.

There are ways for you to fight back against the hegemony of an Amazon or the like. You can use content marketing, show off your expertise and thought leadership, you can cultivate relationships with bloggers to get you links to improve your search engine ranking and boost traffic. Yet there’s nothing to say that a customer won’t just take the advice from you and buy from the other site that’s $2 cheaper. The one thing that’s very hard to justify in that situation is losing money on an order in the hope that you’ll make it up later – if you’ve price-matched or incurred costs to a point you’re not making anything on a customer’s first order, what makes you think you’ll do any better with their next order? Or that they’ll have any loyalty to you anyway?

Take care with those lifetime value calculations and remember you can’t rely on always getting a customer’s business (and referrals) no matter how remarkable you are.

Image credit: Florrie Bassingbourn via Flickr

Is paid search the height of responsibility?

In response to The Irresponsible Marketer

awesomeHaving just read Mitch Joel’s latest post, I was going to post this as a comment, then when I got to writing it and it grew to longer than would be polite, or even that readable, as a comment.

To paraphrase, Mitch is saying that marketers should put as much as they can into search marketing, spending “whatever is left over for your more general branding campaigns”. Now I’m sure that Mitch is trying to seed a discussion rather than truly believing that we should give up on all other kinds of marketing efforts to concentrate on the low-hanging fruit and maximising our Adwords spend and hiring SEO experts..

What about cumulative effects?

I think this is a perfect case for ‘with, not instead of’, to quote Mitch again. Paid search, and to almost the same extent, well done SEO/content marketing efforts are eminently trackable. But what drove that search? Reading this post I immediately thought of David Ogilvy’s belief that a consumer needs to see a message multiple times before they act on it (though as he was head of an ad agency, one might question the number of exposures required).

Search gets all the credit

Search gets all the credit because it is often the last link in the chain, starting with awareness. Whether it makes sense to go further back down that chain depends on your business model. If you’re a reseller of a low margin product then you absolutely need to be concentrating the bulk of your spend on paid search, getting the customer when they know what they want to buy and they’re just looking for the ‘where from’. It’s not your job to educate the customer on what they need, that’s a task for the manufacturer of the product, which is where the other, less measurable parts of marketing come into play.

Sometimes paid search isn’t a good idea

To take the local restaurant example given by Matt Shaw, his boss won’t be clicking on an advert on Google after searching for the restaurant by name, it’ll be the link to the restaurant’s own website, Google Local listing, Yelp or some other directory/review site. What that example points out isn’t the value of paid search but the value of having a well executed online strategy including content marketing, building and maintaining a presence, all  coupled with being damn good at your core business. What if the search was instead for a type of restaurant, with a search term of “Italian restaurant Minnesota”? In certain markets, particularly restaurants, adverts are the equivalent of paying someone to stand outside trying to attract custom, it will turn people off than convince them to dine with you. If on the other hand the restaurant has strong SEO and the all-important ‘being awesome‘ then it will do well for that generic search, because the independent reviews will bring in business more than even their own site will. You don’t become awesome by spending all your marketing budget on Adwords.

So what should we be doing?

Smart marketing is about targeting all of your efforts and measuring as much as you can and sometimes, going with your gut on something just because it feels right. It means working on multiple fronts, including paid and organic search to make sure you can be found for your business name and your important keywords. It means spending some of that budget on the customers you’ve already got, delighting them, getting them talking to their friends and colleagues about you and maximising word of mouth. It means more contact with your customers (yes, the marketing people might actually have to talk to a customer every now and then). It also means being smarter about asking the ‘what brought you to us’ question by allowing multiple answers, not giving all the credit to the latest one.

Image credit: Brianarn

Holding On – The right and wrong way in customer retention

apple pieCustomer retention seems to get little thought in some companies. The fact that retention tactics only kick in when you tell them you want to terminate your contract is a significant part of the problem. Customer acquisition is an expensive business but it seems that some marketers are obsessed with it, accepting churn as a fact of life, with holding on to existing customers given only cursory attention.

Keeping customers is too important to be left to a salesperson calling the customer after they leave, you should be aiming to be so good for your customers that they never even think about leaving. Good marketers do this by making sure that all parts of the customer experience are faultless. ‘It’s not my department’ marketers on the other hand constantly have to come up with ways to retain customers that are disappointed by the service delivery.

A personal example

My dad recently decided to switch gyms. He even took the time to tell the Fitness First retention agent that called him the reasons why he was leaving.

A few days ago he received this text message:

As a thank you for being a member we would like to give you Aug for FREE.
Limited spaces – 1st come 1st served!
Contact 0208743 4444 to redeem

“OK,” he thought, “a month for free, as a thank you, that’s a nice gesture, maybe they’re trying to win me back, plus I can go to the gym with my sister for another month.”

So he called them up and said “I’d like to take you up on the August for free offer you just texted me.” Only to be told that the August for free offer was contingent on signing up for a whole year. Even as a retention offer, 8.33% extra free is pretty weak but what really irked him was the fact that they’d sent him something phrased as a ‘thank you for your past custom’ that was contingent on future custom. So he called their head office and asked them whether they knew the difference between a thank you and an offer on a future purchase. They conceded that the message could be worded better. Whether they change their approach or not is doubtful at best.

Maybe the bright spark that came up with the offer thought it sounded compelling. Maybe they thought that the best way to entice lapsed members back is by offering them 8.33% off their next year’s membership fee. Maybe they didn’t really consider what it would feel like to receive this text.

Reframe so you can think like a customer

Here’s a trick for when you’re working out an offer, whether it’s a retention offer or an acquisition offer: reframe it into a different industry. I like to use hotels or restaurants to do this – everyone knows how they work and know what it’s like to be a customer, so it’s easy to explain and get others’ opinions on. The idea is to transplant your situation to an industry that you are a customer of. This works for pretty much any kind of marketing you do – ‘think like your customer’ is rather obvious but it’s amazing how many marketers have forgotten how to do that.

Reframing applied

Take the gym example above, reframed to a restaurant. A couple is dining at a restaurant, they decide not to have dessert and to just have coffee. The restaurant would like them to return some time and by foregoing dessert they’ve indicated that they’ll be finishing soon and asking for the bill. So when the bill is given to them, along with it is a coupon that says ‘We appreciate for your custom, as a thank you have a free dessert with your next meal’.

Is a free dessert, that the customer has to remember to bring a coupon for, on a future visit sufficient to convince them to return? Possibly, possibly not.

Ask yourself: would that work on me? If the answer is no, clearly you need to rethink your retention tactics. Think about how the restaurant could do it better and you have your answer.

What if instead of making that offer contingent on future payment, the waiter, when he takes the coffee-only order, says “how about some apple pie (offer whatever the kitchen has plenty of) with that, on us?”. Most people can make room for a free dessert. The customer is rewarded right there and then, they have an experience worth talking about – an act of unprompted generosity, and they’re more likely to return as well. Total cost – less than with printing a coupon, with more efficacy.

So how could the gym have handled it differently? Point 1, if it’s a thank you then it’s a gift, free as in beer. Point 2, don’t make people call up to claim a limited offer, tell the customer their membership has already been extended for them – if they don’t turn up it doesn’t cost you a thing, if they do, the marginal cost is negligible. Is this going to convince someone to renew at the end of the month instead of lapse? Who knows, but you stand a much better chance at winning someone back by giving them something instead of dangling a carrot.

What kind of marketer are you?

The question you have to ask yourself is what kind of marketer are you? Stuck in the 80s, with cut-out coupons, conditional offers and small print? Or evolved, aware that customers have more choice and power than ever before, aware that your job is to make your customer like you by treating them well, not beguiling them into signing something.

Image credit: code_martial

How to Get More Reviews

starsWe all know that reviews written by real people help to flesh out the details of a business. So why is it that hardly anyone writes reviews?

Several of my friends love to talk about their favourite places to eat, or shop but very few of them write reviews of anywhere they go. We talked about the reasons why this was the case. For some it was time – they just didn’t think it was worth their while to spend the time writing it. For others it was that they weren’t sufficiently moved either positively or negatively to bother. Always keen to solve the insoluble I’ve put together this list of how to get more reviews.

0) Be remarkable
In case you were wondering why I’ve numbered this point zero, this is because being worthy of comment is the ground zero of getting reviews. Ever wonder why Seth Godin just won’t stop banging on about being remarkable? That’s because it’s important! If the average response you illicit is ‘meh’ and would have most people ticking the ‘just average’ box on a comment form, you’ve got serious problems. Take care of this first. It doesn’t matter what business you’re in, if you can’t find something to give people to talk about, ask your customers what would blow them away and find a way to do that. If you’re still stuck, and wish you weren’t, maybe change your line of work.

1) Just Ask
Granted some people just won’t write reviews but in a lot of cases all it takes is asking someone if they wouldn’t mind spending a few minutes, next time you get a compliment on your product/service, to share that sentiment with others. (The same goes for referrals by the way). Afraid of coming across as needy or narcissistic by asking straight out? If you really want to avoid that, soft-pedal with the suggestions below.

2) Provide links to/excerpts of existing reviews
And not just the great ones – people aren’t stupid, they can find the average and even the bad reviews. Some people just don’t appreciate what you do, so learn from it and show that you’ve learned from it. If the site/medium the review is in lets you reply and you think you can make things right by stating your side, do so. If your side is indefensible, apologise. Whatever you do, do not use the phrase ‘it is against our policy’. Customers and potential customers don’t want to hear you spouting stuff that could have come from a software license agreement. They want to know that you’re human.

3) Link to the places people can submit reviews
Not just from your site either, though if you don’t have any reviews up on the site, linking to review sites is a good start to getting some. If you have a physical location show signs and logos to the same end. When customers leave give them their receipt wrapped in a short note from the owner or manager, with details of where they can write reviews.

4) Make it easy for people to write reviews by providing them the means to do so at your location. Anything from comment cards to providing free wi-fi. If you want to spread good word of mouth, there’s nothing so effective as handing people a megaphone.

Photo credit Stefanvds

Helping out your competition

busy restaurantSparked by a comment on twitter recently by Justin Levy, co-owner of a restaurant and social media proponent.

I own a restaurant and we’re doing great due to SM. But I see a lot of restaurants closing which sucks to see happen

he was replying to this question by Dave Ferrick:

Last few local restaurants I visited in the past 3 months said they’re closing down despite excellent service. SM Gurus where are you?!

The sad truth of a weak economy is that discretionary spending is one of the first things to get cut – we go out a little less and we spend less when we do. Restaurants are one of the first businesses to feel the pinch, certainly the more up-scale and generally ‘better’ ones. Conversely, McDonald’s and KFC are doing bumper business.

If you’re a restauranteur and you’re weathering the storm ok, consider who else you could help. Let’s face it, people won’t eat out at your place every time they eat out. You probably eat at other restaurants yourself, to check out the other guys, or maybe just for a change. If you’re a tex-mex joint, why not work with your favourite local sushi place? It’s possible for restaurants to succeed by working together – you’re not competing in the traditional sense that McDonald’s and Wendy’s and Burger King do. If most of the restaurants in your neighbourhood go out of business that’s not going to help you in the end – people will go to other neighbourhoods to eat because there’s not enough choice where you are.

Where I live there’s a loose chain of restaurants under the Ambiente banner. They have their own identities, unified by a core brand. Why is it a loose chain? Check out their site – there’s no more than two restaurants of any single concept – Brazilian, Cafe Savoy, Pasta Fresca, Pasta Caffe and Living Restaurant (think TGI Fridays’ menu but with more class). Each restaurant is a franchise, odd – when you consider what they’re really franchising is an umbrella brand rather than an operating manual driven system like McDonald’s. But it’s more than that – there’s co-marketing/cross pollination going on, on a variety of levels: gift certificates valid in all the restaurants, postcards for the other restaurants in the reception areas, city centre maps showing all the locations, advertising for the other restaurants in the rest rooms. They also have supply-side deals that bring them cost savings and consistency.

Granted, Ambiente is an integrated franchise operation but it’s clear to see that together these restaurants combine to create something much bigger than each could achieve on their own.

How far you go in co-operating with your fellow restauranteur is up to you – whether you teach them how to use social media to reach out to their patrons in the same way you are, share some of your marketing ‘special sauce’, do some co-promotions, run tasting stands at local events together, or just work with them on a basic reciprocal level of ‘when you hand the customer their check, also give them a coupon to come try my restaurant’.

If you’re doing any of this, or any of this applies to you and is helpful, let me know. If you’re interested in exploring the possibilities presented here and would like to talk through how you could make them work for your business, get in touch with me via twitter or by email – my inbox is always open.

Photo credit: Punch Pizza