Business Intelligence Report

Greater Richmond Chamber of Commerce

      October 2008

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In this issue:

Customer Service
• Soothing the Savaged Customer Soul 

Trends
• The rise of single consumers 

News
• Local media websites bring results
• Experienced recruits may bring 'baggage'
• New postal tracking system helps small biz 

Tips
• Using pictures as testimonials
• The dangers of learning too much about job candidates
• When is it appropriate to give a customer a gift?
• How to get more from your pay-per-click advertising
• Developing your best pricing strategy
• IRS is back on the independent-contractor warpath 
• Much more... 
 


CUSTOMER SERVICE 

 

Soothing the Savaged Customer Soul  

Times are tough for customers. Rise above the competition by showing your customers some love. 

IN SUCH ECONOMIC times, when our nerves are raw and we are stretched like a rubber band ready to snap, we all need a kinder hand, a kinder voice — just plain more kindness in our life.

Nearly every interaction tests us now. Opening the cell phone bill and gasping, then endeavoring to get a bit of help. First the queue, then the call. Not much kindness there. Putting gas in our car. Buying groceries that are creeping up in price daily. Trying to sell our home or buy one. Calling the support line to fix the appliances that chose now to conk out.

If you are in the business of serving customers, now is the time to seek out the intangible opportunities to soothe the savaged consumer soul. Here are ideas that will bring you dividends by rising above the fray and soothing the frayed nerves during these times of spending woes.

1. Become wizards at alternative solutions. Creative solutions that help customers cope and manage with the current financial pinch will be long remembered. Can you offer revised payment plans or offer different pricing schemes? Can you coach your front line on how to hold a diagnostic conversation to understand the financial implications of the current market with customers? Can you reach out to customers proactively, especially if service contracts or annual commitments are due?

In this economy, customers are more likely to opt out and disappear. If you show up proactively with a helping hand, empathetic approach and creative options prior to their decision to leave, you can save business and build allies.

2. Listen, then repeat. This sounds ridiculously simple, right? Think again. Eight out of 10 phone calls, retail interactions and service calls begin with prescribing a solution to a customer before the customer need is really listened to, understood and validated.

This is a time when customers will want to vent. Let them. Then repeat back to the customer what they said. Because not only do customers need to vent right now, they need validation; that times are tough, that prices are high and that they’re in pain. If your customer is not in dire straits, good results will also follow. Repeating the reason a customer walked in the store, called your number, or emailed your “contact us” contact will take you to a level that is just not being received today — which is internalizing what the customer needs and using that knowledge to drive an outcome that is right for them.

3. Practice wild empathy. Customer empathy is not a pity-party! The ability to empathize, and to put ourselves in our customers’ shoes so we understand what they are going through, tests the humanity of our organizations.

Bring your team together and have them identify the top 10 customer frustrations that are occurring right now and discuss how customers are responding and coping with challenges. Then, in groups of two, have them role-play customer conversations. Film these and make them available to everyone. This action will send a signal internally that it is recognized that times are tough. Giving people permission and good examples for how to empathize will provide not only comfort to customers who receive it but also to your employees who are feeling the pinch themselves.

4. Deliver small heroic acts of kindness. Small kindnesses will go a long way right now. We are all so fatigued from walking away empty-walleted, that small gestures will really stand out. Zane’s Cycles, a bicycle shop in Connecticut, sells $15 million a year from a single shop. They give away any item that a customer is in a panic about finding that costs under a dollar (e.g., a link that will fix a broken chain). Think Dad with a 10-year-old whose bike is broken; one stop at Zane’s and they save the day — without charging anything. Such small heroics send customers away shaking their head in amazement. What can you do?

5. Find your best customers. Love them! Your best customers deserve all the love you can give. First, let them know that you’re glad they’re sticking around. Then reach out to them. Are you developing new products or services? Bring a group of your best customers in for an evening of food and feedback. Perhaps you can send them a letter acknowledging that you value your relationship with them and offer an extra service.

6. Play defensive end for the front line. Your people who are working directly with customers are likely feeling two things right now: their personal pain in the wallet and the pain of their customers. Now, especially, is the time to come up with uncommon acts of kindness for them. Create a monthly casual conversation with your front line so they can tell you what they are hearing and where they are perhaps being beat up a little by beleaguered customers. Host something fun once a month, such as bringing in lunch or hosting a karaoke night.

Most importantly, listen to what they have to say. Make a list of the biggest issues they say customers are having and work to systematically cross items off the list. You may need to create some tools to help them coach customers down from that ledge that some may be standing at right about now. Don’t wait to do this!

7. Hire those with dash and daring. Indications are that this financial crunch will take some time to recover. Profile the type of person who will thrive with customers in this type of economic environment: listeners, creative thinkers and naturally service-oriented people for those serving and interacting with customers.

Hire for passion and the natural ability to empathize. Find leaders who find the glass half-full and can motivate creativity and inspire creative solutions. While these skills are always desired, they are a necessity when times are tough.

8. Call customers who have left you. This is the time when acts of heroism for consumers and business accounts will not go unnoticed. So reach into your customer database and identify some customers who have left you. Then reach out to them. But before you do, build some creative financing and pricing options for them.

When you call, first apologize. Then listen. Asking why a customer left and then really listening and repeating back the reason is extremely powerful — and yet few do this!

Finally, ask to be given another chance and then offer your new creative finance and pricing options. Even if they don’t bite right away, this type of gesture sticks with customers. One financial services company that implemented this strategy ultimately got back 35% of customers who had departed. Just the shock value that you realized they were gone and cared enough to ask “what happened” will set you apart from the rest!

Jeanne Bliss is the founder of CustomerBLISS (www.customerbliss.com), a consulting and coaching company, and the author of Chief Customer Officer: Getting Past Lip Service to Passionate Action.

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T R E N D S

 

The rise of single consumers 

One-person households are expected to account for 36% of all U.S. household growth between 2010 and 2020, according to the Joint Center for Housing Studies of Harvard University. And singles are forecasted to be the fastest-growing household group in the world, according to Euromonitor International. While the burgeoning demographic is a potential boon to marketers, the challenge is targeting an audience that covers such a wide range of ages. Singles could be graduating from college or celebrating their 80th birthday.

Singles are more apt to splurge on themselves. A study by WSL Strategic Retail found that singles are more likely to spend money on self-indulgences, even though 70% of them earn less than $50,000 annually.

You can market your products to singles by focusing on the following key needs: 1) Mobility. Singles are often on the go. Help them get around easier and win them over. 2) Companionship. Like anyone else, singles desire companionship and, for example, will spend big bucks to keep pets healthy and happy. 3) Entertainment. Singles have more discretionary income and more time on their hands and often seek out entertainment. 4) Romance. Events that allow singles to meet one another can be combined with other product and service offerings. 5) Space. Singles often live in smaller homes with less space, so packaging products in smaller containers might win over this demographic. 

Sources: FuelNet, August 26, 2008; www.jchs.harvard.edu 

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N E W S

 

Local media websites bring results 

According to a new report by the Online Publishers Association, local media websites hold a distinct advantage when it comes to delivering results for advertisers. The study finds that consumers trust advertising on local newspaper, magazine and television websites, and are very likely to take action after viewing ads on these sites.

Newspapers rank first, with 46% of consumers taking action, including making a purchase, going to a store or conducting research, after viewing a local ad; followed by local television sites (44%); local magazine sites (42%); user review sites (39%); and local channels of national portals (39%).
Consumers on these sites are desirable advertising targets, concludes the report. Local magazine, newspaper and TV sites attract significant percentages (48%, 40% and 39%, respectively) of consumers who spent more than $500 online in the past 12 months. The study also shows that an important common trait of all local online content sites is an ability to attract high concentrations of influencers.

Furthermore, consumers express significant faith in advertising on local content sites. Newspaper sites lead the way, with 56% of visitors expressing strong trust of the advertising found on these sites, followed by local TV station sites and portals.  

Source: Research Brief by MediaPost, August 27, 2008 

 

Experienced recruits may bring ‘baggage’ 

Companies looking to jump start growth and productivity may be inclined to hire skilled, experienced job candidates, as opposed to workers that need training. Experienced workers, however, often bring baggage from prior jobs that can negate the benefits of their prior experience, according to new research at The Wharton School of Business at the University of Pennsylvania.

For example, during the study, a human resource manager said, “We tried to hire from our competitors and paid a premium for the experience — but those hires were the least successful.” Another manager commented: “People are weighed down by the baggage they bring in.”

Companies might be better off investing in training fresh recruits with little experience in an industry so the companies can have more control over how the new workers adapt to their new employer’s corporate strategy and culture. The research found that training may be more productive than paying a premium to hire experienced workers who might come from a different sort of corporate environment.  

Source: Knowledge@Wharton, September 3, 2008 

 

New postal tracking system helps small biz 

The U.S. Postal Service (USPS) is going digital on bulk mail service. Unique scannable bar codes will start to show up in May 2009 on business- and first-class mail and packages. The codes should speed up processing of that mail and will allow businesses to track the movement and delivery of each piece sent.

Named “Intelligent Mail” by the USPS, the new system will help companies zero in on their best prospects by much more quickly gauging response rates to mail offers and tweaking pitches if they flub.

Intelligent Mail will deliver benefits on the businesses operations side, too. Customers won’t be able to brush off collections calls by saying “the check is in the mail” because companies can verify that instantly. The system will automatically alert companies to customer returns, helping them to reduce processing time and improve inventory operations. And no more mail forwarding delays caused by address changes, a problem for businesses sending time-sensitive offers and bills.

The cost to get the Intelligent Mail system up and running will vary from a few hundred dollars for small firms to millions of dollars for the largest companies mailing millions of bills, letters and direct mail ads annually.  

Source: Kiplinger.com, September 18, 2008

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T I P S

 

  • When building trust, a picture is worth a thousand words. So instead of simply listing the names of your clients and telling about the results you have delivered, take a photo of every one of your clients using your product, meeting with you or doing something goofy involving your name brand. It’s proof that people are happy with your company. After all, they wouldn’t let you take their picture if they didn’t like you, right? One way to get photos is to hold a contest for the best picture of a client holding your product or logo near an obvious vacation landmark.

Source: www.ducttapemarketing.com

  • Be careful checking out job candidates on social networking sites. If you reject them based on what you see, you could be subject to charges of discrimination. Employers could be accused of making hiring decisions based on candidates’ race, sexual orientation, political stance or other factors that are easy to find on websites such as MySpace and Facebook. A recent survey by Vault.com found that 44% of employers use social networking sites to examine the profiles of job candidates. As a result, “failure to hire” lawsuits are expected to increase due to the growing use of social networking.

Source: www.workforce.com

  • When is it appropriate to give a gift to a customer? Jerry Acuff, author of The Relationship Edge in Business, says that you should use a gift to deepen a relationship, not to develop one. Giving a gift too early in a relationship seems phony and desperate. Therefore, limit gifts to established customers, not prospects. Also, watch how much you spend — expensive gifts could be perceived as a bribe. Acuff once developed a long-term business relationship through a Star Trek poster he got for free at a drug store.

Source: www.bnet.com

  • Is your pricing strategy producing the desired effect? If not, consider the following: People associate the number nine (e.g., $29.99) with value and the number zero (e.g., $30) with quality. The extra penny isn’t so much about gaining extra sales as it is about communicating whether you offer value or quality. Another strategy is to require monthly payments. While it may seem advantageous to ask for a one-time or annual payment, customers may actually perceive the item as free after awhile and not use it as often — think gym memberships — thereby limiting satisfaction. This strategy also makes high-priced products and services seem more affordable. Finally, be sure to boast about a discounted price. Big “sale” signs make bargain shoppers feel good about their purchase.

Source: www.smallbiztrends.com

  • IRS is on the warpath against firms that misclassify workers. The Internal Revenue Service has signed up most states to share payroll tax exam data, made it easier for independent contractors to claim they’ve been misclassified and revved up their document matching program. An electronic matching system, for example, lets the IRS spot businesses issuing 1099 forms with payments of $25,000 or more to at least five workers with no other income sources.

Source: The Kiplinger Tax Letter, 1729 H Street NW, Washington, DC 20006

  • Maximize your trade show investment by making small improvements that can generate big gains in traffic. Start by sending a short and sweet pre-show mailing. Give a short description of your products, let the prospect know where to find your booth and entice them with the promise of something great once they get there. Also, backdrops are key to getting people to gravitate toward your booth. Before the show, set up your booth in a space where you can stand back 50 feet and take a look at it. Does the backdrop entice you? Finally, create an eye-catching one- to two-minute video, running on a continuous loop. The video should be the perfect introduction to the conversation you’ll start with anyone who stops at your booth to watch.

Source: The Marketing Report, 370 Technology Dr., Malvern, PA 19355

  • Never ask anyone to do something that you wouldn’t do. Entrepreneurial guru Guy Kawasaki says that this is one of the most important lessons he’s learned as an entrepreneur. That goes for customers (e.g., “fill out these 25 fields of personal information to get an account for our website”) and employees (e.g., “fly to Mumbai, meet all day the day you arrive and fly back that night”). If you follow this principle, you’ll almost always have a good customer service reputation and happy employees.

Source: www.sun.com

  • Need financing for your import business? The financial unit of package delivery company United Parcel Service recently launched a bridge loan for small U.S. businesses that import goods into the country. Under the UPS Capital Cargo Finance program, the company will advance 50% of the value of goods to U.S. importers for up to 60 days upon pickup of the merchandise in a foreign country. The goods themselves will serve as collateral. The loans are available to companies based on criteria such as profitability, a track record of at least three years in business, market share and company management.

Source: www.reuters.com

  • Get the most from pay-per-click advertising by considering the buying cycle. With many products and services there are several buying stages. At the beginning of the buy cycle, searchers may be looking for general information and product reviews, while at the end of the cycle they may be looking for return policy information or where to make a secure purchase. For effective ad copy, segment keywords and write ad copy that’s appropriate for the buy-stage of the keyword(s). For example, you may want to promote a white paper to attract early-stage buyers, while a time-sensitive offer may appeal to those ready to buy.

Source: www.wdfm.com

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Business Intelligence Report (ISSN 1091-9597) is published 12 times a year by DBH Communications, Inc. PO Box 22337 Kansas City, MO 64113, email:  4info@bizintellreport.com.  Subscriptions are $89 per year.

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