Posts Tagged ‘customer engagement’

Can Social Media Build Loyalty?

by on Tuesday, November 22nd, 2011

Pitney Bowes recently released the results of a large-scale, multi-country online survey (PDF) about which specific engagement techniques encourage consumers to “continue using a business and maybe buy more from them.” The key finding of the study, as reported in MediaPost and elsewhere, is that social media has little effectiveness as a channel for building loyalty: “Only 18% of consumers believe that the ability to interact with a large company on social platforms would encourage them to buy from that company. This average drops to 15% for small companies.”

Consumers were more likely to be loyal to brands that gave them more control over the shopping experience: “Being able to choose home delivery; choosing how to interact with a company (which communication channel); controlling the frequency of those interactions; and having a say in the company’s development of products and services.”

Social Sharing (via Elmo H. Love, Creative Commons)

So, does that mean that social media is a waste of effort for brands that want engage with consumers? Not at all. Although the underlying survey data hasn’t been made public, the survey as reported reflects a very narrow understanding of social media and how it can be used to promote customer engagement.

The survey report focuses primarily on the use of social media as a communications channel between the brand and the consumer – a cooler but less measurable version of email. Viewed that way, it’s easy to conclude that social media doesn’t offer much as an engagement vehicle. But the potential of social media lies in so much more than its use as yet another top-down channel in which brands say a lot but don’t listen much.

One of the most fundamental recent changes in consumer attitudes and behavior is the decline of the brand as authority figure and the increased consumer preference to be in control – something reflected in the Pitney Bowes survey itself. But another aspect of this paradigm appears to have been ignored: Consumers who formerly relied on the brand as authority now are more inclined to rely on each other.

The online retail space is full of brands that facilitate interactions among consumers, not just between the brand and consumers. Kaboodle is a women’s clothing site that invites consumers to “Shop and share your style with friends.” Users share their style tips and can in turn be followed by other consumers. Kaboodle’s merchants rely on these interactions in making selection and stocking decisions. ModCloth has a similar social shopping model, including a “Be the Buyer” tool that lets users directly affect the merchandise that is carried.

Both of these sites facilitate consumer control, but the social context adds a dimension that arguably makes the relationship stickier. According to one customer: “I love Kaboodle because now I have people from all over the country (who used to be complete strangers) as shopping buddies! This is my new favorite way to shop.” Note, too, that most of the social interactions take place on these companies’ respective sites, not on social media platforms, although the ModCloth page on Facebook has almost 375,000 likes.

The Zavee takeaway:

  • Social can build engagement and loyalty, provided it’s used creatively. It isn’t just another form of email.
  • The genius of social media is that it puts consumers in charge – and lets them learn from and help each other.
  • Social sharing is a paradigm, not a technology. It isn’t limited to Facebook and Twitter and might best be implemented on your own site.

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Tis The Season to … Shop Locally

by on Thursday, November 17th, 2011

Here’s an idea: let’s make December “National Shop Locally Month”. Big brands get lots of media attention with their Black Fridays and their door busters, on top of the biggest ad budgets of the year. Maybe a wristband and a car magnet aren’t much, but local businesses always have had to make do with less.

On second thought, there are better ways to raise awareness of the importance of local commerce and persuade consumers to spend more at local businesses this season. Shift Your Shopping is an umbrella site that provides a great deal of information about the impact of local business on the nation’s economy. Spend some time on the site and you can’t help but be impressed by local business as an economic driver. In addition, there are several organizations that support small business in the community. Take a look at their sites and consider making them part of your own community.

Black Friday (via lululemon athletica, creative commons)

Consumers want to save money, but studies show that most consumers don’t make purchase decisions solely on price. They want personalized service, a relevant product selection and a merchant whose integrity is beyond question. Those are your strengths as a local merchant, so make sure your customers know about them. Don’t overlook the power of social media to engage consumers about the importance of local businesses in general and value that yours adds in particular.

Best wishes from Zavee for a prosperous holiday season.

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Airlines and Loyalty … It’s Not Getting Better

by on Wednesday, June 29th, 2011

Bill Hanifin of Loyalty Truth recently posted about airlines and customer service, a post prompted by his trip around the world (Malaysia and back – that qualifies). My trips are rarely as exotic but I fly almost every week, primarily between Newark and either FLL or PBI, and primarily on Continental. Like Bill, I have a soft spot for airlines, having begun my career in aircraft finance. Again like Bill, I am amazed – and not in a good way – by the unforced errors airlines commit when it comes to customer service.

Bill writes that airlines should be using the wealth of data available to them to build in more flexibility in dealing with customers, some of whom may be very valuable to the airline. I agree, but I think that ignoring their own data is only half the problem. A lack of empowerment is the other. Associates can only be as flexible as the rules allow. And I have a hunch that consolidation has made carriers more rigid and reduced employees’ sense of ownership (anyone have similar – or different – experiences at newly-merged carriers?).

Bill isn’t a fan of unbundling, but my view is mixed. I think baggage fees are a slap in the face to passengers. Airlines ask us to cooperate in limiting what we carry aboard, then charge us for our cooperation. Nice. On the other hand, unbundling food is a win-win, because concourse food concessions are improving steadily at many airports just as on-board food is disappearing. Carrying on our own food is one of the few freedoms we have as passengers, and I wouldn’t want to turn back the clock.

via Flickr - where are the jonses

Maybe it’s because there aren’t any bosses or unions at 35,000 feet, or maybe it’s because the airlines know how to hire for the cabins, but most flight attendants do a great job despite more crowding and fewer amenities. One recent flight departed “on time” by pushing back before the aircraft was fully catered. Not surprisingly, grumbling ensued. Very surprisingly, the flight attendants up front decided to open bags of almonds left over from the inbound flight and serve them in wine glasses. It showed that the flight attendants cared and it put a smile on every face in first class. Airlines can’t teach that kind of resourcefulness, but I hope they reward it.

One of the biggest customer engagement problems the airlines face as they impose more rules, charges and limitations is that the customer-facing staff is constantly required to disappoint or frustrate the customer. The trick, whether in the cabin, at the gate or at the ticket counter is to avoid turning delivering bad news into delivering bad service. Being told your bag has to be gate-checked is bad news; being made to wait for it at baggage claim is bad service. Being handed your bag at the Jetway is a smart way to ease the sting.

Flexible rules, empowered associates and a premium on resourcefulness can do wonders for an airline’s word of mouth. At a time when consumers are increasingly willing and able to share their experiences effectively, bad service is just reckless. If I hated Continental – and I don’t – I’m sure I could find a different way to get to Florida every week. Travelers under fewer constraints can drive to a more distant airport or just drive to their destination. And many people would just as soon stay home. Customers like me who really have to fly can use social media to make sure that everyone in our social graph – including whoever runs social media at the airline – knows exactly how and what the airline is doing.

The Zavee takeaway:

  • Airlines need empowered, resourceful associates applying flexible, data-driven rules. The alternative is an ongoing low-intensity conflict with customers that the airlines can’t win.
  • Every customer has an alternative to a bad airline, even if it means staying home.
  • Social media levels the playing field for airline customers. They can sit us down, but they can’t shut us up.

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Building Loyalty with Customer Reviews

by on Wednesday, February 23rd, 2011

Kevin Stirtz of Amazing Service Guy has an outstanding post in The Social Customer called, “10 Ways to Turn Online Reviews into More Loyal Customers”. Kevin’s advice is not just smart, it’s easy for any merchant to adopt. Things like, respond to every review; when you’re wrong, apologize; stay positive and consistent. Simple points, but they get at what makes a review platform like Zavee so powerful for local merchants.

I have only a few thoughts to add to Kevin’s. First, I absolutely agree with responding to every review, at least with a thank you. Depending on the platform, merchants can respond publicly (on the platform), privately (via direct message or email), or both. For example, I’ve seen public responses to reviews on TripAdvisor but not on Yelp. I’ve received private responses to reviews on Yelp. Zavee supports both public and private responses. Having access to both domains gives merchants a lot of flexibility but requires thought about how to use them. For example, a general statement of apology probably should always be public, but a promise of specific compensation might best be communicated privately.

Kevin doesn’t make the point explicitly, but underlying his comments is the notion that reviews can be shared socially. An inappropriate response can easily make the social rounds and do more damage than the review that the merchant was responding to. A gracious and informative response can be shared as well, but with the opposite effect. In other words, responses to reviews are marketing communications, and should be crafted as carefully as a news release or an ad.

Shout!

shout! (via Sandra Nahdi - Creative Commons)

Kevin rightly advises against writing fake positive reviews, calling them a distraction from the real work of improving the business. I agree that they are a distraction but I think another reason to avoid them is that they jeopardize the credibility of the review platform as a whole. Think of it as “Gresham’s Law” applied to content.

However, merchants frequently tell us they are more concerned about fake negative reviews, e.g., from a competitor or extremely dissatisfied customer. Merchants can never completely prevent malicious reviews but there are two things they can do to limit their impact: First, merchants should be extra vigilant about not rising to the bait and engaging in an online shouting match with the reviewer. Kevin makes this point about all negative reviews but it the more negative the review, the more important the merchant’s self-restraint. Second, merchants should trust their customers. They are pretty good about spotting outlier reviews, recognizing them for what they are and discounting their impact accordingly.

A more annoying problem for merchants is reviews that are stale. Restaurants that have changed chefs, hotels that have repainted their rooms, and stores that have changed suppliers have all been victimized by dated reviews. No one knows why anyone would wait months to describe a shopping, dining or travel experience they probably barely remember, but it is a common occurrence. Our attempt to limit the impact of both dated and false reviews is to permit shoppers to post a review only after making a purchase and within 30 days of that purchase.

The Zavee takeaway:

  • Respond to every review, if only to say “Thank you” or “I’m sorry”.
  • Treat every review as a marketing opportunity, to both new and existing customers.
  • Treat every response a marketing communication, one that may be shared well beyond merchant and customer.

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Big Brands Embrace Social Commerce. Are They Alone?

by on Tuesday, October 12th, 2010

Zavee CEO Alan Pleskow and I attended the inaugural Rise of Social Commerce conference last week in Palo Alto. Big brands (usually) adopt new technologies and strategies earlier than small to medium sized businesses, so the conference provided a fascinating peek at how some of the largest companies are planning for and deploying Social Commerce today.

Social Commerce was defined by the conference organizers as “the use of social technologies to connect, listen, understand, and engage to improve the shopping experience.” For most conference attendees, the goal was removing the the technological, economic and operational obstacles that add “friction” to the online commerce experience.

(via x-ray delta one - Creative Commons)

Does that mean that Social Commerce is only for brands that sell online? And only for enterprise level companies? Not at all. Much of the learning around how consumers interact with brands and each other applies equally to brands whose customers make shopping decisions online but actually buy in-store. And much of the same learning applies equally to SMBs, even if some of their challenges are unique. For example, while SMBs are more likely to ask “How can I find the time?” than “Which department owns this?” using technology to become more customer-centric is something every business can do.

The organizers developed a conceptual framework for Social Commerce that has four phases:

  1. Let’s Be Social
  2. Enlightened Engagement
  3. Store of the Community
  4. Frictionless Commerce

The first phase is where many SMBs are today: working out the basics of consumer engagement on social platforms. Very few business we meet through Zavee still believe that social media is irrelevant to their business. Their most common issues are the time commitment required and the loss of control over their business’ message. Depending on the size of the business the time issue can be a real concern, but small businesses can start small, and increase their investment in social media as they begin to see results. As for the control issue, a few minutes on Twitter should open the eyes of any business owner about how much control they really have.

The second phase should be the destination for most SMBs, and they should get there as quickly as possible. This phase involves adding social content to the shopping experience: reviews from consumers, information and suggestions from the business, even content sourced from third parties. Regardless of whether the actual transaction takes place in the online or offline domain, enriching the consumer’s shopping experience through social content can have a significant impact on businesses of any size. Consumers respond to timely, relevant, personalized content by trying new businesses, becoming loyal customers and sharing their experiences with the community.

The third and fourth phases are over the horizon for many enterprises, let alone SMBs. The third phase involves bringing consumers into the process by which businesses create, buy, stock and price products, and the fourth involves completely re-imagining the retail experience. Some of the examples from the conference, such as Kaboodle and ModCloth, are very impressive. Many of the companies at the conference are looking to leverage Facebook’s enhanced commerce capabilities to bring the online store to the consumer rather than force the consumer to leave Facebook for an e-commerce site. SMBs may not be able to do everything these companies have done, but the underlying insight – that consumers respond to being included in decisions that are made upstream of the purchase – is something SMBs should consider making part of their strategy.

With so much emphasis on the enterprise, why did Alan and I attend this conference? It’s because we believe that the definition quoted above also describes what Zavee does for our merchants and shoppers. Our platform helps merchants use social media to listen, understand and engage with consumers. More importantly, Zavee is a community that supports the shopper-to-shopper and merchant-to-shopper interactions that lead to an enhanced shopping experience and a stronger brand. Adopting a Social Commerce strategy can seem daunting for SMBs, but with Zavee they don’t have to do it alone.

The Zavee takeaway:

  • SMBs can learn a lot from what enterprises think and do, even if these learnings can’t be applied directly.
  • The insight that consumers respond favorably to content that is timely, relevant, personalized can be leveraged by businesses of any size.
  • SMBs need to get into the Social Commerce space, but Zavee can ensure that they don’t take the journey alone.

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What Can We Learn From Airline “Unbundling”?

by on Tuesday, August 24th, 2010

Anyone who has flown recently has experienced what the airlines call “unbundling”: separate fees for optional services that used to be bound up in the ticket price. Unbundling means, for example, that a passenger who flies with just a laptop bag will pay less than a passenger who checks baggage in the hold. The passenger who fills up at McDonalds or Starbucks before boarding will pay less than the passenger who wants an airline meal. The economics of unbundling fees for ancillary services have been amply discussed elsewhere: The airlines do well and the passengers … well, it depends.

From the passenger’s perspective, unbundling works best when (1) the service really is optional (i.e, the passenger isn’t coerced to to incur the fee) and (2) the fee itself doesn’t seem like an unreasonable money grab by the airline. Airlines are most likely to be successful unbundling services that a substantial number of passengers either don’t want or need or that they can easily live without or replace on their own.

Suitcases (via Malias - Creative Commons)

Airline food is a perfect candidate for unbundling: It’s easy to get cheaper and better food on the concourse and the airlines no longer forbid passengers from bringing their own on board. Seating is another example. Want a reserved seat? Pay for it. Willing to take your chances on your seatmate? Save your money. Some airlines charge more for seats that are larger or closer to the exit. Worth the extra fee? You decide. These fees are relatively easy to explain to passengers, but airlines on the whole have been lax in communicating with their customers.


Checked baggage fees are also economically defensible, since every piece of checked baggage adds to the fuel required for the trip and thus to the airline’s cost. But airlines are fooling themselves, and doing a disservice to their customers, if they think the economic rationale is self explanatory. While many passengers, especially those on business, don’t check bags and don’t pay the fee, other passengers, especially families, find the policy coercive. One unintended consequence is that passengers have an economic incentive to carry on bags they might otherwise have checked. As the Steven Slater incident reminds us, trying to stuff oversized carry-ons into undersized bins can end badly.

As Bill Hanifin points out, it’s essential that airlines communicate the policy both on the plane and via social media. This is especially important with airline policies that are new, subject to change and may be perceived (rightly or wrongly) as unfair to the passenger. Why are airlines so lax about communicating with their customers? One guess is that there hasn’t been a storm of complaint about most of these fees. But the likely reason for such acquiescence is not consumer satisfaction, but its opposite. As a frequent flyer I hear a lot of grumbling, but most of it sounds more resigned than angry. Many airlines survive consumer dissatisfaction, but only because consumers often have few alternatives and, except for the most egregious service issues, have simply given up. This is the sign of an industry in trouble.


The Zavee takeaway:

  • Communication of any significant business change is essential. Customer dissatisfaction will fill the void if you let it.
  • Don’t assume that customers understand the economics of business decisions that affect them. They aren’t stupid, but economic rationales require explanation.
  • Don’t confuse the absence of complaint for approval. In fact, if you do something that should generate (some) complaints and don’t get them you have a problem that you need to address immediately. Unlike airlines, few small businesses can count on getting away with taking their customers for granted.

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Facebook vs. Twitter: Do You Have to Choose? (Pt.2)

by on Tuesday, July 13th, 2010

Last week we blogged about how valuable Facebook can be for local businesses and suggested that it wouldn’t take much additional time to add Twitter to the marketing mix. We are strong believers in Twitter as a complement to Facebook, but we realize that many local merchants are able to devote only limited time to Social Media.

HootSuite logo

The key to making Twitter easier and more efficient is to use one of the free third party Twitter management tools instead of Twitter’s own site. HootSuite and TweetDeck let you do two things that can save a lot of time: manage multiple searches and cross-post into multiple Social Media streams.

In a previous post we blogged about four ways that local businesses can use Twitter. Some involve more time and attention than others. First, we suggested using Twitter as a listening post, gathering information from other users. The net you cast can be as wide or narrow as you want. Use your Twitter manager to set up searches for your industry, competitors, community, etc. If you can’t do all of these, establish some priorities and set up fewer searches. Checking them should only take a few minutes a day.

Second, we discussed using Twitter to build your brand. This is the most time-consuming aspect of making Twitter work, and while we think it’s worth the time not everyone will agree. This is where cross-posting can come in handy. You can use your Twitter manager to publish your Facebook posts as tweets – same content, two streams. You can do the same with blog posts (every Zavee Thinking post is automatically tweeted as soon as it’s published). Cross-posting isn’t a substitute for frequent tweeting, but it’s a reasonable compromise between committing to a major brand-building campaign on Twitter and ignoring your brand altogether.

Third, we pointed out how Twitter can generate leads. There is a passive and an active component to using Twitter this way. The passive part involves setting up searches for keywords that potential customers are likely to use when tweeting. The active part involves tweeting with those same keywords. Not enough time to do both? Just set up and monitor the searches and see how that works. You may need to adjust the search terms but that still should take less time than actively tweeting to gain leads. As you get better at finding potential customers on Twitter, however, don’t be surprised if you find yourself spending more time building those relationships online.

Finally, we recommended using Twitter as a customer service channel. At a minimum, you should use your Twitter manager to display mentions of your business on Twitter. Whether and how you respond to tweets that mention your business is up to you, but there is no reason not to see what people tweet about you.

We think that this minimalist approach to Twitter is a good way to start, especially if you don’t think you have a lot of time for Twitter. We also think it’s likely that you will ramp up your Twitter strategy as you gain experience with the medium. Take an hour or two on a weekend afternoon to get familiar with one of the Twitter management applications and play around with both searches and cross-posting. Let the technology do some of the work and you can get value out of Twitter without putting in more time than you want.

The Zavee takeaway:

  • Use a third party Twitter manager for multiple searches and to publish Facebook posts on Twitter (and vice versa).
  • An active tweeting strategy takes more time than reading relevant tweets, so if time is an issue focus on using Twitter passively – at least for now.
  • Don’t be surprised if you find yourself spending more time on Twitter than you expected – not because it wastes your time but because it builds your business.

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