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Friday, July 14, 2006

"Good Tea. Nice House."

So said Worf, the no-nonsense Klingon from Star Trek: The Next Generation, to express his appreciation for the hospitality he was shown. I can't tell you the name of the episode, but it is forever engraved in my mind for several reasons: seeing Worf handle a dainty tea cup, watching the change in his usual warrior-like demeanor, and hearing his concise expression of appreciation. [picture courtesy of Paramount Pictures]

Welcoming customers into one's space is an important part of the retail experience. In fact, it is a critical one that can make or break the relationship you are trying to develop with them. So why is it that it is so often forgotten?

Here follows a true story from my friend Gary in NYC as recently experienced by his wife, Shirley:

Shirley went to Home Depot on 23rd St. to get some information and background on carpet for our bedroom.

She wandered around the department for 15 minutes without finding a sales assistant, and finally approached two young women with Depot shirts on sitting in a corner chatting and asked for assistance. One of the women asked her if Shirley expected them to get up!

Then they went off in this litany of contradictory and confusing information. The women disagreed on whether the products were available, how long the delivery was, etc. Shirley’s favorite was when she was quoted an installation price, she noted the banner on the carpet said installation was free, and the sales rep told her “Just because it’s free doesn’t mean you don’t have to pay for it!”

They finally gave her a print out, which is basically indecipherable, and she left fuming!

Her comment, I don’t care if ABC is more expensive, I don’t trust Home Depot, if their service and installation is as incompetent as their sales staff, and it will be another horror story.


What frightens me most about this story - apart from the sheer preposterousness of it - is that this is more the norm than the exception and NOT JUST AT BIG BOX RETAILERS.
Let's put this in perspective. Why bother with the niceties? Why care about customer service or being hospitable?

  • Who generates profit for you? ---> your customers
  • Who are your customers? ---> over 80% of the time, women
  • What makes women special as consumers? ---> shorter repeat purchase cycle than men, AND word-of-mouth referrals
  • And, if you satisfy your women customers, you will also satisfy your men customers!!

Seems like a no-brainer to me. Your profitability is inextricably linked to the quality of the relationships you have developed with your customers [and your employees as your representatives to the customer]. It's how you develop loyalty.

Fred Reichheld - an expert on customer loyalty - has just released a new book titled "The Ultimate Question". I remember being stunned by his article "The Number One Number You Need To Grow" in the December 2003 issue of Harvard Business Review. I was excited to be hearing renewed buzz on the subject. This link will take you to an interview with Reichheld that describes the ultimate question he asks, which is: How likely would you be to recommend us to a friend? Here follows an excerpt:

People who score nines and tens are promoters. They account for 80% to 90% of the positive word of mouth. They generate the growth in business and make employees proud to be there. Passives are those who give you a seven or an eight. They’re perfectly satisfied for the moment, but they’ll switch to a competitor if something better comes along. Then are those who score zero through six. Those are failing grades. Those customers are detractors. They complain and will eventually defect. If you take the percentage of your customer base who are promoters, subtract the percent who are detractors, you come up with the net promoter score, or the net worth of your customer base.

Pretty powerful! You can read more about the book, loyalty and Fred Reichheld at his blog [note that this will point you to a Dec. 2005 posting; but I found it a good big picture post. You' ll find lots of interesting examples in other postings.]

So, shouldn't we all become passionate and ferocious zealots in pursuit of offering hospitality and fabulous service to our customers to generate loyalty? It sure beats the alternatives!

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