Wide Angle

On Monday, Fortune came out with a long, in-depth piece on the success of Trader Joe’s – the wildly popular small gourmet grocery store. The chain, owned by German grocery conglomerate Aldi, has experienced dynamite growth in the last 15 years, expanding from its base in Southern California to over 200 stores nationwide. Their sales numbers ($8 billion in 2009) are similar to those of semi-competitor Whole Foods, and their sales per square foot are an estimated $1,750, more than double those of Whole Foods.

Fortune spends a lot of ink (or pixels, I suppose) analyzing aspects of Trader Joe’s success. It’s a good article, but what has made TJ’s such a cultural phenomenon isn’t too difficult to discern. I’d separate it into a few key buckets: Read More »

Advocate amplification will always have a place in the B2B marketer’s toolbox, especially as the trend toward consensus-buying strengthens.  However, shortcomings of the strategy in today’s environment are causing marketers to scrutinize the investment.  Three factors seem to be sapping the power of advocate strategies.

#1 Ever More Customer Stakeholders Are Involved in Deals

This key change in customer buying behavior (noted in this Sales Executive Council post) makes an advocate’s job much more challenging.  Coming out of the downturn, businesses are keeping a tight fist on the moneybags by increasing the number of folks needed to sign off on a purchase or bringing in outside consultants to audit deals.  These moves severely limit an advocate’s capacity to influence broadly and deeply enough. Read More »

Jeff Hayzlett, former CMO of Kodak, keynoted at MLC’s opening executive retreat last week. Arriving in his signature cowboy boots, Jeff shared his fittingly defiant approach to leadership in the “Wild West” of social media. He also shared insights from his new book, “The Mirror Test”.

Adversarial Leadership

Jeff opened by saying:“my job as CMO is to create tension,” and explained how he challenged the status quo and broke the rules to get action on social media at Kodak. He once asked Legal how many people he would have to annoy before he got fired. When they said a third of the company, he decided he still had plenty of leeway to push his plans through.  Similarly, when we asked how to deal with Legal’s approval processes for social media, he answered “You’re in marketing, be creative.” Read More »

This week marks the official release of the Customer Effort concept into the “wild” with the publication of our article, entitled “Stop Trying to Delight Your Customers,” in the July/August issue of Harvard Business Review. If you haven’t seen the article, feel free to download a complimentary copy. You will also find some cool podcasts and our Customer Effort Audit tool available to download.

As you’ll read in the article, our research shows that “delighting” the customer—in other words, going above and beyond—yields only marginal additional loyalty from the customer.

We also found that customers are four times more likely to leave a service interaction disloyal as compared to loyal, and the primary thing companies can do to mitigate this disloyalty in the service channel is to focus on reducing the effort customers must put forth to get their issues resolved.

Put succinctly, loyalty in the service environment is a matter of reducing effort, not delighting the customer. Read More »

Zappos founder and CEO Tony Hsieh released a book, Delivering Happiness: A Path to Profits, Passion, and Purpose, last Tuesday, recounting his experience as the creator of the Zappos brand, from start-up phase to its eventual sale to Amazon last summer. The book looks great – full of insights on how Hsieh created the Zappos culture of employee and customer happiness. Having had a number of positive customer service interactions with Zappos myself, I’m excited to read about how he scaled his vision across what became a $1.5 billion business.

In advance of the book release, though, Hsieh released an excerpt to Inc. magazine, detailing how that vision created conflict between he and his investors – venture capitalists who sat on the Zappos board: Read More »

When it comes to buzzword bingo about the issues B2B marketers care about most, “customer loyalty” makes a pretty strong showing.  It’s no secret that—on average—cross-sales to existing customers are much more profitable than new business acquisitions.  And even as we inch our way closer toward economic recovery, it’s heartening to know that current customers present the best opportunity for profitable growth in any economic environment.

MLC has spent a significant amount of time on the loyalty question, trying to understand what companies with high levels of customer loyalty do that’s so much better than the rest of the pack.  We’ve surveyed marketers, we’ve surveyed sales reps and sales managers, and, perhaps most critically, we’ve surveyed B2B customers. 

Interestingly, the data all points to one resounding conclusion: Read More »

When it comes to loyalty program enhancement, most marketers are squeezing basis points of response out of email marketing or are micro-tweaking status tiers and reward levels.  Of late, however, we’re noticing a handful of brands pursing discontinuous innovation, which seems to fall into one of three categories: Read More »

A recently released report by Gallup underscores how difficult it is for marketers today to know where to focus their efforts.  The report, which is based on a survey of US consumers’ retail shopping behavior (and includes some really interesting data on the engagement premium), at first suggests that success lies in the quality of customer service efforts and ease of shopping—both very functional aspects of the retail experience.  But three paragraphs later, the authors argue that retailers’ most effective strategy is to build an emotionally engaging experience. 

Well, which is it?  Of course, we’d all like to have an experience that is as good as can be, both functionally and emotionally.  However, we as marketers have limited time and financial resources.  We appreciate advice that steers us on how to prioritize. 

So, here is MLC’s take on how to make those tradeoffs.  Read More »

One of the many hats I wore while posted in CEB’s Asia hub in New Delhi was that of “glocalizer”—contributing to the organization-wide effort to translate insights for the region.  It was exciting to see such efforts come to fruition. 

One of the more visible projects I was involved with is CEB’s joint initiative with the Indian business publication Mint Magazine (a partnership of HT Media—inaugurated by The Mahatma himself—and The Wall Street Journal).  With Mint, we publish a monthly series, entitled the Six Myths, based on the thought leadership from the global memberships at CEB and the regional expertise of the folks at Mint. 

Recently, our Six Myths installment focused on six common misconceptions about the world of Sales that are especially relevant to heads of Sales and Marketing in central and east Asia.  Though most of the myths align to the broader challenges faced anywhere in the world, some were especially resonant in India.  Read More »

Customer churn is a perennial problem, particularly for those in service and utility businesses.  When it comes to solutions, it’s easy to get into an internal rut.  Practices, processes and metrics build up over time to support a particular worldview of churn.  The worldview works for a time, but retention gains inevitably flatten as competitors replicate the approach and the business evolves.

We often find that fresh ideas from outside the industry can catalyze new, healthy thinking about churn.  Here are a few ideas to hopefully freshen your thinking: Read More »