Posts Tagged ‘Reputation Management’

Don’t sell your reputation with your coupons

April 28th, 2009 Dean

I came across this blog post by Elaine Fogel about gift coupon, or commonly known as vouchers in Singapore. She wrote:

I was a gift card virgin – until recently. Now, I will not use them anymore. Number one – they aren’t worth the trouble. Number two – they aren’t worth their full face value. There’s hidden info that consumers don’t know about until they try to use them, which brings me to number three – they’re aggravating!

It reminded me how true it is even here in Sg. I remember getting a $20 coupon with my credit card for one of them restaurants only to find that there were so many conditions to use it, i might as well throw it away. No way am I going to arrange my schedule to fit their requirements so nicely!

So if you are in the retail business and you have used (or thinking of using) coupons to get sales going, think carefully. Are you setting too many conditions on the use of that coupon such that it seems you were not being sincere? Are your coupons an extension of your brand’s core values or will your customer see it as just another $$ deal?

“A national survey [in USA] of 1,500 consumers done last spring by WSL Strategic Retail, based in New York, found gift-card fees and expiration dates were among the top causes of frustration. And that’s just among people who attempted to use them. Earlier this year, TowerGroup, a research firm in Needham, Mass., estimated the value of unused gift cards in the U.S. at $8 billion for 2006. And in its fiscal 2006 annual report, the retailer Best Buy revealed a $43 million gain from gift cards that were unlikely to be used.”

Consumers like to deal with authentic businesses. If your marketing tactics involves giving away coupons, you might as well make it another vehicle to promote your brand values and use it as a means to get customers to like you. It shouldn’t just be about getting them to come back. It should also be about getting them to interact with your brand more so they can get to know more. After all, true friendship comes from constant communication.

Have you gotten a coupon and thought it was pointless to use it because of all the restrictions? What are your thoughts on it?

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Time your sales right and earn PR points for your shop

April 9th, 2009 Dean

I got this interesting piece of insight on customer behaviour from Marketing Profs.

If you offer a sale, say 10% on a coffee maker, for a limited period. If a customer just missed the sale dateline and you wanted to be kind and extended the offer to her, there is a 87% chance that she will reject the offer. But if you told her that the sale for the coffee maker has ended and you offer her a 10% discount on another brand of coffee maker (probably as a ‘peace offering’) there is a 40% chance that she will accept your offer. Isn’t that interesting?

Possible reason:

“The researcher suggests that consumers may transfer the “negative affect” (regret at missing a sale) to the promoted product itself, leading to a lower opinion of the product.”

 

Lesson we can learn from this:

“time sales of different brands, or even of different items in [a] product line, to ensure that a consumer who misses a sale on one product can find another sale on a different yet similar product,” this researcher suggests….When one item goes off sale, consider offering similar products at a slight reduction, to keep latecomers happy.”

Now isn’t that easy way to make build a good reputation with your customers? 

If you are offering services, would you be able to apply the same principles? get back to the drawing board, friends…

Source

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Reputation comes cheap at True Yoga

February 20th, 2009 Dean

Something must be awfully wrong in the True Group boardroom. Despite getting bad press last month for not relenting to a court ordered refund of (just) $2,500 on Jan 24, they were still strong headed and kept on at being bad!

On Feb 13, the local newspapers reported on how customers are complaining about poor service at the fitness centre. Straits Times, in its article, noted that

  • Online, the forums and blogs are abuzz with gripes against the yoga arm, with customers venting their frustrations in at least 50 postings.
  • A group of 16 disgruntled customers have also banded together to file a collective suit against True Spa.
  • customers have so far been angry about repeated cancellation of appointments made for spa treatments, pressure selling and the unavailability of slots despite bookings being made five weeks ahead.  

In response, their spokesperson said “……., we have offered them ways to make bookings easier. There is really nothing else we can do”.

Are you kidding me? Nothing else you can do?? There is something they obviously can do. Refund the customer.

First off, they need to decide which is more important, money or customer satisfaction? I would suggest to the GM that put customer satisfaction before money. A satisfied customer can be a customer for life. An unhappy customer is going to make a hell lot of noise. The management at True Yoga must have been living in a well. Don’t they know that with Social Media, anyone can spread a piece bad news like a bush fire.

Customers can band together either for your company or against your company. I hope the Management wasn’t surprised to find “a group of 16 disgruntled customers have also banded together to file a collective suit against True Spa” (ST). I bet these 16 people didn’t even know each other before this. And now they have a common enemy. Dangerous.

Why bother spending so much money in glossy ads, spokesperson and promos to build credibility and then let is all go down the drain because of greed. I guess reputation comes cheap at True Yoga. Definitely cheaper than their spa packages.

What we can learn from this:

1. Your reputation is more valuable than the cost of any product or services that you offer. 

2. If your customer is not happy, help resolve the issue sincerely. If you cannot resolve it, then give full refund. The sensible customer will understand and forgive you for your mistake. The irrational customer will not dare make news about it, because they know inside them that they are being irrational.

3. If your customer has to use legal means to resolve the issue, its as good as losing him/her for good. As reported: “Marketing manager Nora Yusoff, 43, took True Spa to court last year, where an agreement was made that allowed her to make bookings a week in advance. She said: ‘It improved for me after that, and I was able to use my whole package. But I am never going to sign up with True Spa again.’”

4. Remember what Warren Buffet said. It takes years to build a reputation and a day to destroy it. (or something like that). 

 

Full article as appeared on ST below:

Feb 13, 2009

Wellness group gets flak from customers

Complaints pile up online and at Case; unhappy spa clients file collective suit

By Jessica Lim

 

 

 

COMPLAINTS about poor service are piling up against the True Group, the wellness empire that runs yoga, fitness and spa businesses here.

The Consumers Association of Singapore (Case) received 331 last year, more than double the 155 filed in 2007. And barely two months into this year, True’s business arms have already drawn 15 complaints, mostly against True Yoga.

Online, the forums and blogs are abuzz with gripes against the yoga arm, with customers venting their frustrations in at least 50 postings. A group of 16 disgruntled customers have also banded together to file a collective suit against True Spa.

Last month, True made the news when a court bailiff went to its True Fitness outlet in Suntec City to seize equipment to raise money to make good on a customer’s court-ordered refund of $2,500.

True’s customers have so far been angry about repeated cancellation of appointments made for spa treatments, pressure selling and the unavailability of slots despite bookings being made five weeks ahead.

Assistant marketing manager Tan Siang Mei, who bought a $4,000 spa package in 2006, said she has hardly been able to get through the booking hotline and has had appointments cancelled at the last minute. As a result, the 29-year-old has used only $580 worth of services in two years.

Of her attempts to make spa appointments, she said: ‘No one picks up the phone. And when you are lucky enough to get some attention, spots are fully booked for weeks on end.’

Going online in the middle of last year, she had no difficulty finding 80 others with bad experiences at True Spa. Out of that number, 15 of them joined her to file the collective suit.

One member of the group, a 27-year-old teacher who declined to be named, wants a refund for the $6,000 package she bought. She is frustrated in having snagged appointments for only three sessions in her eight months as a member.

A True Spa spokesman confirmed that the spa received a writ of summons through the group’s lawyer on Jan 24, but said True has ruled out refunds.

‘In these cases, we have offered them ways to make bookings easier. There is really nothing else we can do,’ he said.

He explained that the existing system allowed customers to book spa slots two weeks in advance for peak hours and a day or two ahead for off-peak times; some of those who complained were assigned personal representatives to help them with bookings. He said these customers had earlier sought refunds for entirely different reasons, such as financial difficulty or because their favourite massage treatments were no longer offered.

But one of two lawyers representing the complainants, Mr Michael Loh of Clifford Law, said: ‘It’s not a case of wanting their money back due to making a bad decision. They are coming forward with what they have experienced, which should not be discounted in any way.’

He said his clients were asking for a full refund, though they were open to ‘any sincere offer’ to settle the matter.

Case, which has described the number of complaints as ‘quite high’, advises consumers to be clear about the terms and conditions of membership and to go online for reviews before signing up.

It added that, it may, if needed, invite True to sign a Voluntary Compliance Agreement, that is, admit to unfair trading practices, compensate its customers and clean up its act.

Mr Peter Sng from the Spa Association of Singapore put down True’s problems to its membership base being too large.

Marketing manager Nora Yusoff, 43, took True Spa to court last year, where an agreement was made that allowed her to make bookings a week in advance.

She said: ‘It improved for me after that, and I was able to use my whole package. But I am never going to sign up with True Spa again.’

…..end…….

 

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YouTube becoming a powerful PR tool

January 19th, 2009 Dean

I was having a discussion with one of my client, a learning programmes business owner. I told him he neededto record a video of his best classes and upload it to YouTube. And his response was, “You Tube is for entertainment, not for real business”. I was speechless!

I wish he knew that even world leaders are using You Tube to get votes. World-class trainers and speakers are using it to promote their programmes. Chefs are using it to promote their recipes and books.

If you don’t know it yet, You Tube is becoming a major How To resource centre. I myself have gone onto the portal to check on how to do this and that, especially new exercise routine. Here’s a article on Straits Times to proof my point (Sunday 18 Jan).

If you are a consultant, then you need to seriously consider making a presence on You Tube. Here’s how you can do it in 3 easy steps…

1. Get a video recorder of some sort. It need not be super high quality

2. Record something you already know well but might be of interesting to somebody. Your video need not be polished, as long as it has good info. Keep it within 5 min. You might want to add your website link onto the video to encourage viewers to go to your site.

3. Upload, add the correct tags.

4. Sit back, feel proud of the work you’ve done, no matter how poor the quality of your video. You can improve it the next time around.

Many business owners hold back on doing this simply because they are waiting for a time when they can produce a high quality, polished, corporate video. The problem is, that time may never come. And what they dont understand is, the You Tube community dont care for high quality, polished, corporate video. They want reliable, interesting content. It needs to be authentic more than polished.

It is a good way (read low risk way) for your consumers to sample a little bit of you before they commit to a proper programme, product etc.

So what are you waiting for?

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Communicating Bad News Effectively – 5Cs to note

January 9th, 2009 Dean

Communicating bad news to your employees and stakeholder is not only difficult but a nerve wrecking one. How you do it will affect you and your company’s reputation. Here’s an article that gives you tips on how to do it carefully and with empathy. It might be useful for those who have to make cut backs to your business that will affect your staff. (more…)

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5 Lessons on Marketing for the Recession

January 9th, 2009 Dean

Are you trying to find a way to beat the recession and boost your sales?

I thought this article from B2B Marketing Confidential could give you something to think about as you revise your marketing plan (if you have one, that is *wink*). I believe that how good your business can be during these hard times really depends on how you view the current economic condition and how you interpret all the bad news you hear in the media.

You have a choice not to participate in the recession. Here is the article:

……………………..start………

Depression Marketing Best Practices

No, we’re not in a depression. But, given all the recent depression buzz (Krugman’s book, non-stop CNBC pundits who won’t shut up about crashes and black Mondays and Fridays,) I pulled Studs Terkel’s fantastic Hard Times down off the shelf the other night. There’s a section in there called “The Big Money” where he interviews people that actually did well during the Depression. Here are some outtakes from William Benton’s interview:

“I left Chicago in June of ’29, just a few months before the Crash. Chester Bowles and I started in business with seventeen hundred square feet, just the two of us and a couple of girls. July 15, 1929–this was the very day of the all-time peak on the stock market.

As I solicited business, my chart was kind of a cross. The left-hand line started at the top corner and ended in the bottom right corner. That was the stock market index. The other line was Benton & Bowles. It started at the bottom left-hand corner and ended in the top right-hand corner. A cross… When I sold the agency in 1935, it was the single biggest office in the world. And the most profitable office.”

Well, this is an interesting case study, I thought. Maybe I should pay attention. The most amazing thing about Hard Times is how familiar it seems. The passages talking about bubbles, business cycles, people’s incredulity at how all this happened is really eerie. So how did Benton & Bowles kick butt in the depression? Here are some best practices:

 

  • They essentially invented audience research. When they heard a lot of people listening to “Amos and Andy” on the radio, they bought it straight away. They put a Pepsodent spot on and sales went through the roof. They worked with George Gallup. They listened to customers. This was new stuff.

Lesson: Marketers who listen to their customers in new and powerful ways will win the battle for fewer dollars.

  • Radio was the newest new media at the time. Basically, they were investing like crazy into stuff that the big agencies didn’t understand yet. They were young–late 20s–and didn’t know any better. 

Lesson: Those who master the next wave of media will rise above the fray. Mobile? Social? Something we haven’t seen yet??

  • Once into radio, they perfected “audio illusion”. Example–they cast two people in one role on “Showboat”, a program to promote Maxwell House Coffee. A sexy singer for the audio, and a known actress for the voice. They also started adding in sound clips of the coffee brewing and pouring. Sales doubled and quadrupled, crushing store brands. The other agencies were angry because it was improper to do these things at the time. 

Lesson: Just because things are done one way, don’t fear doing it a totally different way. Thinking outside the box is critical.

  • Once this guy had a lot of money, he was able to buy businesses at bargain basement prices. He bought Muzak for next to nothing and built it into a national behemoth.

Lesson: Keep some powder dry. The really good investment opportunities are starting now. Once you buy, own and retool. Pretty good time to be a PE company, even if Carlyle is laying off.

  • He also comments on how he was able to add incredible talent at low prices because of the glut of labor supply. His salesmen improved every year as they could screen more and more applicants for these jobs. 

 

Lesson: Keep hiring channels open and be pickier than ever.

For anyone who hasn’t read Hard Times or any of the Studs Terkel interview compilations, they are an incredible insight into people’s attitudes and behaviors throughout history. I highly recommend them.

……………………………………………..end……….

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The persuasive power of “Low-Fat” Nutrition labels! It can make you fat

January 8th, 2009 Dean

I came across this an extract from Journal of Marketing Research website that caught my attention. It just validates what we have suspected all along. Eating ‘low-fat’ labeled food product can actually make you fat! This is something food retailers might want to know: 

 

In this era of increasing obesity and increasing threats of legislation and regulation of food marketing practices, regulatory agencies have pointedly asked how “low-fat” nutrition claims may influence food consumption. The authors develop and test a framework that contends that low-fat nutrition labels increase food intake by (1) increasing perceptions of the appropriate serving size and (2) decreasing consumption guilt. Three studies show that low-fat labels lead all consumers—particularly those who are overweight—to overeat snack foods. Furthermore, salient objective serving-size information (e.g., “Contains 2 Servings”) reduces overeating among guilt-prone, normal-weight consumers but not among overweight consumers. With consumer welfare and corporate profitability in mind, the authors suggest win–win packaging and labeling insights for public policy officials and food marketers

Source

 

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What is Social Media? Here, in plain english…

January 2nd, 2009 Dean

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Tangs reaches out to consumers in Second Life

January 2nd, 2009 Dean

Local retail store Tangs becomes the first retailer in Asia to set up a store in a virtual world Second Life, to be launched in March ’09. This is amazing! A 76 year old retailer embracing Web 2.0 means that they are plugged into the changes in consumer habits.

In Tangs virtual store visitor will be buying clothes, hairdos and different looks for their avatars. As Straits Times reported:

Shoppers can expect to see items from Tangs’ ‘signature lines … but with a tinge of fantasy’, in line with players’ desire for a ‘larger than life’ appearance for their online personas. They can pay for their purchases in Linden dollars, the game’s currency, or via a virtual credit card. Credit card bills are paid monthly in Linden dollars, which can be traded for real money. More floors, ‘stocked with usable and desirable items by well-known Second Life designers’, will be added over time, said First Meta co-founder Aileen Sim.

I am sure many small business owners and retailers are not even aware of the power of using Second Life to reach out to their consumers. Before you say you are just too busy running your shop, note the statistics:

  • There are 16 million registered users from all over the world in Second Life
  • There are many shops in Second Life set up by individuals
  • It has amassed a gross domestic product of US$402 million. 

You might be saying to yourself that it is too much of a hassle. Here are three reasons why you should seriously consider it:

Do it for brand recognition

With people buying stuff from virtual Tangs for their characters it becomes a brand people will recognise and grow to trust. Tangs is a local retailer and has been for a long long time. But with Second Life, people from all over the world will get to know the brand. Should they visit Singapore, they will go “Aha! I know this store.” They are more likely to step into the store. Should Tangs want to expand overseas, the brand recognition gotten in Second Life would definitely be beneficial.

Abacus, a Singapore based travel agent, already has a virtual store. I doubt they are a big company.

Do it for brand loyalty

If you want your retail brand to achieve a cult status, with strong consumer following, you can’t achieve it in a few months. With more and more people getting an avatar in Second Life you can expect their virtual experience to affect their buying decisions in real life. 

Do it to get another cash register

Buying and selling on Second Life is done using their local currency, Linden dollars, which is really pegged to the real dollar value. Your virtual store might be another revenue generating machine too. Who knows?

Start small

If you are a B2C kind of business, don’t think too much. Get your toes wet in Second Life. Get yourself an avatar. Play around a little. Once you are comfortable, start working on your virtual store. It will take a while, but who is keeping score…..Of course, you can always hire a techy undergrad to do it all for you.

Till then, hope we bump into each other in Second Life!

Or maybe you are just happy being an old school mom & pop store like this below. Discovered along River Valley road.

(the pic is rotated to the left) It’s no surprise that I found the old lady sleeping in the middle of they day…you can see her leg sticking out 

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Two PR Benefits of a Money Back Guarantee Policy

December 29th, 2008 Dean

Came across this letter sent in to Straits Times (27 Dec) about Botak Jones, the restaurant that serves ‘damn good American food’. The letter reminds me once again how easy it really is to build an authentic business and in so doing win the admiration of our customers. What better way to build customer loyalty!

Lessons we can all learn from this:

Consumers love to deal with authentic business. One that has a ‘heart’. To be an authentic business, all you really need is (a)passion for your business and (b)to provide service with sincerity. When what you delivered is below expectation, like what happened to Edwin Neo in the letter, then let your sincerity guide you to take the necessary action. 

If you are proud of the quality of food (or any other product) that you sell, it makes complete sense to provide a complete refund and, like what Botak Jones did, take a step further and give them something better at no charge.

Unfortunately, from my interaction with many business owners in Sg, a complete refund and free replacement is such a bizarre concept! They are very resistant to implementing a money back guarantee policy. I find this strange.

Two PR benefits of a money back guarantee policy

When you offer a guarantee like what Botak Jones does, then

1. it lowers the risk to the customers and therefore they are more likely to buy your product than your closest competitor

2. the bad experience of getting a bad product/experience will be downplayed by the sincerity of your response. Customers will more likely to say good things about your company despite the bad experience.

I understand that many business owners in Sg are too afraid that customers will take advantage of their money back guarantee and that their profit margin will be lowered.

People are generally nice and sensible. Customers who exploit money back guarantees are always in the minority. If you experience such a customer, would you want to hold on to him? I will rather drop him and never deal with him again.

As for lowering profit margin, this can only happen if a significant percentage of your customers are asking for refund. If this happen then all signs points to a poor service/product quality. It’s time to do a business review or drop the product altogether.

 

I managed to get my hands on Botak Jones’ brochures. I was not surprised to see them proclaiming their guarantee. The owner even wrote a personal letter to the reader and signs it off! How nice! What an easy way to show their sincerity and providing “damn good food”. I bet he didn’t need to pay branding consultants to do that. It’s just common sense.

 

Your comments please:

What is your opinion on money back guarantee? Is it worth while? Is it effective in fostering a good reputation for business?

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