Walmart just launched the “Get on the Shelf” program to enable producers to receive space on the Walmart shelf:
“How does it work? Pretty simple actually. Submit a video of your product to Get On the Shelf and then, when voting starts, rally your family, friends and fans to vote for it. The product video with the most votes wins.”
Is this practice likely to become more and more prevalent?
I found this Shin and Sudhir study on “When to Reward Your Customers” very thought provoking. Please note particularly”
“The award-winning paper helps to reconcile a contradiction between marketing theory and practice. Marketing scholars have generally held that in order to maximize profits, firms should attract new customers with low prices, rather than giving discounts to current customers to reward them for their loyalty. But such rewards for existing customers are common in practice.
Shin and Sudhir found that rewarding your own customers can be justified in industries where two conditions apply. First, heterogeneity in customer value is high; that is, a small group of customers provide a large percentage of profits. And second, stability of customer preferences is low: customers can easily switch to competitors.”
Should you reward your own customers or your competitors' customers? [or is this a false choice?]
“Surely, it's nice to be courted for input, at least sometimes. But some consumers say they're fed up with giving time-consuming feedback for free, don't like being drawn into a data web used to evaluate employees or feel companies don't act on the advice they get. Others say they simply don't have anything revelatory to impart about, say, ordering a shirt or buying a package of pens.”
Do your customer surveys breed feedback fatigue?
Delta recently introduced the Ideas in Flight concept to: “inspire thought, facilitate collaboration and identify great ideas to continue to enhance the travel experience”. The program was introduced in collaboration with TED. TEDTalks videos are used to prime Ideas in Flight conversations. The program is featured on Delta’s facebook site.
I found this Frances Frei and Anne Morriss perspective on [customer service] excellence refreshing. Please note particularly:
“In their new book, Uncommon Service: How to Win by Putting Customers at the Core of Your Business (Harvard Business Review Press), coauthors Frances Frei and Anne Morriss (MBA ’04) maintain that it is possible for organizations to reduce costs while dramatically enhancing customer service. That win-win approach involves “looking at your biggest buckets of cost and rethinking those strategically in ways that give your customers something they value,” notes Frei, the UPS Foundation Professor of Service Management.”
Following are several of the tough choices organizations must make to achieve customer service excellence, according to Frances and Anne:
• How do customers define “excellence” in your offering? Is it convenience? Friendliness? Flexible choices? Price?
• How will you get paid for that excellence? Will you charge customers more? Get them to handle more service tasks themselves?
• How will you empower your employees to deliver excellence? What will your recruiting, selection, training, and job design practices look like? What about your organizational culture?
• How will you get your customers to behave? For example, what do you need to do to get them to treat your employees with respect? Do you need to make it easier for them to use new technology?
I found this Schumpeter Too much buzz article on the big opportunities and big problems provided by social media very thought-provoking. Please note particularly:
"Responding quickly to bitter tweets sounds like a nifty way to soothe angry customers. But there is a risk that companies will concentrate on a handful of activists (who tweet a lot), while neglecting average customers (who don’t). They may also ignore non-customers (who are the biggest potential source of growth) and the elderly (who seldom tweet)."
Do companies over concentrate customer service on a handful of social media activists?
The following article outlines several major design considerations for developing effective customer loyalty programs:
1) Define the Purpose and Objectives of the Program
From the company perspective, loyalty programs should be designed not only to improve customer retention but also to improve the performance of customer acquisition, new customer engagement [or onbording], customer development, and customer winback. This end-to-end customer lifecycle approach will extend and multiply the impact of the program.
From the customer perspective, loyalty programs should offer customers an opportunity to benefit from enhanced product or service value propositions.
2) Design the Program to Attract the Right Customers
Loyalty programs should focus of attracting the “right” customers. High-value “secondary customers” will prove particularly attractive candidates for loyalty programs. These secondary customers divide their purchases in the category among two or more providers. They are also however the least likely to join the program.
3) Design the Program to Enhance the Value Proposition of the Product
Customers will ultimately base their “loyalty” decision first and foremost on relative value considerations. Loyalty programs that directly enhance the value proposition of the product or service will therefore prove more effective in influencing customers’ loyalty decisions.
4) Design the Program to Facilitate Incremental Customer Behaviors
Loyalty program should be designed to motivate customers to produce new or “incremental” behaviors. Loyalty Programs that rewards customers mostly for “mindlessly” producing the same natural customer-as-usual behaviors will have limited impact.
5) Develop a Strategy for Engaging Customers in the Program.
Companies should also develop an adjunct strategy for engaging customers in the program. The strategy should include customer participation, introduction, and engagement elements.
6) Develop a Strategy for Measuring and Improving the Effectiveness of the Program
Loyalty programs defy easy measurement. Companies need to particularly develop an approach to adjusting the measurement process for any “selection effect”. Loyal customers will find the program more attractive than less loyal customers. Customers who participate in the program will typically be more loyal than customers who do not partly because of the sheer selection effect.
Additional readings:
Collected Works on Customer Loyalty Programs that Really Work
The JWT’s trendspotters recently included The Rise of Shared Value in their Top Ten trends for 2012:
“The Rise of Shared Value: Rather than simply doling out checks to good causes, some corporations are starting to shift their business models, integrating social issues into their core strategies. The aim is to create shared value, a concept that reflects the growing belief that generating a profit and achieving social progress are not mutually exclusive goals.”
Following is Michael Porter's perspective on Creating Shared Value:
“A big part of the problem lies with companies themselves, which remain trapped in an outdated approach to value creation that has emerged over the past few decades. They continue to view value creation narrowly, optimizing short-term financial performance in a bubble while missing the most important customer needs and ignoring the broader influences that determine their longer-term success.
How else could companies overlook the well-being of their customers, the depletion of natural resources vital to their businesses, the viability of key suppliers, or the economic distress of the communities in which they produce and sell? How else could companies think that simply shifting activities to locations with ever lower wages was a sustainable “solution” to competitive challenges?”
This inspiring Zazzle video brings the Mass-Customization and Co-Creation concepts to life:
