March 11, 2008
Consumers Want Service for Private Details
A new poll from Harris Interactive, commissioned by Chordiant Software, finds that consumers, to varying degrees, believe it’s important that companies have information about their buying habits and other personal details to provide the level of service they seek.
According to the study, 64 percent of respondents thought it was either “very important” or “important” that companies had a personal history on them.
Having the information is one thing but what consumers are most interested in is what is done with it. Today’s consumers, according to the study, are willing to walk when they feel even the least bit slighted.
Sixty-two percent, for example, said they would not hesitate to cancel or switch service or product suppliers after having a bad experience. Seventy-eight percent said poor customer service would cause them to shop elsewhere.
“There’s a whole generation of people coming up that will vote with their feet,” Frank Florence, VP-chief marketing officer of Chordiant Software, told AdAge.com. “They say, ‘I expect Bank of America to know me this well. I’m on Facebook, and everyone knows me. They know I like cheese ravioli.’ ”
Younger consumers seem particularly unwilling to understand subpar performance from the companies they patronize. They are more than willing, however, to go online and share their bad experience with thousands of people.
“Your brand is impacted by all of your customer interactions,” said Bruce Temkin, an analyst with Forrester Research. “Today there are many more opportunities for the customer to interact with your brand — and there are many more opportunities for people to discuss the interaction they had.”
Discussion Question: Are you surprised that more consumers seem willing to share personal information with retailers and other companies? Are retailers and others really taking this information to provide a higher level of service to consumers? Where do you see the greatest opportunities for retailers to take personal information and translate it into a more meaningful relationship with shoppers?
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In our experience, using customer purchase data to pre-select offers for each shopper based on individual shopper preferences works extremely well.
Shoppers appreciate several aspects of the process:
– They save time by buying more during a given trip – through reminders of items they use and might forget.
– They expand their enjoyment – by being made aware of items they haven’t yet discovered, among the tens of thousands of products offered, that fit their preference profile.
– They feel good – because they are acknowledged and treated as individuals.
Distractions cause shoppers to forget items they need or be unaware of what’s available. Those are both lost sales opportunities.
Shoppers get annoyed when their information is used less thoughtfully; “Because you really enjoy brand A you should try brand B.”
In summary, you want shoppers to spend more and shoppers want to spend more – on items that fit their preferences. They appreciate someone taking the time to filter communications based on their preferences. Shoppers will buy more during each trip given thoughtful recommendations.
Frankly, my dears, I don’t think this is surprising at all. It’s just another part of our general preference for convenience, shortcuts and ways to permit us to continue leading those lifestyles which are oh so very busy.
Basically, we are lazy and have become spoiled by cute little cookies that mean we don’t have to keep on typing our boring personal details over and over again. We love PINs so we don’t have to waste time writing checks or signing our names. Of course we expect something in return, and customer service would be great. But when we don’t get it, all we do is squawk and, as has been pointed out already, do nothing else about it. Because there is nothing else we can do. Stop shopping???!!! You cannot be serious.
This study underscores the unfortunate truth that many of us have simply given up protecting our personal information in the face of increased ways to steal it, and others of us are so oblivious (i.e., clueless) that we willingly and helpfully contribute to the fertile fields harvested by identity thieves. And sometimes systems conspire against us. I destroyed my Safeway Club card and applied for a new one with no name because I didn’t appreciate the Safeway checkers saying “thank you, Dr. Banks,” at the end of every transaction. Didn’t work. They see my name on my debit card and thank me by name anyway. I’m shy.
What sort of information does a retailer really need to maximize, personalize, and individualize their services? Just one thing: a record of our purchase decisions in their stores. They don’t need our name, CC#, birth date, phone number, address, or SS#. All they need is an avatar for each shopper to which they can attach purchase behavior data and analyze it. Targeted offers can then be delivered in-store in a wide variety of anonymous ways. How many retailers are doing this? None, nada, zippity doo dah. Know me by my purchases and not in any other way, thank you very much.
Privacy and personalization are two sides of a golden coin. If you want more of one, you must give up some of the other.
The ultimate solution would put the consumer in control of his or her own data profile, and permit him or her to reveal just as much of that history as he or she wants, in order to enable the desired service standard at each interaction moment.
Electronic wallet-type applications for cell phones have potential to deliver this kind of consumer control in the brick & mortar world. But the concept implies that the consumer would exert effort to manage his or her profile. This may be perceived as inconvenient by some.
“Seventy-eight percent said poor customer service would cause them to shop elsewhere.” Where would they go? For most retail categories, the same systems, procedures, merchandise quality, and personnel quality are found at the competition. So would these folks go to another country?
Years ago, angry travelers would say, “I’ll never fly on that airline again.” Today, most travelers realize that almost all airlines stink. They use the same systems, procedures, and equipment, and their personnel quality is awfully similar. Retail stores have a similar structure. For every store with unusually high loyalty, like Costco or Trader Joe’s or L.L.Bean or Stew Leonard’s, there are 90,000 copycat mediocrities with no higher aspiration than survival.
It is all about cost benefit ratio. If I give up information do I get something back for giving you that information? Even if you gain the information on your own and use it once, then I will expect you to use it all of the time. The key is consistency but what happens if you use the information the wrong way, even not on purpose?
A favorite story goes back a couple of years ago. I check into the Four Seasons with my wife. She likes a foam pillow, which went somewhere in the record. Next time I check in with my wife, there is a foam rubber pillow with a note that said hope you enjoy.
Now let’s assume for a minute that the first time I checked in, it was not really with my wife. What is the outcome the next time I check in with my wife?
This was the same thing that was a big problem a couple of months ago with Facebook and some of the information they were gathering.
If I give it up (information), I expect it to be used effectively or even an older goat like me will walk! Unfortunately the problem with the information is the cost to utilize and in many cases, the proper amount of investment is not put up to support effective use of data. Companies that do it well will keep consumers more loyal than those that collect and then don’t deliver.
Consumers are in an “I want it all” mode. This has been going on for some time and will continue. This mode is facilitated by brands who have told consumers that they can have it their way. Consumers, especially those under 34, are freer with sharing their personal information and expect others to do the same. Put the two trends together and you get a quid pro quo attitude.
We discussed the topic of using data last week and we’ve frequently discussed customer service, or the lack thereof. In spite of this, too many companies–retailers and brands alike–do not invest enough resources in their people and/or customers.
As complaints rise and consumers vote with their feet, will this trend change? Will these same consumers that want it all be willing to spend more money to get the same products, but with better customer service?
Consumers are willing to share personal information as long as they feel it won’t be abused AND that there is a unique benefit to them for sharing. The key thing is the benefit needs to be customized and actionable to the individual and not be perceived as a one size fits all.
What’s interesting to me is the privacy element to all of this. Consumers expect brands to know who they are and use that information to create a mutually valuable relationship. But it still amazes me that after the biggest data breach in history, TJX posted a profitable quarter. Consumers have not yet begun to punish retailers who do not keep their info secure. But they will punish retailers if they don’t use the info they have, or they use it in a way that is not valuable to the customer.
Interesting.
I am a bit surprised that such a high percentage of consumers (64%) thought it important for companies to have their personal information. It speaks to the desperation of consumers to have better experiences with retailers and brands and that they believe if the company has their information it will lead to personalized high-value experience.
Unfortunately, most companies have not shown the ability to consistently deliver a more positive experience on the basis of owning personal data. This is an enormous opportunity area for the companies who figure out how to use the personal data they have to personalize the consumer relationship.
The under-30 crowd will continue to drive open sharing of personal data and I expect data safety will continue to improve. Now it is up to the retailers and brands to use it effectively.
To the three questions posed:
1. Am I surprised consumers are so willing to give personal information to retailers and others? “Yes.”
2. Will it result in better customer service? It hasn’t done too much really beneficial for the consumer up to now.
3. What can be done with this personal knowledge? Take the information and develop a personal relationship with the consumer, preferably in person … but that could be expensive.
Bottom line: Expect more but be content with less.
I am not surprised at all. Customers are truly at wit’s end when it comes to customer service and the general perception is that companies do not care about customer service. If a chain ‘extends its hand’ and offers a chance for change, I think customers would jump all over that. Consumers look at the benefit to themselves more so than the corporation itself.
Consumers must weigh the benefits vs. their willingness to provide personal information to companies. Retailers often have more information than they know how to use effectively. The result is category managers who are overwhelmed with too much data and consumers who get the same coupons and offers as everyone else.
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In our experience, using customer purchase data to pre-select offers for each shopper based on individual shopper preferences works extremely well.
Shoppers appreciate several aspects of the process:
– They save time by buying more during a given trip – through reminders of items they use and might forget.
– They expand their enjoyment – by being made aware of items they haven’t yet discovered, among the tens of thousands of products offered, that fit their preference profile.
– They feel good – because they are acknowledged and treated as individuals.
Distractions cause shoppers to forget items they need or be unaware of what’s available. Those are both lost sales opportunities.
Shoppers get annoyed when their information is used less thoughtfully; “Because you really enjoy brand A you should try brand B.”
In summary, you want shoppers to spend more and shoppers want to spend more – on items that fit their preferences. They appreciate someone taking the time to filter communications based on their preferences. Shoppers will buy more during each trip given thoughtful recommendations.
Frankly, my dears, I don’t think this is surprising at all. It’s just another part of our general preference for convenience, shortcuts and ways to permit us to continue leading those lifestyles which are oh so very busy.
Basically, we are lazy and have become spoiled by cute little cookies that mean we don’t have to keep on typing our boring personal details over and over again. We love PINs so we don’t have to waste time writing checks or signing our names. Of course we expect something in return, and customer service would be great. But when we don’t get it, all we do is squawk and, as has been pointed out already, do nothing else about it. Because there is nothing else we can do. Stop shopping???!!! You cannot be serious.
This study underscores the unfortunate truth that many of us have simply given up protecting our personal information in the face of increased ways to steal it, and others of us are so oblivious (i.e., clueless) that we willingly and helpfully contribute to the fertile fields harvested by identity thieves. And sometimes systems conspire against us. I destroyed my Safeway Club card and applied for a new one with no name because I didn’t appreciate the Safeway checkers saying “thank you, Dr. Banks,” at the end of every transaction. Didn’t work. They see my name on my debit card and thank me by name anyway. I’m shy.
What sort of information does a retailer really need to maximize, personalize, and individualize their services? Just one thing: a record of our purchase decisions in their stores. They don’t need our name, CC#, birth date, phone number, address, or SS#. All they need is an avatar for each shopper to which they can attach purchase behavior data and analyze it. Targeted offers can then be delivered in-store in a wide variety of anonymous ways. How many retailers are doing this? None, nada, zippity doo dah. Know me by my purchases and not in any other way, thank you very much.
Privacy and personalization are two sides of a golden coin. If you want more of one, you must give up some of the other.
The ultimate solution would put the consumer in control of his or her own data profile, and permit him or her to reveal just as much of that history as he or she wants, in order to enable the desired service standard at each interaction moment.
Electronic wallet-type applications for cell phones have potential to deliver this kind of consumer control in the brick & mortar world. But the concept implies that the consumer would exert effort to manage his or her profile. This may be perceived as inconvenient by some.
“Seventy-eight percent said poor customer service would cause them to shop elsewhere.” Where would they go? For most retail categories, the same systems, procedures, merchandise quality, and personnel quality are found at the competition. So would these folks go to another country?
Years ago, angry travelers would say, “I’ll never fly on that airline again.” Today, most travelers realize that almost all airlines stink. They use the same systems, procedures, and equipment, and their personnel quality is awfully similar. Retail stores have a similar structure. For every store with unusually high loyalty, like Costco or Trader Joe’s or L.L.Bean or Stew Leonard’s, there are 90,000 copycat mediocrities with no higher aspiration than survival.
It is all about cost benefit ratio. If I give up information do I get something back for giving you that information? Even if you gain the information on your own and use it once, then I will expect you to use it all of the time. The key is consistency but what happens if you use the information the wrong way, even not on purpose?
A favorite story goes back a couple of years ago. I check into the Four Seasons with my wife. She likes a foam pillow, which went somewhere in the record. Next time I check in with my wife, there is a foam rubber pillow with a note that said hope you enjoy.
Now let’s assume for a minute that the first time I checked in, it was not really with my wife. What is the outcome the next time I check in with my wife?
This was the same thing that was a big problem a couple of months ago with Facebook and some of the information they were gathering.
If I give it up (information), I expect it to be used effectively or even an older goat like me will walk! Unfortunately the problem with the information is the cost to utilize and in many cases, the proper amount of investment is not put up to support effective use of data. Companies that do it well will keep consumers more loyal than those that collect and then don’t deliver.
Consumers are in an “I want it all” mode. This has been going on for some time and will continue. This mode is facilitated by brands who have told consumers that they can have it their way. Consumers, especially those under 34, are freer with sharing their personal information and expect others to do the same. Put the two trends together and you get a quid pro quo attitude.
We discussed the topic of using data last week and we’ve frequently discussed customer service, or the lack thereof. In spite of this, too many companies–retailers and brands alike–do not invest enough resources in their people and/or customers.
As complaints rise and consumers vote with their feet, will this trend change? Will these same consumers that want it all be willing to spend more money to get the same products, but with better customer service?
Consumers are willing to share personal information as long as they feel it won’t be abused AND that there is a unique benefit to them for sharing. The key thing is the benefit needs to be customized and actionable to the individual and not be perceived as a one size fits all.
What’s interesting to me is the privacy element to all of this. Consumers expect brands to know who they are and use that information to create a mutually valuable relationship. But it still amazes me that after the biggest data breach in history, TJX posted a profitable quarter. Consumers have not yet begun to punish retailers who do not keep their info secure. But they will punish retailers if they don’t use the info they have, or they use it in a way that is not valuable to the customer.
Interesting.
I am a bit surprised that such a high percentage of consumers (64%) thought it important for companies to have their personal information. It speaks to the desperation of consumers to have better experiences with retailers and brands and that they believe if the company has their information it will lead to personalized high-value experience.
Unfortunately, most companies have not shown the ability to consistently deliver a more positive experience on the basis of owning personal data. This is an enormous opportunity area for the companies who figure out how to use the personal data they have to personalize the consumer relationship.
The under-30 crowd will continue to drive open sharing of personal data and I expect data safety will continue to improve. Now it is up to the retailers and brands to use it effectively.
To the three questions posed:
1. Am I surprised consumers are so willing to give personal information to retailers and others? “Yes.”
2. Will it result in better customer service? It hasn’t done too much really beneficial for the consumer up to now.
3. What can be done with this personal knowledge? Take the information and develop a personal relationship with the consumer, preferably in person … but that could be expensive.
Bottom line: Expect more but be content with less.
I am not surprised at all. Customers are truly at wit’s end when it comes to customer service and the general perception is that companies do not care about customer service. If a chain ‘extends its hand’ and offers a chance for change, I think customers would jump all over that. Consumers look at the benefit to themselves more so than the corporation itself.
Consumers must weigh the benefits vs. their willingness to provide personal information to companies. Retailers often have more information than they know how to use effectively. The result is category managers who are overwhelmed with too much data and consumers who get the same coupons and offers as everyone else.