Why Online Retail Has High Customer Service Scores

Taylor Pratt at Marketing Pilgrim wrote about a study from e-consultancy that showed online retailers out-ranking offline retail for customer satisfaction. This may come as a surprise for many, but here’s why I think it makes sense.

In the offline world, entering a retail store has become a crap-shoot. After enough poor experiences with under-trained staff, one begins to realize that there is little reason to visit a physical store outside of being able to possibly handle the product one is considering purchasing. Sure, there are plenty of very caring, knowledgeable people working in offline retail, but the bad experiences tend to be remembered more than the positive ones.

Compare that to the online world where the equation changes. Online, retailers have one “employee” interacting with a prospective buyer: the product’s webpage. Since there is only one relationship to manage, it can be turned into a thing of beauty. Photos, price information, reviews, buying history, comparable products, etc. The retailer can put their best people to work on creating as close to perfect of an experience with that product as possible for each and every prospective buyer who visits that page. It’s consistently awesome.

That is, if retailers understand this concept. Sadly, it appears that many are still putting their best talent to work managing a single offline store when their talents could be used on a much larger scale to reach a national or international audience. Instead, many retailers appear to be continuing to view their online store as a division of the IT department rather than what likely could be the retailer’s single largest store – dwarfing the sales of what a physical store can generate.

Shopping for a Canon SD880IS Camera: Amazon.com vs BestBuy.com

I recently found myself in the market for a new point & shoot digital camera after putting my last one through the wash. It turns out that cameras don’t need to be laundered.

I’m a huge fan of Canon’s Powershot point & shoots. Especially the ones with wide angle lenses because they’re great for indoor shots, food photography, and self-portraits. The image stabilization makes it possible to get away without using a flash a much longer exposures. Awesome. So, I researched the latest model from Canon and quickly figured out that it’s the SD880IS.

Once I knew what I wanted to buy, it was time to find a place to buy it. Being a Minnesotan, I decided to check out BestBuy.com. They carry the camera. Here’s how they present it:

Canon SD880IS Shopping

Hmm. That’s disappointing. Let me count the ways:

1. No picture of the back of the camera.
2. Only two reviews.
3. I can’t see the price without adding it to the shopping cart.
4. No information about shipping costs.
5. No information about related products I may want to consider (perhaps there is a previous model that’s so much cheaper I’d go with that?)
6. Usually leaves our warehouse in 1 business day? So, I may or may not see the camera one of these days?

Compare this to Amazon’s Canon SD880IS presentation:

Canon SD880IS Shopping

1. First thumbnail is of the back of the camera.
2. 98 Reviews
3. Amazon’s price, and three other supplier’s prices are displayed.
4. Free shipping is offered.
5. Related products are displayed along with the percentage of times people purchased them instead.
6. They explain when I can expect this to arrive if I purchase it now.

Online merchandising matters.

If both store’s prices were exactly the same, Amazon would win because they do a better job giving buyers the information they need to make an informed buying decision.

Oh, I did add the camera on BestBuy.com to the shopping cart in order to find the price. They charge 15.8% more for this product than Amazon, plus $6.75 for shipping so 18.5% more than Amazon.com. I also had to put up with a pop-over reminding me to $44.99 extended service plan for a $245 camera.

Canon SD880IS Shopping

It seems like Best Buy has the buying power to be competitive on products like this. However, the bigger competitive challenge appear to be beyond just price.

Front Door Thinking in a Back Door World

Matt Mantey from The Internet is Just a Fad has some examples of the weaknesses with Nordstrom’s online retail experience. While Nordstrom’s has an incredibly recognizable and respected offline brand, it doesn’t necessarily translate into comparable online success.

If I was to guess, I think the problem faced by many large retailers trying to succeed online is one of front-door mindset.

They come from a mindset of build a strong brand experience, get people in the door, take care of them, watch the cash register ring.

But online, it’s not about getting people in THE door. It’s about EVERY door. You’re no longer competing at the store level. You’re competing at the product level.

The doors into your store are every single product and category page.

If people can’t find the appropriate door into your store when searching for a specific product, you lose. It doesn’t matter how strong your brand is, how generous your return policies are, or how big you are in the offline world. If you’re not found on specific product searches on Google, you’re losing money.

Once you get someone in one of your thousands and thousands of doors, you have the potential to leverage your brand’s power to increase the size of your consumer’s shopping cart. But first, you have to get them there.

Sadly, it seems that many strong offline brands are still focused on the front door of their online presence. They stare at homepage mock-ups in boardrooms and make group consensus decisions on how to make every stakeholder happy instead of focusing on the thousands and thousands of other doors into their online store where the real money is made (or should be).

Where Offline Shopping Beats Online Today

Does online shopping always beat offline? Absolutely not. Here are a few examples of where offline trumps online shopping today.

But first, a shout-out to online: While shopping for new running shoes on Amazon last night, I was able to filter by size so I didn’t waste time comparing shoes that didn’t fit me. That is ALL I need to see since everything else is completely irrelevant for me. Sure, some shoe warehouse type stores display all of their inventory by size but that’s the exception today. What a waste of time it is to have to ask humans whether they could check their stock to see if they have a particular model in your size?

Offline Beating Online Shopping

1. Dealing with Disappointment: What happens when a product is out of stock online? You’ll often find a page telling you the product is out of stock, or worse yet, you may hit a 404 error page. Not good. Compare that to offline where you can probably glance left or right to find comparable products that are in stock.

2. Negotiable Pricing: Offline stores are great for cutting deals. Explain to a salesperson that you’re willing to buy a lot of something for a fair discount and you’ll have a good chance of getting it. Online negotiation is nearly impossible today beyond buying enough to receive free shipping.

3. Proactive help: Few things are more frustrating than being in a store that you know carries a specific item that you can’t seem to find. Personally, I run into this most often at the grocery store when picking up recipe items. In the offline world, a staff member can usually point me in the right direction in a matter of seconds. Beyond that, great staff members will identify frustrated shoppers and proactively help them through their buying mission. This is an experience that, so far, hasn’t translated well to the web where it may be needed even more than offline.

4. Bundling: If you go into Best Buy and pick out a digital camera, a salesperson will surely ask you whether you’d like to pick up a case, extra battery, extra storage, tripod, extended service plan, photo printer, laptop, Photoshop, etc. Why? For one, because they make more money if you spend more. But it’s also a service to the customer to make sure they leave with everything they’re going to need to truly enjoy their new camera. Some retail sites offer bundles, such as Amazon, but few have been able to translate the “Why?” of buying bundles to the web that come naturally in an offline transaction.

Of course, the majority of the offline wins above depend on dealing with helpful and well-trained employees, which seems to be the exception rather than the norm these days.

What’s your take? Are there any that you’d add or remove from this list?

Capital One Can't Read Its Own Emails

My Capital One credit card’s online account management service includes a customer service feature called, “Send us a Secure Message” that sounded like the perfect way to communicate with the credit card company before traveling to Uruguay and Argentina.

While it isn’t required, I have run into issues in the past with credit cards when traveling overseas without providing prior notice. Better safe than sorry, I figure.

So, I found the appropriate area of the site:

Capital One Customer Service

And shot them a quick note. I was in an out a fraction of the time it would have taken me to get in touch with a human on the phone. Why waste my time, Capital One’s phone bill, and a Capital One employee’s time communicating such a simple message?

So, I left on my trip and while I was gone, I received the following response telling me that I had to call to tell them what I just told them in my message:

Palm Backup Info

Huh?

Notice that the bottom of the message contains my message to them. Considering that this was sent through a secure message center on their site, they had my credit card number, dates, and destination of travel right there.

Isn’t a secure online message more secure than a phone call?

Isn’t forwarding me message back to me in a normal email less secure than how I sent the same message to them in the first place?

Doesn’t Capital One have the ability to forward messages like this to a different department if necessary?

Capital One: What’s in your wallet?

Dishwasher Shopping Online is Not Easy

After shopping for a dishwasher online earlier this week, I’m thoroughly convinced that nobody is really taking this market seriously.

The two biggest problems I found were a lack of consistent specs, and no highlighting or differentiating or key features and benefits.

I ended up getting into this market after the motherboard fried in my current dishwasher (LOL, try saying that to someone 100 years ago) and it isn’t worth replacing.

I’ve decided that I’m willing to spend pretty much any amount on a dishwasher that I can justify since over the life of the product, it isn’t really that big of a difference.

So, I set out to research what’s available on the market. Home Depot is my first stop, where I drill down to standard size models in white. Then I’m stuck. There’s no good way to figure out the difference between a $300 and an $1100 model.

I then bounced around to other retailers, including Best Buy, Amazon, and Sears. Shopping.com provides a link to an article that actually helps explain some of the features available at different price points.

Over time, I get a feel for features:

– A heat booster seems to be a good idea since it will wash the dishes with hotter water without jacking up my home’s water heater.

– The quieter the better.

– A time delayed start sounds nice.

– EnergyStar compliant seems like a must.

– A built in garbage disposal that can grind up food I’m too lazy to pre-rinse off sounds like a time saver.

– A soap tub that lets you dump an entire bottle into the thing so the machine can handle things from there? Sounds cool.

– Stainless steel tub? Hmmm, does that matter?

I eventually figure out that dishwashers seem to hover in $200 incremental price points starting at $300 and working up to $1100. So, you think there might be an easy way to figure out which features are added with each price jump You’d be wrong.

Like I said above, I’m willing to spend any amount that I can justify, so I was simply looking for a site that would help me understand what I’m getting for every $200 additional I spend.

Where do the retail sites fail?

1. They provide product comparisons, but only of the most rudimentary specs.

2. They don’t tell you which specs are actually worth paying attention to.

3. They don’t standardize the specs into human friendly terms. For example, I don’t really care what GE’s trademarked term is for their soap dispenser system.

4. They don’t humanize specs. Should I care than one unit creates 57 decibels of noise while another creates 55? Would I even notice? Can I talk over that? Watch a movie?

5. They don’t debunk (or simply hide) specs that don’t matter.

6. They don’t explain what’s involved in installing a dishwasher. Is this something I should attempt to do myself (probably not). If not, how do I get it installed and what will it cost?

Overall, I don’t think any of the sites I looked through were designed with the consumer in mind. A consumer, in my case (and most) who rarely shops for appliances, so needs to be educated on what actually matters when making a purchase. Specs alone – even when consistently provided – don’t help tell the story of why higher price points are justified.

Cocktail napkin this stuff.

I imagine there are plenty of qualified dishwasher salespeople working for each of the companies mentioned above. Have them break down why one would spend more for a dishwasher at each of the key price points on a single cocktail napkin. Translate that into the web and they’ll have a winner.

Live Chat at Its Worst

Offering live chat on websites can be a great way to connect with customers, but like most tools, it’s only as good as the people using it.

Take, for example, a recent experience I had with Home Depot where I decided to use the live chat feature to get answers to a few questions that should have been included in their product listings.

Clicking the live chat link brought up this screen, where I was told a “Specialist” would be with me shortly:

Home Depot Live Chat

I waited. And waited. Like a phone queue, it occasionally repeated the hold message for my reading pleasure. I don’t remember how long it was between messages, but it was at least a couple minutes.

Mind you, I wasn’t staring intently at this chat window, since there are plenty of other distractions on my computer to help kill time waiting for Home Depot to care about the $800 worth of stuff in my shopping cart.

Eventually, I toggled back over to find this message waiting for me:

Home Depot Live Chat

My “specialist” Dineshia decided that, after holding for probably 15 minutes, that I wasn’t really interested in chatting?

Why did this happen? My guess is that Dineshia’s performance is measured based on completed chats, and possibly how fast chats are completed. Had Dineshia simple waited for me to respond his or her stats would have been skewed (but I would have gotten my questions answered).

In my opinion, this is a horrible use of live chat since the cost of waiting for my response is near zero. Unlike a phone call, a chat support person can manage many simultaneous conversations so keeping my chat live in the background would have been a better option from a customer support perspective.

This was not a technical problem, but a poor use of technology.

Make sure your customer support incentives are aligned with your customer’s needs to avoid situations like this.

Mining Product Recommendations from Google Search Results

Seth Godin think search engines still have a lot to room to grow when it comes to comparison type searches:

Seth’s Blog: The haystack

But they’re terrible at connections, at rankings, at horizontal results. They can’t help me find the 25 most important up and coming artists in the United States. They can’t help me find six products that are viable alternatives to something that was just discontinued. They can’t help me rank the service of four accounting firms.

He raises a good point. I get the impression that he expects Google to understand that a product-specific search for a product that’s discontinued should generate links to alternative products.

This is something Amazon does today. I’m sure comparison shopping sites handle it as well.

One area where it’s poorly done today is real estate, where most real estate sites today remove listings once sold rather than pointing people to related properties that are still on the market.

Using search engines, a person could run queries that generate relevant results as well. Try coming up with comparative phrases that may be mentioned on product review sites or blogs to generate appropriate search results. Here are a few suggestions to get you started:

“better than”
“replaces the”
“great alternative”

Terms like that – especially when used in quotes – do a great job filtering search results down to sites with opinions on products. Give it a try.

Reviewers Twice as Likely to Write Positive Reviews over Negative

Marketing Pilgrim has been on a user reviews kick lately as it pertains to
online retail and has come up with some really interesting nuggets. The crux of
the posts have been about whether user generated content on retail sites helps
or hurts business. Are people more likely to buy from a site that has reviews?
It looks like the answer is a rather easy to believe, “Yes.” But what about
negative reviews? Sure, they may hurt sales of some products, but providing
alternatives to the bashed product provides both a service, conversion, and
happier customer, so it’s a relatively simple issue to address.

Another concern that’s often raised is, “Aren’t people more likely to give
negative reviews?” Well, according to a JupiterResearch presentation by Patti Evans reported on for Marketing Pilgrim by Greg Howlett, that’s not the case:

Five
More Important Facts About User Reviews in E-tail

Customers are about twice as
likely to write user reviews about good shopping experiences than bad
ones.
Likewise they are twice as likely to write user reviews about
products they like than products they do not like. This is good news for
retailers and should help alleviate fears about user reviewers hurting
sales.

Huh? But doesn’t conventional wisdom say that people are
twice as likely to tell their friends about bad customer service experiences
that good ones? Doesn’t that apply to online retail as well?

Here’s my theory on this: People are more likely to TALK about bad experiences
they’ve had, but they’re more likely to WRITE about their good experiences. It’s
easy to bash a product or service to a trusted friend where you won’t be
challenged in a conversation between friends, but who’s really willing to
publicly bash a company, service, or product in public on the web? That’s a much
higher bar for negativity. Especially if you can’t do it anonymously (or in a
way that only your trusted friends could see).

Going negative – even when justified – has consequences.

Keep that in mind the next time you’re reading reviews for products online.