Customer Performance

Goals, Habits, and Behaviors

2012-01-02T15:58:00.000-08:00

An interesting piece on NPR morning edition today (1/2/12) on goals, environment, and behavior change. Key researchers interviewed are Jerome Jaffe, Lee Robins, Wendy Wood, and David T. Neal. Basically, while goals are a key driver of behaviors and behavior change, the performance environment plays a strong role in how behaviors are changed. If the environment in which the behavior or habit was learned/reinforced doesn't change, then it is likely the performance won't change either. Environment change can be as small has changing the hand you use to accomplish a task or as big as moving to a different country.

Fear and Graphic Labels

2010-09-19T10:45:00.001-07:00

Communication that influences customer performance relies on four key methods of framing: fear, pride, imitation, and gain. In Thailand, the government's fight against alcohol abuse has turned to using fear in its communications. Similar to the "Red Asphalt" drivers education movies that began in the 1960's (http://en.wikipedia.org/wiki/Red_Asphalt), Thailand is moving toward placing graphic labels on liquor bottles. The graphical labels are used to illustrate six types of messages, including:

Type 1 “Drinking alcohol causes the hypertension liver cirrhosis”
Type 2 “Drunk driving causes disability or death”
Type 3 “Drinking alcohol leads to unconsciousness and even death”
Type 4 “Drinking alcohol leads to sexual impotency”
Type 5 “Drinking alcohol leads to adverse health effect and family problems
Type 6 “Drinking alcohol is a bad role model for children and young people”

Examples of the policy and more graphical labels can be found at: http://www.puntofocal.gov.ar/notific_otros_miembros/tha332_t.pdf

Too Little Customer Education?

2010-09-12T13:12:00.000-07:00

The report investigating PG&E's smart meter program was released on September 2, 2010. While the report found the smart meters accurate, the consumer backlash associated with the program was connected to poor customer education and customer support. A presentation I attended at Smart Metering International (Sept. 8th) by Chris Villareal from the California PUC echoed these issues and provided additional insight into their rise. Additional details are in the WSJ 9/7/10 p. A5 and http://gigaom.com/cleantech/report-pges-smart-meter-tech-works-but-outreach-lacking/.

Rise in Co-designed Products

2010-08-28T12:46:00.000-07:00

WSJ (8/26/10 B5) reports that there is a rise in customized, made-to-order goods, ranging from custom mattresses, food, kids products, and even toilet paper. Typically, a website provides customers tools to co-design and customize the products.

Paying the Patient

2010-07-01T14:56:00.000-07:00

I just came across this great meta-analysis of positive and negative incentives that are used to motivate patient behavior across a wide range of behavioral health issues: diet, smoking, STDs, and so on. A quick summary:

The most successful schemes are positive incentives tied to small behaviors.
Lottery-style incentives appear to increase recruitment and participation (smoking cessation, weight loss), but there was significant relapse when the incentives were removed.
The greater the lottery reward, the greater the participation.
Incentive amount is relative, based upon income level. Lower income = lower incentive needed to simulate behavior.
Incentives that focus attention on the reward, and not the behavior, have limited long-term benefit/persistence.

You can find it at: http://www.wpro.who.int/NR/rdonlyres/BCC2F5C3-B685-4FF1-AE77-39C52F4ED247/0/payingthepatient.pdf

Twitter tracking of customer complaints

2010-06-30T13:59:00.000-07:00

WSJ 6/24/10 D1 discusses how hotels are using Twitter and other social media tools to capture and respond to customer complaints. The scenario is that a customer checks into a hotel and complains about some aspect of the experience via Twitter. Hotel employees are monitoring such tweets and respond appropriate. This is extended to how businesses monitor and respond to online complaints associated with such sites as TripAdvisor.

Paying to avoid punishing conditions

2010-06-28T13:50:00.000-07:00

Airlines have started introducing fees that allow customers to buy their way out of the unpleasantness of travel. Southwest Airlines is offering "Early Bird" check-in, which costs $10 and enables the customer to jump ahead in the boarding group A, B, C pecking order. American Airlines is offering something similar, with prices ranging from $9 to $19, which enables customers to board the airline before regular coach customers. Such fees may evolve into special pricing for a bundle of services, such as Family Plans for families traveling together. See WSJ 6/24/10 D1.

Suntan performance

2010-06-18T12:43:00.000-07:00

An interesting product recently came on the market to help customers determine when they've had too much sun. UV-Sunsense is a band one wears around their wrist, which changes colors indicating the duration one has spent in the sun. Product is discussed in the WSJ, 6/15/10 D3.

Customer Service Growth

2010-06-08T07:13:00.000-07:00

The Wall Street Journal reports that customer service is a growth engine (6/7/10, B6). Essentially, some organizations, including American Express, Walgreens, and Comcast, are giving customer service representatives more flexibility in handling customer problems. For example, companies are relaxing standards on "call times" and reducing reliance on scripts. The objective is better customer relationships and increased loyalty.

There is a catch to the above article, that may reflect the WSJ's increasingly blurry line between editorial and advertising. On the preceeding two pages (B3 and B5), there were large ads for Tony Hsieh's book on Delivering Happiness, which is all about redefining customer service. Hmmm...hit the reader with two ads for a book on customer service, then run an article about how customer service is a growth engine...something doesn't seem right.

Smog Squad

2010-06-05T07:38:00.000-07:00

The city of Hong Kong has an interesting solution to reduce auto and truck polution in its city: the smog squad. The smog squad is a specially trained group of volunteer citizens who spot vehicles that are emmitting too much smoke and then report them to the authorities. (WSJ, 6/5/10, A1 - The Smog Squad of Hong Kong).

Cellphone Pricing to Modify Behavior

2010-06-04T07:23:00.000-07:00

I discussed AT&T's plans to use new pricing strategies to gate unlimited cell phone bandwidth usage (see December), and now that has become a reality. In June 2010, AT&T announced that it would stop selling unlimited plans and instead charge extra for data consumption that exceeded a certain amount (WSJ, 6/4/10, B6 - AT&T Pricing Shift Will Test Behavior).

This decision reflects the Incentive component of the Coproduction Experience Model in that the pricing plan now includes a punishment (increased costs) for the use of bandwidth beyond a certain amount. AT&T claims that such a policy will limit bandwidth hogs who download TV shows to their iPhones (or at least more fairly charge bandwidth hogs for their use of a limited resources).

AT&T's policies are very similar to what is happening in the utility industry, where dynamic pricing of electricity aims to reduce consumption on peak days, and therefore increase reliability of the electric grid (and reduce the need to build new generation capacity).

Automation, Information, Pricing and Smart Meters

2010-05-20T07:32:00.000-07:00

A nice article about smart meters appeared in the 5/19/10 issues of the Wall Street Journal (A6 - Electricity: The New Math). It tracks the current installation statistics of smart meter deployments and discusses the nascent transition to dynamic pricing of electricity. As I've written about before in this blog, smart meters are the core technology for enabling much of the Coproduction Experience Model with regards to customer performance associated with managing electrical usage and costs.

Incentives to Cut Usage

2009-12-12T13:10:00.000-08:00

An article published in the WSJ, 12/10/09 B10, discusses an AT&T plan to offer "incentives" that motivate customers to cut back on usage. The problem seems to stem from iPhone users, who consume five to seven times the data as an average subscriber. The incentives may take the form of tiered pricing (which is similar to how California utilities charge for electricity), or by "throttling" a person's connection if the usage hurts nearby users. Also, AT&T indicates that they would provide users more feedback on data consumption, to address the fact that customers don't know how much data they are using.

Southwest Inconsistency

2009-07-23T20:58:00.000-07:00

Southwest Airlines recent media campaign has been very effective in differentiating itself from other airlines, essentially calling other airlines "onerous" policies such as fees for bags, food, drinks, and other things "ridiculous." It's because of these ridiculous policies that I've become a very loyal Southwest customer - these days I fly Southwest exclusively.

But tonight I experienced one of the most ridiculous policies ever with Southwest. I was flying from Chicago to Reno, with a connection in Las Vegas. I arrive Las Vegas at 8:15pm. My scheduled flight to Reno is at 9:50pm. However, I discover that there is an 8:55pm flight to Reno. So I go to the gate. I ask if there are seats available. Sure, the agent says, but it will cost me $143.00 extra. What?!?!? Then he tells me that if my 9:50pm flight is 15 or more minutes late, then he can put me on the earlier flight without charge - but my 9:50pm flight is only 5 minutes late at this time. So no can do. So we're at the point of arguing over 10 minutes. You gotta be kidding me.

Now, SWA has conditioned me that if I want to take an earlier "originating" flight, I have to pay extra if I have a discounted ticket. I'm fine with that. That is reasonable. However, extending this policy to a connection that I had no control over (as it turns out, the 8:55pm flight is an "illegal connection" because it is less than 45 minutes from the arrival time of the previous flight -- that's why swa.com didn't include that connection when I booked) is stupidity in terms of brand consistency.

So now I'm cooling my heels in Vegas, with nothing to do but flame SWA for their ridiculous policy. And this is after my I watched my business partner (three weeks ago) do what I tried to do successfully as he connected from Chicago to Vegas to San Diego.

Increasing Preference for Self Service

2009-07-19T06:57:00.000-07:00

Research by NCR suggests that customers prefer doing business with companies offering self service. According to a news release, the survey’s results show that 85 percent of global consumers, and 79 percent of Americans, are more likely to do business with companies that provide multichannel self-service via a mobile device or at self-service kiosks. The survey’s results suggest consumers prefer the flexibility of self-service as they change their purchase decisions and behavior in the midst of a challenging economy.
http://kioskmarketplace.com/article.php?id=22683&na=1&s=2

Grandma DTV Customer Education

2009-07-17T17:36:00.000-07:00

I was at an innovation session yesterday to generate some creative ideas for customer experiences and customer education regarding customer adoption of new technology. The facilitator started the session by playing this video: http://www.youtube.com/watch?v=7w34nNux4Xw.

The message was clear - we're not going to be designing an experience like this.

Aria Nuances in Chicago

2009-07-15T18:44:00.000-07:00

After getting a great deal to stay at the Fairmont hotel in Chicago, I decided to eat in their restaurant called Aria. When I entered the restaurant, the hostess greeted me, asked if I was a guest, and took my name and room number. Then something strange happened. As she was about to lead me to my table, she asked if I would like a magazine. Huh? I said no, and indicated I had my own reading (notes from a meeting), and we proceeded to walk to the table. As we walked, I ask her, "Did you ask me if I wanted a magazine because I was eating alone?" "Yes," she replied, and we discussed a bit about why she was trained to do that as part of the customer experience, which to me was a brilliant deduction by the designers. After all, what is more awkward than eating alone and having nothing to do.

The food and service was very good, and I began to notice other things. The service staff seemed to walk at a very measured, relaxed pace. It was a very odd gait, but it essentially had an effect of slowing the whole place down and providing a more relaxed atmosphere. I couldn't tell whether the service staff was on drugs, or if it was part of their training to enhance the nuance of the experience - to bring a calm to the environment. If so, very cool.

The Cheese Shop

2009-07-11T17:28:00.000-07:00

On a recent visit to my brother in Philly, I ventured into a cheese shop in Chestnut Hill. Of course, the Monty Python sketch about the Cheese Shop with no cheese was ringing in my head, but I avoided the temptation slip into my closet John Cleese attitude. My brother and I bought some cheese, had a glass of wine, and noticed a funny sign by the cash register that read, "Customers on cell phones will not be served." Of course, I inquired about the sign. After all, my students a semester or two ago did a great piece of fieldwork on how other customers and stores normalize devient customer behaviors. So I asked the clerk to explain.

"If a person is talking on a cell phone, we don't serve them," said the clerk. "I had one woman talking on her phone pointing frantically to the cheese she wanted. But we cut and slice the cheese to order. So she can't tell me what she wants. So I go help other customers."

An interesting example of how a store creatively uses subdued punishment to norm customer behavior and get customers to perform.

Transformative Consumer Research

2009-06-28T07:02:00.000-07:00

The Association for Consumer Research (ACM) has started a database of literature related to transformative consumer research for individual, societal, and ecological well-being.

http://www.acrwebsite.org/tcrdb/default.asp

Anti Smart Meters

2009-06-01T15:34:00.000-07:00

Rebecca Smith's WSJ article (4/27/08, R5,7) provides an alternative view on Smart Meters and feedback devices and whether or not they will really save customers money. The primary challenge is that smart meter systems cost to much money (for customers), and that the cost of programs will wipe out the benefits.

Low-Key, Non-Emotional Messges More Memorable?

2009-05-15T15:37:00.000-07:00

NIH today released the results of a study that show that low-key, factual anti-smoking messages (rational) are more memorable than attention grabbing messages (emotional). Study was done using MRI and neuroimaging. Details are at http://www.nih.gov/news/health/may2009/nida-15.htm

Training Brain Performance

2009-05-15T15:30:00.000-07:00

An interesting article about conditioning related to incentive programs that help train the brain to change behaviors and performance (WSJ 4/28/09, D1,3). It is all about different kinds of incentives, such as lotteries, deposit contracts, and financial incentives.

Key to this article is a report of a GE stop smoking program that offered workers $750 to stop smoking. 847 employees participated.

Customer Education Games

2009-05-14T15:54:00.000-07:00

Here's an interesting twist on customer education in terms of enabling customers to recognize that they might potentially have a need for a good or service. ARS Ready Rooter's Energy Challenge game asks questions about various energy efficiency measures related to different parts of a home. See http://www.arsenergychallenge.com/

On the plus side, it help me connect (although not immediately) a need I might have to ARS's services. On the minus side, the feedback I get when I select the wrong answer is condescending and treats a potential customer like they are stupid. From a customer experience standpoing, kind of makes me apprehensive to call them for service -- will their field service techs treat me like I'm an idiot?

The better solution would be to make the feedback initially constructive and helpful. For example, instead of feedback saying, "You can't be serious," a better approach would be something along the lines of, "A lot of people incorrectly think this. ARS can help get you the right answers."

ITunes Gift Card PITA Factor

2009-05-09T17:20:00.000-07:00

My son recently purchased an Apple ITouch mp3 player. Today he got a gift card (first one) and came to me trying to figure out how to activate it (he's a smart kid, and had quickly figured out how to use the ITouch when he purchased it). On the back of the card was a set of four steps. The third step was to enter the code shown.

Which code would you enter? Well, there are three "codes" shown on the card - the one below the barcode, one on the lower left, and one on the lower right. Entered them all, none worked. So much for Apple's intuitive user interface and specific instructions.

So we did what any self-service customer would do, which is to find some help online. After exploring a few links, we came across this page and picture:

This solved our problem instantly and my son was able to register his card and start spending. What we can't figure out is why the instruction shown in the above example isn't integrated into the card itself (in our book, we call this an Embedded Tool). If Apple had to devote a page on its website to communicate this simple action (even lottery cards have this instruction), it seems logical that lots of other people are having this problem.

Anyway, we've now passed through the learning curve so usage of future cards will be easy. But the first experience was a pain in the ass (the PITA factor) and is very inconsistent with Apple's easy-of-use experience promise.

Energy Feedback and Value

2009-05-07T17:41:00.000-07:00

This past week I attended the Utility Energy Forum conference held at Lake Tahoe. One of the more interesting presentations was by Bruce Ceniceros of the Sacramento Municipal Utilities District (SMUD). SMUD has been testing Positive Energy's paper-based energy feedback product in a controlled experiment. 35,000 randomly assigned customers are receiving the Positive Energy feedback, and 55,000 customers are a control group.

The results Bruce presented indicate that overall reduction in energy usage is about 2% (treatment group compared to control group). Although Bruce didn't present specific facts or numbers, my subsequent discussion with him suggested that the $1 million investment in the Positive Energy solution had a positive benefit of about $2 million (the math formula was a bit fuzzy here for me, so I can't do justice in explaining it -- so for now we'll need to take Bruce's word). Also, no data was presented with regards to overall customer savings on their bills -- which I think is another way of assessing the value of the $1 million investment for 12 months. So, let's try a simple hypothetical: ((35,000 customers x $100 average bill) x 12 months) x 2% = $840,000.

The point I am making is whether enhanced feedback has value. Given the hypothetical illustrated above, the answer is "no" for the first year if customers had to pay for the feedback (which they are not). Yet what we don't know if those savings will persist in subsequent years, and whether if SMUD continues to invest in this feedback whether we'd continue to see reductions year after year (the law of diminishing returns might come into play).

Anyway, it is good to see that feedback has impact, but the program is missing one significant theory-based element that is inconsistent with the Coproduction Experience Model and previous research: that of goals. The PE report doesn't include a goal. It just shows the social norming data (which if you want to stretch things could be considered a goal). Now Bruce did report that a hundred or so postcards with various goals (5%, 10%, 15%) were sent to some subjects (about 200), but the details on this were also fuzzy.

Another interesting fact about the study is that about 3% of customers called, emailed, or wrote to opt-out of the program.

I've emailed Bruce to get some more details, and will update the post as I learn more.

Enabling Annoying Customer Performance

2009-05-01T15:26:00.000-07:00

It seems that "hypermilers" - people who drive in such a way to increase MPG, are driving other drivers crazy (WSJ, 4/17/09 A9). The interesting thing about this is that car manufacturers are installing devices in cars that aid this kind of driving, such as Nissan's "eco-pedal", which provides the driver pressure-based feedback when stepping on the gas too hard. Additionally, customer education has sprung up to teach people about "eco-driving."

Smart Meters a Dumb Idea?

2009-05-01T13:39:00.000-07:00

I've been working on the customer behavior side of smart meters for a couple of years now, and most of the press has been pretty positive. A 4/27/09 WSJ article (R5,7) by Rebecca Smith questions whether smart meters are a dumb idea. The angle of the article is on the cost of installing the smart meters, and that utilities will charge customers for the meter (guess what, utilities have been charging customers for the mechanical dumb meters for years now).

While colleagues have blasted this article from an economic perspective, I've reflected on it from a behavioral perspective. A speaker at a conference I attended said, "If you think feedback isn't important, just count the number of mirrors you have in your home." People thrive on feedback. It is the primary driver for helping people improve their lives. While the recipe for saving energy is relatively simple -- turning things off -- the question really is when and what we turn off so that we maintain a level of comfort. Energy waste is the villian here, and smart meters, as a core technology for enhancing a coproduction experience of vision, access, incentive, and expertise, is one of the more valuable solutions to come around in a long time to help us be better consumers.

Feedback and Energy Consumption

2009-04-25T13:58:00.000-07:00

I came across this interesting paper by Sarah Darby on feedback associated with energy use. A good overview of the research and methods, with lots of good references to the core literature. See http://www.eci.ox.ac.uk/research/energy/electric-metering.php.

Embedded Expertise

2009-04-15T15:23:00.000-07:00

WSJ, 4/10/09, W13, has an interesting article about embedded instructions/education in machines and devices -- essentially machines that talk to you to help you accomplish tasks. The driver is that people are searching for other channels of communcation from devices rather than just staring at a screen.

Embedded Customer Education

2009-04-10T07:20:00.000-07:00

An interesting WSJ article (4/10/09, W13) by Christine Rosen explores "Machines That Won't Shut Up," an essay on the plethora of new technogies that are embedding speech, or even text-to-speech capabilities. The purpose of this embedded speech is not only educational (in terms of the machines explaining how something works), but performance-oriented as well, such as reading your email, notifying you of tasks. Regarding their usage in cars, the author suggests that these devices pose a significant distraction hazard, even if they are "hands free".

This article reflects the customer expertise model in our book, in terms of Embedded Tools, in which expertise is embedded in products in the form of textual, visual, or auditory prompts.

Car Disabler

2009-03-26T12:53:00.000-07:00

An interesting twist on Vison and Incentives reported in the WSJ, March 25, 2009, p. D1. Some auto dealers have been installating "disablers" in the cars they sell and finance. If a customer is late on a loan payment, the disabler notifies the customer and counts down the days until the car will be automatically disabled. Car lot owners indicate it works so well that customers rarely miss payments. The loss of mobility is a strong incentive (punishment).

Stakeholder Workshops

2009-03-06T07:46:00.000-08:00

In March, I was invited to speak at ComEd's AMI Future stakeholder meetings, a series of workshops facilitated by Plexus Research/RW Beck that collect the community's requirements for smart meter systems. I spoke specifically on the customer experience/customer behavior aspects of smart meter systems.

What I want to point out is that these stakeholder workshops are a direct example of one of the First Principles I discussed in my October posting -- that of 1. Embrace customer-centered design. Bringing the different stakeholders together prior to writing the business case and regulatory filings strongly reflects the customer-centered design principle at a mega level.

Customer Experiments

2009-02-26T12:29:00.000-08:00

The February 2009 issue of the Harvard Business Review includes a nice article on designing business experiments ("How To Design Smart Business Experiments). Lots of the examples deal with customer performance issues that look at testing innovations. This article connects well with our work on customer performance issues associated with the Smart Grid (smart meter systems), in terms of research and experiment recommendations we're making.

Incentives Reduce Smoking

2009-02-12T06:05:00.000-08:00

The WSJ (Feb 12, 2009, p D1) reports a New England Journal of Medicine study in which smokers paid to quit smoking were more successful than smokers who were not paid. From a customer performance standpoint, this piece of research links directly to the Incentives component of the coproduction experience model.

Treatment group subjects received $750 in cash, spread out through multiple payments that encouraged long-term behavior change.

Customer Needs and Jobs

2009-02-06T16:46:00.000-08:00

An interesting twist on customer performance, which relates to the "understanding" aspect of our coprodution experience model is that of customer needs. Bettencourt (Marketing Management, Jan/Feb 2009) has an interesting take on customer needs, looking at them from a job perspective. As a job, there is a goal or problem the customer wants to solve, with specific outcomes they desire. This view is consistent with the chapter on Vision in our CDIYC book.

However, they way these "jobs" are portrayed are very rational -- the job that needs to be done. But what about the emotional? I exchanged email with the author to investigate this further.

PCH: Your article forms a clear argument for what I’ll call “rational customer needs” – the job and outcome – and is well done. However, I’m unclear about how you are addressing “emotional customer needs”. For example, I might define a rational need for a residential customer as, “Reduce my greenhouse gas emissions by 2% per year.” Clear job and outcome, consistent with your formula, precisely measurable). However, an emotional customer need, such as, “Lead a low carbon lifestyle” or “Possess cool, designer technology” is much different (it has those imprecise, subjective words, but more accurately describes the “feeling” the customer wants).

Lance: Although not reported in the Marketing Management article, we also capture emotional jobs – feel this way, be perceived this way. Although this is true, I believe that at least one of your “emotional” job statements is actually quite functional – though it may have an emotional/value-driven motivation. Thus, I would say that “Lead a low carbon lifestyle” is very functional, and might even be recorded as “Leave a small carbon footprint” which makes this more evident, whereas be perceived as caring about the environment (perhaps an underlying emotional motivation) is the true emotional job. In a similar way, someone might be tempted to say that a job such as “Find a person to marry” is an emotional job because it has such a strong personal component. However, I would disagree. Such a job is highly function even though it resonates on an emotional level because people want to “avoid feeling lonely” or “feel loved.” I agree that it is hard to say which comes first, though we both agree that they are definitely related. My personal belief is that emotional jobs and values are key drivers of the relative importance of different jobs and the priorities of outcomes on getting a job done. In reverse order, satisfaction of functional needs is a means of satisfying the emotional/value ends – consistent with means-end laddering.

Customer Relationship Types

2009-02-03T12:41:00.000-08:00

We've been doing some work recently on helping a client redefine its relationship with customers. Another model we've come across that aims to "classify" types of customer relationships is one in the Jan/Feb 2009 Marketing Management article by Slater, Mohr, and Sengupta. It creates four types of customer relationships: True Friends, Butterfiles, Barnacles, and Strangers (based upon customer value).

Stories as Emotional Drivers

2009-01-28T12:35:00.000-08:00

Our upcoming chapter in the book Memorable Customer Experiences (Gower Press) called "Balancing Act" looks at the balance between rational and emotional customer experiences. Wachtman & Johnson's article in Jan/Feb 2009 Marketing Management offers an interesting perspective on the emotional side of a customer experience, in terms of the use of story as a means of communicating the emotional side of a brand. The connection here is trying to blend a customer's personal story with the company's story. We've been investigating this in one project in terms of the customer's desired "lifestyle" as the root source of customer's emotional needs.

Social Norming Feedback

2009-01-09T17:10:00.000-08:00

Here is a link to an NPR Marketplace piece on 1/6/09 discussing a pilot by Puget Sound Energy on providing feedback comparing your energy usage with your neighbors. Essentially, peer pressure. No results published yet, but an interesting increase in complaints to the call center about the program -- all of which were negative. Yet in the end, only 19 people opted out (which is the right thing to offer customers -- that choice thing).

Customer Performance in a Ford Fusion Hybrid

2009-01-06T17:14:00.000-08:00

Recent article in the WSJ, 1/6/09, p. D6 discusses customer performance issues with the Ford Fusion Hybrid. Essence of the article is that the reporter, test driving the car, couldn't achieve the MPG claims made by Ford. The reporter writes, "But Ford's biggest challenge will be educating consumers how to get the most value from their high tech cars." Ultimately, the reporter got a personal tutorial from the Fusion Hybrid program leader, who showed him all the tricks on how to drive the car to achieve the promised mileage.

First Principles for Smart Meter Experiences

2008-10-12T07:35:00.000-07:00

As the world undergoes a radical transformation in gas and electric energy usage through the installation of smart gas and electric meters (which enable real-time usage and energy pricing information/feedback), key stakeholders (regulators, utilities, technology vendors, appliance manufacturers) need to think about how to design the customer experience.

As I mentioned in my last blog, my participation in the energy efficiency workshop at Stanford's Precourt Institute triggered some key conclusions that I presented on the closing panel discussion. I've dubbed these principles "The First Principles", since they are what designers of the new utility customer experience should think about first.
1. Embrace customer-centered design
2. Blend rational and emotional experiences
3. Engage customers in small, observable steps of adoption
4. Segment by observable customer actions
5. Use action research to drive emergence and evolution of solutions

Feedback for Energy Efficiency

2008-09-08T10:39:00.000-07:00

Last week I attended a workshop at Stanford sponsored by the Precourt Institute for Energy Efficiency. One of the more frequent topics presented was methods of providing feedback, which reflects the Vision component of the coproduction experience model. Numerous presenters discussed their systems and pilot test results. These included:

Positive Energy
Green Box Technology
IDEO
Widefield Technology
Echelon
General Electric Energy
Itron

The competing ideas and solutions had similar characteristics: rich graphic design, layered/elaborated information, normalized comparisions ($, kWh, C02, MPG, and so on), and expert advice on how a household could become more energy efficient. However, there wasn't any discussion on the cost of these solutions, which is important since customers will ultimately pay for these services. The key question is whether these information services provide customers a reasonable ROI.

Evidence-Based Goals

2008-07-05T11:11:00.000-07:00

I'm doing some work for the National Institutes for Health on disseminating behavioral innovations related to reducing substance abuse. One of the interesting pieces of content we're using is the evidence-based standards for how much alcohol one can drink.

Men, under 65: 14 drinks per week, no more than four in any one day
Women, and men over 65: 7 drinks per week, no more than three in any one day
Pregnant women should drink alcohol at all.

From the viewpoint of our coproduction experience model, these standards act as evidence-based goals (Vision) for driving customer performance. I happen to think that this is one of the more persuasive means of establishing goals for important behavioral changes - using research to establish the goals.

Balancing Act: Memorable Customer Experience

2008-06-14T11:00:00.000-07:00

Roy and I just put the finishing touches on a chapter that will be appearing in the forthcoming book, Memorable Customer Experiences. Our chapter, titled Balancing Act: The Impact of Rational and Emotional Designs on Memorable Customer Experiences, explores how rational and emotional experiences work together to create great customer experiences. A new contribution offered by this article is the Memorable Experience Model, which from a design perspective illustrates the outcomes when the rational and emotional elements of a customer experience are in (or not in) alignment.

The book, which should be published in 2009, is edited by Adam Lindgreen, Joëlle Vanhamme, and Michael Beverland, and published by Gower Publishing in the UK.

Symbols and Customer Performance

2007-12-10T16:23:00.000-08:00

While doing some research today on totally unrelated tasks, I stumbled upon a 1967 article from the journal Science. It is by two gentlemen, Charles Baldwin and Robert Runkle, and describes their development of the biohazard symbol. The symbol was the product of an obvious customer performance problem, keeping humans safe from biological health hazards.

From the perspective of the coproduction experience model, symbols like this would be best classified as Access:Information, as they aid customers in making decision about products and environmental spaces.

DriveCam Provides Customer Feedback

2007-12-08T13:40:00.000-08:00

I just came across this technology called DriveCam. It provides a "big brother" feedback system for drivers. In addition to fleet services, the company has partnered with American Family Insurance to provide a free program for teenage drivers.

This is an excellent example of a technology-driven solution that addresses part of the Vision component of the coproduction experience model -- feedback. While the market for fleet services is obvious, I'm wondering how many folks on the customer side of things would sign up for this service. While it provides great feedback for coaching good driving performance, it also provide pretty strong evidence of your guilt if your driving actions caused injury or death. But on the other hand, it is clear from the information on the company's website that it can also provide evidence of your innocence as well.

Southwest Airlines Boarding School

2007-11-20T13:01:00.000-08:00

On November 8th, 2007, Southwest Airlines changed is bording process. This is a great example of the coproduction experience model in action. Everyone should check out the Expertise element of this system by visiting http://www.southwest.com/help/boardingschool/. Very creative instruction, with a reward to boot.

Capital One Card Lab

2007-11-05T07:33:00.000-08:00

Here's a new angle on coproduction. Capital One credit cards is offer the "first ever" do-it-yourself credit card offer. This four-step process engages customers in choosing a credit level, choosing features and rewards, picking the card design, and applying.
http://www.capitalonecardlab.com/

RFID In Shopping Carts

2006-11-05T10:32:00.000-08:00

The Muskegon Chronicle reports that Meijer grocery stores in the Michigan area will be testing whether RFID chips in grocery carts and speed customers fast through check-out. The system tracks how many carts are in the check-out area, tiggering management to increase staff in the check-out lanes.

Do-it-yourself Consumer Education

2006-10-26T12:43:00.000-07:00

On October 24, 2006, the WSJ reports that numerous sites on the web are featuring short educational programs on a wide variety of consumer topics, from brushing your teeth to folding a shirt. These programs are produced by everyday consumers and are featured on the following web sites:

I find these programs interesting in that consumers, not necessarily companies, are producing these programs to share what they know about goods and services. It is a radical change to the consumer/customer education landscape, which puts companies in the position of having less control over teaching customers how to use various goods and services. Through inexpensive video cameras and computer-based editing tools, anyone can become an instructional designer and share their knowledge and expertise. The key problem, however, will be how will one search for and find the education that they are looking for.

Status Skills

2006-09-18T21:01:00.000-07:00

A September 2006 posting on trendwatching.com sheds light on the coproduction-drive called "Status Skills". The article discusses the trend of "status skills", which are skills customers acquire related to specific goods or services. For example, if you buy a Mini Cooper, you can take a course for EU 325 that will teach you how to drive it. If you buy an Apple computer, you can go to an Apple Store to take a free course to learn how to manipulate mp3's.

The link to customer experiences is that companies are creating add-on experiences to support full usage of their goods and services. They are also developing a community of like-minded customers who become further "walking advertisements" for the companies.

For a peek at the trend, see http://www.trendwatching.com/trends/status-skills.htm

Toilet Paper Experience

2006-09-13T09:09:00.000-07:00

Flipping through the Sunday circulars this weekend uncovered an interesting twist on coproduction experiences. Cottonelle, a toilet paper, markets itself as helping kids learn how much toilet paper to use (a problem any parent has). The toilet paper has printed on it "puppy tracks" leading to an image of a puppy engaged in some sort of interesting activity. The message: when you see the puppy, tear off the paper.

Check it out at: http://www.cottonelle.com/products/kids.asp

Self service a dis-service?

2006-05-04T11:52:00.000-07:00

Here's an article that investigates the light and dark sides of self-service and coproduction, and the new technologies and places where we'll be seeing self-service gain new footholds.

http://www.philly.com/mld/inquirer/business/14460831.htm

Another Reason To Do Real Estate Yourself

2006-04-30T10:39:00.000-07:00

If you have not checked out Zillow (http://www.zillow.com/), I encourage you to take a test drive. This site puts significant power into the hands of the consumer to do real estate transactions themselves. For years, Multiple Listing Services has kept realtors in the driver's seat when it comes to collecting information about properties. Now, consumers can bypass the realtor completely and perform their own research and due diligence online. From price histories of homes to birds-eye snapshots of properties, Zillow is quite amazing. Try it out today to see what your own home is worth, and what your neighbor's homes are worth. The ultimate nosy neighbor tool :-)

Sing-A-Longa Sound of Music Experience

2006-04-10T10:45:00.000-07:00

Talk about an innovative coproduction experience. During a recent trip to London we came across an interesting diversion. At the Prince Charles Theatre in Leicester Square, they schedule Sing-A-Longa's, musical movies that demand audience participation. We stepped in to see the Sound of Music, paying 13.50 pounds to see a has-been re-run movie that you could rent for a buck. Obviously, there is value in the experience (and the show was sold out as well).

But the show had all the elements of a coproduction experience - vision, access, incentive, and expertise. In each seat there was a bag of props to use during the show (access:tools), that included picture cards, an invitation to the Captain's ball, a piece of drapery, and a a new-years-eve popper. To start the show, a extremely funny female impersonator lead the audience through a number of activites. First, she (he) told us what we should be doing as audience members in terms of our involvement (vision). Next, she taught us how to use the props in the bag (expertise). Then there was the parade of "fancy dressers" (people who come in costume) and a drawing for a bottle of champagne (both of which would classify as incentives). The picture below is the female impersonator introducing all the fancy dressers.

The show was a riot. We sang along, heckled the Baroness, hissed the Nazi's, and set off our poppers when the Captain kissed Maria for the first time. The customers, of course, performed perfectly.

Monitoring Your Vehicle's Performance

2006-03-17T08:01:00.000-08:00

OnStar, the GM service that provides information services to GM vehicle owners, has introduced yet another services that enhances customer performance. It is called OnStar Vehicle Diagnostics. This service provides owners of GM vehicles a monthly email that contains a diagnostic report about their vehicle. The report assesses the engine, air bag, brakes, oil life, and mileage, and makes recommendations when these items should be checked and/or serviced.

This kind of service reflects the Vision component of the Coproduction Experience Model, and is a creative way of providing feedback to customers.

Do-It-Yourself Cuts Airline Workers

2006-02-19T08:19:00.000-08:00

USA Today, 2/19/06, reports that do-it-yourself systems adopted by the nation's airlines (such as online reservations, online check-in, and self-service check-in kiosks), have reduced airline workforces. Over a four-year period (2000-2004), the number of airline workers dropped by 111,000, while the number of airline passengers rose by 33 million passengers. The article quotes veteran travelers as relishing the self-service systems, since it reduces long lines and avoids impersonal customers services.

Setting Expectations for Surgery

2006-01-12T10:31:00.000-08:00

Hospitals and doctors are providing their patients with interactive educational programs that explain procedures and describe the risks associated with certain procedures (WSJ, 12/14/05, D5). These web and CD-ROM programs, collectively known as Expectation Management and Medical Information (EMMI) programs, are offered by thousands of health care facilities. Primary motivation for these programs is reduction of medical malpractice claims, and insurance companies are offering health care facilities policy discounts for using these programs.

NextBus

2005-12-04T20:42:00.000-08:00

In my marketing class at University of Nevada, Reno, a group of students has been doing a project on transportation information systems. One of the cool things they found was a new service called NextBus (http://www.nextbus.com).

What this service provides is real-time bus arrival time information to passengers through a variety of media (Web, PDA, Cell Phone, etc.). Thus, if you commute by bus or other public transportation, you can determine when the bus you take will arrive at the stop, and you can plan your departure appropriately.

This is a great example of the Vision component of coproduction experiences. This service clearly sets customer (rider) expectations as when their bus will arrive, making the experience of taking public transportation that much more satisfying. Gone are the days when you ask yourself, "When will that darn bus be arriving!"

Confounding Buffet

2005-10-21T12:55:00.000-07:00

I was at the Kiosk and Self Service Conference in SF last week, where we gave a presentation about coproduction experiences for self-service. A great session I attended was by Kerry Bodine of Forrester Research. She was talking about environmental aspects that afford great kiosk experiences. She introduced her presentation with a very funny article from The Onion: Area Man Confounded By Buffet Procedure. A great satire on the world of coproduction experiences and customer performance.

Persuasive Messages for Customer Performance

2005-10-11T14:54:00.000-07:00

This past weekend I attend the Frontiers in Services conference at Arizona State, sponsored by the Carey School of Business. The plenary speaker on the last day was Robert Cialdini, professor at ASU and author of the best-selling book, Influence: The Power of Persuasion.

Cialdini presented the results of a recent study in which he was investigating customer performance in relation to reusing towels in hotel rooms. In his experiment, he tried three messages:

1. Help Save The Environment
2. Partner With Us To Save The Environment
3. Join Your Fellow Guests In Saving The Environment

The first message resulted in 38% compliance. The second message resulted in 33% compliance. The third message resulted in 55% compliance, which was a significant difference. Why?

The words one uses have a big impact on customer performance. In the third message, Cialdini relies on the principle of social proof (other people are doing it -- why not you) as the key driver for getting customers to perform.

In a follow-up experiment, Cialdini combined the first and second message: We're Doing Our Part. Can We Count On You? This combination better activated the principle of reciprocation, and resulted in a compliance rate of 50%.

A new hotel coproduction experience

2005-09-06T08:20:00.000-07:00

Last evening I checked into the Crowne Plaza at the LA airport. No self check in, unfortunately, but another surpise awaited me.

As I exited the elevator on the 14th floor, a sign informed me that this was a quiet floor. It described that no children, marching bands, or other noisy guests were to be assigned to this floor. It also suggested how I should conduct myself to contribute to the quiet nature of this floor.

Upon entering my room, I noticed something on the bed. It was a CD and a mesh bag containing an eye shade, ear plugs, and lavender-scented sheet spray. The CD packaging provided ideas and tips for getting a good night sleep. The CD player in the room was open -- as if asking for the CD. There was also a clothespin-like device by the curtains -- so I could ensure the curtains would block out all the light. All this was branded under Sleep Advantage(tm).

I played the CD, which contained a sleep specialist leading me through some relaxation exercises (two tracks), then continued with some of the most peaceful music I've ever heard. I believe I fell asleep before the CD ended.

This has all the elements of a well-designed coproduction experience. Vision was set when I arrived at the floor. Access was provided by the tools and nuances I found in my room. Expertise (in falling asleep, that is) was built by the sleep specialist on CD. Incentive? If they didn't give me a wake-up call I'd get the room for free.

Radical DIY for Hybrids

2005-08-15T18:39:00.000-07:00

Radical do-it-yourself customers go to extremes to customize goods and services. A recent AP news story by Tim Molloy (8/14/05) tells the story of Ron Gremban, an electrical engineer and environmentalist. Mr. Gremban has modified his Toyota Prius with 18 more batteries that enable him to achieve 80 mpg.

The article goes on to describe Toyota's initial resistance to such "tinkerers", not wanting them to alter the hybrid vehicles. However, Toyota now seems that these "codesigners" might provide ideas and know-how for enhancements.

The question that we can derive from this story is what should your company's policies be with regard to radical do-it-yourself? Is it embraced? Resisted? How do customers communicate their radical explorations? How do companies learn about them?

Customers Helping One Another

2005-08-07T20:00:00.000-07:00

An interesting approach that provides a strong foundation for DIY customers is to establish communication channels that enable customers to help one another. INC. (August, 2005, pg. 36) ran a piece about online peer forums, where customers-to-customer interactions provided a lot of the technical support for a small software company. The forums are relatively easy and cost effective to set up, and they require about an hour a day of moderating (for a customer base of 2,000).

As we mention in our book, this is an example of a company "owning the context" of customer communication and "encouraging articulation" by customers -- especially in the sense of including them as codesigners and cocreators of a service experience.

Photo Kiosks

2005-08-05T19:52:00.000-07:00

One of the real growth areas in digital photography are kiosks that enable customers to do their own photo printing. According to the WSJ (8/4/05, B1, B4), photo kiosks are appearing in hospitals, cruise ships, and other high-traffic locations. Kiosks are grabbing a larger share of the images customers print. Kiosks share increased to 17% in 2004, while home printing decreased to 54%.

The trick for these kiosks to be successful is where customers access the kiosk (one kiosk needs to do 100 prints a day to justify the cost). Carnival Cruise estimates its kiosks are turning out 200-500 prints and that the program is barely turning a profit, while 7-11's test program in five stores was discountinued.

Outsourcing Customer Training

2005-08-02T15:47:00.000-07:00

Here's an interesting trend -- outsourcing the creation and delivery of customer education. This article has several examples of companies like Intuit who have partnered with third-party organizations to build customer expertise. Most of the solutions are centered around e-learning, a technology that most companies don't maintain as a core competency.

Lots of good ideas here to consider to build the expertise of your customers.

iPod Cocreators

2005-07-24T17:07:00.000-07:00

At first glance, an iPod seems like a product low on cocreation. The model in the minds of many of us is that we buy an iPod and download our favorite songs to it. However, there is a cocreation trend with this product called "Podcasts", in which customers record their own audio shows and make it available to other iPod owners (WSJ, 7/22/05, B1, B5).

It appears that when Apple spotted this trend, it wrapped an experience around it and launched a directory of Podcasts. Apple generates no revenue, but supports the cocreation in order to promote the iPod platform, sell more iPods, and create a crossover effect to its music store.

Customers want a role in cocreating a product experience. Companies can ignore it, let it happen on its own, or step in to embrace it and control the context. Apple's strategy here appears to support the do-it-yourself content creation that continues to make the iPod a winner.

Threats to Do-It-Yourself Real Estate

2005-07-20T20:15:00.000-07:00

In my mind, For Sale By Owner has always had connotations of a fly-by-night home buying experience. While I would like to sell my own home (and put the 6% commission in my pocket), the marketplace has developed in such a way whereby the Realtor experience has become associated with trust and convenience. But it is no wonder that in this day and age that discount realtors have come onto the scene to shift some of the work to homeowners in exchange for flat-fee commissions.

Even though discounters push to provide a more viable do-it-yourself model for real estate transactions, the traditional realtors are pushing back hard to defend their turf (WSJ, 7/18/05, A2). They are lobbying to tighten real estate transaction laws and using other tactics to keep out the DIYers. One discount realtor ran an advertisement promoting "self service" transactions -- full service realtors were appalled and, as a block, pressured the newspaper's advertising staff to limit where such ads could appear in the paper's real estate sections.

Building Expertise Through Paid Experts

2005-07-16T16:27:00.000-07:00

Pharmaceutical companies have been slowly increasing their usage of doctors to teach other doctors about new products (WSJ, 7/15/05, A1, A2). The performance the companies want is more prescriptions -- and it appears to be working. Through the development of expertise, Merck estimates the return on investment of doctor-to-doctor educational sessions is double that of its own sales force.

Hmmm....Interesting coproduction concept in which customers (doctors) assume the role of employees (salespeople) and become the brand ambassadors.

What other types of companies might benefit from setting up experiences in which customers educate other customers? What might the experience look like?

Punish Me, But Only When I'm Bad

2005-07-13T16:39:00.000-07:00

Several car rental firms have enacted new punishments for no-show customers (WSJ, 7/12/05, D4). If you reserve a car, but don't show up or cancel less than 24-hours before pickup, you get spanked with a $10 to $25 penalty.

But Vanguard Car Rental (Alamo and National brands) has added a twist. Customers can earn a 10% discount on car rental fees if they pay in advance. Furthermore, Alamo now allows online check-in -- another way to enhance the committment of customers.

How Vision Aids Customer Performance (for guys anyway)

2005-07-13T15:14:00.000-07:00

You must check this out. Seems like the folks in Europe are really trying to modify customer performance with a very innovative solution. See Seth Godin's blog for the photo.

Airport, restaurants, and hotels in Amsterdam have silk-screened a fly in urinal bowls in public rest rooms. The purpose? To improve the aim of gentlemen such that urinals stay clean.

Think of this from the standpoint of a coproduction experience -- in terms of modifying customer performance. The solution is all about VISION -- set the goal (shoot the fly) and provide feedback (the user can see if he is hitting the fly). Customer performance improves and restrooms become cleaner places.

Apple's "Studio" Enhances Expertise

2005-07-10T16:33:00.000-07:00

In Apple Computer retail stores, an area called the Studio is enhancing customer expertise (RGJ, 7/10/05, 2D). Staffed by experts in digital media, these walk-up counters offer customers face-to-face support in learning such tasks as ripping CDs, processing digital photos, and editing video.

We've seen this strategy in other retailers. Through the enhancement of customer expertise, the expectation is that customers will learn new skills, tell others about those skills (or show-off the results), and buy more add-ons and accessories.

Color Me Anything

2005-07-09T16:27:00.000-07:00

In our book Creating Do-It-Yourself Customers, we talk a bit about the performance aspects of color -- a nuance of a coproduction experience. I came across this company -- ColorCon. It specializes in manufacturing color coating systems for pills, food, and packaging. It seems that they are linking their services to the enhancement of various brands -- through their exclusive Brand Enhancements Services (BEST).

Perhaps they are the ones who helped create those little blue pills :-)

The Blended Coproduction Experience

2005-07-08T16:16:00.000-07:00

Charles Schwab Corp. is trying a blended solution for DIY customers (WSJ, 7/5/05, D2). Long known for enabling individual investors to do investing themselves, Schwab over the past few years has pushed the other way -- in terms of offering more financial advisor/money manager services for customers who got tired of doing it themselves.

The service -- aimed at "emerging affluents" -- provides investors a list of "vetted" stocks and mutual funds from which to choose. Customers are still doing do-it-yourself investing, but Schwab is reducing the complexity in terms of investment choices. Advice and counseling is available if the investor desires such services.

An interesting solution in a very complex industry.

Self Checkout Success Stories

2005-07-07T18:28:00.000-07:00

Is self-checkout at the grocery store faster? St. Cloud Times reporter Dawn Peakedmp investigated self checkout at local grocery stores. What she found is what the industry is claiming -- decreases transaction time (read "customer time") and enables businesses to retain more customers. Other interesting facts include self-checkout at Home Depot increasing customer satisfaction by 10%. Up to 50% of customers at certain retailers are using self-checkout.

Her other conclusion: self-checkout appeals to the younger, technology-savvy generation.

Think what this generation will expect in ten years.

Self-Check-In Hosptial Style

2005-07-05T08:19:00.000-07:00

DIY customers are now finding it easier to check in at hospitals (Orlando Business Journal, 6/28/05). Beth Israel Hospital in Newark has installed MediKiosk systems. These systems enable patients to fill out medical record forms and check-in for their appointments. The hospital says the systems have reduced the time it takes new patients to check-in by 25%, and returning patients by 75%.

Trends in DIY

2005-06-22T18:43:00.000-07:00

Recent research from WSL Strategic Retail in New York suggests the DIY customer trend continues to build steam (Brandweek, 5/23/2005, Vol. 46 Issue 21, p26, 1p).

83% of homeowners do their own repairs or improvements
76% of homeowners do their own home decor projects
80% of computer owners do their own upgrades or installations
62% of computer owners burn their own music CDs
40% of people who use beauty/healthcare products use do-it-yourself kits/products.

Do-It-Yourself Hotel

2005-06-22T12:44:00.000-07:00

Here's an interview with Hilton Hotel's president Matt Heart (Business Travel News (6/20/05). Hilton has been a leader in adopting self-check-in systems for hotels (yeah!). It is no surprise that they really looked at customer tasks and discovered other things DIY customers migh need -- like the ability to print out their airline boarding pass.

When DIY customers become conditioned to the DIY life, it annoys them when they lose access to it. For the past couple of years I have wanted a way to print my boarding pass at the hotel without paying an arm and a leg in the "business services center". Seems like Hilton has figured out an easy way for me to do this. I guess I can stop trying to get through airport security by showing the .pdf of my boarding pass on my computer's screen.

Digitial Photo Coproduction

2005-06-21T12:49:00.000-07:00

When I was in high school, I was a photography nut. I had a camera, darkroom, and could do everything myself -- from loading film cartridges to printing photographs. Most other people I know where quite happy to bring their film to Fotomat for processing.

The digital photo age has certainly changed things. Fotomat appears to have evaporated and customers are now avid do-it-yourselfers in a variety of different ways. As discussed in this New York Times article, digital photographers have three choices these days for printing their photos -- Kiosk, Internet, or DIY with their own computer/printer (New York Times, 6/17/05).

Each of these involves the customer as coproducter. I like the Internet solution the best -- I've used Wal-Mart's service, but there are others. I can upload the photos I want printed, crop them if necessary, then have them mailed to me or held for pickup.

Self-Service Drugs

2005-06-21T11:10:00.000-07:00

Pharmacies are in the process of testing kiosks to distribute drugs to patients (WSJ 6/21/05, D1, D6). These systems aren't all inclusive. The customer must still call in their refill, but when the customer picks up the prescription, they use the self-service kiosk. By entering a user name and password, the customer can access the prescription, and then pay for it by swiping their credit or debit card. Benefits of the system include reduced waiting times for customers. Challenges to the system focus on the absence of face-to-face consultations between the pharmacist and customer. I see this challenge as odd, since if the primary segment this system is serving is refills, why would a customer want to waste time hearing the patient education spiel he heard when he first received the prescription?
(Copyright 2005, Honebein Associates, Inc.)

Five Types of DIY Customers

2005-06-20T10:51:00.000-07:00

In the world of codesign, cocreation, and coproduction, customers can play many different roles. When I use do-it-yourself to explain these concepts, people tend to equate that with one or two types of customers (the first two in my list below). However, I see that there are five general types of do-it-yourself customers.

Transactionals are those who like to perform everyday transactions themselves. They use self checkout at the grocery store, eat at the buffet, and book travel online.
Traditionals are what we typically think of as do-it yourselfers in terms of home improvement, gardening, financial management, auto repair, and so on. These are the people who frequent Home Depot, Smith&Hawken, Charles Schwab, and Kragen Auto Parts.
Conventionals acquire tangible self-contained products that are enablers for doing things themselves. For example, a Viking stove facilitates the do-it-yourself task of gourmet cooking. A snowblower enables one to clear the snow from the driveway.
Intentionals engage in do-it-yourself experiences to customize goods and services to their specification. Think Build-A-Bear® Workshops and Nike iD.com online design center.
Radicals take do-it-yourself to new extremes. Like the gentleman who re-wrote the operating system for his Lego® Mindstorms robot.

Do-It-Yourself Curmudgeons

2005-06-17T15:48:00.000-07:00

As I troll around the DIY space, I sometimes come across articles that speak negatively about the DIY economy and culture. For example, Ed Quillen, a Denver Post columnist, railed against DIY in his 12/21/05 article "More Assembly Required". Similarly, Cathy Weaver from the Greensboro News & Record aired her complaints in the 4/25/05 "Do It Yourself? Don't, and Do Yourself A Favor".

Their arguments are typical. First, the expertise gap: trying to fix something at home to save money, then botch the job due to lack of expertise (requiring a call to a professional to fix it right). Second, the inconvenience gap: being dressed up for a night on the town, but then suffering the indignity of having to fill the car with fuel and end up smelling like gas. Third, the luddite gap: buying a computer accessory that has the user manual on CD-ROM, then trying to print and assemble a paper user manual yourself. Let's look at these one at a time.

The Expertise Gap
If customers don't have expertise, they can't perform. It's that simple. If economically viable, companies will provide customer education so customers can build expertise. However, customers should be self-aware of what they can and can't do. And if they have never done something before, they should get someone who has to help them. Watching DIY shows on TV and reading DIY develops one's knowledge, but it doesn't develop skill. Only hands-on practice with appropriate feedback can develop skill.

The Inconvenience Gap
What can I say -- PLAN AHEAD. Why do people place blame elsewhere when the cause of their inconvenience is their own lack of action? You never want to do things yourself when it is not convenient to do so. Quillen knows he is going out. He probably knows his car is low on fuel. He knows all the gas stations in Colorado are self service. Why didn't Quillen think to fill his car with gas the day or morning BEFORE his big night on the town? He blames the self-service industry for his own lack of forethought. Yet, if the punishment of having a gas smell on his clothes doesn't change how he thinks about his performance, I don't know what will.

The Luddite Gap
I'm a bit more forgiving in this area. People are hesitant or slow to change their ways. I know I can be. However, also consider that new ways of doing things are typically done for a reason. It should be obvious that replacing a printed user manual with a CD-ROM-based manual has many significant economic and societal benefits. Less paper, less chemicals, less shipping costs, better product price, increased producer margins, and so on. I admit that for those of us conditioned to read things on paper, it is difficult to read things electronically. A generation from now, it won't be a problem. Quillen has the choice to change his ways, or spend an hour printing and binding his own user manual. He chose wrong, and I think society and the environment suffers from his choice.

I think what these stories show correlates well with research. If customers perform well, they praise themselves. If they don't, they blame the company or industry. Coproduction experiences must provide customers what they need to perform. However, customers must recognize when they don't have the expertise, when they need to plan ahead, and when they need to change.
(Copyright 2005, Honebein Associates, Inc.)

More Travel DIY On The Way

2005-06-14T13:18:00.000-07:00

WSJ (6/14/05, D3) reports that more and more hotels are moving to install kiosk-based check-in systems. Embassy Suites and Doubletree properties will have kiosks in all locations by next year. Fairmont Hotels kiosks will allow guests to pick their own room.

Additionally, for customers who don't want to go online or don't have a printer, Continental Airlines has started offering faxed boarding passes.
(Copyright 2005, Honebein Associates, Inc.)

Business Drivers for Creating Do-It-Yourself Customers

2005-06-13T20:41:00.000-07:00

In Baseline last April 2005, Gary Kelly (CEO of Southwest Airlines) and Robert Nardelli (CEO of Home Depot) discussed business drivers for do-it-yourself customers.

Some key DIY information for Southwest Airlines:

65% of customers book their own tickets at southwest.com
Ticketing cost through an agent averaged $10; now it averages $0.75
Functionality is being added to self-service check-in kiosks to handle more transactions
People per aircraft (a key business metric) has dropped from 95 in 2002 to 74 today

Some key DIY information for Home Depot:

Self checkout systems enable Home Depot to re-assign employees to revenue-producing roles
If each of those re-deployed employees sells one home installation, it equates to $1 billion in revenue
1,029 stores currently have self checkout systems
Four self checkout systems take the space of three regular checkout systems
Kiosks that handle special orders are being tested
The average customer transaction has increased 7.3%, to $54.89

Gardening Advice

2005-06-10T07:00:00.000-07:00

As you become more familiar with what I call Coproduction Experience Design, you'll come to recognize that the critical element of a well-designed coproduction experience are vision, access, incentive, and expertise. In this post, I'll share an case I found that elaborates the concept of expertise.

When companies build the expertise of customers, one of the expected outcomes is that customers will be more likely to spend money on add-ons, enhancements, and consumables. After all, once a customer has invested time to learn a new hobby, he or she wants to continue leveraging that expertise.

Many companies are training their employees to build the expertise of customers. In an article called Digging for Gardening Advice (WSJ, 6/7/05, D5), Ron Lieber discusses his search do-it-yourself gardening advice. He cites that Home Depot has certified over 7,000 "nursery consultants" to help shift customers from novice gardeners to expert green thumbs.

In reading this article, I had some thoughts about how gardening retailers could better share their advice -- and be more prepared. Mr. Lieber did several interesting things before consulting several gardening retailers. He took pictures of the area he wanted to plant, and he wanted a plan (map) of how best to fill the space with flowers. How did he know to do this? Were the "nursery consultants" prepared for such a customer? Perhaps these are experiential elements that gardening retailers could incorporate into their service scripts.

The take away from this is that if a customer like Mr. Lieber is successful setting up his do-it-yourself terrace garden, he'll become a regular income stream as he maintains and improves his garden.
(Copyright 2005, Honebein Associates, Inc.)

Fidelity Open Bond Market

2005-06-09T12:21:00.000-07:00

When companies create or enhance coproduction experiences, look for the link to competitive strategy. One of those links is differentiation. In the June 7, 2005 Wall Street Journal, A5, Fidelity Investments ran a full-page ad announcing its new Open Bond Market service. To me, this reflects the ideals of a coproduction experience. Just look at the headline of the ad:

The competitive differentiation? Buying bonds yourself is a pain in the ass, but we've created a coproduction experience that provides you the tools, knowledge, and simplicity to do it yourself, better than any of our competitors.

This service seems enticing. I've looked into buying bonds through other brokers, but the process seemed risky and overwhelming. Perhaps Fidelity is onto something.
(Copyright 2005, Honebein Associates, Inc.)

What are Coproduction Experiences?

2005-06-08T15:14:00.000-07:00

There is a paradigm shift in today’s economy. In the past, customers expected companies to do a lot of the work for them. Now, companies are expecting customers to do more of the work themselves. And when the company designs the brand experience effectively, customers respond enthusiastically!

Self check-in at the airport, self checkout at the grocery store, do-it-yourself DNA testing kits, even the self-installation of your digital cable services are all examples of coproduction experiences. The common thread is clear -- customers doing some or all of the work, rather than employees. Customers often find that doing things themselves is faster and more efficient. It provides a greater sense of control, and, in some cases, greater customization of the results. In other words, customers are able unlock more value from the goods and services they buy when they can successfully do things themselves.

So, the next time you are designing your personalized Nike shoes online, installing new software, creating a blog, or visiting the ATM, remember that you are part of a coproduction experience. Sometimes it is nothing more than you getting what you want faster. But ideally it is where you become the cocreator and codesigner of solutions that add value to your life.
(Copyright 2005, Honebein Associates, Inc.)