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An Impatient consumer should never – never – come away feeling exploited

 

So, I had the temerity to buy a new computer from Dell, anxious to get a faster, better, hotter machine that also had all the wonderful new features of Vista. The experience has been horrible from beginning to end. First, the laptop was delayed in production, so that I had to wait three weeks for Dell’s vaunted production capability to perform. I suppose I should have expected such delays, since much has been written in the business press lately about production snafus at Dell. In any event, I refused to cancel the order; I’ve tried to be loyal to Dell since the early days of our firm, MCAworks, when we were quite IMPATIENT to get set up and wanted a bunch of computers right now. In those days, Dell delivered.

For the preceding several months, after all, I had been a classic PAINSTAKING consumer, spending a lot of time researching exactly which model of laptop I would want, focusing on the electronics, the software performance, the ergonomics (having just written a book on the last laptop, I was quite sensitive to keyboard and screen size) and, of course size and weight – I’m on an airplane every week.

It was after I received the laptop, however, that the real nightmare began. I won’t bore you with all the details, let’s just say that many of the promises of faster, better, and most importantly, ease of transferring data from the old computer were – how to put this? – over-promises. I called Dell’s 24-hour warranty service 800# and they, of course, could not help. My problem was “escalated,” as they say, several times and I was finally turned over to something called “Dell On Call.” Dell On Call, of course, wouldn’t let me explain my problem – again – until they had charged me $230 to work with this supposedly PREMIUM service. After two weeks – yes weeks – of escalation and unsolved yes unsolved problems, Dell On Call convinced me to block off an entire Saturday (SATURDAY!) when their top person would call me at precisely 9:00 AM and work with me all day if necessary to get this all fixed.

You guessed it; he did NOT call at 9:00. By 9:19, I had given up and was playing with my children when his call came in. Obviously quite skilled at this maneuver, he managed to leave a very quick “sorry I’m late, call my voicemail and leave a number” message before I could get to the phone.

For the record, all I was – am – trying to accomplish is to get Outlook to perform as promised. Or, as I finally screamed at one of the many many service reps, “I am just trying to send an email on my $3000 computer for which I have had to pay an additional $230 just to get you to tell me you don’t think you can solve this!!!!!”

This personal experience shows how a misunderstanding of consumer needs can be exploited by a company to achieve short-term gains at the expense of long-term business strength. No one was more IMPATIENT that I when faced the need to send an email on my new computer and found that I was unable to do so. In true IMPATIENT fashion, I was willing to pay even more than the $230 to get the $3000 PC working. Dell, desperate, apparently for short-term revenue gains, exploited this unmercifully and pocketed the $230. What they missed, of course, was that I felt forced by Dell and Dell alone into the IMPATIENT quadrant. Having already purchased the PC, I should have been in the Recreational quadrant – “Oh, let me see some more new gizmos and thingees in Vista and the new PC. That looks like fun, I’ll buy that add-on!”

To summarize, Dell capitalized on my impatience to pocket some short-term revenue. Long-term, their forcing of me into that quadrant has lost them a customer – whose company has purchased multiple Dells over the years – for life. This was a profound misreading of the consumer. When I should have treated RECREATIONALLY, happy to part with money for a new functionality, I was treated…badly.

So, having PAINSTAKINGLY researched and committed to the purchase over the summer, I am willing – forced – to remain patient while Dell fails to help me optimize this current laptop. When the time for the next purchase rolls around in a couple of years, I will again PAINSTAKINGLY research alternatives from a range of manufacturers, but my stopwatch for Dell will have precisely zero ticks. I look forward to revisiting this blog two years from now and comparing my experience with Sony or HP in 2009 with my experience with Dell way back in ‘07.

PC’s Don’t Have to Require Painstaking  stopwatch-ticks-remaining-for-dell.jpg

 

Targus Slows Down Consumers’ Stopwatches With EcoSmart Cases

As a marketing consultant, I applaud Targus’ effort on eco-friendly cases. I expect that most people buying laptop cases (as opposed to having them supplied by their employer) are impatient — they just want to get it over with, this bag is a means to an end: carrying the laptop that contains their entire life. The advent of the EcoSmart line should make a segment of laptop case shoppers slow down their internal shopping stopwatch and consider a reason why this category does NOT represent a commodity purchase behavior pattern. Here’s a link to a CNet post on Targus’ announcement:

http://news.com.com/8301-10784_3-9775701-7.html?tag=recentPosts

And to the official announcement on Targus’ site:

 http://www.targus.com/us/about_pr_20070911.asp

 Impatient Quadrant  EcoSmart Backpack

BTS Shopping: Retailers Need to Do a Little Homework

You’ve seen them at your local supermarket, mass discounter, and office supply store.  Parents with the look of dread on their faces. Kids with the look of dread on their faces.  It’s back-to-school shopping season.  ‘Tis the season to stock up on school supplies and try to put a positive spin on the end of summer / beginning of fall. 

School is most likely in session at this point nationwide (with the exception of a few colleges like the University of Chicago and Dartmouth which have later “starts”).  Retailers are starting to celebrate their victories or lick their wounds.  Here’s a thought for the Targets, Office Depots, etc.:   can you borrow a lesson from Whole Foods and take what is typically a painful and “wait ’til the last minute” shopping experience (for both Parents and Kids - albeit for different reasons) and turn it into something more fun, more pleasurable, and more positive for all involved? 

For example, retailers can have local school supply checklists on hand so parents can compare what their kids “want” vs. what the school recommends they “need.”  Retailers can create a special BTS debit card which trusting parents can give their kids to have the freedom to purchase what they need - as long as the purchases fall within the school- and parent-approved guidelines.  Retailers can also bring in organization and time management experts for evening events - targeting both parents and children with brief (and I mean brief!) tips and tricks for getting the most out of their time hitting the books, participating in extracurriculars, and researching their homework (as well as connecting with their friends) online.  And, families can plan on re-connecting at these events with fellow parents and students before school officially starts.

The goal is to make the BTS shopping experience something parents and kids can eagerly anticipate - and to watch them spend more time in-store and ring up more sales at the register. 

The iPhone as Recreation

Apple moves to keep iPhone firmly planted in the Recreational Quadrant

Steve Jobs announced yesterday a $200 price cut on the iPhone – a product we’ve identified in Stopwatch Marketing as representative of a Recreational purchase. When it was first launched in June, the iPhone received a tremendous reception, buoyed by the obvious technical and design wizardry combined with Apple’s powerful marketing machine. At about $600, however, the iPhone was clearly a high margin item, and in the terms of the Stopwatch Matrix, targeted at Recreational Quadrant – Apple devotees and newcomers alike had spent months in the run up to launch coveting the product, studying the trickling technical and marketing communications, and devouring the “hype,” such that there was pent-up demand that Apple exploited brilliantly and unmercifully.

Nonetheless, that early demand is now satisfied. In an interview published today in the Wall Street Journal, Jobs makes the critical point that “we can’t move the holidays.” He clearly recognizes one of the key tenets of Stopwatch Marketing – consumption is occasion-specific. The target consumer for the iPhone as we head into the holidays is almost certainly demographically identical to the ones targeted over the summer. The primary differences in these target consumers are threefold:

  1. For whatever reason, they have until the Fall/Winter to actually buy

  2. They are more likely to motivated by gift-giving in November and December than they were in June

  3. They are going to be faced with more competitive and competitively priced products

Apple could have left the price high, attempting to target consumers in the Painstaking quadrant, hoping that they (Apple) could meet their numbers by focusing on those consumer willing to shop around, carefully consider alternatives, and step up to the higher price because of the iPhone’s superiority. The decision they appear to have made, however, is that they (Apple) were unlikely to make their  goal of 10 million cumulative units by year-end 2008 if the 2007 holiday season strategy was to target Painstaking shoppers at such a busy and time-pressed period. For iPhone to achieve its transformative vision of the phone category, it must remain a Recreational purchase – something people buy because they “just love it,” or “got to have it.” Price, therefore, cannot be a barrier.

Here’s the link to the interview in today’s Wall Street Journal:

http://online.wsj.com/article/SB118904154464818867.html

 

Reluctant and Recreational Quadrants

Editing Stopwatch Marketing

Working on this book has been a fascinating learning experience. For example, copyediting of a book is still done the old-fashioned way…using colored pencils and making notes on a hard copy manuscript. No one at MCAworks has used a pencil in years. Imagine my consternation, then, when Portfolio told me it was time to start using a red pencil to provide my own notes on the evolving manuscript a few weeks ago:

I purchased a Staples battery-operated pencil sharpener and four AA batteries. Returning to MCAworks World Headquarters, I found the damn thing inoperative. (Several of my colleagues will concur). So I returned the pencil sharpener and hit upon a much cheaper and more inventive option – I purchased a $2 package of PRE-SHARPENED red pencils. So, in one two-hour period of frustration, I hit every quadrant:

Reluctant – I have to get in my car and drive to Staples just to buy a pencil sharpener???

Recreational – I actually enjoy browsing around gadget shops and good retailers

Impatient – I have to make a RETURN TRIP just to get my $25 back and buy a better sharpener????

Painstaking – Wait a minute, slow down, there’s probably a better way…I’ll save $23 and purchase this package of pre-sharpened red pencils!

We really have to put this story in the next book.

stopwatch.jpg

Welcome to the Matrix

Welcome to the Stopwatch Marketing Blog.Our book, Stopwatch Marketing, will be published by Portfolio in February, 2008. Below is an excerpt that describes our 2 X 2 matrix that models consumption, and forms the foundation of the book.Imagine a stopwatch. Better yet, imagine a hundred stopwatches, or a thousand. Imagine that every one is held by a potential customer. Some are ticking very fast, some glacially slow. Some, in fact, aren’t ticking at all. All stopwatches measure time, but the shopping stopwatch measures a very specific sort of time. The slower it ticks, the more time and energy a consumer is willing to spend shopping for a particular purchase, and the more opportunity a marketer has to influence and ultimately capture a purchase decision. Even though they don’t use the term, researchers have long distinguished among consumers based on their shopping stopwatches … differentiating between hedonistic and utilitarian shoppers, for example, those who derive value from shopping and those who derive value from owning. This would be a useful model, but for two things: First, our own experience has demonstrated that consumers are too ornery to stay in one place on any scale, which is why labeling consumers, rather than consumption, is the sort of simplifying assumption that simply does not apply to real situations. On any given day, at any given life stage, in any given economic environment, individual consumers – about which we as marketers think we know so much – will behave differently than a backward-looking model would suggest. The same consumer utilizes different stopwatches for different purchases on different days and in different states of mind, often without knowing it and certainly without calling it out. The chronic complaints of contemporary marketers – fragmented media, time poverty, and gnat-like attention spans – are really just other ways of asking “Why won’t they just stay put?!”. It’s the predictable result of addressing consumers, instead of consumption. The other reason we developed our model is this: We are marketers rather than social psychologists. Our interest is in helping sellers to maximize profit, rather than helping buyers to understand their motivations. The stopwatch marketing model contrasts high margin and low margin selling with high time-value and low time-value buying. Businesses are constrained by the number of touchpoints and catchpoints they can afford as well as the diameter and speed of the shopping stopwatch. The most powerful model we use, in fact, has four quadrants. Welcome to the matrix. At MCAworks, we have designed a model that measures consumption – not consumers – along two axes: the disposition to spend time shopping for a particular product or service; and the net margin of that product or service. (Since marketing resources, over time, must be a fraction of any business’s gross margin, they will determine the quantity and quality of the touchpoints and catchpoints… the resources available for marketing the product or service). This model segments shopping style into understandable groupings, so that marketers can align their marketing strategies to those segments…what we call their marketing styles. In this model, transactions tend to fall somewhere within one of the four quadrants that comprise the matrix: In one, we match low-margin products or services with consumers who have a low willingness to spend time shopping; others match low-margin with high willingness; high-margin/low willingness; and high-margin/high willingness. Of course, since we’re marketers who understand the importance of packaging, we actually give the quadrants slightly less imposing names:

Few touchpoints plus lower margin/Fast stopwatch = Reluctant shopping

Many touchpoints plus higher margin/Fast stopwatch = Impatient shopping

Few touchpoints plus lower margin/Slow stopwatch = Recreational shopping 

Many touchpoints plus higher margin/Slow stopwatch = Painstaking shopping

                                         

Understanding the real estate your customers occupy on this map – their shopping style – is the single most important thing you need to know in order to succeed in selling your product or service to them.