Our baby boy is growing up fast and the time came this past weekend to purchase a high chair. We headed over to Babies R Us but our first choice was out of stock.

The employee we spoke with told us to visit Toys R Us because they frequently stock similar items and that they would accept our Babies R Us coupon. This sounded fine to us, and since they both end in “R Us” we figured they must be the same company.

We found our high chair at Toys R Us and proceeded to checkout. The cashier told us that we couldn’t use that coupon “because the computer wouldn’t accept it.”

The manager strolled over to help explain the situation and told us that the Babies R Us store in our area frequently hands out false information despite requests to stop.

My wife, quick on her feet, asked the manager if she had any coupons that we could use. The manager turned around and came back with a 20% off coupon.

This was a significant discount when compared to our previous coupon and we happily completed our purchase.

When you empower your employees, your customers will be happy! Instead of making us feel like we were out of luck, doomed to pay full price, or leave the store without the product, the manager that helped us out saved the sale and got us to buy. Toys R Us got our money and will probably have our repeat business in the future because we left the store with a good feeling.

Are you restricting your employees to the point where they can’t close the sale? Empower them to help the customer and watch your sales grow.

We recently traveled to Raleigh, North Carolina to visit with family. While driving around, I kept seeing buildings with no other markings but a simple sign: “BB&T.”

ob·fus·cate (defined by tfd.com)
1. To make so confused or opaque as to be difficult to perceive or understand
2. To render indistinct or dim; darken

What was BB&T? The rather nondescript buildings provided no clues as to their function or purpose. It turns out that BB&T is a bank. I didn’t find that out until I returned home and stumbled across an article on the Fool.com.

So if I had just moved to Raleigh and needed a bank I probably would have stopped by any of the other numerous financial institutions that actually had “bank” or “banking” on their marquee. It pays to clearly define your company and services!

Barrier to Entry

Hiding your company behind an acronym will not help you win new customers. Using an acronym goes against sound company naming conventions. When potential customers can’t tell what your company does, they’ll drive on by and do business with someone else.

Acronyms are Confusing

Unless an acronym is defined up-front, people will not necessarily know what you’re talking about. Even after an acronym has been explained, people will forget the meaning until they’ve seen it several times. Once an acronym has been used so much that it is commonplace (i.e. IBM or USA) it will become effective. Only then may individuals that have never had contact with you recognize your company by its acronym.

Explain Everything

If you are forced to use an acronym, explain it or supplement it with an explanation. If BB&T had used a sign with a subtitle like “banking – investments – loans, ” I would have known right away what they were about.

Don’t leave your potential customers guessing. Avoid acronyms and explain clearly (and for all to see) what your business can do for customers.

My mother-in-law recently had some new blinds installed in her home. A friend of hers highly recommended a particular company that had done a great job at her home. Unfortunately, the installation for my mother-in-law was rife with problems, delays, and broken promises. A recommended service should never turn out this way.

Earn the Recommendation

The first step in gaining a recommendation is to provide a top quality product or service. When your customers are happy with your work, they’ll be more likely to refer you to their friends and family.

Make it easy for customers to refer you by giving them your business card, and provide clear contact information on your receipts or invoices. After all, if your current customers can’t contact you, how will their friends?

Be Consistent

Put a system in place and train your employees so that any customer, at any time, with any employee, will get quality work. Consistently meeting your customer expectations will produce repeat business and referrals.

Treasure that Recommendation

One of your customers has stuck her neck out to recommend you to others. Don’t make your customer look like an idiot! If you don’t live up to the recommendation, your original customer will have to deal with the aftermath of your mistakes with the friend they referred. This situation could lead to at least two lost customers plus the potential referrals that could have come your way from both.

Remember to thank the original customer that referred her friend with a gift or hand-written thank you note.

Customer referrals are potential gold mines that require careful handling and nurturing. Treat the referral right and they will, in turn, refer others to your business.

My wife and I joined online DVD rental service Netflix a few months ago. Overall, I’ve been satisfied with the experience and their prompt delivery of DVDs. I’m sure it helps that they have a distribution center here in Austin!

Shipping

Your company may sell products to customers and ship them via UPS, FedEx or even the U.S. Postal Service. With online shopping, there is always a time gap between when the order is placed and when it arrives. This time can often fill the customer with doubts as to when their purchase will arrive.

Provide Tracking Information

Always give your customers the tracking ID for your shipping carrier. This will allow customers to see for themselves where their package is located at any given time.

Email Notifications

Netflix uses the U.S. Postal Service to send and receive DVDs. Since there is no tracking system for first class mail, they can’t give customers a tracking number. Nevertheless, they have effectively leveraged their knowledge of their distribution network and standard USPS delivery times to estimate arrival dates.

Since I’ve had my share of issues with the USPS in the past, I always have a little bit of doubt when I drop a letter or DVD in the mail. Will it ever get to its destination? How long will it take to arrive? Netflix soothes my concerns by acknowledging receipt of DVDs via email.

On the flip side, when another DVD ships to me, Netflix will email and tell me it is on its way and the estimated delivery date. So far, their estimate has been on the mark about 95% of the time. Not too bad!

Visibility into the Shipping Gap

Setting expectations with shipping helps comfort your customers during that gap of time between a product’s purchase and its delivery. Remember that communication is the key to reassuring your customers:

• At the time the order is placed, set the delivery expectation. If you know it, tell them the exact day.
• Email the customer when their order has shipped.
• Email the customer when you receive mail, a package, or a return from them.

Netflix does a great job of communicating with its customers about delivery and shipping times. What lessons can you apply to your online business?

A few months ago, my wife bought some flowers through 1-800-Flowers and used my email address. Since then, I have been getting spam email from them almost every other day.

They try to follow one of my guidelines for a successful newsletter by having a “remove me” link at the bottom of the email. However, this link takes me to a page on their site stating:

If you no longer want to receive our promotional email offers, please send an email to remove@reply.1800flowers.com from the email address you would like removed.

This requires too many steps and too much time!

One Click Please

Have a “remove me”-type link in your company emails that directly unsubscribes the customer from your mailing list. Don’t make them jump through hoops to leave your mailing list.

Customers will want to unsubscribe from your mailing list for an untold number of reasons. Forcing them to take undue extra steps in that process will surely leave a bad taste in their mouth. They may no longer receive your emails but that doesn’t mean they won’t make future purchases. Don’t kick customers on they way out and they may just come back again.

I saw on the news the other day that Delta Airlines was filing for bankruptcy. My first thought was “Oh, no! My frequent flier miles!” I’ve been building up my SkyMiles for years now and would be sad if I lost them overnight.

At the time of the bankruptcy news, I was also holding a previously purchased ticket. Would this be changed? Needless to say, I was concerned.

Fortunately, my fears were abated a few days later when I received an email from Delta entitled “As Always, Delta at Your Service.”

Inside I read the words that reassured me and answered all my questions:

Your travel plans are secure – We are operating our full schedule of flights, honoring tickets and reservations as usual, and making normal refunds and exchanges.
…
Your SkyMiles are secure – The award-winning SkyMiles program has not been affected

Change is Certain

Companies will always have changes. Acquisitions will happen or companies will fail. In our ever-changing business environment, you can not lose sight of your customers.

Communication Must be Certain

When there is a big shake-up at your company, be sure to communicate the ramifications to your clients and customers. Unless they hear from you, they may not have enough information to make good decisions. Keep them informed and they’ll be more likely to stick with you during your transition.

Buy Freakonomics

Freakonomics, written by economist Steven D. Levitt and journalist Stephen J. Dubner, takes an unorthodox view at some questions you’ve probably never asked. In so doing, they explore “the hidden side of everything” as the book’s subtitle states.

Although the authors claim at the end of the book that there is no recurring theme to its pages, they do state a straightforward central premise:

If morality represents how people would like the world to work, then economics shows how it actually does work.

If nothing else, you’ll learn from this book how to break away from the standard perceptions and accepted norms that society often pounds into our heads. Through the power of the data, the authors’ analysis illuminates the differences between correlation and causality.

To illustrate what the authors mean, they use this analogy: With correlation, it would be fair to say that it only snows when it is cold. Since it doesn’t always snow when it is cold, there isn’t necessarily a cause and effect (causality) relationship. These two points do, however, have a strong correlation.

When analyzing numbers at your business you may be tempted to erroneously put pairs of results into a cause and effect relationship. For example, your company has a stellar fourth quarter with record profits. During that quarter you got a new CEO, introduced two new product lines, and opened a branch office in Chile. Would it be true to say that your new boss led the rise in profits? Not necessarily.

Unless you dive deeper into the data, you won’t know the exact effects of these events on your company’s bottom line. All three may correlate to increased profits because they happened at the same time; however, that doesn’t guarantee that any one of them caused the increase.

Incentives

The wide ranging effects of incentives are illustrated in Freakonomics with stories and data from day care facilities, standardized school testing, and sumo wrestler tournaments. Through these you see why people do what they do even if that means cheating. People’s reactions to incentives may not always be what you’d expect them to be.

Information

Experts can wield a great amount of knowledge to their advantage and often to your detriment. The authors compare the Ku Klux Klan to real estate agents. Both have used closely held information to their benefit. By spreading that knowledge to the masses, their power has been reduced. How can you leverage the power of information for your success?

How are these all related?

You’ll ask the question “how are all these stories related?” several times while progressing through this book. Nevertheless, the authors masterfully tie their stories and data together to bring out effective and thought provoking conclusions.

Conclusion

Freakonomics turned out to be an eye opening voyage through the world in which we live. Reading this book will help you take a step back and question society’s accepted conventions. You’ll find yourself asking more questions like: “What do the statistics and numbers I deal with every day really mean?” You’ll take a fresh look at your business or personal life and see how your actions are really affecting the world around you.

Read more Freakonomics reviews on Amazon.com

Buy Freakonomics on Amazon.com »

I talked the other day about iStockphoto’s reminders to use previously purchased credits. While their timely reminders were helpful, I had one grievance with their email content. Near the end of the message they state (emphasis is mine):

If you have any questions please feel free to contact us at 1-866-478-6251 or service@istockphoto.com.

Thank you,
iStockphoto

–
Please do not respond directly to this e-mail. The originating e-mail account is not monitored.

So while they could give me the service@istockphoto.com email in the body of the email message, they couldn’t set the “from” email field with that same address.

Setting the “from” address on an email is a trivial programming exercise. Many companies already do this, so why not iStockphoto?

People hit reply

Most users of email applications will hit the reply button when they wish to respond to an email. Don’t force them to use other, more inconvenient methods to respond to your email.

Be approachable

Messages that tell the customer to not respond to an email reinforce the thought that they are just a number and aren’t getting personal attention.

Your automated emails should be sent from an address that is monitored and processed by someone in your company.

As hurricane Rita rumbled toward the Texas coast last month, my wife and I were worried about its effects here in Austin. Each day of that week as the hurricane approached, I’d come home and turn on the news to see the forecast.

On one of these days I caught a piece of the game show “Jeopardy” as I changed channels. The contestants were running through a category on hurricanes. The first clue I heard was asking about the storm that hit Galveston in 1900 and killed over 6000 people. According to the latest forecast, this same city was in Rita’s path.

So here we sat with a major hurricane headed our way and Alex Trebek and the contestants were jovially asking and answering questions about this most serious issue.

I turned to my wife and asked, “Are you kidding me?” Why would Jeopardy or the TV network choose to air this episode during this week, of all times?

Follow Current Events

Watch the news or visit your favorite online news source. Your business and livelihood are directly affected by what is happening in the world around you.

If current events merit a change in your business practices, do it. If they require that you reshuffle your schedule, make the change. If you have to rename a product to be less offensive, make it happen.

Listen to your Customers

Let your customers easily give you feedback. This will allow you to see if you might have missed something–or worse, something obvious.

You Can’t Accommodate Everyone

Try your best to be sensitive to your customers and their situations. However, even when you do this you can’t appease everyone. You may always have outspoken opposition to whatever you do. Assess this feedback as objectively as possible. Act upon the reasonable feedback when it is the right thing to do.

We bought a ClosetMaid shelf for our garage a few weeks ago. When I brought it home and started installing it that Saturday, I realized the package was missing a small part.

The absence of the little metal anchor clip didn’t prevent me from completing the project. However, I still wanted the piece to make sure my shelf would be stable after installation.

I went to the ClosetMaid company website and after a little digging around, I found instructions for how to order a free replacement part. The following Monday, I received an email from their customer service department, saying the part had shipped. I received the package a few days later with not one, but two replacement parts.

Provide Multiple Contact Methods

ClosetMaid had numerous ways to contact them on their packaging. Make sure your product clearly shows ways to contact you when something is wrong. These could include:

• Phone
• Fax
• Email
• Website
• Mail

More methods of communication give your customers more flexibility. I discovered my problem on the weekend and I knew there wouldn’t be anyone at the call center. I turned to the company’s website to meet my needs.

Replacement Policy

You need to clearly state your replacement policy on your product’s paperwork. ClosetMaid has a big “free replacement” logo on their packaging along with their contact information.

Customer-friendly replacement policies help prospects overcome their doubts and fears about buying your product. Allaying customer fears gives the customer the green light to purchase your product.

Preemptive Quality Control

Put checks in place to prevent the need for replacement parts from the start. Create a feedback loop from your replacement department to your manufacturing department. If you see patterns in customer requests for replacements or repairs, you may have a problem with your manufacturing system.

Company Benefits

Ignore the little things at your own risk because small sales lead to big ones. I spent maybe $15 with ClosetMaid. Will I do business with them again? You bet. I have other closets in my home. If I ever get to a point where I need closet parts again, I know ClosetMaid has a good track record of providing great customer service.

How will your customers remember you when a little something goes wrong? Will that small issue fester into aggravation or will it be a springboard to repeat business?