Fruitful

Complacency or anticipation?

I've been living in San Francisco for three weeks now. People have asked if I was concerned about earthquakes, and to be perfectly honest, I hadn't given it a thought. But April 18th was the 100-year anniversary of the Great Quake of 1906, and I've been reading and watching about how another Big One is predicted to hit within the next 25 years. Experts say that the greatest threat to Bay Area residents is not the actual quake, but complacency. We believe that it won't be that bad, or that it won't happen in our lifetimes. Yet the threat is real.

Whether it's the threat of an earthquake, deregulation or an upstart competitor, most of us succumb to complacency. I worked on the GTE account when they were going through telecom deregulation. They made no visible changes to their business before the ruling passed, despite indications that up to 80% of their customers would defect to new providers. The same thing is now happening with the cable TV industry as legislatures rethink local franchise laws that would quicken the phone companies' entry into the television market. If the comments and emails on my Comcast blog post are any indication, Comcast has been complacent about investing in their customer experience... and they'll pay the price when competition hits.

Healthcare and education should expect major quakes as well... along with any other business that is basking in  the perceived security of size, market position, government regulation or subsidies.  We all lip-synch "there's no constant but change," yet most businesses are structured with the kind of rigidity that prevents any kind of meaningful response to a shake-up in their industries.

The bad news about earthquakes is that there's no way to predict when it will hit. Yet a shake-up in business can be predicted, so there's really no excuse. Here's a quick checklist for 'business shake-up preparedness:'

• Find bedrock. Where is the unmet need that your company can uniquely fulfill?
• Monitor. Are you tracking customer perceptions of your business over time?
• Identify fault lines. Where are your vulnerable points?
• Reinforce. Are you investing in customer support, usability and/or other table-stake attributes that will strengthen customer loyalty?
• Take small tremors seriously. Is there a new company in your space that's "too small to take seriously" yet is attracting customers and buzz? What can you learn from them?
• Retrofit. Are you evaluating new technologies or processes that will help you withstand changes in your industry? What are you doing about the web 2.0 trend?  How can you instill some flexibility, openness and collaboration into your processes?

Hurricane Katrina, the tsunami, and the 100-year anniversary of the Great Quake have been categorized as wake-up calls. And yet we still go through our lives with blinders on -- myself included. How differently would we live, love and work if we were open to all the inevitabilities of life? If we lived in anticipation of change instead of in denial or complacency?

Or better yet... instead of anticipating a shake-up, why not initiate one? That's so much more exciting than the status quo. It's going to happen anyway... you might as well be the one in control.

Soft Underbellies

Tim Manners writes about the "vulnerable soft underbellies" of Apple and NetFlix in a recent Fast Company article.

Apple won't let us do what is ultimately the most important thing. It won't let us easily change the damn battery when it dies... This is not the stuff of which undying customer loyalty is made. They have needlessly left themselves vulnerable to any competitor able to design something of comparable aesthetics and smart enough to let the consumer have life-and-death control over its battery.

The famous Netflix promise is that you can rent as many movies as you want each month for a flat fee. Well, not exactly. Netflix recently acknowledged that it slows down the rate at which it fills the orders of its heaviest users, a practice critics call "throttling."... As with Apple, it took a class-action lawsuit before Netflix would publicly acknowledge that it is giving preferential treatment to its newest -- and least loyal -- customers.

A strategy that punishes one's most loyal consumers is hardly sustainable.

There are so many examples of this. In the wireline telecom world, service providers promote a low per-line rate while adding special surcharges that almost double the advertised price. Consumer electronics are made to last only for the life of the one-year warranty. Wireless and cable providers give special discounts and promotions only to new customers, not to existing ones. Software companies like Symantec offer frustrated virus-infected customers no way to reach a live customer service rep without paying $40 to $70 for the call (which is why I ditched their software).

What is your company doing to sabotage its success with customers? Do you even know the areas where customers are frustrated and may cause them to jump ship? Are you willing to break away from "industry-accepted practices" in order to give customers a more desirable experience?

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BTW (shameless self-promotion plug here), we've got a pretty cool online customer dashboard where our clients can measure the gap between what's really important to customers and their satisfaction level with each attribute... then track progress in closing those gaps over time. It's a great way of identifying your vulnerable spots from your customers' perspectives. Ping me at jrice at mantrabrand.com if you'd like to know more.

Maslow & Branding: Wrap-Up

In previous posts I've outlined 8 basic human needs in Maslow's Hierarchy and how they relate to branding: Security, Connection, Esteem, Control, Aesthetics,  Cognitive, Self-Actualization and Transcendence. But as Tomas commented, "such a sequential hierarchy of needs doesn't usually happen in our post-scarcity society. Rather, we should see "human needs as an ecosystem where all needs co-exist together for the vast majority of us once our basic subsistence needs are met." Exactly right... and that's the topic of this post.

As you can see from this diagram, I've changed the pyramid to a circle (I've also rephrased a few of the names to be more reader-friendly).  In the center of this example is "Web 2.0", which refers to blogs, forums, wikis, social networking, etc. You can see at a glance what's driving the massive growth of web 2.0 -- almost every core human need is satisfied through these technologies. Blogs, MySpace, epinions.com and Slashdot are all places where different types of people can converge to get their needs met. Whereas web 1.0 only offered a source of learning via one-way communication, Web 2.0 offers entire ecosystems for people to learn, share, grow, achieve, connect, and promote a cause.

I've titled the chart "Employee/Customer Engagement" for you to think about how your brand activates core needs, both internally and externally. Let's take a look at Starbucks as an example. Starbucks environment activates Belonging and Aesthetics. Ordering a half-caf blended vente latte satisfies the need for Control (I get my coffee exactly how I want it), and Ego/Esteem (pride of being an "insider" and knowing the terminology). Ego/Esteem is also stimulated by friendly employees who remember your name and exactly how you like your coffee. Starbucks is a strong brand because they meet numerous core needs simultaneously. I'd be interested to hear from John Moore or Paul  Williams on how this model works internally at Starbucks.

From an employee engagement perspective, you might think about how you can enable employees to learn, grow, achieve, or contribute to a cause of their choice. How can you give them more control over their work environment, or their career path? How can you use Web 2.0 technologies to create an ecosystem for learning, collaborating and recognition?

Everyone talks about change... but basic human needs don't change. By aligning your brand with one primary need -- Apple with Aesthetics, or Starbucks with Belonging -- then that need serves as your anchor and compass to guide business decisions over time. Then establish links with secondary needs to deepen and enrich the brand experience.