Damage Control: Bad News Travels Fast

The evidence continues to mount that on-line communication and social networking is playing and increasingly important role in the consumer’s decision to buy your brand. It seems a day does not go by without another story about the importance of integrating social networking in your go-to-market strategy. The stark reality is that if you have any business at all, something is bound to go wrong. The key is minimizing service outages and, when something is amiss, pacifying the consumer to a) retain a loyal customer and b) prevent them from using the new mass media to campaign against your brand. Nothing makes an angry consumer happier than to take other people with them.

A story in the New York Times today by Alex Mindlin discusses a study in the Journal of Consumer Research which tracks 172 angry consumers who made their complaints known on ConsumerAffairs.com and the Ripoff Report.

Does time heal all wounds? Yes and no. The report says that over time the desire for revenge on the part of loyal consumers does decrease. But that revenge factor is replaced by the desire to not do business with the offending party. If the customer considers the brand relationship to be more casual, they are less inclined.

The research also tracked a scenario where people where told to imagine being mistreated in there favorite restaurant. Loyal customers were 25 percent less likely to crave revenge if offered a $50 gift certificate. The casual customers, perhaps sensing a battle for their loyalty, required $100.

Bad news has always traveled fast, and it’s faster than ever now. This case study makes a clear and concise point about the customer experience. Service outages have to be dealt with quickly and substantially. The problem will not go away, the customer probably will, and they will take their friends and whoever else will listen along with them.

More Consumers Opting to Buy Groceries from Deep Discounters

More Americans are buying food at Wal-Mart and other deep-discount store such as Aldi. How are mid-sized chains such as SupreValu and Delhaize Group reacting? They are promoting more private label brands, reducing costs on staple items such as milk and eggs, and offering gas cards. These are all great ways to promote customer loyalty. Is it enough though?

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Consumer Habit Research Helps Public Health Initiatives in Ghana

A few years ago Dr. Val Curtis, an anthropologist then living in the African nation of Burkina Faso, contacted some of the largest multinational corporations to teach her how to manipulate consumer habits worldwide. Dr. Val Curtis then used this knowledge to persuade Ghanaians to wash their hands habitually with soap. Diseases and disorders such caused by dirty hands, such as diarrhea, could be prevented with regular soap use but only about 4 percent of Ghanaians were using soap after going to the bathroom.

Dr. Curtis wanted to know find out how she could sell hand-washing the same way multinational corporations sell Speed stick deodorant and Pringles potato chips. Many companies had perfected the art of creating automatic behaviors and habits among consumers which have helped earn billions of dollars. Could the same habit trigger approach help save lives in third world countries?

Studies revealed that Ghanaians used soap when they felt their hands were dirty such as after cooking with grease or after traveling into the city. These hand-washing habits were prompted by feelings of disgust. Dr. Curtis and her colleagues realized that they had to craft a habit where people felt a sense of disgust cued by the toilet. The queasiness then can trigger the need for soap.

Ads started running showing mothers and children walking out of bathrooms with a glowing purple pigment on their hands that contaminated everything they touched. The ads worked. There was a 13% increase in the use of soap after the toilet.

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Convenience Store Gasoline Shopper Base Decreasing

A recent TNS Retail Forward ShopperScape survey indicates that one-third of shoppers are buying most of their gasoline at alternative outlets, up from 22 percent just three years ago.
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Connecting With Consumers Though Text Messages

A growing number of retailers and big brands are connecting with consumers primarily
in their teens, twenties, and thirties through texting, also known as short message service or SMS.

Text messaging is a simple concept. Retailers place an ad either in a newspaper, magazine, TV, or radio. The ad highlights the special promotion and a shopper participates by sending a text message with a specific word or abbreviation to the short code in the ad.

Online testing and research firm Keynote Systems found that the average for a text response from a short code was approximately 9 seconds. The fastest response was less than 6 seconds. This study was based on SMS messages sent to 24 popular short codes.

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