Paul Wallbank – Brilliant Communications

Category: consumer

  • The business of baffling choices

    The business of baffling choices

    In his Daring Fireball blog, John Gruber’s takes to task the view that Apple suffers through not having a wide product range.

    John makes the valid point that Samsung seems to stealing market share from HTC rather than Apple but the whole theory of offering too many choices strikes to the heart of two industry’s business models.

    Those two industries are the mobile telco business and the Windows personal computer sector.

    In the PC world, the wide range of models has been both an advantage and a weakness; it’s allowed Dell and others to create custom machines to meet customer needs but also leaves consumers – both corporate and home buyers – confused and suspicious they many have been taken advantage of.

    All too often customer were being had; frequently buyers found they’d bought an underpowered system stuffed with software that either was irrelevant to their needs or an upgrade was necessary to get the features they hoped for.

    The entire PC industry was guilty of this and Microsoft were the most obvious – the confusing range of operating systems and associated software like the dozen version of Microsoft Office was deliberately designed to confuse customers and increase revenue.

    For the PC industry, the “baffle the customer” model reached its zenith, or nadir, with Windows Vista where Microsoft deliberately put out an underspecced ‘Home’ edition designed to push sales up the value chain.

    Compounding the problem, most of the manufacturers followed Microsoft’s lead and put out horribly underpowered systems in the hope that customers would upgrade with more memory, better graphics card and bigger, faster hard drives.

    Most customers didn’t upgrade and as a result the Vista operating system – which was horrible anyway – enhanced its well deserved reputation for poor performance.

    In the telco sector, consumer confusion lies at the heart of their profitable business model; a bewildering range of phones and plans often leaves the customer spending too much, either through an overpriced plan or paying punative charges for ‘excess’ use.

    Having a hundred different types of Android phone adds to the confusion and, by restricting updates, they can cajole customers into ‘upgrading’ to a new phone and another restrictive plan every year or so. This is why you get phone calls from your mobile phone company offering a new handset deal 18 months into a two year plan.

    Apple’s model has been different; in their computer range there has never been a wide choice, just a few configurations that meet certain price points. The same model has used for their phones and iPads.

    For Apple, this means a predictable business model and a loyal customer base. They don’t have to compete on price and they don’t have to fight resellers and telcos who want to ‘own’ the customer. It’s one of the reasons mobile phone companies desperately want an alternative to the iPhone.

    Companies using the baffling choices business model – Microsoft, HP, Dell and your local mobile telco – may well continue to do okay, but that business model is coming under challenge as new entrants are finding new niches.

    For all of us as consumers all we can do is make the choices that are simple are reject complexity. Warren Buffett has always maintained he doesn’t invest in businesses he doesn’t understand, perhaps we should have the same philosophy with the purchases we make.

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  • The importance of transparency

    The importance of transparency

    The US Federal Reserve has announced they will release more details from the information they use on determining official interest rates. On the same day the social networking site Twitter is embarrassed when its opaque verified account policy fails.

    Being open and honest is the key component in trust and in turn trust is the bedrock of society. If you can’t trust your neighbour, the local cop or the grocer at the shops then society quickly starts breaking down.

    Many big businesses, particularly those in markets where they are one of a small group of incumbents get away with abusing your trust; they tell an illegal surcharge can’t be waived because “that’s their policy, you can’t change an account because of the “terms and conditions” and that the call centre’s operators name is Janet even though it’s Rajiv and you know that when you call back asking for “Janet” you’ll be told”there’s 35 Janets working in the department right now”.

    All of this we’ve come to expect from big bureaucratic organisations like the phone company, the bank and the tax office. The interesting thing is how many new businesses that are adopting this anti-customer model of operating.

    Rules and policies are fine – as long as everyone knows them, they aren’t too onerous and they are applied fairly and consistently.

    The challenge for all businesses – particularly those taking on incumbents – is they have to show they are more trustworthy than the existing operators. If you can’t show that, then maybe it’s time to think about how you operate.

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  • ABC Christmas Computers

    ABC Christmas Computers

    For Christmas 2011 Paul joined Nikolai Beilharz to discuss dealing with problems with your Christmas tech gifts.

    We had a number of callers with problems including setting up a wireless network, what to do if a drink is spilled on your keyboard and how older people can get useful computer training.

    Seniors Computer Assistance

    John from Hobart asked about where he could get instructions on using his computer.

    The Australian Seniors Computer Clubs Association is a volunteer group bringing together local computer clubs that cater for older folk.

    ASCCA’s national members directory lists local clubs by state and contacting the nearest group should help you find the right assistance from your peers.

    Oh no! I’ve spilled a drink on my computer?!?

    Watching a freshly spilled cup of coffee, glass of wine or can of softdrink pour into your keyboard makes for one half panic and the other half despair.

    If you move quickly and you turn the keyboard upside down then you have a chance of rescuing a laptop computer before too much damage is done. The important thing is to stop liquid getting onto important circuits.

    Having turned the keyboard or laptop upside down, leave it for a day for the liquid to dry out. Then its a good idea to take it to the local computer store to see if it the residue can be cleaned up as usually the keyboard becomes sticky and some keys may not work.

    Should the liquid damage a desktop computer’s keyboard that’s usually easily fixed by buying a new keyboard but if you’re using a laptop, then the motherboard – the key part of a computer’s circuits – may be affected and that’s usually time to start shopping for a new system.

    Setting up a wireless network

    Most of the tech devices we’re getting for our households require some sort of wireless connection.

    If you have a wireless network, it’s important you get the security right as you don’t want neighbours and passers-by using your connection. The IT Queries site has instructions on securing these networks.

    Once have a secured network, preferably using the WPA2 encryption standard and a strong password, you can then connect each device. You’ll need the name of the network and the WPA2 password to make it work.

    Sometimes some devices want older, inferior security settings and occasionally they just won’t work at all. It may take several attempts to get them to work and it’s worthwhile re-reading our ten tips for setting up technology.

    Our next national ABC spot will be on February 9 next year. We will probably have some more spots over the summer break and we’ll let newsletter subscribers know about them as soon as we do. We also post them to the events page.

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  • Comparing local review and search sites

    Comparing local review and search sites

    With the Australian launch of local search and recommendation site Yelp, it’s worthwhile comparing the different sites to see how well they worked.

    The sites work in different ways, some – like Sensis Yellow Pages and True Local – are online directories that search just the title and description of business.

    Yelp, Foursquare and Word Of Mouth Online, are socially based and derive their searches on the content and number of community reviews. Their algorithms, the formulas to figure out what customers are looking for, are more complex than the basic online directories.

    Most complex of all are the hybrid searches, notably Google Places and Facebook Places, that build local upon their search and social media data.

    Each model has it’s own strengths and weaknesses which shows when we do a search. Due to time restrictions we only did two.

    Looking for brunch in Neutral Bay, NSW

    The first search was using what somebody might be expected to search for on a casual weekend or holiday morning. Neutral Bay and surrounding suburbs have plenty of cafes catering to the brunch crowd so it should be expected to return plenty of hits.

    Yelp

    search results for neutral bay brunch on yelp

    The new contender only found one local result and the rest being on the other side of the Harbour Bridge, including one at Bondi Beach which may as well be in the Upper Amazon to the average Sydney North Shore dweller.

    Interestingly, entering neighbouring suburbs changes the first two or three results to that suburb but the subsequent listings are the same remote locations as for the Neutral Bay query. This might indicate popularity with the current Yelp users or may be part of the package merchants get when they pay for a listing.

    True Local

    a search on true local for brunch in neutral bay

    News Limited’s True Local disappointed one cafe in the district was identified and the number one result was in the city.

    This poor results are probably due to the word “brunch” not appearing in the local cafes’ descriptions or titles, but this is a serious weakness for True Local, particularly in a district where they dominate the local news media.

    Google Places

    brunch local search results for google places

    Surprisingly, Google Places returned an extremely poor result with no local businesses found.

    Again, this is probably due to the failure of business owners to ensure keywords are entered in their business description and it illustrates how Google is allowing an opportunity to pass them by.

    Facebook Places

    Facebook Places results from Neutral Bay brunch searchNothing. Nyet. Zip. No brunch for you.

    Yahoo!7

    yahoo local search results

    Another poor result that has just scraped information off the web. It shows the weakness of the Yahoo! and Channel Seven joint venture which, like News Limited, is letting opportunities pass.

    Bing/NineMSN

    Local search results on NineMSN for Neutral Bay Lunch

    Probably the most disgraceful of the results, NineMSN returned two cafes for the whole of Sydney, a city of four million people.

    The second result entailed, according to Bing’s directions, a 38km drive timed at an optimistic 23 minutes involving $9 in tolls and an illegal u-turn.

    NineMSN’s performance shows just how irrelevant Microsoft has become in the online space and their Australian joint venture partner is more interested in selling big integrated campaigns to advertising agencies.

    Given NineMSN and Bing are the default browser and search engine on nearly two million computers sold in Australia each year, not having a local business strategy is squandering a massive opportunity.

    Citysearch/Sensis

    brunch local search on Citysearch for Neutral Bay

    Founded by Fairfax, Citysearch could have been a great success combining the assets and readership of Fairfax’s metropolitan and local newspapers coupled with their experienced sales teams selling advertising space and subscriptions. Good management could have done this.

    Sadly Fairfax was being run by Professor Fred Hilmer and his army of power suited McKinsey consultants and Citysearch was eventually sold for a pittance to Sensis, who have allowed it to shrivel away as the zero result for our search shows.

    Eatability

    local search on eatability for neutral bay brunch

    Eatability was a genuine surprise, returning no brunch establishments in the area. The only thought is that no cafe in the neighbourhood has the word “brunch” in their keywords. Still a very poor result.

    Urbanspoon

    local search for brunch at neutral bay on urbanspoon

    The web version of Urbanspoon returned the most bizarre result, correctly finding one local cafe but misinterpreting the address as being in Bankstown on the other side of Sydney.

    Urbanspoon’s iPhone app returned a far better range of results in surrounding suburbs although it only found one cafe actually in Neutral Bay which wasn’t the one incorrectly found on their web app, which didn’t appear at all.

    Word of Mouth Online

    word of mouth online local search for brunch in neutral bay

    Word Of Mouth Online delivered the best result of the web pages with two of the first three results being relevant. Of the other seven, they met the criteria of being within a 5km radius of the location which in Sydney can be a 12km drive.

    The results would have been better with more local establishments but it appears the keyword “brunch” hasn’t been used by many of the WOMO reviewers.

    Note: After the review I was contacted by the founder of WOMO, Fiona Adler, it appears some of the reviews have have been updated in the meantime. I’ve changed the results below, but the left the one above as it was correct at the time of the review.

    Foursquare

    neutral bay local brunch search on four square

    Like Yelp, Foursquare relies heavily on users’ contributions and this shows in the flaky, almost useless results for our search terms on a web based search.

    Foursquare’s iPhone app was far more efficient, identifying a range of good venues in the area which were ranked according to friends’ recommendations.

    Sensis/Yellow Pages

    search for brunch on yellow pages for local brunch in neutral bay

    Again, “no brunch for you.” It’s almost scandalous that Yellow Pages has no entries at all for “brunch” for an inner Sydney suburb.

    Redoing the search

    Clearly the term “brunch” is problematic in all the services, so as a check here’s the relevant first page results for other search terms on each of the services;

    Service Café Neutral Bay Breakfast Neutral Bay Lunch Neutral Bay
    Yelp 7/10 2/10 7/10
    True Local 9/30 0/30 0/30
    Google Place 10/10 0/10 10/10
    Yahoo!7 not relevant
    Bing/MSN 3/10 0/10 0/10
    Citysearch 6/10 3/6 4/4
    Eatability 40/50 8/8 23/31
    Urban spoon 3/3 0/0 0/0
    foursquare 3/20 1/20 1/20
    WOMO 8/10 2/10 5/10
    Sensis 7/10 0/10 0/10

    As we found with the earlier search, Yelp was somewhat inconsistent and no doubt the social aspects will see it improve as more users come on board, the results are highly dependent on the terms used by reviewers and this will affect the search results.

    True Local’s score was surprisingly bad, the search for “cafe” found 12 places but three are long closed. “Breakfast” listed B&B accomodation and “lunch” found outlets in the city and Eastern Suburbs.

    Google Places also disappointed on “breakfast”, picking up some B&B establishments along with some city cafes. This is almost certainly due to keywords missing in descriptions.

    Yahoo!7 doesn’t get a rating as all it does is scrape other sites and often refers you to other search services. They are just going through the motions.

    Microsoft and NineMSN’s service again failed dismally; the “cafe” result was poor, “breakfast” looked for B&Bs and “lunch” amazingly didn’t find a thing in Neutral Bay.

    Citysearch’s results for “cafe” found nine places, three of which are long closed which indicates the lack of maintenance their database receives. Encouragingly, Citysearch was one of the best performers for lunch and dinner, albeit only on four and six places found.

    Eatability had by far the most impressive number of results, however a large proportion of the places have closed and are not flagged as such. This probably indicates a lack of maintenance by the owners.

    WOMO was good and like Yelp their results are highly dependent on the words used by reviewers, so key words could be missed simply because reviewers didn’t use them.

    Sensis performed well on “cafes” except that three of the ten listed were closed. The lack of results on “breakfast” and “lunch” is due to no places having those words in their name.

    Conclusions

    This comparison is not scientific, being based on a narrow search and small sample size, but there’s a few things we can take away from the experiment.

    Search is still young

    Right now, search is still a crude tool.

    From the results, we can see that the keywords used by reviewers and businesses matter. If the public are looking for “brunch” and that isn’t on your cafe’s website and online listings, then you won’t appear.

    Over time that will change as the web and search engines get smarter but right now search is still at a basic stage in its development.

    You have to be there

    Customers are using these tools to find what they need and if a business isn’t listed, then they can’t be found. Setting up a profile and getting some favourable reviews is important.

    The business who are being pro-active are the ones who are succeeding.

    There’s a lot of opportunity

    It’s no surprise that older organisations like Fairfax, Sensis and Microsoft are failing to understand local search. What is suprising is how poorly the newer players like Google and Facebook are doing.

    This opens up a lot of opportunity for services like Yelp and Foursquare in adding value to the data already available through services like Google, Facebook and Sensis.

    Yelp’s tie up with Sensis makes a lot of sense from the US company’s point of view; they get to ride on Sensis’ sales team, maybe some licensing fees and – most importantly – they can access the richest, albeit not always accurate, database of Australian businesses.

    For small, local business there’s a lot of opportunity as well. By getting online and registered on these services, it’s possible to become more visible and improve your competitive position.

    The market’s young and there’s a lot of potential for disruptive players. It will be interesting to see how incumbents deal with the threat.

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  • Mad, bad or dangerous: The One Percenters we need to avoid

    Mad, bad or dangerous: The One Percenters we need to avoid

    “I’m not going pay you, your technician was constantly looking at his watch,” growled the customer when asked why she’d stopped a cheque for some work we’d done for her.

    There’s many excuses for not paying your bills but a tradesman trying to keep the client’s bill to a minimum is an excellent dodge.

    Over the phone call’s ten minutes, it was clear this lady was going to be a tough customer.

    First the job wasn’t done properly, then the charges were too high, she accused us of taking advantage of vulnerable women and finally she was going to complain about us to her union.

    It was clear we were in for a fight to get a hundred dollars from her, so I let it go. She went away believing she was right.

    The saying “the customer is always right” was coined by US retail pioneer Marshall Field and exported around the world by Harry Selfridge, one of his employees who also founded a business empire.

    We can be sure neither of them actually meant that customers are always correct in what they do, just that the key to successful service is the client walking away believing they are right.

    Regardless of how well we deliver on our promises, there are always going to be some that aren’t happy. In most cases this is due to misunderstanding, or just a bad day on our part, but sometimes there’s the one percent of customers who are mad, bad or dangerous.

    The Mad

    Some customers just aren’t quite with us. These people, some of whom have genuine psychological problems, simply aren’t going to be reasonable.

    There’s no point in fighting them as that’s only going to make their issues worse and maybe even transfer some of their problems to you.

    Fortunately as you become more experienced in business you get better at detecting and avoiding these type of customers although there’s always the odd one who sneaks through.

    The Bad

    There’s a certain breed of people – and businesses – who don’t pay their bills, seeing their suppliers as banks and an invoice as an interest free loan.

    Often these customers are charming and the perfect client before the bill is presented then they string you out for months of years before paying your invoices.

    For these people and organisations, who are genuine deadbeats, there’s the fool me once, shame on you; fool me twice, shame on me philosophy. It’s usually better to write them off rather than sink hours of management time.

    The Dangerous

    Of all the bad payers, the most dangerous is the game player. To these people, not paying debts is an intellectual challenge which they enjoy and play for fun.

    These folk will just as happily mess around the phone company or the tax office as much as the local plumber or newsagent, it’s just a game which they’ll play to their maximum enjoyment and your frustration.

    For the big companies, these people can be a benefit as they justify the existing of entire bureaucracies dedicated in getting them to pay; small business though don’t have the time and resources to spend the hours of work over years to extract payment from them.

    Thankfully these folk usually stonewall as the first invoice so there’s early warnings you’re dealing with trouble. Resist the urge to play the game with them as they are usually better at it than you.

    Regardless of which category these bad debtors fall into, in each case it’s better for your valuable time and sanity to let them believe they are right, write the debt off and move on to helping customers who really matter.

    Fortunately these people really are the One Percenters and only representative of a tiny proportion of our customers.

    The taste of copping a loss is always painful, but at least we get good stories from the excuses they give. What’s the best reason you’ve heard for a customer trying to dodge a debt?

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