Opinions And Ramblings By Adam Kmiec On All Things Media

Do we need a bit of a reality check?

I was in a client meeting a few days ago where we collaborating on their 2010 social strategy. The social strategy ultimately is tied to the overall marketing strategy and thus the well defined business objectives. As we were plotting out a fairly robust and comprehensive plan, our client paused and asked a great question, “We don’t know if what we have behind the door is a drip or a flood; how will we scale to meet their real time expectations?”

Think about that question. It’s profound really. When we mailed in comments to companies we might have accepted a 30 day turn around for feedback. When we email customer support, it’s reasonable to expect anywhere from 24 to 48 hours for a response. When we call the 1-800 number, we’ll tolerate 15 minutes to hours (depending on call volume and your need) to connect with a real person.

But, in the social space (twitter, Facebook, etc.) we demand, not expect, INSTANT feedback. So, again, I ask, do we need a bit of a reality check? I even find myself expecting immediate feedback when I tweet a company, comment on a post, or make a request via a forum/message board. Is that right?

Let’s consider a few things:

1. Customer service is important and consumers expect great customer service
2. Providing great customer service is expensive – technology while an enabler, still requires REAL humans to deliver on that great customer service experience
3. Customers want value…and by value I mean they don’t want to spend a lot
4. Quality customer service is derived from both what is said/done and how quickly service is provided

There seems to be a gap here, no? Let’s assume you’re a company that offers a service. If you have 10 customers and 1 customer service person, you’re probably ok. But, if you have 1,000 customers and still that 1 customer service person, you’re going to be stretched. Ok, so what happens if you have 1,000,000 customers and still only 1 customer service person? Well, you aren’t going to be able to provide great customer service. Hmmm…ok, so we’ll just hire 99,999 more customer service people to bring us back to our ratio of 1 customer service person per 10 customers. Cool, but we’ve got to pay these people. For the purposes of round numbers let’s assume each person costs the company $100,000 in salary, benefits, and operations. Well we just went from $100,000 of customer service overhead costs to $9,999,900,000. That’s a big jump, no?

Is the company going to eat those costs? Of course not. They’re going to pass those costs on to you. If amortized equally, each customer will now be paying at a minimum $9,999.90 more. Guess what’s going to happen? Yeap, we’re going to have some pretty ticked off customers.

Look, that’s an extreme situation, but the round numbers show us that customers like you and me need to be willing to do 1 of 2 things:

1. Pay more for better service
2. Have more realistic and lower expectations

Surely, there’s a middle ground. Companies like Zappos, Comcast, Southwest and others are showing us the way. But, you can’t simply copy someone else’s model. If you’re a company you need to find your own model; one that works for your culture and customers. And as companies are developing these models what are we to do as customers? Should we change our expectations? I think we should. If we don’t, companies will be reluctant to enter the social space. After all it’s easier to keep us using older and more familiar tools for customer service, like email, letters and the phone.

There’s a reason Apple isn’t in the social space. Part of it is arrogance. But, the other part is they don’t have a model for how to make it work. Think I’m wrong? Consider the Genius Bar. Have you ever tried to walk up and get help at a Genius Bar? If you’re like the majority of Apple customers, it’s a rare occasion when they’ll simply help you on the spot. A more likely situation is the Apple employee will ask you to schedule an appointment at the Genius Bar. Granted, that appointment could be for a time 15 minutes in the future. The point is, they schedule, slot and meter your ability to get customer service. And, while they’re doing that, they’re also getting major kudos for offering amazing customer service. Not too shabby, huh? Imagine if Apple was on twitter and using the platform for customer service…an extension of the Genius Bar, if you will. Do you really think customers would accept an exchange like this:

Customer: “Hey, having a problem with 15″ MacBook Pro. The screen keeps shutting off randomly. Any thoughts? Thanks.”

Apple: “Thanks for your tweet, unfortunately all of today’s, tomorrow’s, and the rest of the week’s slots are filled up. I can tweet you back in about next Thursday. Thanks.”

No customer would dare accept that. After all, if you have time to tweet me that, you should have time help me out. If Apple, instead ignored the customer’s tweet until next Thursday, the customer would still be irritated because of the time lag in getting a response. See, it’s the expectations of the medium. Almost feels like a no win situation.

So, what do we do?

Just a quick note so that everyone understands the situation…The thoughts and views expressed in this post and on this blog are mine and do not reflect the thoughts and views of my current or previous employers.

I think Zappos made a huge mistake in how they approached their recent RFP.  Having been on the client side and the agency side of the business I can tell you that the whole RFP process in general is flawed for so many reasons.

From the very beginning most companies have 3 lists for issuing the RFP. One list has “big names” because you can’t go wrong including DDB in your pitch. Another list has the “red tape” agencies. These of course are the ones that the person leading the pitch doesn’t really want to include, but they have to because so and so is friends with the agency’s president. Both the person running the RFP and the agencies in the group no this is a waste of time. The last list is the most important one, it’s the “favorites.” This is the group of agencies you really want to work with and who you think can make some magic happen. If the list portion of the process is flawed, how can the rest of the process not be flawed?

The purpose of a RFP process is to find a dance partner that you like and believe can help your business. Sending pieces of paper back and forth is not the way to get there. As an old friend of mine once said, “if you really want to know if these are the guys you want to work with, have dinner and a drink with them. If they can hold your attention, carry a conversation, and make your head spin; they’re the right agency for you.” Amen.

So what did Zappos do wrong?  To me it boils down to 2 things:

1. Expectations: The concept of expectations in an RFP are always ludicrous.  Seriously, you want a 5 minute video that shows you our office, including the bathroom?  I’m not exaggerating here.  When I worked at DRAFT this was literally a request from a perspective client.  I think what they asked for was not only reaching, but simply showed them to be greedy and frankly not a company I’d want to work with or for.
2. Focus: The simple fact that they went from a small list of select agencies (aka list 3) to then opening up the process to another 100+ agencies shows a serious lack in focus from leadership at Zappos.  If you’ve ever been on the client side leading a pitch process you know there’s no way you can give those 100+ responses a fair, thorough, and unbiased review.

Agencies could have certainly declined to participate, but in this horrible economy agencies are chasing down every possible RFP and opportunity under the sun.  The whole industry needs a reset.  I’ve been in pitches where the internal costs for the pitch exceeded 250K.  And guess what happens if you lose?  That’s right there’s no compensation for the time, work, and ideas.  That’s the risk.  I’ve also seen those ideas that were pitched, eventually used by the winning agencies.  All of us in the industry know that one of the main purposes of an RFP is for the “client” to essentially get “free” ideas.  It’s to their advantage to invite many agencies, because then you get many ideas.

I can tell you right now, that if I ever went client side again and had to choose an agency I’d do everything in my power to avoid an RFP process.  I already know the 3 agencies I’d want to work with.

All I’d want to do is bring them in for dinner, some drinks, and a full day immersion session where they can soak up all the information they need to make sure that they’re up to challenge and WANT to work with me.  No formal letters, no spec creative work, no audacious presents.  Nope, it would just be simple conversation in both a formal and social setting.  Basically it’s taking Gladwell’s “Blink” concept and applying it to the agency review process.

Folks, we need to fix this broken machine.  But, one person, one company, one agency can’t make the change.  It has to be a unified effort. I’m willing and able if you are.