To what extent can a company go to provide best possible quality to its customers
There are so many amazing organizations in the world which are generating unimaginable revenues and are providing great value to their customers. Obviously, to get to such a level, a company needs to be loved by its customers.
But to what extent can a company go to please its customers? Is there any limitation on this? Well, let us try to find this out.
For huge organizations serving thousands or even millions of customers, it is not uncommon to make mistakes. Due to a complicated supply chains, sometimes defects or errors can crept in silently in the offerings of the company. It can be due to human error in judgement or due to some hardware/software bug (as these days most things are operated and controlled with the help of computers).
Many times such errors go unnoticed for long time. But what happens when such mistakes are identified in the system? The company can quietly close its eyes and can pray that it does not get noticed by its customers. Or, the company can honestly come forward with the truth and do whatever possible to resolve the issue.
In my opinion, and many others, second option is the ideal option to be followed. But it comes with certain risks. First, it poses a threat to the brand image of the company. People may lose the reliance on the products offered by such company. Second, it will also cost huge sum to the company as sales will go down and company will have to spend extra to fix already sold products.
The first issue can be easily resolved. If a company is coming forward and honestly offering to fix the issue, it will actually build up the brand value of the company and will increase the customer’s trust. People can peacefully buy the products of the company without worrying about anything as they know that the company can do anything to provide the best quality.
However, second issue of cost is a bigger one and we need to realize that money lost will be worth the trust built. Of course companies should avoid such issues from happening but if something comes up, it is ethically wrong to hide it. Moreover, it is better to accept it.
We can learn about quality from Toyota. The Japanese brand is known for its obsession with quality products and is actually behind so many quality assurance processes which are now widely accepted and practiced all over the world.
In case of product companies, usually they recall products when they find some issue which could not be identified during production. A recent study shared on statista.com shows that in the last four years, Toyota has recalled highest number of cars, more than any other car manufacturer.
It is a great example of a company for which customer satisfaction is the highest priority. If we see in economic terms as well, the money spent in this process can be considered as money spend in brand building activities for the company.
Similar instances have happened with many companies for so many products. But why all these companies are doing it? Did they find something important and useful while following this strategy?
Well, such strategy may seem inappropriate for the short term, but is actually much more relevant in the long term sustainable growth of the company. It seems quite appropriate as the famous saying goes, “you reap what you sow” with dictionary meaning "everything that happens to you is a result of your own actions". Hopefully all the companies will realize its importance with time.
Is Facebook’s move to offer money transfer services a wise step?
A lot has changed in the last few decades. Invention of computer followed by the invention of internet have shrank the world. Huge aircrafts have made it possible to travel from one part of the world to another in very less time. All this has evaporated the boundaries of trade as distance is not a barrier anymore. It would not be wrong to say that today we are just a “click” away from anything.With the rise of trade, there arose a need for an easy, secure and efficient money transfer system. With the world divided into a large number of territories with complex political systems, each one having its own currency, laws and systems, it is a tedious task to devise such a global system.
We have a lot of such systems in place, the most famous one is PayPal which has had its own ups and downs due to the regulatory requirements of different countries. But still, it is very successful with more than 143 million active user accounts in 193 markets and 26 currencies around the world (as per PayPal Press Center here. There are still less number of players in this market and huge opportunity for companies to enter.
Recently various news websites published news claiming that Facebook is going to start a money transaction service. It said that Facebook is in the process of getting approvals and will start its services in Europe first.
Facebook’s revenue is mainly dependent on its ads. As per the 2012 Facebook filing to United States Securities and Exchange Commission, Facebook mentioned that in 2011, 85% of its revenue was generated from advertisements. You can find the complete filing here.
Further, if we take a look at the annual earning report after the company got listed, we find that the revenue share has been maintained near the earlier mark (Refer to the image below). You can find the complete annual earning report here.
This poses a great threat to Facebook as number of people using Facebook primarily on mobile devices has been increasing which will reduce the earnings as Facebook does not display ads on mobile devices. Also, click through rate is not very efficient way of revenue. It indicates that Facebook has to diversify its business to reduce the risk. In view of this, the addition of money transaction service seems a very smart move at this time.
As per the report, Facebook had more than 750 million daily active users for the last quarter of 2013. It provides a huge scope for the new service. First of all, it will be easier for people to trust a service from Facebook. Secondly, people usually like all-in-one package and addition of money transfer facility will increase the utility of Facebook.
This will also help in increasing user base as people who are still not using Facebook much will be more active. Thus, in a way, it will increase the advertising revenue as well. So, if this new service is successful, it will not only help in reducing risk for Facebook, but will also help in indirect increase of revenue through ads.
Now, the main issue is the existence of complicated and differing laws and norms in different countries following different currencies. Facebook has to get approvals in all these territories for actual success of the platform.
As of now, Facebook is seeking approval in Ireland to start a money transfer service. It will allow it to operate digital money transfer service in all the European Union member states through “passporting” without the need of any regulatory approval. However, in the United States, Facebook would need to get separate approval from all the 50 states.
Till now, Facebook has been the most popular and successful social networking platform on the internet. With time, it became a marketing tool for companies from being just an entertainment network. But its time for it to venture into more useful services which can make it backbone of international business. It will be interesting to see how it will help Facebook in its growth.
Innovation: A key to Customer Loyalty and Growth
Recently we posted a link on our Facebook page which discussed about a restaurant which Googles its guests before they arrive so that they can serve them in best possible way. The article was published on Forbes website here.
This is a great example of how a business can use latest available simple and free technologies in innovative ways to be the best service provider. Usually, it does not seem much relevant in short term. Its real importance is realized in the long term when the business not just grows, but grows sustainably. We have all seen lately that “sustainability” is the new buzzword in the business world.
If we talk specifically about hospitality industry, it is a B2C business where customer retention is very important factor for the success of a particular company. Here, a good service experience results in customer loyalty which is a very important asset for any company.
A lot of growing service providing companies have large share of revenue from returning customers. While returning customers help the companies to sustain the market share, it also helps in the growth of the company.
To support the above statement, a research published in the April 2013 edition of Colloquy, a monthly newsletter of LoyaltyOne research group explains how enterprise loyalty can result in revenue growth by about 20% in 3-5 years.
Now it brings forward a very good question- how to increase customer loyalty for a firm. Well, there can be no generalized answer for this, as it depends on the type of industry and the targeted market. However, one can surely say that innovation is a very important factor for this. Companies like Amazon and Starbucks are the biggest examples which show the importance of innovation in increasing customer loyalty. Few very good examples of innovation are reward programs, unique customer experience, new ways of providing customer support etc.
Apart from this, one can also do some research to identify the factors which are most important from a customer’s perspective. For example, a research published on Statista.com highlights the relative weightage of various factors which may influence a customer to return to a restaurant. This data is very important for a restaurant to focus on the key areas for a better customer experience and thus increased loyalty. Here are the detailed results of the research:
Find more statistics at Statista
Likewise, every company should try to figure out such parameters so that they can focus on improvement areas while reducing the wastage of resources on not so important factors.
So, to sum up, we can say that the growth of any company is highly dependent on how innovative a company is, may be in terms of improving the existing services/products, or bringing out an altogether new service/product. Obviously, it is easier said than done, but in the present competitive markets, it is the need of the hour and company with the right attitude should be able to do this.
It reminds me a great quote by Thomas Jefferson. He rightly said, “Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude.”
Mystery Shoppers: Sherlock Holmes of the Modern Corporates
It seems like modern day corporates have an entire business built around this. Here, you play a detective for the companies and you do not have to get a license for it. Just shop, use their services, give them ratings, collect proofs of misconduct or bad services and get paid for it.
Yes. You read it write. This is called Mystery Shopping where one has to pose as a customer to evaluate a company’s services. Companies are ready to pay for it as this is crucial for them to get real picture of their services. This is specially very much relevant for big corporates which require to maintain certain standards across all their outlets.
However, with increasing awareness, even small companies are realizing the importance of mystery shopping audits. It helps them to improve their services and outperform their competitors easily.
To conduct mystery shopping, a person does not require any extra-ordinary qualifications. The only desirable characteristics are keen observational skills, an eye for detail and a smartphone with video and audio capture capabilities. You can even use spy gadgets like spy cam and small audio recorders.
Mystery shopping is an emerging field in India. Earlier, it became quite popular with students, housewives and people who required some extra income. But with time, it became an activity which is very much enjoyed by people, and people from diverse age groups, professions and income levels are now joining the wave.
For huge brands like Porsche and Mercedes, shopper must actually able to afford such products to appear a legitimate buyer to the showroom sales representative. This is why mystery shopping companies require buyers from upper middle to upper income groups as well to cover these big brands.
Mystery shoppers from very high professional profiles like executive managers, vice-presidents and the likes are actively being involved in mystery shopping audits. Obviously they get assignments of their stature like auditing a 5-star hotel in any part of the world, going to a buy a Porsche etc.
Apart from the shopper fees, these audits also reimburse the amount paid for using their services. And as it seems, this amount keeps increasing with the level of audit.
A lot of companies have emerged in this new market. WeMark, one of the earlier Mystery Shopping companies in India has been able to provide top quality services to the clients while providing the best kind of audit opportunities to the shoppers.
Sounds like a great deal, huh! So, what are you waiting for? You have shopped enough for fun and needs by paying money. Wake up your desire to play the spy. Your shopping experience can be a huge asset which should be leveraged. A combination of these two is what you need. Be a Mystery Shopper today and use your spying and shopping skills to earn. And where can you get a job which is actually fun to do!
To register as a Mystery Shopper, log on to www.wemarkindia.com today.
To register as a Mystery Shopper, log on to www.wemarkindia.com today.
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