1. WOM @ my local Starbucks…

    Tuesday, 12 Aug 2008 15 Comments Posted by:

    One of those fundamentals in WOM is creating stories that inspire people to talk.  Often times this comes down to doing the unexpected – which is generally unexpected because the “front lines” just aren’t empowered to do much beyond execute on their function. 

    Today, I’m grabbing some laptop time in a local Starbucks and took a table very near where the baristas are working – only table available near an outlet of course:)

    As I’m setting up I hear, and then watch, the following transaction.  A guy orders and pays for a grande iced latte.  When the latte is called out at the bar, he takes it and I hear the following:

    Guy:  “Is this a grande?  I thought they were bigger than that.” 

    Barista:  “Yes, that’s the grande, the venti is the even larger one.” 

    Guy:  “Oh, ok.” – no frustration, just simple acknowledgement.

    Barista:  “Would you like me to make that a venti?”

    Guy:  “Ummm…you can do that?”  (he almost looked guilty, like he shouldn’t say yes – he got what he ordered after all)

    Barista:  “Sure, not a problem.” 

    She takes the drink back, then a second later, she hands it the orginal grande back to him.

    Barista:  “Here, you can just give this to someone if you’d like, I’ll make a new one that is a venti.”

    Guy:  “Really, ok, sorry for the trouble”

    Barista:  “No trouble at all’

    Guy approached me and asked if I wanted the free grande… nope, I have one already, but he took his new “WOM object” with him out of the store:)  I’m pretty certain he’ll tell this story a few times today.

    Now it’s gonna be pretty tough to attach any metrics to this, but I thought it was a good moment and a simple reminder of the opportunity every company has to create the conditions for WOM by empowering their front line employees.  I think we can be pretty confident the barista never went to a WOM class.  Many companies have large populations of employees who touch many customers every day at retail, in customer service, in the support org, at their conferences, online, etc…I wonder how often those critical roles are forgotten in the grand plan for creating a WOM campaign.  It’s a shame that so many call centers in particular are seen as cost centers to operationalize instead of the WOM machines they could be.

    Sean

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    • Jeff

      it’s no wonder Starbucks is having financial issues. lol.

      how about doing a cost analysis on what that transaction just cost the company.

      rough napkin math.

      Grande Iced Latte. $3.50 (?)
      Vendti Iced Latte. $4.50 (?)

      If guy is buying a latte on avg 20x month x 12 months. That freebie just gave the company $240.00 in extra revenues. How many customers, how many times does this happen?

      Looks like a win for starbucks.

    • Sean

      costs would be much lower than that:) those are closer to what they charge…actual cost on a iced latte…2 shots espresso, 1 cup milk, cup, ice and labor… ? don’t know there margins at an item level, but must be decent.

      sean

    • Phil Nieman

      I actually just had a similar experience at the local Starbucks. Ordered a piece of coffee cake, and the girl forgot to give me my piece. When I told her I was still waiting, she apologized and threw in an extra piece. Of course I went back to the office and skyped everyone looking to see who wanted it. I don’t know if they are training employees to give more things away, but they should be!

      phil

    • http://prcogitation.com Joseph Wilburn

      I liked this post! I agree with your last statement about call centres, having worked in many over the years before transitioning into the PR/Marketing world. There are many people who work in the industry like the barista in your example that love what they do and can help support WOM strategies. It’s too bad they are not encouraged to do so.

    • http://www.jkp-ads.com Jan Karel Pieterse

      No Idea what WOM stands for, but let me share an example of a Dutch company who does a good job at that: http://www.NS.nl (Dutch railway).
      I travel a lot by train since I got self-employed, since that enables me to work “on the road” and thus extends my billable time considerably. Anyway; Here’s the thing I experienced the other day.
      In comes the conductor and asks a fellow passenger for his ticket. He doesn’t have one, because he arrived late due to a problem with the ticket machine at the station. This means the fare is increased with a penalty (I think it is 30 euros), to be paid to the conductor. They discuss this for a while, but in the end, the passenger (of course) has to pay the full bill.
      10 minutes later, in comes the conductor again and he presents the passenger with a 20 Euro bill. Flabberghasted the passenger accepts and the conductor explains that all NS conductors receive an envelope with a certain amount of cash, to use for whichever they judge is right.

      Neat, eh?

    • http://blog.rummble.com/ Ina

      Thats what good karma is all about.

    • Sean

      Jan:

      More than neat…Awesome!

      WOM = Word of Mouth :) sorry for the acronym.

      thanks for your example/story – it’s one of the best I’ve heard.
      sean

    • JD

      Great example of the impact of company culture on WOM,

      I think a big part of successfully developing WOM and setting the proper foundation of front line empowerment is held by management leading by example. By providing and channeling real-world examples and by actively demonstrating an instinctive understanding of the ‘bigger picture’ in relationship building, they promote in-depth customer satisfaction in servicing their customers.

      I’m sure this employee witnessed their manager, (and their manager witnessed a previous manager, etc..) acting the same to a similar situation in the past.

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    • http://satmetrix.typepad.com/deborah_eastman/ Deb Eastman

      My daughter works at Starbucks and has had several training programs on how to treat customers, including the infamous program where they closed Starbucks for a few hours. This story is a prime example that word of mouth is created by experiences, not buzz campaigns, and that experiences are driving by a culture of focusing on the customers. More companies need to get that.

    • http://blogs.technet.com/kevin_beares Kevin Beares

      I think this is an amazing example of how something of such low cost to a company can have such a dramatic impact on a customer’s perception of that company. Two examples that I can think of that I think are tremendously valuable to customers involve technical support engineers and techbeta (technical beta) “give aways”.

      I was a technical support / customer service manager for close to 10 years before Microsoft and for 2 years at Microsoft. One of the most powerful impacts we could have with a customer was to empower an engineer to provide free support to a customer whenever they felt it was warranted. There are just too many times where the fee based support models can go major league out of control. An great set of examples; A customer calls in with a problem that is complex to them, but takes virtually less time to answer for the engineer than it took the customer to look up the phone number and get the call paid for via their credit card. In most call center models, the support engineer is not empowered to refund the customer for their call, which IMHO is broken. In the times that we did this in my experience, the customer who got the refund without even asking were the happiest customers we ever talked to in the future. It gave them much more patience with our support organization in the future because they valued the relationship that they had with our team. They were also more inclined to do business with us again.

      With techbeta (technical beta) “give aways”. Lot’s of software companies run techbetas with their customers. These feedback programs are tremendously valuable to the software company if run properly. They can validate their feature sets and also get more eyes on their product and catch a lot of bugs that normally would not be caught with the internal testing process, ultimately contributing to a higher quality bar being met when the product releases to the public. In my experience, giving the people who are running the techbeta program the authority to give customers prizes for their participation is a tremdendous way to create a WOM effect. Most customers do not participate in the feedback programs with the expectation that they will be given anything in return for their time. So, when they are awarded for their contributions it has a tremendous impact on thier feelings towards your company. Now, at Microsoft, it is a little challenging to run contests and provide “give aways” for participation because of international gaming laws and also Anti trust policies, but as long as you involve your legal team, you can play by the rules and still have a huge impact on your customers.

      Hope this was helpful.

      Kevin

    • http://msmvps.com/blogs/otelis Octavio Telis

      The secret here is to give added value to the customer, it makes sense when a customer get what he want’s and its spectatives are raised. I like to play with this, give to customers more about they belive are paying.

      Octavio.

    • thebigmouth

      Starbucks serves up Politics

      Starbucks
      2401 Utah Avenue South
      Seattle, WA 98134
      7/18/09

      Mr. Howard Schultz,

      One month ago I sent the letter below, stating my concerns about Starbucks’ support for Morning Joe. Since it was ignored, I feel I must take my complaint to the next level.

      I plan to take my letter to the public forum and request that patrons boycott Starbucks stores until the support for Morning Joe stops. I will also be sending a copy of this letter and a list of videos about Morning Joe to every unions’ web site across the nation asking for their help in boycotting the Starbucks brand and asking their members to help in this matter.

      You have chosen to support Joe Scarborough, who has about 400,000 viewers a day. If your goal is to pickup new customers, other shows have viewers over one million a day, so that would seem to be a logical place to spend support monies.

      What qualities does Joe Scarborough possess that would make Starbucks want to support him other than his politics? I have not seen any disclaimer posted before or after the show stating this is not the view of Starbucks. So I’m assuming that Starbucks approves everything he says. Or did I miss the fine print?

      MSNBC & Starbucks hawked Joe’s book for six months and has only sold 7,000 copies and sits some where around 400 on the best sellers list. He hasn’t been able to sell his book to his base viewers.

      In the end, I’m sure research will show that this didn’t help Starbucks and maybe will show a decline in your business. The main problem is that some people never return to a brand.

      All I wanted was a cup of coffee and yes I noticed product placement and thought that Starbucks was furnishing coffee to Joe. When Starbucks announced their support that changed my mind about SB. The decision that politics was in their best interest and Joe would be their messenger was one huge mistake in my thinking.

      Joe’s stated views on torture go against US and international law, yet he uses this venue to spout his opinions, without real debate. This show is touted as a news/political broadcast, yet the moderator takes it upon himself to interpret the news to his liking our laws and international law, I have no degree in law but I think novice can understand this issue. I can no longer support Starbucks

      Just think tonight some US soldier with all the right intentions sits in Afghanistan worried about his life. Joe and the last administration have praised torture as a way of getting to the truth, even though we know that torture can make people say anything. Is this a debate we should have? Not really, it has been settled law for a very long time.

      An independent voter and former Starbucks patron,

      Starbucks
      2401 Utah Avenue South
      Seattle, WA 98134
      6/8/09

      Mr. Howard Schultz,

      As a patron and gold card member of your store and brand, I have to wonder where Starbucks is heading.

      I’m not sure who came up with the idea of a Sponsorship Agreement with Morning Joe but this seems to me one of the worst ideas that your PR department has come up with. Also Burger King already uses Morning Joe slogan in their stores. You are walking into a minefield and an ambush at the same time, which is the worst-case sanerieo for Starbucks and its brand. There is no good outcome for Starbucks with this sponsorship. It is really short sighted. Yes I ‘m sure that your PR people convinced you that Joe and Mika is the new shiny thing and that you should get on board quickly.

      It is my thought that a company should try its best to stay away from politics, religion and social issues, but you have decided that Morning Joe is the man and the show, which you will attach your name and brand to. You only need to look at other companies that have taken political or social stands to see what it cost. Denny’s thought discriminating against skin color or Cracker Barrel against gays, just a couple that come to mine, not great PR.

      Joe is an attorney, journalist, author, congressman and commentator who thinks torture should be used, because someone in the CIA told him it works. The authority on torture are Joe and Donny Deutsch neither having any first hand knowledge on the subject, and General David Petraeus, Joe’s favorite General has said it is torture and it’s against our laws, but you haven’t heard that reported on Joe’s show. This is a man who can’t handle an open and honest debate. He always gets angry and overbearing on his own show with his guest and mostly with women. This is the same guy who had the failed show Scarborough Country. This is the show that thinks talking about vibrators and how sexy Mika looks with her hair up or down makes great morning conversation. This is a guy who calls an FBI agent testifying before congress a liar. This is the show that thinks that unions are the problem with business, although this could be good for Starbucks to have Joe, Andrew Ross Sorkin and Mika Brzezinski (“They cripple the system that makes a company work.”) talking down unions in one of the most unionized cities in our country and on a union set. I hope the union members in NYC don’t boycott Starbucks when the card check debate begins. Or calling Paul Krugman an idiot. This is the guy who tells some of the best journalists in the country, they just don’t understand! This is a show that makes fun of people’s clothes and hairstyle that appear on their show. This is the show that makes a joke about David Carradines’ death. I think you’re under estimating the intelligence of your average coffee drinker.

      Yes, this was a Great Idea! If Starbucks is looking to push customers away. You have asked us, to take a stand, to get on one side or the other of the issues, that Joe thinks are important.

      Here are some things that I think could win customers to Starbucks.
      Set up coffee stands around the WWII, Korean and Vietnam Veterans Memorials and hand out free small cups coffee to the people attending those places on Veterans or Memorial Day. Tens of Millions of American’s are directly related to those who either survived or gave their lives for this nation. I can see the cup that says Starbuck Salutes Sacrifice.

      Or how about offering to bring commercial free time for D-day events on MSNBC with your logo present during the show, so the viewers can listen to all the presenters.

      I’m sure Starbucks can win customers in any number of ways without risking the chance of alienating any part of their customer base that they have or could have in the future. I’m sure at some point Joe or Buchanan will say something that will offend or anger someone that will take a hard look at what Starbucks is supporting and start asking hard questions of Starbucks that has nothing to do with the brewing of a great cup of coffee. I’m sure this is not the public conversation that Starbuck wants to have. I didn’t know there was a Republican, Democrat, Independent, conservative, liberal or moderate cup of coffee, I thought there was just good coffee.

      It would seem to me that Starbucks should be forward thinking company; its clients are more educated, have more sources for information, younger and are good at making choices. Just look at the last election and yes the people did turned on their last brand, they didn’t like what they we’re sold. Starbucks should be careful of what they are about to start selling. Maybe Starbucks should stick to coffee and pastries and not get involved in politics and social issues.

      So, in closing, let me say I’m returning my gold card and will start paying full price for any products I purchase at your stores, understanding that you need the money more the I need the discount. But the company that I thought you were is not the company I’m seeing today. It is obvious that Starbucks has made a political calculation rather a than a business decision. I’m not boycotting Starbucks but I will start at this point to spread
      my coffee business around and at the same time watch to see how politics and coffee mix. And while I’m usually a brand loyal person that doesn’t mean it’s Joe’s brand.

      I remember a great quote. Hiring people is an art, not a science, and resumes can't tell you whether someone will fit into a company's culture. When you realize you've made a mistake, you need to cut your losses and move on.
      Howard Schultz -

      From my point of view this would be very good advice.

      Former Starbucks Supporter

      Starbucks Sponsorship of Morning Joe MSNBC

      Possible loss of sales from offending comments by Pat or Joe or Mika.

      Our coffee cost, my simple calculation.

      $4.37 X 5 days = $ 21.85 X 52 weeks = $1136.20 X 2 patrons = $2272.40 per year

      People offended X 10,000 = $22,774,000. per year

      People offended X 100,000 = $ 227,740,000. per year

      Starbucks investment in Morning Joe $10,000,000

      Web videos MJ Starbucks

      Target HHS.
      http://www.youtube.com/watch?v=Tmz2e2s3BKU&eurl…

      Torture
      http://www.youtube.com/watch?v=dccwJNYwVw8&feat…

      Torture debate Christa
      http://www.youtube.com/watch?v=7iD-noY7IDE

      More torture
      http://www.youtube.com/watch?v=Nxl8ZQhG7-Q

      CIA tape torture Joe explodes
      http://www.youtube.com/watch?v=e7PpIImLHWM

      Dick O & Joe
      http://www.youtube.com/watch?v=iaH3U4TuzAM

      Joe’s fear
      http://www.youtube.com/watch?v=mpf_-AoFQG4

      Joe & Matthews
      http://www.youtube.com/watch?v=QZ-eaXCD3NA

      Joe Hitch torture
      http://www.youtube.com/watch?v=HslR9UaVuXA&NR=1

      Joe, on Bush
      http://mediamatters.org/research/200906190028

      Joe & Krugman
      http://videocafe.crooksandliars.com/heather/pau…

      Joe, on Bear
      http://newsbusters.org/blogs/scott-whitlock/200…

      Joe, on Krugman
      http://theplumline.whorunsgov.com/political-med…

      Joe, Jesse Ventura

      http://www.swamppolitics.com/news/politics/blog…

      Joe, on torture
      http://videocafe.crooksandliars.com/heather/joe…

      Joe, VP Dick
      http://airamerica.com/blog/2009/may/13/joe-scar…

      Joe, gay not in my state
      http://www.queerty.com/joe-scarborough-let-gays…

      Joe, on Schiavo
      http://mediamatters.org/mmtv/200503290005

      Joe, Pelosi,
      http://mediamatters.org/research/200907090025

      Pat Buchanan calls for killing
      http://mediamatters.org/mmtv/200907130007

    • http://www.staffingpower.com/ staffing1

      The secret here is to give added value to the customer, it makes sense when a customer get what he want's and its spectatives are raised. I like to play with this, give to customers more about they belive are paying.