Exceeding Customer Expectations and Perceived Value--Under Promise and Over Perform

Value...what do we value? What's more important, actual value or perceived value? Is there such a thing as too much value? Jennifer White in her excellent book Work Less, Make More argues that we can add too much value into our companies and products or services. At some point, there is so much value that we "don't count" parts of it. Two things come into play: 1. What I call supposed value, and 2. What Mrs. White calls perceived value.

1. Supposed value is when we provide a bunch of stuff that our customers don't really want, or want but "don't count". We suppose that they need these things and it leads to frustration because we count them and our customers do not. I'll give you a few examples and you'll quickly understand what I mean. 

1. A. Supposed value that customers don't really want.--Eliminate all these quickly.

Our Playstation 3 will play region 2 DVD's. For those of you who don't know what that is, here's a synopsis. The media world is divided geographically into 6 regions. Region 1 is the US and Canada. Region 3 is Japan, Europe, South Africa and the Middle East. Discs from regions other than your own have coding that prevents players in other regions from playing them. Often tourists are annoyed that DVD'd they buy in Europe don't play in the US.

My wife is happy that our Playstation will play her foreign videos. I suspect that she is one of a small percentage of customers who were thrilled by this news. In fact, it's likely that most people with Playstation consoles don't know what this means and don't care. Listen to that--They payed extra money for value that they don't care about. Sony got smart in latter releases of the same console--they lowered the price and eliminated this hardware. Now the blue-ray player we do value. 

1. B. Supposed value that customers don't count.--Gently help your customers count these.

A friend of mine grew up on a large dairy farm. His father worked very hard to keep everything running well, but at the end of a hard day's work he always made it home on time. One day his father got stuck out on a job and came home over an hour late. When he arrived at home his wife was very upset that he was late and hadn't called. She thought the worst. He was never late, so he must be dead or injured. He was surprised that she was so upset...after all, he's never late. She should cut him some slack for this one occurrence, he thought. 

They are both right. This is supposed value that this farmer provides every day. He counts it. and supposes that she will too. He works hard to come home on time. He leaves farm jobs unfinished to make his family a priority. She takes it for granted. She doesn't "count it"...unless it's missing. This is a case where "we don't realize what we have until it's gone". 

Parents and children often have this problem of unperceived value. It can be very damaging to a relationship and happens frequently in close relationships. One party overvalues something, the other takes it for granted They are suddenly offended when things don't go as usual. 

My wife and I often nip this one in the bud when one of us starts complaining that something didn't go as expected instead of saying, "I can't believe you didn't take out the garbage!!" we'll say, "Thank you for taking out the garbage all the other times.". 

This is dangerous territory because we need to distinguish between what our customers don't want and what they do want, but are not counting so we can eliminate the things they don't need or want, and gently help them "perceive" the value of what they just aren't counting. Pray that you don't accidentally eliminate something they really do want but aren't counting. It can be tough to know the difference. 

2. Perceived Value is that bunch of things that you provide that your customers love...they "perceive" or count the value even if it doesn't really exist. There are two categories. 

2. A. Perceived value that customers don't really need, but value anyway.--You will want to eliminate anything that falls into this category that costs you more money than it brings in. Double down on anything that brings you more money than it costs (hype, fads, brands and one hit wonders fall into this category). These are what make rabid customers, but it can be fickle. 

Beanie Babies. Need I say more? They are merely tiny stuffed animals, but when there was a shortage, people got injured at the mall trying to get their hands on one and were willing to brave weather, long lines and threats of death to get one. Just know that all good fads come to an end. For some reason customers perceived value where there really was none. 

Black Pearls (Tahitian pearls). In the 1970's black pearls were considered inferior to white pearls (never mind that pearls are just parasites covered in layers of calcium carbonate-what antacids are made from). In the mid 1970's Salvador James Assael a pearl manufacturer if you could call him that, brought several black pearls to jeweler Harry Winston in New York and had them set in extravagant settings and placed them in the window next to expensive stones. This piece of sheer marketing genius created for these junk pearls a perceived value far greater than that of white pearls. This perception remains true today. Starbucks did the same thing with gourmet coffee.

2. B. Perceived value that customers need and love.--Run with these. It's your bread and butter. These are what create consistent customers. 

What do you get at McDonald's that doesn't fall under the heading of hype from above? A consistent size, shape, look and taste (not to mention quality of meat, at least in cleanliness) to everything on the menu anywhere in the world. And you get it fast, to boot. Start messing with quality and customers will run for the hills. 

How can you increase perceived value? Some ideas: 

Find ways to gently point it out. I read a book once that said if you come in early and leave late, send your boss an early morning e-mail periodically so he might notice your sacrifice.

Under promise and over perform. I recently failed at this when I told my banker I'd email a document within the hour and then didn't get it sent for several hours. Now I look like a slacker. How much better to have said I'd have it by the end of the day and then send it in several hours instead?

Figure out what your customer wants and give it to them.

Surprise them. Front loading special bonuses makes a customer feel like you only have a bonus because you want a sale. Back loading special bonuses make a customer feel important or valued. They value you in return. Zappos routinely sends flowers with their shoes. 

Inexpensive ways: remember names (of customers, kids, grand kids), use names, send a thank you email or note with specific information from a prior meeting, smile, say thank you, make a special offer for each customer group "just for people like you (new customer, old customer, young customer, etc.), communicate well, remember birthdays, remember special events (and mention them), point out features, refer out when you can't meet needs (keep a list of professionals handy).

The possibilities are endless. Get out there and exceed customer expectations and create perceived value. 

Method for Improvement

I'm not sure where I picked this up, but I think it was likely several books and possibly a few research articles. The one that stands out in my mind is Dale Carnegie's How to Win Friends and Influence People. Some audio book I've listened to recently must have brought it again to my attention. If I run into anything I've read on this subject again I'll try to add a reference here, or you can add it in the comments section.

So here it is: any situation you have, you need to think through it ahead of time and answer the following questions.

Before:
B1. What outcome do I want to have from this (meeting, conversation, negotiation, etc.)?
B2. What will I do to cause this to be the outcome?

During the situation you need to ask yourself the following.

During:
D1. Are my actions causing my desired outcome to be more or less likely?
D2. What can I change now (in my approach, method, tactics, tone, mood, etc.) to make my desired outcome more likely?

Then after the situation ask yourself and answer the following.

After
A1. Did I get the outcome I desired?
A2. Why did I or why didn't I get the outcome I desired?
A3. What will I change next time I have a similar situation?

Carnegie suggests that a businessman he associated with stated that he reviewed his business and personal dealings every week. This weekly review was the single most important thing he did to bring about positive change in his businesses and life.

Here's the rub. If you don't go into a situation with an expected outcome, you have no measuring stick. How will you know if you did well or poorly? How will you know if you got what you expected? How will you know what to do in the future to avoid reliving bad outcomes and keep getting good ones?

Practical application: My 4 year old is not going to brush her teeth to get ready for bed.

Me: What would you rather have happen? You can complain here for ten minutes and not get a bedtime book, or you can quickly go brush your teeth and you might have time for two chapters of your bedtime book?
(Read: B1. Which outcome do you want? Extra book time. B2. What do you need to do to get it? Get ready for bed quickly. )

Child: Erg. Two chapters!

Me: Then why are you standing here complaining? That's not going to get you what you want! Go get your toothbrush!
(Read: D1. Are your actions (complaining) causing you to get your desired outcome? No. D2. What should you be doing to get your desired outcome? Quickly get your teeth brushed.)

Child: (runs to get toothbrush)

Me: Good Job! You got ready so fast we have some extra time for TWO WHOLE CHAPTERS tonight! You should do this every night!
(Read: A1. You got your desired outcome--two chapters. A2. You got your outcome (book chapters) because you got ready for bed quickly (action). A3. What will you do next time? You can have this every night if you just get ready for bed quickly instead of complaining.)

Simple. If you're having trouble remembering, notice that it's the same thing three times. 1. Outcome.
2. Action. It's that simple.

Now my 4 year old child is already savvy enough to know that sometimes she doesn't want to do the action that leads to the outcome. My only answer to this is "When you want it badly enough, you will do what you need to do to get the outcome." My old therapy mentor used to say, "Some people just aren't hurt badly enough to get better yet."

There was an old rat poison commercial where a lady saw a mouse and screamed, "I hate you!" Then a guy in a giant mouse/rat suit standing in her kitchen takes a bite out of some food and says, "Prove it."

You wanna lose weight? Quit smoking? Learn Spanish? Change careers? Open a business?...Prove it. 1. Outcome. 2. Action. It's that simple.

"You Are on a 0 Day Streak"...Fail. Your Simple 3 Step Plan to Stop Failing.

I have begun learning Spanish. I took Spanish in Jr. High and High School, but pretty much purged what little Spanish I did know one year after high school when I learned Mongolian to a high level of fluency and spent nearly two years in Outer Mongolia. Since knowing Spanish may connect me with another 470 million native speakers and Mongolian only connects me with 5.7 million speakers at best including many dialects that I doubtless would not understand, I figured now might be a good time to take the plunge. Next on my list will be Chinese.

Anyway, I got a Duolingo account and began learning. The first few sections were enjoyable and easy as I relearned the most basic "Hola" etc. Then I had to buckle down and start learning. After a few weeks of sporadic efforts at best, I decided that I really was going to put in the effort, so I busted out a 52 day streak. Then Halloween happened. 

I worked late and went straight to my sister-in-law's party, then went straight home arriving some time after midnight and Kabaam! Now I have a 0 day streak. Lame. As in, I am lame. 

So the question is when did I lose my 52 day streak?

Answer: The day before Halloween when I did not foresee the fact that I usually study in the evening and likely would not get that opportunity on Halloween, duh. 

And the moral of the story is...we all need to do a better job of planning ahead. 

Other times we "plan to fail because we fail to plan", then make excuses as to why it wasn't our fault even though it really was:

Waiting until the last minute to buy gifts for a birthday, anniversary, Christmas, or other holiday. "I can't believe every store was out of _____." (They weren't out 3 weeks ago when you should have ordered it.)

Waiting until the last minute to get ready to go to your event, party, meeting, date, job interview etc. "Traffic is never that bad" (Yes it is...every day...you should have left 20 minutes earlier and you would have been on time...and you should know how long it really takes yourself to get ready by now.)

Eating all that junk at work, that party, home. "Cravings happen, and I just had to try _____. (No, they don't just happen and no, you didn't have to try it. You know what sets off your cravings and you should have a healthy snack ready.)

Smoking, drinking, snorting, or otherwise participating in ______. "I just can't help myself." (Yes, you can. But maybe not in that moment. If you had planned ahead, you could have because you would have had a plan for just that moment, situation and/or scenario.)

Recent research has shown that you may be right. You may not be thinking straight in the moment of temptation or neglect. That is precisely why we need to plan ahead when we are level headed. We need to have a "pre-mortem".

In a situation where things could go wrong or have gone wrong in the past do the following:

1. Ask yourself, "If this was going to fail, why would it have?" in other words, "If tomorrow I wake up and I have failed, in what way did I fail and what could I have done differently so I would not have?" 

2. Make a plan that fixes or prevents that failure (kills the excuses).

3. Follow your plan no matter what.

So, when Thanksgiving and Christmas and Kwanzaa and New Year's come around I will:

1. Ask myself the day before. "Adam, how will I lose my __ day streak on Duolingo tomorrow?"

2. I need to do my Spanish in the morning so I don't forget to do it after dinner when I'm "Trippin' on Tryptophan". I think I'll set an alarm for the morning so I wake up on time and schedule a phone reminder to ring in at noon in case I forget in the morning. Also, I think I'll plan my outfit and pack the diaper bag tonight so I'm not late even after getting stuck in that horrible holiday traffic. Then, when that delicious pumpkin pie comes my way I'm going to reward myself for having done my Duolingo by eating three slices with an extra helping of whipped cream--can't win them all, right?

3. Wake up on time. Do my Duolingo. Eat my pie! 365 day streak here I come.