Voices: the CMB Blog

One of my major motivators in life is receiving free stuff. You can often find me walking around Costco looking for samples or signing up for loyalty programs just for the bonuses. So, when I recently started using Birchbox, a monthly subscription service that sends a box of expensive beauty product samples each month, I was ecstatic to learn that I could earn rewards points for reviewing each product in the box. Birchbox’s use of points seems to be working; with around 400,000 subscribers most of their products have over 2,000 reviews with some nearing 10,000.

This program has two key benefits for Birchbox. It keeps users engaged; reviewers need to go to the website at least once per month to review products. And, it gives buyers more confidence in the products. With thousands of reviews and a 4- or 5-star rating, customers can feel safe they’re buying a good product. This strategy, however, might leave you asking: is it fair to ask customers to depend on reviews when the reviewers are incentivized to write them? If you’re not a Birchbox member you might think the question is purely academic. But chances are you are one of the nearly 700 million people who’ve shopped on Amazon, and in that case, you have some things to think about.

Enter Amazon Vine, an invitation-only program in which Amazon’s top reviewers are given free products to review, sometimes before they’re released to the public. According to Amazon, they welcome both positive and negative reviews, and ask only for honest reviews. Despite the fact that Vine reviews are identified with a green stripe, in the beginning many readers of reviews were unaware of the program, they believed they were reading the reviews of people like themselves, who reviewed a product they bought because they wanted or needed it. Instead, they are written by people who are given products by Amazon (sometimes worth as much as $1,000) with the only stipulations are that they have to write a review within 30 days and they can’t sell or give away the product. It’s fair to wonder whether these two types of reviewers may react differently to products based on the circumstances.

Amazon has actually confirmed that Vine reviewers act differently than non-incentivized reviewers, but not perhaps the way you might think. On average, Vine reviewers give lower ratings than non-Viners. That being said, Amazon research shows that products with bad reviews still sell better than those with no reviews. In the end, it seems to be a win for all parties: Amazon gets reviews from invested reviewers which then boost product sales; The Consumer can read reviews from both Vine and non-Vine members, and decide themselves who to trust; The Vendor may very well see increased sales due to the reviews; and finally, the Vine Reviewer, who ends up with a lot of free stuff.

The key here is transparency, knowing whether the reviewer received the product for free lets the consumer weigh how much that review counts in their decision. For me, when I’m reading Amazon reviews, if I see the “Vine reviewer” stamp on it, I’ll trust that I’m reading the review of an opinionated, knowledgeable reviewer. And if I get an invitation to join Vine, you’ll be reading my reviews in no time.

McKenzie wrote this blog post from Oregon. She managed to avoid both snake bites and dysentery on her trip west from Boston.

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Last week my Facebook feed was filled with tragic news. The Alchemist Brewery, in Waterbury, Vermont (where I happen to live), is closing its retail store—no more dropping in to taste their beloved Heady Topper. Luckily, my fellow craft beer lovers can find some solace in the fact that while the retail space will close, the brewery will turn their focus to canning the delicious brew. But not too long ago the only canned beers you could get were decidedly not craft—they were mostly watery domestic lagers without a hop in sight. However, if you’ve been to a liquor store in the past few years you’ve probably noticed nearly every style of beer can be found in cans. In fact, a number of domestic standards have also changed the look and feel of their cans—there are bow-tie shaped cans, wide mouth cans, and cans that change color as the beer gets cold. It’s a canned beer revolution!A decade spent in the Market Research industry changes the way you look at everyday things, like these changes to the beer market, so I decided to do a bit of secondary research. First, I wanted to understand what motivates people to purchase canned beer. The results of my highly unscientific online search are here:

• Beer cans work better with outdoor lifestyles (hiking, boating, etc.)

• Cans keep beer fresher

• Canned beer weighs less/is easier to carry

• It saves money on packaging and shipping

• Cans block light which is destructive to all the things that make beer so tasty

• Cans are sturdier (won’t break in your cooler during your road trips)

• Cans chill faster and keep beer colder

• Cans are easier to recycle

• Their favorite retail beer store closes (n=1)

So canning is great idea, right? In 2002 just one craft brewery canned their beer, now there are roughly 330 different craft breweries canning a little over 1,000 different brews. But, when I asked many of my fellow Vermonters whether they’d drink their craft beer from a can, I was told “no, that ruins the taste.”  

Ah, the taste…which is the reason aficionados buy craft beer in the first place. Luckily, the brewers of Sam Adams have been relentlessly pursuing beer can innovation, breaking down the key barrier that is that metallic taste. Just this summer, they debuted the SamCan:

“the result of two years of ergonomic and sensory research and testing…the new can design aims to provide a drinking experience that is a little closer to the taste and comfort of drinking beer from a glass. What you’ll notice: The larger, wider lid helps open your mouth allowing for more air flow during the drinking experience. The can opening is located slightly farther away from the edge of the lid, placing it closer to the drinker’s nose to help accentuate the hop aromas. The hourglass ridge creates turbulence (like our patented Perfect Pint glass) which “pushes flavor out of the beer” and the extended lip places the beer at the front of your palate to maximize enjoyment of the sweetness from the malt.”

The amazing thing is, that despite their research investment, Jim Koch, the co-founder and chairman of the Boston Beer Company, the producers of Samuel Adams, announced that they plan to "make the patent-pending design available, without any royalty or license fee, to all craft brewers who would like to use this can."

That’s great news for this Vermonter, who will continue to buy my craft brews in a can because let’s face it, it’s much easier to hike with backpack filled with canned beer than it is to carry a bottle.

Sam is a Data Manager at CMB, she loves hiking the green mountains of Vermont with or without a tasty brew.

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Originally posted in Loyalty360

In early July, shoppers at Shaw’s, Albertsons, Acme, Jewel-Osco and Star were greeted at the door and asked to hand in their store loyalty cards. These chains, recently acquired by Cerberus Capital Management LP, all shut down their loyalty programs, focusing instead on everyday low prices and storewide sales.The move left some industry analysts scratching their heads, questioning why the brands would kill off decades old programs with millions of members. They pointed to the vast quantities of information that can be harnessed improve merchandising and marketing, and to customize products and messages. They hypothesized that the stores hadn’t invested in the data mining activities needed to extract insights. Perhaps…

Or perhaps the financial experts at Cerberus had done the calculation and determined that in today’s marketplace, the loyalty program – and its strategy and value– was standing in the way of profitable growth.

Think about it. What impact do the grocery store loyalty program cards you carry on your key chain have on your behavior?  Can you point to any benefit you’ve received beyond the ‘loyalty member price’ and coupons at check-out? Can you point to any special benefits you receive from your primary grocery store?  Or do you get the same level of benefits whether you spend $1 or $1000 per trip?

I think there are 3 compelling reasons these grocery stores don’t need a loyalty program to drive customer loyalty:

1. They need to compete with Wal-mart: These brands have to compete with Wal-mart and other warehouse stores offering EDLP (everyday low prices). To grocery and drug store shoppers, price matters!  And to sustain a business and drive profits at low prices, the brands need to focus on operational efficiency – not customer intimacy promised by a loyalty program.

2. They can take a local approach: The executives at these brands promise that analysis will be done at the store – not the customer – level.  Mining the data at the individual store level will, they theorize, provide plenty of data on what merchandise is important to shoppers and the impact of marketing decisions on spend. They also believe that taking a local approach – where store managers can make marketing and merchandising decisions – will enable stores to better meet customer needs.

3. They can focus on what matters to shoppers: Most customers are applauding the move to consistently lower priced products.  In addition, they suggest the brands focus on the basics – the features that drive their shopping decisions, including: (1) clean the store; (2) stock the shelves; (3) keep sufficient registers open to reduce check out time; (4) mark sale items clearly; (5) create a customer-focused culture.

In most locations, shoppers have many choices and in the absence of consistent delivery on these core elements, customers won’t shop at the stores, loyalty points or not.

“Sun setting” a loyalty program is not a low-risk decision. But program managers in every industry must be prepared to defend their programs by answering the following questions:How do you recognize and reward your most loyal and valuable customers?  How do you make participating in the program worth their while…and something they would miss if it were not present.

• If you ran a grocery store program, how would you treat the person who spent $1000 per trip? Would your first check-out register be for those with 10 or fewer items?  Wouldn’t you help the shopper get the items into their car?  Into the house?  Into the pantry? Do you really have to make them come to the store and shop? Do these customers get any special recognition in store?  Could they visit customer service to get a free cup of coffee or a piece of a new signature pastry when they enter the store?

What mechanisms are in place to grow the share of wallet from light shoppers?  What incentives and processes are in place to support your shopper’s goals and encourage them to spend a higher share of wallet with you?

• Could you look in my basket and make recommendations for recipes that my family might like?  Or like Amazon and Netflix, develop a recommendation engine (people who buy xyz also buy abc)?  Would you price match on identical items to prevent shoppers from fragmenting their baskets?

What has your organization learned from the data collected from the program?  Think about the tactical (e.g., merchandising, marketing) and strategic (e.g., location selection, branding, pricing) decisions supported and how you can get more value from the data you collect.

• Have you shared insights with store managers?  Your media partners/ad agency?  If not, schedule some meetings and connect data you have with what’s relevant to them. Today.

Consider what would happen if your loyalty program “went away?” Are you prepared to answer the question “Do you need a loyalty program to drive customer loyalty?” in a way that would satisfy your CFO?

• Get and communicate data on the value of your program, and how to drive additional value.  

It will be interesting to see the impact of Cerberus’ decision on the industry as a whole.  Will other grocers, to compete with Wal-mart, follow suit and disband their programs?  Or will we start to see some retailers ‘break away’ from the pack and to drive incremental behavior and true loyalty?

Where would you place your bet?

Judy is VP of CMB's Travel & Entertainment practice and loves collaborating with her clients. She's the mom of two college students and the wife of an oyster farmer. Follow Judy on Twitter at @Judy_LC

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One of the cardinal rules of great customer service is be helpful - even if there's no immediate profit in it. That’s never been truer than today; a customer who feels truly special and cared for has more channels to express themselves than ever before. We hear quite a bit about the power of negative reviews; many companies spend millions trying to recover poorly-served customers, but the positive impact of a happy customer also deserves attention.Case in point, Crate & Barrel has awesome customer service. And now all my friends, and friends of friends, and probably even their friends, know it. I bought 2 glasses from Crate & Barrel a few months ago. One arrived chipped. I called to see about getting it replaced, I was all geared up to argue my case to the representative on the phone. I was ready to try and prove that it arrived chipped, I wanted to make sure she knew that I wasn’t lying about it to get something for free. Of course, I assumed I would have to send it back, so they could see that it was indeed chipped and mark it in some inventory database somewhere, and basically go through a lot of trouble to get my unchipped glass.

The customer service rep didn’t question me at all.  She looked it up in the database, saw that I had ordered the glasses, apologized for one being chipped, and said she would send a replacement out right away. She said as far as the chipped glass goes – I could keep it and use it as a flower vase or throw it out or do whatever I wanted with it. I got the new one 2 days later.  It could not have been easier or more pleasant.

I was so excited about the whole experience that I immediately posted on Facebook about it.

Facebook and Yelp have, of course, helped revolutionize customer service. Before them, a bad experience could be emailed around to friends, talked about at gatherings, you might have even written to the company itself. But these channels only reached so many people. Now, however, through Facebook, Yelp, and countless other online review sites, we can reach thousands of potential customers in one second. We can literally tell the world about our experience, good or bad. This is a pretty powerful motivator for companies to go above and beyond in the customer service department, and we can thank social media for that.  

Jessica is a data manager for CMB’s Technology, e-Commerce, and Medical Devices practice.  She always reads reviews or consults Yelp before buying any new products or services.

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Over the last year I’d heard rumors of a new “super” Walgreens coming to Downtown Boston. To be honest, it sounded a little odd: a Walgreens with a sushi bar? A nail salon? But sure enough, one sunny day in May, a coworker announced the giant Walgreens had finally opened; of course I had to check it out. The moment I opened the doors I was like a kid on Christmas morning—this is not your mother’s Walgreens.

The aisles were brightly lit, and everything was clean and well organized, but what really blew my mind were all the high-end amenities: a juice bar, frozen yogurt bar, fresh sushi, and a pharmacy that looks more like a very nice health center than a regular old pharmacy area.

It’s certainly not how most of us perceive the Walgreens brand; but it’s all part of their efforts to transform the customer experience and they’re doing it in a number of really interesting ways:

An innovative approach to the community pharmacy and health services—Like most drugstores, Walgreens' traditional stores are split between retail and pharmacy/health care services. In the new store model, there is a health and wellness wing, including consultation rooms where pharmacists and other healthcare professionals come out from behind the counter to speak privately with customers. New patient-facing “portals” allow customers to schedule appointments, access information, and share health contacts—empowering customers in the way the old model never has.

Integrating the wellness focus throughout the store—Not surprisingly, Walgreens reimagined pharmacy is getting most of the press, and it’s well-deserved. But I was also struck by how the company highlighted healthier food and beauty options in each department. At first, doing your food shopping at a drugstore sounds both unappealing and unhealthy—all processed food and junk, but if others follow Walgreens lead, that might  change. While the juice and sushi bars might have seemed at best gimmicky, and at worst like a health hazard, the holistic focus on wellness and health means that what might have seemed unimaginable (drugstore sushi?) really starts to make sense. I swear the sashimi was actually good!

Getting mobile—Walgreens' new concept also does a great job leveraging mobile to transform and improve the customer experience across departments. For instance, you can scan your prescription bottle to get a refill. That might seem like a no-brainer in this day and age but how many of us are still calling our pharmacy’s automated hotline?

And hard as it may seem to believe, not everyone just posts all their pictures to Facebook, Walgreens' QuickPrint option lets customers print their pics right from the phone they took them on. It’s a smart move for a company that realizes the drugstore photo lab may not be with us forever.

As Walgreens President and Chief Executive Officer Gregory D. Wasson puts it: “We are taking a multi-pronged approach to delivering the Well Experience. We are combining leading-edge design with enhanced products and services, increased engagement with team members and customers, and an omni-channel approach that blends our brick-and-mortar stores with e-commerce and mobile commerce. We are deliberately blurring many retail channels to fit how consumers shop today.”

Bravo Mr. Wasson, bravo.

I’m looking forward to seeing what other benefits are in store for Walgreens customers. But in the meantime, I’ll have plenty to explore at the new, impeccably designed, Super Walgreens. And for all my fellow Bostonians, the next time you need to pick up a birthday card, wine, or health and beauty products, I suggest you make a trip Downtown.

Posted by Stephanie Kimball. Stephanie is CMB’s Marketing Operations Manager and loves any and all sports, the beach, traveling, marketing, good food, and is always down for a movie night. You can follow her on twitter @SKBalls

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