Companies, please tell your “Virtual Assistant” to shut the **** up! Let’s put the Customer back into Customer Service

(read the article to the end and I will give you a hint about how to possibly shortcut this nightmare)

Technology is detrimental to business? In this case, yes. Am I nuts? Yes, no or maybe, read on.

I am willing to venture a guess that we all have been through this: You call a company that is vital to your existence like your internet provider or your bank, and, instead of a person, you get a “Virtual Assistant” who asks you to state your issue. No matter what your response, it tells you that you can get a quicker response by: a. visiting their web site b. chatting with someone (who is somewhere) or responding to the link they just sent to your mobile phone. If you don’t respond to one of those choices, there is no option to speak to a live human being. In fact, in more than one case (company to remain nameless), if you don’t choose one of those it hangs up on you. IF you have experienced that, you know how I feel, and if you didn’t, I need to know which companies you have called recently.

 

It seems that, today, companies will do ANYTHING to prevent you from talking to a human being. Why? Because that human being is someone who is paid for the knowledge that will help you, while the other choices are free or cheaper. 

Wouldn’t chat be a viable option? NO. Why? Because a. It is so much easier to say “sorry I can’t help you” on chat than on phone and b. more than likely, that person is in another time zone, probably working in the dead of night, is not paid by the company that you called and c. Doesn’t know jack about your problem.

So, since I am a businessperson and professor who is supposed to understand the economic benefits of technology, I should get it, right? NO. I don’t. For two reasons: a.  I didn’t get my problem solved and b. I am really pissed off at the gauntlet I have to go through every time I call. Make no mistake about it: If I had the chance to dump your ass and switch to another company, I would. So the company’s terrible customer service moat is switching cost. They are betting you can’t or won’t switch because your brain doesn’t want the trouble. Are they right?

What have I done in these situations? Simply, get apoplectic. I yell Customer Service! Representative! Human Being into the phone while pressing 0 a dozen times in rapid succession, like 00000000000000000. Oh.. Good thing my heart is sturdy.

Do I have to go through that every time? Seems so, except when I find a workaround (see below)

Wait, it gets worse. All of these companies have conspired, once you get to a point where a human is possible, to deliver the message, “We are experiencing a higher-than-normal call volume.” That, my friends, is half the story. The real deal is that the company is experiencing a higher call volume that the fewer and fewer humans cannot handle.

But seriously folks, if I were the CEO of one of those companies, I would STOP all that and allow customers to chat with a human any time they indicate a reason that cannot be answered by an automatic response (like bank account balance). But wouldn’t this cost more money? Depends if you are looking for short term gain or customer loyalty. Executives know about the value of customer loyalty, right? (Your answer? See below) 

Even for those unlike me (there are a lot of them) who just hangs up, gives up, or chooses one of the alternatives, the experience will create a negative memory in their unconscious mind and, according to Dr. Peter Steidl, author of Neuromarketing Essentials, just as our forebears did when they were looking for easier ways to hunt food, like this is a great place for food but there are lions there, whereas another with less food is lion-free. They will try to avoid the bad experience and look for more positive ones. 

Thus, for example, the plethora of cellular companies that has sprung up in recent years. They really don’t provide better service or coverage, but the companies people are switching from really suck. So as human beings led by their quest for dopamine (the brain’s chemical secreted when we have or anticipate a pleasing experience), they have to make the move.

My message to companies is, no matter how much more you think you are spending for prompt and human customer service, it will create more business, more loyalty and create behavioral codes that will make your company a no-brainer and an automatic choice. All you need to do is connect your customers to a real, knowledgeable person that actually works for the company in the same or nearby time zone. 

Happy customers spend more, stay longer and buy more things. This is a fundamental fact. Whereas unhappy ones become part of the leaks in your Leaky Bucket. Ask Apple, who still makes it easy to get in touch when you need help (used to be ask Amazon as well but they have gone the way of the outsourced). This is more than a fact of Customer Relationship Management or business logic: It is a fundamental function of our non-conscious mind or System 1, which controls purchase decision making.

Wait. Shouldn’t big companies know this? There are ways to measure customer loyalty, like Customer Lifetime Value and Customer Retention Rate, Average Customer Spend etc. 

NO. According to a survey done by Customer Gauge in 2022, 44% of businesses didn’t know their rate of churn or retention. In fact, 32% of B2B executives were completely unaware of their loyalty rates at all.

.

“According to our most recent research, 86% of B2B (me: I know this is for B2B but it should be the same or worse for B2C because B2B firms have fewer and less diverse customers) brands aren’t measuring the ROI of their customer experience (CX), while 47% don’t measure upsells, cross-sales, or other metrics of customer loyalty.” 

It gets worse. According to the same survey, “The trouble is that many of the executives we spoke to didn’t know how to measure customer loyalty.” 

OMG. Where is John Galt?

 

 

👍👍👍

What is my little hint to circumvent the gauntlet? Don’t respond to any prompts or questions; as soon as you get connected to the bot, press 0 and say customer service, representative, human. This will confuse the Virtual Assistant and give it no choice but to hand you over to a human. (This does not work all the time, nor does it guarantee which time zone the human will be in).

Good luck with that. Protesting or writing to the company most likely won’t help. As always, customers need to talk with their feet. Or their checkbook, as it were.

The answer is NO! Creative Destruction is NOT, nor will ever be, DEAD. So what about Nondisruptive creation?

 The answer is NO! Creative Destruction is NOT, nor will ever be, DEAD. So what about Nondisruptive creation?

After reading Kim and Mauborgne’s “Beyond Disruption,” I got my answer: NO. Creative Destruction is not only not dead, it is, as was venerated from antiquity and by Schumpeter, the way of all flesh. It may wear different clothes in this age of technology, or the Fourth Industrial Revolution, as the authors call it.

My answer did not come from anything they said, but partially from my own head, and partially by what they originally wrote about in Blue Ocean Strategy. 

The authors make a good case for what they call the third path to growth, after:

• Complete disruption in the zero-sum world of conventional strategy within the boundaries of an industry. As an example, we can use Netflix streaming vs. DVD as a good example (hmm…let’s consider for a while that Netflix started in the DVD rental business). The social consequences of this type of disruption are massive in scale, like they were for everyone who worked for Blockbuster.

• Partial disruption as exemplified by Blue Ocean Strategy. Uber caused havoc and great social consequences, even suicide, in the taxi industry; but there are still taxis today,

• Then there comes nondisruptive creation, which the authors position as an innovation that has no social consequences, because it is something totally new which adds growth without something else dying or having to reinvent itself to survive. Examples they give are Viagra, Sanitary Napkins, and Prescription Eyeglasses.

Then it occurred to me, wait—the above examples were nondisruptive creation when they first came on the market, but are they now? So let’s look:

• Viagra- Pfizer’s patent expired in 2017. Immediately afterward and until now, a new industry was born- generic ED and other drugs. Hims, Roman etc. all selling generic sildenafil at a small fraction of the price of Viagra (still today). Not only could former users who could afford the outrageous price of Viagra replace it with a cheaper alternative, but a whole new marketplace was born. Think about it—ED, which occurs to something like half the men over 40, does not restrict itself to the rich. Now an even bigger market was born, all those who had ED but not the means to buy Viagra.

Somebody said, not sure who, “if you fail to prepare, prepare to fail.” Pfizer had literally 20 years to think about what would happen after the patent expired. Maybe they thought about it, but they did nothing. Of course, as a result, their business has declined. 

 

Sales peaked at $2 billion and now the graphic has them at $0.5. It is difficult to estimate the market size today because of the price difference (generic around $.37/pill vs. $5.75 for the supposed real deal), but my guess is that the market is growing for the generic providers. 

2. Sanitary Napkins

Were first marketed by Johnson & Johnson in 1888 as “Lister’s Towels.” The nondisruptive creation didn’t last long as you can find ads for other brands as far back as 1900  

The current market size is huge- $23.6 Billion in 2022 projected to grow to $34.03 billion by 2030.  But this market has never, in real life, been a nondisruptive market. It is a conventional market and a zero-sum game. Most women will continually use the same item and, if they switch, it will not be a partial switch.

3. Prescription glasses- This is the most ridiculous citation of “nondisruptive creation.” Some sort of corrective lens goes back until latest the 15th century (1430) and the first protoype of modern eyeglasses with arms was invented in 1727 and made its debut in 1750. Here is Warby Parker’s timeline:

 

Looking at the timeline, exactly when was prescription eyeglasses a nondisruptive creation and when did it become a zero-sum game?

So is there no such thing as “nondisruptive creation?” I believe there is, but not only is it not enduring, it is the beginning, the birth, of Creative Destruction and its original iteration leads to a disruptive marketplace. Will it be total disruption or partial disruption a la Blue Ocean Strategy?

Depends.

Depends on what? Depends on what the product is and its usage, as we can see from the above. IF it is simply an innovation of an existing product that calls for substitution if adopted, then it fits the total destruction mode.

IF it is a product that crosses markets, as in Blue Ocean Strategy, it will be more difficult to copy and will not total destroy the disrupted product.

But in no case that I can see will a non-disruptive creation be in the garden of eden for long.

It can be a bit of a scary thought that, no matter what you do or invent, that you can be disrupted sooner or later. And, in today’s crowed marketplace, how do you prevent that from happening?

GO DISRUPT YOURSELF.

My best example of this business strategy is Apple. I am sure it was well known that the smartphone would replace the iPod, likewise with all the other trends Apple has captured since. Philosophy should be, I have to act like I work for another company and figure out how I would disrupt the current products. Then do it yourself- or someone else will. This entails waking up every day thinking about how you are going to improve or take the next step, not going to sleep or living in a bubble of denial as so many have done (think Nokia).

So, in conclusion, my position on Creative Destruction now is that it is not replaced by Nondisruptive Creation; it is, in fact, the beginning of that cycle.

So I won’t change my classes—totally. But, thanks to Kim and Mauborgne, I can present them with the most complete picture of product strategy.

AND, I understand that there is no answer for disruption. Just a matter of who, when, and how.

 Wikipedia, “Menstrual Pad,” https://en.wikipedia.org/wiki/Menstrual_pad#:~:text=The%20first%20commercially%20available%20American,by%20Johnson%20%26%20Johnson%20in%201888.

  Verified Market Research, https://www.verifiedmarketresearch.com/product/sanitary-napkin-market/

Warby Parker, "When were glasses invented?" https://www.warbyparker.com/learn/when-were-glasses-invented#:~:text=The%20invention%20of%20the%20printing,and%20sold%20by%20street%20vendors.