Tue 21 Aug
Late last week, the Business Day section of The New York Times ran a great story on Netflix’s customer service strategy. Faced with unexpectedly effective pressure from Blockbuster Video (who have turned Netflix’s own mail order model on its head by allowing their customers to return movies not just by mail but at the rental chains’ physical locations as well), Netflix has counter-intuitively invested millions of dollars in domestic telephone support facilities and staff.
Where the number of companies outsourcing customer service by telephone to Third World locations is only increasing, Netflix has instead chosen to hire two hundred workers in Oregon to man their hotlines in the hopes that a renewed, more responsive focus on customer service will win the day for them. They’ve even given these representatives enough operational latitude to allow them to function not just as telephonic automatons, but as real, empathetic human beings who help other human beings solve their video rental-related problems. Imagine. It’s a winning strategy, in my book.
I thought about this approach when I was at my local video store over the weekend, trying to find a copy of “The Bourne Supremacy” to watch with my nephew, who’s visiting for the week. In spite of the fact that this Matt Damon franchise has transformed itself into a sterling example of what can be accomplished in the action genre, I admit that none of the installments are much in the way of artistic or intellectual marvels.
And yet the utter disdain on the clerk’s face when I inquired whether she had a copy available to rent surprised me. All I wanted to do was to find an entertaining distraction for a ten year old, and she looked at me as if I had committed some egregious error of politeness. Here we are, at least half a decade after the video rental industry has peaked, when mom ’n’ pop rental stores seem to be hanging on by a thread, and it’s still possible for a shop clerk to act like anything but a request for “The Seventh Seal” is an imposition? Amazing.
This incident at my rental shop reminded me of one staple of urban commerce that I’m only too happy to have upended by the more efficient competitive dimension made possible by the Internet: the holier-than-thou boutique, in which erudite, ludicrously hip sales clerks seem perpetually annoyed by the unsophisticated, bourgeois and yet completely legitimate queries of their patrons. Once upon a time, New York City was riddled with these kinds of stores — book stores, comic stores, record stores, video rental shops, etc. — where it was impossible to ask simple questions without being passive aggressively humiliated by the staff.
In the early 1990s, the big box stores rolled into major cities and many cries of complaint went out over the death of neighborhood bookstores at the hands of chains like Barnes & Noble. I was sorry to see lots of them go, too, because many of them were staffed by genuinely helpful people, and their role as small businesses — bulwarks against cultural homogeneity — were invaluable.
But there were a few whose demise I secretly relished because the experience they provided to their customers was so bad. I feel the same way today when I walk into any kind of a boutique whose staff are distracted, disdainful or clearly disorganized such that they are more preoccupied with their own systems or protocols than they are with their customers’ needs… there just doesn’t seem to be an excuse for it in this day and age.
The effect of the net on commerce over the past decade has been unfair and unkind to a lot of independent enterprises, I admit. But one thing that’s not often acknowledged is that it’s done an unexpectedly good job of rooting out those businesses who are just plain bad at relating to their customers. Even those small businesses who aren’t directly threatened by net-based competition should sit up and take notice, I think, because the net is bringing about a new expectation for intensely customer-focused commercial practices.
Where once expertise and scarcity of merchandise allowed boutiques a certain kind of superiority, those advantages are clearly eradicated, or nearly gone. It strikes me that the relationship with a customer is the only thing that a business has, really. It’s not an unassailable advantage, to be sure, but it’s as good a foundation strategy for survival as any — which is why I applaud Netflix so heartily, and why, at the same time, I wonder if they’ve already waited too long to execute on this strategy — too long meaning they waited until Blockbuster showed up, nipping at their heels. Regardless of your size or whether you’re selling online or offline, why wait until newer, more ruthlessly efficient competition is eating your lunch to start being nice to the people who buy your goods?