Radio Shack’s Mobile Store Experiment

Radio Shack is testing a new store model under the name PointMobl.  The three test stores in the Dallas area focus on “mobile” categories ranging from compact laptops and MP3 players to smart phones and GPS systems.

The depth of selection is greater than what a typical RadioShack store carries and there is no reference to the parent company to be found anywhere in the store or on the PointMobl website which lists the copyright owner as being “PointMobl Corporation”.

That last point is a very smart move which clearly shows Radio Shack understands where the brand sits in the minds of their target PointMobl customer.  I’m making an assumption here that they are trying to appeal to upscale, tech-savvy customers in the 18 – 35 year old range based on the store description and the images shown on the website.   Taking this “anonymous” approach removes one barrier to acceptance by those target customers.  On the other hand, the way they pitch the concept on the website sounds like the typical safe, boring nonsense that I sometimes hear coming from corporate marketing departments trying to appeal to a much broader and older segment:

“It’s time to let your mobile life out to play.  Give your productivity a power-up, stay connected, and take your inner rockstar on a world tour.  It’s time for a true mobile outfitter. One who really listens to your needs, then leads you to the right solution.”

Blech! If you are 18 – 35, chances are you are already leading a “mobile life”, you are always connected,  and when it comes to figuring out what gear you need, you do your own research because experience has shown that you usually understand the technology and the options better than the salespeople.  The rest of the copy on the site doesn’t get much better.  I should also point out that the website has at least one typographical error where they proclaim “You don’t need another mobile store – you need a good listener“.  Come on guys, any spellchecker program would have found that.

Some analysts have expressed concern about testing new store concepts under the current economic conditions.  I think Radio Shack has no choice but to explore alternatives given that a third of their existing store revenue comes from mobile sales and that business is being eroded by the likes of Best Buy who has opened their own chain of mobile specialty stores and expanded the mobile departments in over 900 of their superstores.  Radio Shack is also losing business to the mobile carriers which continue to pop up like weeds in every stripmall nationwide.  RadioShack has 6,000 company-operated and franchise stores and 700 wireless phone kiosks.  That gives them easy access to real estate that would be retrofitted into PointMobl outlets.  A slideshow of images from one of the test stores is available on YouTube:

This approach could end up generating higher revenue per square foot  than existing Radio Shack stores.  I’m fairly certain that is one of the test criteria and if the test proves this out, an expansion of the PointMobl concept could boost the chains revenue for a few years.  While that idea seems appealing, I don’t see it is a differentiated strategy that can be defended over the long term.  There’s nothing special here.

Store Aesthetics

The stores are described has being “upscale” with white fixtures and clean glass, but based on the following slide show, the interior of the store doesn’t generate that Apple store feel that I’m sure they were going for.  Instead it looks cramped and dark.  In some places, the dramatic lighting makes it seem almost museum-like; not the kind of feel that invites you to pick up the stuff and interact with it. 

The Competition

The mobile carriers all have significant presence in this size footprint and it would be extremely easy for them to expand their product offerings to include a similar product mix.  The only real differentiation here might be in the ability to offer multiple mobile carriers in one store, but that’s not unique either considering Best Buy’s strong position in the market and the growing presence of mass merchants like Walmart and Target in the mobile space.

In order for PointMobl to really be sustainable, it must be able to offer the customer an experience that no one else can.  I just don’t see that happening with categories that are already commodities.

Companies Without Conversation: Comcast Gets Twitter; Circuit City Does Not

Comcast and Circuit City have many things in common.

Both companies sell products and services that deliver video and internet to American consumers.  They also share the dubious distinction of consistently scoring near the bottom of their respective industries in the American Consumer Satisfaction Index surveys (see here & here).

With limited competition, Comcast’s dismal rating doesn’t pose as great a risk to their future profitability as does Circuit City’s score, which is clearly reflected in their ever sinking stock price.  Over the last few years, Circuit City has not executed well at meeting customer expectations.  As a result, they have lost a big chunk of their base and aren’t attracting new customers as fast as the old ones are leaving.  Consumer Electronics retail is a commodity industry and customers can buy their CE products just about anywhere. Bringing customers back to Circuit City should be the company’s top priority.  Doing so will require a number of things, but consistently meeting or exceeding customer’s expectations would be a good place to start.

Another good place to start might be engaging with customers within their Social Media channels to better understand where the experience breaks down, and to offer unexpected support for problem resolution.  Interestingly, both companies are also getting involved with Social Media.  Circuit City maintains a blog on its website and both companies have started using Twitter; however, the ways in which they are using it couldn’t be farther apart.

Comcast has been receiving a significant amount of positive press from their use of Twitter. Frank Eliason, Comcast’s digital care manager and the man behind the Twitter account, comcastcares, tells me their   Twitter program started back in March ’08.  Using a number of monitoring tools, Frank and his small team listen to the stream of “Tweets” coming from Twitter looking for comments about Comcast.  When they encounter one, they immediately reply to the person who made the comment, usually asking if they can help.  As of this writing, comcastcares has made over 10,000 updates and has over 2700 followers.  They operate comcastcares like some kind of proactive help desk, contacting customers who have publicly shared that they are having a problem.

Think about that for a minute.

A company that is actively trying to address every complaint made about it on Twitter.  Every problem solved here equates to a customer whose expectations have been exceeded.  Those customers will are going to tell others about their great experience.  More importantly, by listening to its customers, Comcast is learning about the things that are getting in the way of a great customer experience.  It’s a feedback loop that can be used to drive improvements into their operational programs.

Circuit City on the other hand doesn’t seem to understand the basic concept here.  They established their Twitter account, Circuit_City, about the same time as Comcast, but roughly six months later, they haven’t even broken triple digits in Updates. Circuit City isn’t using Twitter to listen for and help frustrated customers or to find opportunities for improvement in their operational procedures.  Instead, they are treating Twitter (and their CityCenter blog) like any another advertising channel.  There is no conversation, just one-way messaging.  There is no “How Can I Help You?”, there’s just “Here’s some more stuff that you should buy”.   Most of the tweets are links to posts on their blog which is focused on products that Circuit City sells.

One could argue that Circuit City does not have as many detractors as Comcast, but there are clearly opportunities out there.

Earlier this week, I saw a Twitter user contemplating going to Circuit City to purchase a wireless card (see the accompanying Twitter thread).  When he tweeted “Circuit City sucks!  Why are they still in business?“, it would have been a great time for Circuit’s Twitter team to step in and try to salvage this experience.

Unfortunately, Circuit City isn’t listening, they are just talking.  Business as usual.

Does Disney “Get” Virtual Worlds?

Second Life is looking for it’s Second Wind. There.com isn’t quite there yet. The media hype that surrounded virtual worlds just a year ago has ratcheted way back. Real world companies who came in not understanding what they were getting into quickly faded away after they didn’t get what they were expecting.

But one demographic seems to be doing quite well in the virtual space: Kids. If you have one of these living under your roof, you probably know that they are actively participating in online virtual/social networking spaces. They are joining online social networks at increasingly early ages (pre-school in the case of Club Penguin) and in those spaces, they are forming relationships that are very real.

This high level of participation has made kid-oriented worlds like Habbo, Gaia Online, Neopets, Webkinz and Nicktropolis more successful that adult oriented virtual worlds. Disney’s launched Virtual Magic Kingdom in 2005 with a target audience of 8 – 14 year-olds. Seeing business opportunity in the virtual space, they paid $350 Million to acquire Club Penguin last year. This year, Disney launched Pirates of the Caribbean Online to attract a somewhat older, but still teen aged audience (mostly boys) and Pixie Hollow (targeted at girls) is set to be launched later this year. The longer range plan, according to Mike Goslin, VP of Disney’s Virtual reality Studio, is to “have a large number of virtual world for a range of different audiences… sort of like a theme park.” The strategy also includes making the different worlds “feel like a common experience” including the ability to move your social contacts between virtual experiences.

Last Week, Shel Israel posted an fascinating video interview with Goslin and other senior team members from Disney’s Interactive Studios.

In the interview, the Disney team talks about the differentiators that they bring to the game. The most interesting one for me was the idea of Context. Like physical playgrounds, Disney sees their virtual worlds as socializing environments. In them, kids are learning collaboration skills, communication skills and social skills, but as with most everything Disney does, these interactions and communications are done in the context of a story. Disney believes creating social environments and communities around a context adds value to both consumers and business. On the customer side, building environments around a theme drives engagement by communities of interest who are passionate about that theme (think “ESPN Fantasy Football”). This leads to large communities that are defined by their common interest as opposed to the relatively small number of people that may be in your friend list. Those large communities with common interests provides a context for a business model like advertising. Because the community is all there for the same reason, they will likely engage in predictable ways (i.e. minimize random and inappropriate behavior).

Conspicuously absent from the interview was any mention of Disney’s Virtual Magic Kingdom (“VMK”). VMK was launched in 2005 as part of the Disneyland 50th year celebration. In it, participants create rooms themed after Magic Kingdom attractions, play mini-games, collect inventory and make friends. Just seven months after launch, Disney announced the game surpassed one million players and over 1.3 million personalized in-game rooms. Last month, with no advance notice, Disney announced that they would be shutting the doors on this virtual theme park on May 21. Predictably, the outcry from the “community” has been loud and is growing as the date approaches. A number of petitions have collected thousands of signatures, boycotts are being threatened and one group, VMK Kids Unite, is organizing a protest at the gates of Disneyland on May 10 which may be covered by CNN and CBS. Obviously, adults are helping to organize these efforts, but the kids are the driving force. Kids who are already comfortable with the participatory web and who want to have their voices heard.

So here’s my takeaway. From the interview, its clear that Disney understands the business opportunity in Virtual Worlds & Social Networks. The also have a pretty good idea how to build communities through contextually engaging virtual experiences. On the other hand, Disney’s decision to shut down VMK demonstrates that perhaps they don’t really get the “social” component. In these social environments, Disney’s role is to provide the frameworks (architectural, security and creative) and the context, but the real content is created by the participants. In shutting down VMK, they aren’t just closing an amusement park attraction. They are throwing away the work of the thousands of dedicated, passionate kids who have spent countless hours building and sharing wonderfully imaginative experiences, and in the process, will be alienating many of their most dedicated and influential advocates.

What do you think? Is closing VMK “just business”? Will the kids get over it? Is this consistent with Disney’s brand?

Update: Per my daughter’s advice, here are links to http://www.savevmk.com and http://www.savevmktoday.com

Update #2:  My daughter wrote a song and created a video about saving VMK.  Check it out here.

We Are What We Share

Over the weekend, I came across a post from fellow Age of Conversation 2 contributer Chris Kieff which contained a wonderful video from Charles Leadbeater, a well known leader in the innovation and creativity space. As Chris points out, the video does a great job explaining one of the key concepts behind The Age of Conversation. It also highlights the power of applying social collaborative concepts to innovation and points out how companies organized hierarchically are unable to adapt to this new way of doing things.

So what are your key takeaways for you from this video? What would be your elevator pitch if you were trying to share the key concepts with an executive at a traditionally organized company?

50 Ways to Improve Your Customer’s Experience

Doug Fleener over at Retail Contrarian has reposted his list of 50 ways to be more customer focused. Take a look and see how many you and your team do on a regular basis:

1. Open the door for your customer whenever possible. This is especially important if her hands are full.

2. Don’t just hand your customer his product, “present” it to him.

3. Keep the store temperature at a setting that is comfortable for customers. Most retailers set the thermostat at what’s comfortable for the employees.

4. Acknowledge your customer’s children.

5. Offer to gift-wrap purchases if you already know it is a gift. Don’t wait for your customer to ask.

6. Always suggest accessories and other items that will enhance a customer’s purchase and his/her life.

7. Offer to carry your customer’s purchase, however big or small, to her car.

8. Send handwritten thank-you notes. Come on, do you really do it?

9. Smile.

10. Introduce yourself to your customer.

11. Ask your customer her name. Use it.

12. Compliment your customer on his purchases. This is especially effective if he is another staff member’s customer.

13. Don’t give your customer too many choices. You’re the experts, so recommend a product based on what you learn from him/her.

14. Tell her why a product isn’t right for her.

15. If you can’t fulfill a customer’s need, suggest another company that may be able to do so.

16. Never ever say something negative about another company.

17. Act just as happy to see a customer with a return as you are one who walks into make a purchase.

18. Make it easy for customers with returns. Almost all customers are honest and should be treated as such. If you have to give a customer a refund, end the conversation with “I’m sorry this product didn’t meet your needs but we will welcome the chance to serve you again.”

19. Warmly welcome every customer who comes into your store.

20. Loan umbrellas on rainy days for customers to get to their cars. Ask them to either drive up to the sidewalk where you are waiting to receive the umbrella back or to bring it back on the next visit. Most customers will turn you down but you score major points for offering.

21. Don’t interrupt the customer to talk. Talk – listen – talk – listen. You get the idea.

22. Do whatever you can – within reason – to keep an unhappy customer. What you’ll lose on the one transaction you’ll make it back because he will tell his friends and family how wonderful you are.

23. Refrain from visiting with a colleague when he/she is with a customer. It’s distracting to both the customer and the colleague.

24. Never rush customers out at closing time. Gently let them know that you’ll be closing in a few minutes. Never flash the lights or sound the air horn. (I’m joking.)

25. Offer to teach your customer how use the products. Clothing and home goods retailers might show their customers how to accessorize the items he/she have already selected.

26. Never blame the company for a policy or decision. You are the company.

27. When a customer says “Thank you,” say “You’re welcome.”

28. Add “It’s my pleasure” after you say “You’re welcome.”

29. Provide written details of frequently asked questions.

30. Don’t coach or reprimand an employee or colleague in a customer’s presence.

31. If you’re on the phone with a customer and you absolutely must put him on hold, tell him approximately how long he will have to wait.

32. Don’t interrupt an employee with a customer unless it’s extremely important.

33. Create a children’s craft area in your store so the kids can create art while their parents shop.

34. Give your customer your undivided attention when she is talking. Everything else can wait.

35. Accept responsibility when the store has made a mistake. Too err is human. To not admit it is stupid.

36. Empathize with upset customers. Say you’re sorry.

37. Offer free drinks to your customer.

38. Give a gift for no reason. Even better, give a gift for being such a great customer.

39. Have the owner or manager personally call a high-ticket customer and thank her for her purchase if the sale was made by another staff member.

40. Loan books and other resources at no charge. This positions you as an expert and creates repeat traffic.

41. Ship a replacement to a customer with a defective product before you receive the original back.

42. Open the doors early when customers are waiting outside.

43. Provide seating for customers and offer to bring them product to look at.

44. If you’re busy and a customer is waiting for help, give him an estimate of how long he’ll have to wait for someone to help him.

45. Stop cleaning and doing busy work when customers are in the store. They’re less likely to ask for help if you’re doing other things.

46. Partner with restaurants and other stores to present exclusive discounts and offers to your customers. (A win-win-win. The other company gets incremental revenue, your customer saves money, and you’re the nice person doing it for both of them.)

47. No checking email or text messages on your phone when customers are in the store. It makes you look bored and nobody wants to shop in a boring store.

48. If you have to walk away from your customer to go to the backroom or counter tell her what you are doing.

49. Always offer to contact your customer when a product she wants comes in. Never tell her to call and check.

50. Always thank as many customers as you can for coming into your store and invite them back.

51. Always go above and beyond for every customer.

You can download the 50 Ways to Improve Your Customer’s Experience article that’s formated as a handout from Doug & Matt’s website .

(Image courtesy of Becky Carroll)

Education In The 21st Century

One of the best things about social media and Twitter in particular, is the great content that my digital friends share. A few weeks ago, Mike McAllen shared a powerful video created by Michael Wesch in collaboration with 200 students at Kansas State University. I meant to blog about it, but with my hectic travel schedule, I just forgot about it. Fortunately, another Twitter friend, Shashi Bellamkonda mentioned the video again and that served as the kick in the pants that I needed to share it with you.

The YouTube description says the video “summarizes some of the most important characteristics of students today – how they learn, what they need to learn, their goals, hopes, dreams, what their lives will be like, and what kinds of changes they will experience in their lifetime.”

I attended college (Virginia Commonwealth University) before the digital age. My computer was a Radio Shack calculator. My social network was whoever was hanging out between classes in Shafer Court. My Digg was the list of articles that were available at the local Kinkos at $.10 a page and a professor lecturing in front of a chalkboard (or with an overhead projector) WAS the way I learned.

Of course, while the video paints a very different picture of today’s educational environment, some things have not changed that much. Like the students in the video, I paid big bucks for my textbooks in 1980 and most of them were never used.  Other realities described in the video remind me that things are much more challenging for students; like the idea that some of their first professional jobs will be in roles that don’t even exist today.

As I watch my daughter approach her high school and college years, it’s easy to see that her generation does virtually everything differently because of the internet and technology. Communication, learning, recreation, everything.  Current college students did experience life before the internet.  Today’s 13 year olds did not.  As suggested by the recent Media Snackers video, their lives are highly fragmented. They get their information from a vast array of sources, not just a teacher with chalk and a blackboard. When they join the workforce,they very well may be doing jobs that don’t exist today, and you can bet that they will work in complex, distributed environments.  Does this mean we should drastically rethink today’s highly structured educational process to better enable tomorrow’s workforce to compete in a global market? I’m no expert in education, but I think it’s worth looking at. What do you think??

Reviewer or Critic?

My new Twitter friend Justin Kownacki wrote a great post last night on the subject of criticism. Justin talks about the role of the critic and the impact they can have on an an artist’s success. He also makes the point that everyone is a critic and challenges people to consider our own personal motives for recommending or trashing a book / movie / TV show / song.

Justin asks:

“Is a critic’s primary function to be a guide for the audience or the artist? Should a critic support the work of an artist who has the potential to become great, even if that work isn’t yet fully commendable, because the risk of smiting that dream too early might mean the absence of new work that could someday change the world?

Or, should a critic be exceedingly harsh and unrelenting, fostering an environment where only the strongest survive?”

There are a number of excellent comments addressing the question. Here’s my take:

There’s an interesting take on the question “What is a critic” over at filmreference.com.

It says that the people who write about the latest release in papers are “reviewers”. They may call themselves critics, but the write to deadlines and their primary goal is to entertain, which drives their writing style. They are concerned with recommending the things they review (or not) to a readership assumed to be primarily interested in being entertained. Like you said, they know their audience and don’t tend to stray too far from what the audience will agree with.

To the point of your question, I believe “critics” should be guides for the artist. Unfortunately, they are few and far between. What we have in our high-consumption, instantly-disposable culture are “reviewers” who, by necessity, are guides for an audience that doesn’t have the time or patience for serious discussion.

You point out that we all have the opportunity to be “critics”. I would add that we can also be (and often are) “reviewers”. The next time you write about something “critically”, are you going to be a “critic” or a “reviewer”?

Web Democracy

In case you haven’t been paying attention, the Web 2.0 revolution is well underway. Hyper-connected consumers now have the power to influence the way companies do business, apply significant pressure on political issues, and even challenge censorship and legal precident.

No one understands that more than Digg’s founder, Kevin Rose. Last week, the encryption used for HD DVD and Blu Ray (AACS,) was cracked and the processing key was leaked all over the internet. Lawyers were slow to respond, but eventually issued cease and desist notices. When Digg received their notice, the began pulling stories that mentioned the key. As soon as users noticed that their stories were being pulled, they began resubmitting them. Eventually, the first four pages on their site were almost entirely about the processing key.

So if you are Kevin Rose, a guy responsible for an influential and popular tool thats all about “user-powered content”, what do you do? What Mr. Rose decided to do was to be true to what his consumers wanted. He stopped fighting them and made the following blog post: http://blog.digg.com/?p=74

Digg This: 09-f9-11-02-9d-74-e3-5b-d8-41-56-c5-63-56-88-c0
by Kevin Rose at 9pm, May 1st, 2007 in Digg Website

Today was an insane day. And as the founder of Digg, I just wanted to post my thoughts…

In building and shaping the site I’ve always tried to stay as hands on as possible. We’ve always given site moderation (digging/burying) power to the community. Occasionally we step in to remove stories that violate our terms of use (eg. linking to pornography, illegal downloads, racial hate sites, etc.). So today was a difficult day for us. We had to decide whether to remove stories containing a single code based on a cease and desist declaration. We had to make a call, and in our desire to avoid a scenario where Digg would be interrupted or shut down, we decided to comply and remove the stories with the code.

But now, after seeing hundreds of stories and reading thousands of comments, you’ve made it clear. You’d rather see Digg go down fighting than bow down to a bigger company. We hear you, and effective immediately we won’t delete stories or comments containing the code and will deal with whatever the consequences might be.

If we lose, then what the hell, at least we died trying.

At the end of the day, the average person reading Digg is not going to have the software or the expertise to make use of the cracked code.  On the other hand, they clearly have the power to affect outcomes in ways unimaginable just a few years ago.

Power to the people!

<via ThreeMinds>

The Little Stuff Redux

Earlier this week, I wrote about the opportunities in addressing the sources of customer dissatisfaction. On Friday, APs Technology Writer, May Wong, published a report citing difference in the service levels between Circuit City and Best Buy. The report was insightful and absolutely reinforced the points I was making earlier in the week. I’m including some quotes and commentary below.

This customer’s past experiences have let him to solid opinions of the two retailers. Who do you think he recommends to his friends and family?

Ralph Devoe’s hunt for a new computer monitor didn’t include a stop at Circuit City, even though one of its stores was only a few doors down from the Best Buy where he went shopping this week. “They often don’t have what I want,” the retired physicist said. “And Best Buy just seems a little better. The salespeople actually know what they’re doing.”

Having a large inventory selection and “knowledgeable associates” are really important, but they are big and potentially costly things from an operational stand point. In my earlier post, I focused on the smaller sources of dissatisfaction, like how the customer is treated in the store. The following really drives that point home:

For sure, bargains and good rebates could be found at the stores of either chain — an important draw for the price-conscious American public.

But other times, it’s as basic as how a store feels, how the products and aisles are laid out, how the workers there treat you.

A friendly greeter is stationed just inside Best Buy’s front door.

“How’s it going? Welcome to Best Buy,” he repeats.

Within a minute of browsing in a section, a Best Buy associate swings by to offer assistance. The staffer casually dispenses product info or comparisons, and just as quickly lays back if you decline the help.

A visit to Palo Alto’s Best Buy and Circuit City to pick up a component-video cable illustrates the differences.

At the Circuit City, it took some effort to find a store employee to ask where to find the cables — and the red-shirted employee who was tracked down misdirected this shopper to cables for TVs.

At Best Buy, the greeter at the door quickly responded with a more specific question, “What kind of component video?” By asking, he learned the cable’s purpose was for a game console and pointed to the video game section.

The desired Sony-branded cables were sold out, but the Best Buy associate did double check the store inventory.

That kind of attention to detail goes a long way in a shopper’s experience.

I also talked about ensuring that your interactive displays are always functioning. Ms. Wong points out this difference between the two retailers:

At another Best Buy in Sunnyvale, for instance, the music MP3 players on display were in good working order, and a patron could test the controls and use headphones to listen to them. By contrast, the Palo Alto Circuit City’s portable players — with the exception of a separate display for Microsoft Corp.’s Zune player — were not powered and lacked headphones so a shopper couldn’t get a good test run of the devices. Product information placards were also missing from some models.

The bad news for Circuit City is that this “little stuff” is rampant throughout its stores and it all adds up to a pretty crappy experience for customers. Both companies recently reported results for the previous year and the differences were like night and day. I am not an analyst and I can’t tell you to what degree Circuit City’s continued lagging performance is attributable to the sources of dissatisfaction in their stores, but my gut tells me that it is a significant cause.

The good news is that these problems can be overcome and for the most part, the solution doesn’t involve a big capital investment. What it does require is much more valuable, and perhaps more scarce, than money. It requires people that care. Store associates that take the time to look for things that aren’t right with their store and fix them. Support associates that are not only responsive to the needs of the people in the store, but are proactively looking for ways to improve the operation so that the store associates can focus on the customer and not the infrastucture.

Remove the Sources of Dissatisfaction. That’s the fourth item in my Prescription for Building Loyalty but after Listening to your Customers, it’s the next most important thing that retailers must do.

European PS3 Will Have Reduced Backwards Compatibility

I was so hoping that we wouldn’t hear any more bad PS3 news from Sony, but just ahead of the European launch, they have once again outdone themselves.  It’s bad enough that Sony ruined Christmas for so many young European kids by delaying the launch, but now we hear that the European design would lack the chip used in the earlier models to support backwards compatibility for PS2 games. 

The function of the chip will be replaced by firmware.  They have a website that list the supported games, many of which are designated “Should play on PLAYSTATION®3 with noticeable issues”.  If your game is not listed, then it is “not yet supported”.  Over time, there will be new firmware releases that the customers will have to apply, but a spokesman said Sony “will not put much effort in making old PS2 titles available on PS3”. 

Translation:  Sorry Europe, your PS3 is not going to be all it was supposed to be, but we just don’t care!!  Now please fork over 599 Euros and be happy that we finally let you have it.

The move is designed to cust costs and speed up production.  Sony expected the consoles to lose money, but make it up on the backend through games and Blu-Ray content.  With sales in the toilet, Sony is forced to make some changes.  Unfortunately, it’s the customer who is paying the price and that will only cause bigger problems for Sony.   The PS3 gamble has been a disaster for Sony; a company that has continually forced proprietary standards on consumers.  They just don’t get it and deserve whatever happens to them.

Sony lists games compatible with PS3 – Games – MSNBC.com

Sorry…

I haven’t posted anything in a few days.  Not sure if the house is possessed or just a case of stray cosmic rays, but both my home PC and my work notebook died within a few days of each other.  It’s been a very strange experience to be less connected for a few days. 

The first thing I noticed was that the house was much quieter.  I had no idea how loud the desktop PC was.  I have replaced it with a very quiet notebook.  The other thing I noticed was how much time I waste just surfing around.   The weekend seemed much longer (even though we lost an hour) and I got a lot of things done around here that have been needing attention.

As evidenced by this post, I now have replacement hardware and will be providing regular updates to the blog.

Thanks for being patient.

Doug

Will iPhone Mess Up Cell Phones Upgrade Cycle?

Olga Kharif at Business Week believes the Apple iPhone will disrupt the cellphone upgrade model.  That model says that users generally replace their phones every 18 months.  They do this for a number of reasons: Phone is broken or has battle scars, new features, new styling.  The biggest reason, of course, is that the industry enables it by giving free or cheap phones when you agree to a new contract.

In a recent article, Olga’s makes this argument:

“The new iPhone from Apple….brag[s] touch screens instead of buttons. That means that if cell phone makers or carriers decide to add new functionalities to these phone when they are already in use, they could, potentially, do that over the air. Want to enable consumers to shoot, edit and post videos to a mobile site in a new way? Just send them an application with virtual buttons that will appear on their touch screens and allow for this application’s use.

If consumers are able to get new applications this way, I think some of them will stick with their phones longer. After all, today’s phones all feature cameras and Web access. Unless handset makers come out with additional hardware making replacing handsets every 18 months a must, I don’t see why consumers will keep on changing their phones as often, especially since the phones’ prices seem to be on the rise. After all, with a simple software upgrade, users will be able to drastically change their phones’ looks and functionalities anyway. So, why splurge on a new phone?”

She goes on to ask her readers if they agree.  The article is short, but the list of comments is long and each side makes good points. 

Here’s my take.  The upgrade cycle today is controlled by the carriers.   Apple wants to change that.  The iPhone may be the hottest CE product of 2007 and millions of people will pay the premium to get it.  Once that happens, and assuming that the experience lives up to the Apple brand (and the hype), people will not be so eager to upgrade just because their contract is up.   Assuming that the 5 year exclusive deal with Cingular doesn’t change, they won’t really be able to switch anyway.  Being touchscreen based does not make the iPhone an infinitely extendable platform (sorry Olga).  There will be ongoing evolution of the technology, just as there has been a steady stream of product improvements to the iPod.  This is what will drive the upgrade cycle for iPhone users.  The cycle may remain at around 18 months, but it will be the product itself that shifts the control of the cycle to Apple.

What do you think????

Circuit City Joins The Virtual World

Circuit City and IBM have teamed up to launch a prototype virtual store in Second Life. The store, which will be open to SL residents on 12/18, is designed to be a virtual extension of Circuit City’s existing multichannel design and will be used as a learning lab.

SecondLife residents can purchase items such as iPods TVs, and Computers in the store for use in SL, but they can can also link to Circuit City’s website to purchase the real world version of the product. There are other extensions of the e-commerce site into virtual space such as forum discussions for particular products, a store locator, and a display that helps you decide what size TV to purchase based on how far back your sofa is.

“Teaming with IBM in the virtual world is as much about sensing and learning from the community as it is about commerce. These immersive environments provide an interactive forum for testing and feedback as we focus on the next generation of customer service”, said Bill McCorey, senior vice president and chief information officer of Circuit City. “Our ultimate goal is to understand the implications of virtual 3-D worlds on multi-channel retailing and to extend the connection we have with our customers to new spaces.”

I think the big thing here is that Circuit City is starting to experiment with 3D web as a commerce channel. I believe this is the future of ecommerce. The combination of an immersive 3D environment with the social networking aspects of an environment like SecondLife will give the customer a rich experience that transcends today’s 2D experience. Granted, we are in the embryonic stages of this transformation and the experience is not “all that”, but at least Circuit City is putting their toe in the water and that’s a step ahead of where most retailers are.

Read more about the launch here and here.

Full Disclosure: I am a Circuit City employee and am part of the SL team.

Customer’s Rock Blog: Costco’s Response to a Customer Need

Customers Rock is a new WordPress blog which is getting quite a boost due to being referenced on a number of popular marketing blogs.  The latest post on Customers Rock is about Costco and their new free technical support. 

Costco has been listening to the frustrations of their members and has entered the realm of providing technical support to help ease their pain.  According to a store supervisor that I spoke with, Costco will provide free technical support for televisions, cameras and camcorders, as well as desktop and notebook computers.  The service has been available for about one week now in the Southern California area.  It is part of their existing Concierge Services, which Costco started testing for high-tech TV installs this past summer.

The real reason that Costco is doing this is that the returns are killing them.  Costco has an amazingly liberal return policy.  They have expanded their Home Entertainment offering and a pretty good computer business, and all that new technology is difficult for customers to manage.  As a result, they have seen returns skyrocket and profits erode. 

Offering free support is a brilliant strategy, assuming that they can deliver a great experience.  They are well on the way to that by assuring members that when they call tech support, they will speak with someone in the US.  There is nothing more frustrating to me that to hear a thick accented CSR introduce themselves to me as “Bob” or “Mary” and then not be able to communicate with me.

In addition, Costco is offering the free tech support for the life of the product.  Now that’s an added value that’s easy to understand.

Costco intends to take on Circuit City and Best Buy for the Home Entertainment and Computer customers and they are coming out swinging by turning what was a problem for them into differentiated offering for their members.

Gizmodo starts CES 2007 coverage a little early????

….No, its never too early to look at the future of Consumer Electronics.  Question is, when will the average consumer be able to get this stuff….

Here’s a link to their CES2007 tag.