Is your warranty policy hurting your marketing?

More than ever, the idea of keeping existing customers should be at the top of every marketers critical tasks list. Not only are new customers harder to acquire, but, they now have the power to tell all their friends when you fail to please.

If you doubt me, take a look at Amazon reviews in any consumer products category. You’ll find the most powerful reviews come from either:

  1. loyal customers who have had great customer service and warranty experiences
  2. customers who’ve owned your product and a competitors and have an opinion.

It’s time to pay more attention to keeping existing customers happy.

The other night I was talking over a dinner table with several happy TomTom customers. One of them had just had his TomTom die, and it was just outside of warranty. He contacted TomTom and they said they don’t repair non-warranty units.

Big mistake. The customer service person just released a previously happy customer out to the big wide world of GPS units and suggested he reevaluate the market. All of a sudden, he may think a Garmin or a Magellan is a better choice. It doesn’t take much to come across a comparison site.

For a better example of how to handle this same situation- I had a Sonicare toothbrush die on me after 5 years. I contacted Sonicare, and inquired about a new battery for my first generation model. They offered a sizable discount on a new model toothbrush- in a brown box that kept me a Sonicare user.

Yes, personal electronics may be made for replacement, but wouldn’t you rather customers replaced your product with your brand- instead of a competitors. Good marketers will take this lesson to heart and make sure their policies fall in line with what is best for their company.

It’s said that word of mouth marketing is the best of all- and yes, you can buy good word of mouth, with good warranty policies.

Starbucks pours great ad agency down the drain

Starbucks print ad from <a title="Link to W&K site for Starbucks ad" href=There are a few ad agencies that really understand relationship marketing and building brands based on emotional ownership over rational decision making processes- Wieden & Kennedy is one of them.

Since 2004 they’ve worked with Starbucks, a brand that’s been known as a poor client. When your agency fires you as a client, it’s time to do some introspection. Especially if you are a marquee type client.

Getting fired means you are doing something wrong, and Starbucks’ senior VP-marketing seems to be the first candidate for the introspection couch:

In a statement, Starbucks’ senior VP-marketing, Terry Davenport, said Wieden’s decision was a response to Starbucks’ recent move to ask a number of agencies it works with, including Wieden, to “provide ideas to move the brand forward. … And, as a result, Wieden has decided to opt out of the process,” he said.

While Wieden is Starbucks’ primary agency, the retailer has worked with a number of other agencies in recent years on co-branded products. Interpublic Group of Cos.’ DraftFCB, New York, is the primary shop on its grocery coffee business. Starbucks has also worked with Omnicom Group’s Goodby Silverstein & Partners on the bottled Frappucino beverages it co-markets with Pepsi and Energy BBDO for the coffee liqueur brand it co-marketed with Beam Global Wine & Spirits.

But Wieden, which also handled media buying and planning for the coffee roaster, as well as much of its in-store graphics work, had been responsible for the first large-scale advertising in Starbucks’ history, including its first TV push last winter.

Wieden Parts Ways With Starbucks - Advertising Age - Agency News.

Starbucks is a brand that’s a love it or hate it brand. Their market penetration is incredible, as I’m constantly reminded when I pop up my “Starbucks finder” on my iPhone and almost always find one nearby when the coffee urge hits my companions.

And here is where the fundamental problem exists: The best marketing and advertising that Starbucks can do- isn’t marketing or advertising in the traditional sense of the words- because it’s just not necessary. The focus should be on refining a voice through the brand touchpoints and building very tight relationships with their customers through Customer Relationship Management tools. This is hard for both a VP of Marketing to understand and hard for an ad agency to caculate a compensation program for.

Modern marketing techniques don’t come with conventional media billings- and for a company like Starbucks, they shouldn’t. But, an open mind of how to build relationships with customers should be the first order of discussion with any agency who is bold enough to take on this “difficult client.”