O Customer, Where Art Thou?

KolejkaI really really REALLY don’t think there will be only one post about customers. Really. But I had to start somewhere, so here goes.

The way this laser hair removal place started acquiring customers was rather funny. The owner worked on the fifth floor of the same building in the similar laser hair removal place (only smaller and less clean) when suddenly the owner decided to call it a day. His customers were left out in the cold, many of them in the middle of their voucher deals or packages. The guy pretty much just packed and went home. Given that technicians (there were two) were in charge of their schedules, it was only natural that most of the customers had their personal cell phone numbers. So when the business closed they started ringing up the technicians. Instead of brushing off they decided to explain the situation and offer these customers an option to wait until this new business is up. Since all of this was happening during summer – not the best time for laser skin treatments – a lot of customers agreed to wait it out. There were some misunderstandings and a lot of angry words exchanged, but at the end of the day most of it got resolved.

Once the place was up and running the owner got on the phone again reaching out to old customers. Of course, it wasn’t overly smart to offer them to complete the treatment for which they paid someone else. However, the thinking was that a couple of sessions wouldn’t be that big of a price if the owner would be able to sell them a package of her own. It didn’t always work, but the place got their schedule up and running pretty quick and people were coming in every day.

customer_queueWe started ringing up deal sites. It was a bit unexpected (although understandable) when some of the sites refused to deal with a new business because it was new business. Other sites couldn’t care less. Groupon was the first to take us on, their only focus was pricing – they low balled us to something almost totally outrageous. We haven’t had much experience with any deal sites from the merchant perspective, so it was sort of a revelation to find out how these sites treat both merchants and customers. Words like “customer loyalty” and “quality customer base” started making a whole new world of sense.

One of the sites (I think it was LivingSocial) flat out told us to go and buy likes on Facebook (either through FB’s own ad campaign or otherwise), because they will only deal with us if we have at least 100 or so likes on Facebook. Not a big deal, but if you had your company opened a week ago a hundred likes might seem like a problem. Amazon Local demanded a certain rating on Yelp in order to run our deal. When I flat out asked “So you’re Yelp’s bitch now?” they really had nothing to say except “effectively – yes”. One of the largest deal sites on the market being subject to restrictions of another company, well known for their shady practices of falsifying a businesses’ ratings and reviews – that was just too funny.

Still we managed to get some of our deals up on Groupon, Lifebooker, KGB Deals and, eventually, Amazon and LivingSocial – some time later. That’s when the “customer quality”, “customer loyalty” (or “customer retention”) started making all kinds of different sense.

Let me get this out of the way. 90% of coupon customers aren’t worth the time you spend with them on the phone to schedule an appointment. It’s the other 10% that are the reason for doing the coupon site deals. Each category, obviously, deserves a separate post – which I will probably have to do, eventually.

customer_serviceStrange as it seems there actually is a difference between clients coming different coupon sites. The deep dive probably deserve a separate post altogether, but in a nutshell – we’ve seen the worst coming from Groupon and Lifebooker, the rest are marginally better. One thing where you may regret having loyal coupon customers is when they like you so much they keep buying vouchers all over the place – whatever it takes as long as they keep getting treatments at your place at coupon price. They will never convert and they keep bringing more loyal coupon users, so we decided to force “New customers only” rule on most of our deal contracts after the first wave. It may not sound nice to customers, but it’s a way to cut losses. If they like our services so much they should definitely try to negotiate a deal (and it’s always a possibility with the business like this), instead of trying to cheat your way through.

Here’s a little story to explain.

We had one customer who absolutely loved our service. At least that’s what she said during first five sessions of her coupon treatment. She went and bought four more vouchers (from the same deal site – we didn’t have any other deals running at that moment) – using friends’ credit card with option to “gift” a voucher to someone else. When we pointed out she was effectively cheating the coupon site and gaming the system and that we refuse to honor more than two vouchers out of all five she owned (a perfectly legal move based on our contract with coupon site which stated “one voucher per client plus one as a gift” – or something like that) she decided that we have the worst place ever. She complained to deal site – and they confirmed we did the right thing and warned to ban her AND her friends from the site for cheating. She demanded that we provide her with free session for this occurrence of horrible customer service. She promised she will write a negative review on Yelp – which she did, calling us liars for not honoring a single voucher. Not that we care much about Yelp (we’re not paying them to remove bad reviews, so there’s that), but we took note and responded to review, of course, explaining what exactly happened and how the customer was in the wrong. Given that you can’t really inject any brains or conscience into such customers we decided to implement “new customers only” rule. At least it saves us from drama at the office.

Cloud Storage Comparison – 2014 edition

You’d think you had this all figured out – there’s your Dropbox and Google Drive and OneDrive and… wait, that’s one too many already. Recently I have noticed that my paid-for 100GB of Dropbox space is over 80% full. There’s a folder with PSD images from my photography thing, there’s backups of web sites, both live and gone, there’s documents, receipts, some e-books I am reading, a few backups of software I may or may not need. I keep getting more and more of these – mostly photography, but other stuff as well. Backups of forms from our laser hair removal business. Clients’ backups. Clients’ digital assets and raw files. Clients’ photography – both RAW and edited. It looks like I’m gonna need a way bigger boat.

Before I started looking I had my own ideas and desires. First of all – I wanted to minimize the hassle of moving, so I was really looking forward to either stay with Dropbox or at least retain it in some form. I also have a huge collection of clients’ images on Picasa (including a lot of embedded ones) and I wasn’t looking forward to moving them around in any way. Last, but not least, I really wanted to like OneDrive – primarily because Microsoft bundles online versions of Office applications with it or grants additional 20GB of space should you subscribe to Office 365. Not everything came through, but I still was in less trouble than I thought.

First of all – I was not looking at free tier offerings. Given that I need to move around almost a terabyte of data I needed something better than a couple of gigs here and there. I also looked for a storage solution that won’t limit the size of the file – at least to a reasonable level, have been around for a while, allows sharing of files and whole folders, works on mobile and PC (I cannot imagine having another Mac in my household or business any time soon, so no iAnything for me as well) and allows multiple clients to work simultaneously (so I can upload stuff from my laptop in the field and get files on my home workstation – and vice versa). This eliminated most of exotic solutions (sorry, Mega.co.nz). Unfortunately, Box.com had to go as well due to their weird file size limits. Amazon S3, RRS and Glacier didn’t make it because their usability depends solely on the quality of the client you are using (and what happens when it gets discontinued?) plus their pricing is so through the roof I wasn’t even thinking about them. Some of the services I tried and ran away for various reasons – mostly because their client software lacks sanity, usability or both. What was left is in the table below. All prices are taken from each vendor’s web site on 6/4/2014.

Click image to enlarge

In order to compare these providers I got all their plans down into a single table, then calculated the lowest price per gigabyte per year. This way the comparison would make the most sense to me: if I were to buy a single gigabyte of space for a year at a most favorable price – what would it cost me.

The first place is shared between Google Drive and Bitcasa. No one comes close to their 12 cent per gigabyte. Additional benefits for Google Drive include easy sharing of photos from Picasa or Google+, small size images (under 2048×2048) don’t take up space, tight integration with multiple OSes and mobile systems and automatic upload of images from mobile device. With Bitcasa it’s a bit more complicated – although their pricing is just as good as Google’s – their support section is nonexistent and while I see a lot of happy reports on their services I have not seen them around long enough to put my files there (we’re talking about investing a lot of time to backup large amounts of data). They are also the only two providers with officially published prices for storage over 1TB – Bitcasa offers 5GB for $49/month and Unlimited for $100/month while Google doles out 10, 20 and 30GB for $100, $200 and $300 per month respectively. The only concern for Google’s storage is their uncertainty towards Google+ and the fact that Picasa hasn’t really been updated much.

Next in line, surprisingly, is 4Sync – not another big IT name, but these guys have been around long enough and their services make sense. They allow sharing of images and files, including direct link (although only for paid users), their sync client isn’t too complicated (although not without issues) and they are pretty generous on their free tier, so you can test the hell out of them. One the con side I’ve read about some issues with reliability and that does cast a shadow on their otherwise interesting offering.

Third place is (again) shared – between Microsoft’s OneDrive and SugarSync. Pricing is so very close that I decided that both deserve this position. OneDrive works pretty much the same way as Google Drive or DropBox, can sync across computers, backup current computer configuration and pull mobile device’s photos. The only (huge) problem with OneDrive is its inability to provide direct link to images for embedding – instead you’re getting an iFrame to embed and to click on. This, of course, is unacceptable for photo sharing and publication. SugarSync appears to be in the same boat, however, their advantage is that you can sync folders anywhere on your computer – not just a designated “dropbox” folder.

Runner-up to first three places is DropBox. Their $1 per gigabyte is one of the highest prices on the market. Embedding is possible, although requires some poking around links and features and, therefore, totally unacceptable if you want to publish a post with multiple images or if you want to build a gallery (and Dropbox’s own gallery view is extremely poorly designed which makes it practically useless). The sad part is that Dropbox has become a really robust and powerful solution, so it’s sad to see it losing the game due to price alone. Given that they are the least generous on their free tier offering I can see them losing out fast to many other providers.

The conclusion is rather simple, as far as my personal use is concern. In my case instead of 100GB for $100 that I am paying Dropbox I will be able to get a terabyte of storage for $120 from Google. My DropBox account expires some time in November so I expect to fully migrate all assets into Google Drive by then. It’s rather convenient that I won’t have to move 200+ albums of images to another provider, but everything else (all 80-something gigabytes) will have to be moved. I would still take advantage of OneDrive by migrating my documents there to be able to edit them using Online Word, but it’s a tiny chunk of a pie anyway.

Supplies And Cost Optimization

Since we have picked up a subject of money in the previous post, I thought I’d pick up where I left off. Obviously, having enough supplies is important – while you can get away without a thing or two, in general supplies are what makes your business running. It’s the grease for the wheels. As with all logistical issues too many can be just as bad as too few.

At the beginning of operations we have agreed not to spend much time on supply hunting, preferring the convenience of fast delivery to price. With that in mind we signed up for Amazon Prime and that solved our problem of ordering when we “almost ran out” of something. Most of supply items are eligible for Prime and, therefore, delivered for free through two-day shipping. They would be overpriced items, at least at the beginning, but we have decided that given small space we were allowed to operate in and inability to stock up (and take advantage of wholesale price) might as well be offset by prompt delivery time. This was especially true during certain promotions, when we started running out of things differently than before.

Once the business had a full schedule and had run through the motions a few times, the time has come to the point where we could optimize the costs. Knowing what we needed and how often allowed us to order certain things in advance forgoing Prime shipping, but winning on the cost of the items. Additionally, certain items were being replaced with their less expensive equivalents: do you really need one of the most expensive paper towel s to wipe equipment clean after disinfection or can you do away with cheaper brand? Having certain predictability allowed us to forgo Amazon completely and order from other merchants, who don’t quite adhere to such strict shipping policies.

Yet another thing on our savings list was to verify if we, indeed, needed to use certain things at all. For example, we always offered single use razors for patients who forgot to shave the treatment area prior to their appointment. It sounded like a pretty neat idea at the beginning, taking care of your clients and all. What we’ve discovered was that it significantly increased the length of individual appointment (what could have taken 10 minutes dragged for full half hour), is totally unpredictable (we only learned of the situation at the moment a client walked in) and person who decided to shave on the spot still felt very uncomfortable. This led to major schedule shifts, people waiting excessive amounts of time or even leaving without receiving a treatment. From almost any point of view this benefit was creating more trouble than it was worth. We decided to ditch razors altogether. We changed the language on any promotional items requiring the shave and stating that person who didn’t shave will not receive the treatment and lose their appointment or session (in case of a voucher from a deal site). While it may sound a bit tough on customers we actually received a positive feedback on this move as schedule became just a little more predictable. And we dropped purchasing one item off our supply list.

The always fluid nature of offers on the market creates a never ending quest to seek the most efficient way to supply your own business. This takes time and goes along with “deal hunting” (that I was frowning upon in two previous articles). The upside is that you are getting merchandise, not services, and therefore can always objectively assess whether you are getting a good deal or not.

Running your own small business is a challenge.