My atrocious car buying experience is a lesson in after sales treatment for all founders!

I am re-reading How to Sell Anything to Anybody by Joe Girard (book review coming soon).
Earlier today, I finished his chapter on Winning After the Close wherein Joe talks about the importance of ensuring customer satisfaction AFTER completing a sale. He gives examples of how he goes out of his way to ensure that his customers sing his praises to their friends and family. He links the importance of satisfying his customer to the Girard’s Law of 250, i.e., each person has a direct connect to 250 people; therefore, an unhappy customer can directly influence 250 people. Consequently a salesperson or a business that disappoints two customers a week will have 26,000 negative influence every year!
Why is it important to follow what Joe Girard says? For starters, the man still holds the Guinness Book of World Records for being the most successful car salesman in history. This man was selling six cars a day (on average) while the average salesman struggled to sell one. He was out making $500,000 a year selling cars in the 1970s, i.e., eight times the per capita income in the US of A – TODAY!
So yes, when that man says something – it is worth our time and attention.
I am coming back to my point for the post today.
I just bought my first car in India. It was an important moment for my team and me. We were ecstatic on getting the car delivered on Tuesday evening. However, instead of reveling that moment and remembering it for the years to come, all we cannot forget is how the salespeople delivered the car with just enough fuel to get the vehicle to the closest petrol pump!
The saleswoman blamed the empty fuel tank on some dealership policy of ensuring that customers get a bone dry fuel tank. I could not disagree more with her firm, her firm’s strategy, and finally with the saleswoman herself. If she was so embarrassed about her firm’s stingy policy, she could have ensured a happy customer by filling up the tank herself – she would make more than the Rs. 2200 it cost me to fill the tank.
Buying a car is one of the most important purchases in one’s life. I can still remember, like yesterday, the first car I bought with the money I earned by working during the first summer semester in college – a 1996 Mercury Sable with a v6 engine. I was so proud of the car even though it was six years old at the time of purchase. The moment gives me goosebumps even today.
Then 17 years later I buy my first car in India, a Honda Civic, and it is an expensive car (for my standards), but it was delivered as though the dealership was running out of money. It left a sour taste and you won’t have to think hard whether this dealership (Arya Honda) will be recommended by me to anyone. The answer is no.
I must re-emphasize that a happy customer is the best salesperson. He/she will boast about his/her positive experiences to their closest network. On the other hand, an unhappy customer will tell anyone that would like to hear him/her of their negative experiences and feeling cheated by a car dealership. Unfortunately, these car dealerships operate under old maxims therefore continue to misread their customers. Any start-up founder that is reading this post should not.
Your customer whether they are B2C, B2B, B2B2C or B2B2B or B2B2B2C (and so on) must be happy with their purchase of your goods or services. To hide behind the veil of corporate policies is the old way of doing business, and you must ensure that your salespeople are sufficiently empowered to ensure post-sales customer satisfaction, at all costs! It is just as important that those negative experiences are corrected by changing policies and processes.
The process in which the company acquires a customer, gives them lousy experience, and allows the salespeople to blame an insane corporate policy is a sure indication of a deeper rot settled in that organisation.
A rot that every entrepreneur should guard their companies against the cost of all their corporate policies.

3 Reasons Why I Believe OLA Has Lost Its Mojo

Just last year, I was writing praises of Ola’s product mix that allowed it to have the upper hand over Uber. In fact, I was so happy with Ola’s product strategy that not only did I endorse Ola Select’s benefits to all my friends & colleagues and open a corporate account with them but also swore to use OLA exclusively in India. However, in the past few months I have consistently found myself choosing Uber over Ola and (after much deliberation) I can hone it down to 3 main reasons.
1. Ola Select No Longer Offers a Compelling Value Proposition
For those who don’t know, Ola Select offers 4 main benefits:

  1. Ride without Peak Pricing
  2. Skip Booking queue
  3. Prime at Mini-Fares
  4. Free Wi-Fi during the ride

Initially, Ola used to charge Rs. 499 per month to avail Ola Select. Gradually they started increasing this price until it added up to a whopping Rs. 1999 a couple of months ago.
Since my monthly commute costs less than Rs. 5,000, the steep increase in the subscription cost was economically unfeasible. I felt as though Ola’s management was price gouging me and it broke my trust. I heard similar gripes from many who were regular Ola Select customers.
However, when I opened my app today, I found a discounted monthly subscription price had dropped to Rs. 1299, at the cost of capping the surge protection at Rs 75 per ride. It looks like someone at Ola noticed the drop in the subscriptions and attempted to salvage it with this move.
If I assume that Rs 75 equates to a 25% benefit per ride, then it works out to an average bill of Rs. 375 or a 25-kilometre trip which is rare for someone travelling within Mumbai (or most cities except Delhi & Bangalore). Even if I assume that I took those many trips in a month, it would still take 20 rides before the subscription paid for itself and 40 if I wanted to get any additional value out of it. Therefore, Ola Select would make sense to someone who was regularly spending Rs. 15,000 (40 x Rs. 375) on Ola per month – a rarity in Mumbai.
The biggest guffaw of this pricing strategy is that the normal Ola rides are now directly competing with Ubers prices and often, I end up opening both apps to see availability and pricing before I book my ride. This is something I do not recall doing when I was a Select member.
2. Untrained/Greedy Cab Drivers
The quality of Ola drivers has been steadily dropping over the past 12 months, but it has dived off a cliff over the last 3 months. On multiple occasions, drivers have hesitated to arrive unless they know the drop off location or cancelled the trip if it is short or payment isn’t going to be made in cash. Off-late, I observed the most alarming trend in Hyderabad & Bangalore wherein drivers want me to cancel my trip after they arrive and settle with them in cash for a discounted rate below the original trips pricing quote. Clearly, something is going on at Ola that is causing such drivers to be recruited and retained.
3. Filthy Car Quality
Ola’s fleet is ageing rapidly. Their quality assurance teams seem to have gone on vacation since the tablets have stopped working, in-car Wi-Fi is non-existent, the cars are well dented, have their paint scrapped off in many places and have not had their interiors cleaned in months. If Ola assumes that their riders will take 25-kilometre trips in these vehicles, the least they can do is to ensure that their vehicles are providing a comfortable commute.
The overall Ola experience has left a lot to be desired.
The loyal Ola users are now looking for better options and it isn’t a coincidence that Uber has newly launched its Premier vehicles campaign. It assures the rider that they shall enjoy new vehicles and highly recommended drivers for their trip – at no monthly cost at all!

Time to buck up or it’s going to be hasta la vista, Ola!

Who Will Save India from Bad Customer Service

It took a lot of painstaking effort and careful planning to ensure that I would be in my hotel bed in Hyderabad between 11:30 pm and 12 midnight so that I would be fresh for the conference I was attending today. Bad weather coupled with lousy pilot scheduling resulted in a 4-hour delay, most of which I spent sitting on my seat waiting for Indigo to send out a new pilot to commandeer the aircraft. I finally reached my hotel at 3:30 am and fell asleep around 4:30 am thinking to myself whether the airfare I had paid to Indigo was cheap enough for me to endure the toll this lack of sleep would have on my body today. As you might guess, it is not, and will rarely ever be.

It is time that the enterprising youth of our country got together to create a service along the lines of Resolver. It is a known fact that consumer courts have the highest resolution rates in the country; add that to the rapidly growing internet population statistics and a growing consumer market with many new brands and there could not be a better time than today to start such a venture.

Karishma and I have worked on this idea previously and we are very passionate about investing in this space. If you or someone you know is working on this or anything like it… reach out to us ASAP!

Dont Let The Customer Lead Your Product Development

Many people will tell you to “put the customer first” or that the “customer is always right”. While they are correct, these are invariably techniques to deal with customer conflict resolution i.e. to pacify or aid a dissatisfied customer get what they want. Recently, I have encountered many founders who have extended these strategies to their entire product development process. This has led to a complete disaster, resulting in the unnecessary expansion of the bouquet of products and services being offered – massively scaling both, the size of the team and the processes that the venture is following. Unfortunately, expansion isn’t the answer, since a larger pool of products & services only means that there are fewer winners, many mediocre products and some downright losers.
With so many permutations and combinations to play with and a business to run, the founders’ bandwidth gets spread out too thin and the hawkish attention they should be paying to their target customer is lost. This leads to a new conundrum, which products or services should the venture discontinue? How can the founder gauge whether that move will further alienate the venture from their target audience or bring them closer? To be this confused at an early stage of the venture building process is pure suicide. Alternatively, a smaller bouquet with a focussed attention is much more appreciated.
Take for example the original OYO rooms offer which only offered 4 things to their customer

    1. 1. An affordable price
    1. 2. A clean room
    1. 3. Free Wi-Fi
    1. 4. Free breakfast

Although, offering only these thing, may have alienated larger sections of the market, it catered very specifically to the target audience that they were after. Today they are expanding their product portfolio and catering to different segments, but that wasn’t the case at the outset and yes, of course, today they have $250 million sitting in the bank that gives them to flexibility to expand their portfolio.
It is clear, that I advise founders against trying to cater to every customer’s demands so early in the venture development process. There isn’t a single venture that has successfully been able to satisfy all the people in the world. This has been proven time and again by all the start-ups who have attempted it, and regardless of sufficient funding and prestigious global networks, either died or learnt their lesson and chosen to scale down to stay afloat. If you are reading this and realising that you are in the trap of catering to everyone and no longer addressing the market you had originally intended to cater to – then this is the time that you scaled down

Your discounting campaign is suffocating your business!

Uber & Ola have finally found out that their long-term discounting campaign only helped in distorting the market. However, markets will eventually come back to normal and the fuel behind the discounting campaign (read: investor cash) will dry up as investors focus on the real numbers that drive a business i.e. profits & margins.
Many founders continue to be inspired by the discounting campaign tactic but the economist in me will tell you that long term discounting will cause more harm than do good for your venture. Therefore, any strategy that involves a discounting tactic should have a clear objective backed by an expiry date.
What is discounting?
Discounting is different than having a pricing advantage i.e. a cheaper cost base for providing a product/service. Discounting means that you have decided to take a cut on the margins that were promised by your business plans to achieve an objective. It could be to get rid of old inventory or to gain significant market share in a short span of time. On the other hand, a cheaper cost base allows the venture to provide the product/services at a cheaper price while maintaining promised margins.
Why are you discounting?
Discounting works best in a market where the product/service offered is homogenous and the customer will be inspired in choosing your offering over the others is a discount. Many founders use this example to defend a long-term discounting campaign but I counter that if your venture is a new entrant and it offers no other significant advantage over your competitors expect its deeply discounted price, then why are you entering that crowded universe when you have no other significant advantage?
Some founders will argue that discounting can also be used for snatching away market share as a new entrant in a crowded market or a market dominated by a few players. I can agree with that view and this may lead to a temporary influx of customers but those initial numbers are irrelevant. Only those customers who come back for a repeat purchase are important because they have made a shift in their buying habits because of what they experienced the first time they bought your product/service at discount and were motivated enough to come back and buy it at a full price.
What happens in most cases with founders is that they get scared of removing the discount because they will reveal the real numbers of the business which they themselves do not know nor want anyone else to know.  Then that discount tactic becomes a strategy to distort investors perception and most importantly their own.
When should you use discounting?
The most important decision before embarking on a discounting campaign is the frequency you expect your customer to engage in the behaviour of buying the product/service whether it was from you or your competitor. Next you can figure out how many times a customer needs to buy from your venture so that initial discount pays for itself from future margins. If the answers to anyone of these questions is over a year, then the discounting strategy shouldn’t be pursued because the return on the investment in discounting is too far out for it to make profitable sense to pursue. Secondly the long period to profitability from discounting a customer has inherent challenges as many new entrants come into the market and the there is a risk of a change in customer behaviour which would lead to the entire investment in discounting becoming a complete loss.
Alternatively, if your average customer has the propensity to make multiple purchases from you in a year such that the initial or interim discounting campaign pays off quickly it makes economic sense to pursue a discounting campaign to attract the customer, gain the customers loyalty and enjoy the temporary increase in revenues.
Unfortunately, I continue to see business models & MIS reports that are pursuing discounting campaigns with scant regard for the economics of the campaign. These founders are revelling in the temporary high that the vanity metrics bring to them, blissfully unaware that the business is dying a slow & painful death as the discounts eat away at the foundations of the business.
If you as a founder are thinking about pursuing a discount campaign, please think through the economics of the campaign viz how will the initial discount pay for itself? how long will that take? what is the return of the investment in the discount? what is the probability of that achieving that return?
Without adequate thought and planning behind a discounting campaign you’re just gambling with your business and if you want to run a gambling business then open a casino.

Delighting the Customer – the Taj way! 

I usually do not write my blogs before 6-7 pm but the events of my breakfast wont allow me to keep my thoughts within my head.

The last time I was in Bangalore I was put up at the Taj Gateway Hotel on Residency Road. The stay was pleasant except for a couple of issues and unlike my nature I took the time to fill out the feedback form that was emailed after my stay was done. My apprehensions with these feedback forms is evident in my long held belief that these feedback forms are directed to the trash folder or to a person who has no power to effect a change… but my belief took a paradigm shift today thanks to, Executive Chef Naren Thimmaiah.  
In my feedback form I had complained about the hotel using a brand of ice-cream that had everything but milk in it. The ice-cream had an atrocious after taste and it isn’t good for health as its made with everything but pure milk. I complained about that and completely forgot about it.  
Last night I checked in again at the Gateway and as I sat for breakfast this morning, Chef Thimmaiah approached me at my table addressing me directly, as if we knew each other! He proceeded to explain that my suggestions from my previous stay were taken very seriously by the hotel and that they had decided to change the vendor for the ice-cream!  
Chef Thimmaiah profusely thanked me for taking the time out of my day to register my discomfort with the food item and that he will be happy to serve me the fresh brands of ice-cream available at the hotel at my convenience.
Think about that… a company the size of Taj Hotels took the time to read a feedback form filled out by an insignificant customer like me! Infact the entire staff was aware about the feedback form and I was asked on multiple occasions throughout my breakfast if I was comfortable or needed anything else.
It is a lesson for all entrepreneurs that no matter how big or small you are a focus on developing and delivering a customer experience is paramount to the repeatability of business from that customer. When the customer is delighted by the service offered he/she will recommend it to 10 others or write a blog post and post it all their social media forums – like me.

Did you involve your customer in product development?

A single conversation with Mikhil Innani (of and fame) brought about disruption in the way I have been working with start-ups, especially post investment. The lunch conversation revolved around how a start-up founder (CTO, CEO, COO – all of them) would drive the decision for the next iteration of the product.
When I heard the concept it felt so simple, so easy. Something that every startup should be doing. Yet, I hadn’t heard this from anyone until the day I heard it from Mikhil – involve their top users into the conversation around and about the product and let the learnings from those conversations drive the product!
Sounds simple? It is!
One of the activities that Mikhil did as a CTO, was have a list of the top 20% users of the product and then each day, he would make it a point to visit – physically visit – 2-3 of them and understand:

  1. Why did they use this product?
  2. What were they doing before this product was introduced to them
  3. What do they do before, during and after they interact with the product?
  4. What are features that they use most frequently?
  5. What are the features of the product that they have not used, weren’t aware of or flat-out didn’t care about?

This would spark a conversation that would help the co-founder understand how their product is utilized by their power users. What are the activities that these users were doing before and after the interaction with the product that could be incorporated into the product itself –  making it more relevant and engaging for the user.
This simple concept drove Pharmeasy’s decision to get into diagnostics as, their power users were patients who required regular delivery of medicines (diabetics, cancer patients, etc.) and also had to get testing done on a regular basis to show their doctors. Such innovative thinking not only grew Pharmeasy customer base rapidly – it led to higher engagement, lower CAC and an increasing LTV for the company.
I find the concept behind this method brilliant for the reasons above, but as a marketing & sales professional, engaging your top 20% into the decision-making of the next features of the product leads to two other important benefits:
 Keep the top users sticky
It is a very well-known fact that the top bracket of your customers and repeat orders from the them drive a large part of the profits of a venture. There is also, psychological bonding with a brand or company that gives you the importance of being their top priority. These simple house visits do that brilliantly!
Let the decision making be democratic
The decisions about features which features should be added, removed or modified is often a hot debate between the CEO, that saw something he/she loved at a competing company; the CTO who is passionate to build something disruptive that showcases his/her talent and the investors (me included) who use and recommend iterations based on their own utilization of the app.
However, the person who interacts with the app on a daily basis is not involved in the conversation at all and eventually decision-making is akin to throwing darts at a board. Whatever sticks is what will be added to the app as a feature. When such features fail to take off, it is blamed on the lack of marketing muscle put behind it or that customers don’t understand the features, hence explanatory videos be made or a change in UI/UX is needed – but these are all guesstimates and without real feedback, these are as good as flipping a coin.
When user feedback drives decision making, the founders (and funders) would realize that users may be pointing out other problems that are more important to solve than the ones that they had identified. Working on the top 20% of the problems faced by their top 20% customers will reduce tech, marketing and re-branding spends for most startups!
Therefore, I am making it a point to get Artha’s startup founders to identify, engage with and learn from their users –in fact, I will be asking our startup founders (our customers) how we can be a better platform for them!
Let the learning begin!

An Open Letter to the CEO of Knowlarity from a Knowlarity Customer and Exotel Investor

Dear Ambarish Gupta,
Our company holds a very unique position between Knowlarity and Exotel. You see, we invested into Exotel when it was in its infancy, but we took up Knowlarity for our communication needs due to a better priced product. They were two different business decision(s) at the time and since we were very new to the investing game we hadn’t really given thought to investing as a customer into our investee companies.
We always wanted to move to Exotel, as the lower priced product from Knowlarity came with an even lower standard of service, especially your team’s lack of:

  • People’s Skills (we were abused by one of your staff during contract negotiations)
  • Lack of Follow-Up
  • Missing Deadlines (it took your team 3 months to change the greetings on the corporate number)

Unfortunately, when you start off you don’t think of the long term implications of having your corporate number given off to a 3rd party – they have you by the neck as that number is all over your business cards!
However, backed by the people at Sequoia, we expected that your team would at SOME point become more professional and the systems would be better suited for SME’s. We always wanted to make the switch but we didn’t have a good enough reason.. now you have given me one.
First, I got the email from Shivku on how Knowlarity was allowing (if not condoning) the use of fabrication and white lies to win over customers. That got me quite upset and made me want to send you a personal email to iron out whatever it was that was irking you two. Then, your absolute horrific reply to the serious allegations levelled against your company was the limit. Your reply was misleading, high handed and just dumb.  I’ll dissect my issues with your reply right here:

As for the recording, we fail to understand the connection with us. The only “Anurag” we have in Bangalore is notoriously bad at Hindi. We are still searching for this elusive “Anurag”.

So, I took up the simple challenge of finding this elusive Anurag by doing a search of the Anurag’s that have Knowlarity listed as their current or previous employer (I am sure you didn’t have the time to do the same as in 450 employees an Anurag can always just slip away?) and I found 6 of them! Here is the list I could find
You may be right that the ‘Anurag’ in Bangalore doesn’t have good English speaking skills as none of these guys listed their current location as Bangalore (or maybe one of them was lying?). Anyways, 3 of them – Anurag Nagar (Varanasi), Anurag Verma (Gurgaon) and another Anurag (name hidden as he isn’t in my network) list Knowlarity as their current place of work. I suggest you start from there.

We do not have any policy about responding to market intelligence but we are not surprised if some customers care about this and one salesperson (out of 450 employees) furnished this information.

So you say you do not care what 1 out of 450 people says… hmmm… Are you even listening to yourself? What gives you or anyone in your company the right to slander another company in the hope of winning business? Does your company have a team that monitors its 450 employees email communication sent or do you just let open your network and pray for them to do the right thing? This actually maybe the reason you feel your customers are being poached… if someone from the sales staff can write what he pleases, then what stops him from sending whatever he pleases?
The fact that there is an email out there conveying misleading market ‘rumour’ (NOT intelligence) from an official Knowlarity email address should have made you as the CEO and the leader of the company dig really deep into the culture that led to such an email. Not having a policy to have fair competition may not only stem outside the organisation.. it maybe rotting your own organisation too. Infact that is exactly the sign of an aging business not an “older” and what should be wiser one.
With a similar product you will have the issues of copying and being copied. That is going to happen and it can be accepted to a certain degree (read Samsung vs. Apple vs. Samsung) but lying to customer, slandering your competition and just misleading the public with “holier than thou” response just stinks. Infact it stinks so bad that we are going to stop using the Knowlarity services immediately and shift our business to Exotel. Since you don’t have a policy in your company on what is right and what is wrong.. tomorrow one of your staff may tap one of our conference calls and give the information to our competitors and you will write another ridiculous email defending his actions versus taking action against him.
We cannot continue to associate with a business like that. I really hope that you dig deep and understand the implication of defending something that is wrong… but then if you are defending someone who is guilty… what does that make you?
Good bye and good luck
Best Regards,
Anirudh A Damani

LinkedIn’s Inmail Credit – An Example for Other Businesses to Follow

I had recently written a post regarding unnecessary meddling in the Indian aviation sector by DGCA. A day after that Captain Gopinath wrote an article for the Economic Times which voiced similar concerns (albeit on a different tangent) on the sector too. Captain is a pioneer in the sector and I have a huge amount of respect and adulation for him (I have read his book, Simply Fly , twice and recommend it to any budding start-up as a book on winning against insurmountable odds in India) I sent him an Inmail to review my post and give his thoughts.
Being a busy man as he is, he may not have found the time to respond to the Inmail (I have my fingers crossed that he read the post J) , LinkedIn sent me an email stating that my Inmail credit that had been used to contact Captain Gopinath was hereby being returned and that I thought was – “Simply” Amazing! From my perspective, I am the one who wanted to reach out to someone I have a not direct connection with (yes Linkedin says I have a 3rd level connection with him, but that is just to flatter me), they gave me that opportunity to atleast have my voice reach him, he chose not to respond/missed my Inmail on account of not logging in, in the 7 days response time frame that LinkedIn has as a policy for InMails – which is absolutely his choice and they felt apologetic enough to refund the credit because the “intention” of using that credit wasn’t completely utilized.. I “simply” want to say – Wow! Kudos! Shabaash!
In a world where most businesses will hide their inability to complete a service (please don’t ask for a list, I’ll have to send you the yellow pages for the city you reside in) here is a public listed company that is taking the onus for a job that they couldn’t complete and refunding back what they took from me without a class action lawsuit (which would support the lawyer’s annual bonus).  I remember that back in the US when I had an account with Charles Schwab , they would refund my wiring fees because I had to call in to get the wire done as there was some glitch in using their online system to wire money, they would gladly charge and refund the wiring fee for calling in. With such a commitment to service there isn’t a doubt that these two companies hold such a dominant position in their markets.
This is an example for other companies to follow. If you don’t provide the service that you intended to, fess up and give your customers a credit back. If a booking is made for a hotel and the pool or gym is shutdown – refund to the customer (without haggling) a few hundred rupees that would have been input in the costing of his room based on him using the facility. Let me be clear, I am not advocating for those customers that choose to not use the facility even if it is available, but if it is not available – refund that portion (or give a dining credit) at check-in itself so that the customer is already ecstatic at your honesty (it is the best policy J) and is easy to please.
Another example would be that, if I choose to fly Air India (yes.. I “simply” do), a full service airline and they cannot reach on time or they give this food packet to me in the name of breakfast – kindly refund the money it would have cost to have given a real breakfast or refund the money on the extra taken due to your tardiness and for which my company paid a heftier price in booking through your airline.

This is the dinner on Air India.. Fit for the Maharaja of the skies?
This is the dinner on Air India.. Fit for the Maharaja of the skies?

Yes we aren’t in an Utopian world, but in my experience a policy wherein you own up to your mistakes and offer something back to the customer (it doesn’t have to be spectacular but don’t be cheap either) – they will appreciate you for your upfront honesty and they will choose you in the future (even if you were pricier) because they are sold on your commitment to get the job your customer intended (please mark this word – intention and not your own convoluted, contradictory and magnifying-glass-needed-to-read policy). They will appreciate you back and you will have a customer for life.
A start-up that ingrains this into their DNA from the very outset will go a very long way… that is “simply” a given (yes this will be the last time I will say “simply”)
Err.. okay that was the last time, I promise J
(I am requesting your comments on what other types of companies can institute this, how your company is instituting this (please don’t put up any ads advocating for your company – we will remove the comment) and whether you have seen or experienced this in dealing with a particular company. Please keep your comments anti-inflammatory and non-threatening to avoid being censured)