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The term ‘Invisible Hand’ is a term originally coined by the economist Adam Smith. Boiled down, this term is meant to describe how in free markets, people are free to pursue their own self-interests. Smith believed that when people pursued their own self-interests, the free market would provide for these interests and society would therefore be better off.
While the invisible forces of the market may be difficult to spot, the product that goes by the same name as Adam Smith’s infamous term is anything but. InvisibleHand is a browser plug-in that subtly lets a shopper know whether the product they’re looking at is available for different prices at other e-retailers. It’s helpful for casual shoppers who may not always know the different sites where a product can be bought on the web.
It seems the plugin is helping consumers reign in some serious savings. So far their homepage lists their total savings found for consumers to be $410,049,783, with an average savings per product of $11.65.
However, while InvisibleHand does offer great savings to its users, it also helps illustrate a major trend in e-commerce: pricing convergence. A simple search for a Samsung flat-screen television reveals the number of retailers selling the same product for more or less the same price.
Below you can see the InvisibleHand (the yellow bar at the top of the page, and the corresponding drop-down menu) listing the prices different retailers are offering for that same product.
In addition to the Amazon.com price of $807.00, you’ll notice that the circled prices deviate at most by two dollars. Including Amazon.com, that’s a total of 10 sites with a near identical price (and we’re not even displaying all of the search results). Next, take a look at some of the sites offering the television: Walmart.com, CompUsa.com, Newegg.com, Bestbuy.com, Sears.com and Buy.com. Given the enormity of these retailers, we’re willing to bet that in addition to this particular television, they offer many identical products at near identical prices.
While pricing may not be identical for EVERY product across the web, it’s becoming increasingly true for mass-produced items. With that in mind, pretend you’re in the market for a television and you see several different models available for the same price across 10 different sites. At that point, what information would YOU use to make your decision? Here at STELLAService, we’d like to think we know…
Back in dark ages when you had to physically go into a store to get your problems solved or your questions answered, you were in the best possible position to be truly heard and understood by the company. Standing face-to-face with a CSR triggered that person’s need to completely understand you – your issues; your concerns; your demeanor; your nature; your personality; your needs; and the context of the situation – and then appropriately solve your problem in a way that best suited YOU, the individual. Since no two people are the same, it makes sense that no two customer service interactions were the same.
Fast-forward to 2010 and think about all the different mediums through which you can now engage a company for customer support: the store employees, phone, email, live chat, Twitter, Facebook, text/SMS, GetSatisfaction.com and other support forums. It doesn’t take much to see that there’s been a widening “understanding gap” between you (the individual customer) and the CSRs directed to serve you. When it would have been laughable to see a CSR try to repeat the exact same customer service interaction for multiple people that walked into his or her store in a given day, it’s now standard practice for e-mail and live chat support for many companies.
The test for today’s companies is whether or not they can stay committed to the concept of truly understanding the needs, wants, problems and required solutions for each individual customer. Technology can assist this process or work against it. It can be used to gain information about a customer’s likes, dislikes, preferred methods of communication, attitudes toward products or services, etc. – all of which will ultimately enhance the customer experience and the overall service quality. On other hand, technology can be leveraged to provide measly 140 character “answers” or stock email template “solutions” to problems that really call for in-depth conversations over the phone or in-person.
While the “face-to-face” age of customer service required companies to truly understand you (after all, you stood directly in front of their CSRs!), today’s technology-driven consumer marketplace has no such requirements.
Which companies in your world go the distance to integrate new technologies with exceptional live customer support to truly understand the people they call their customers?
A new survey released today by ChoiceStream found that 59% of online consumers were unhappy with the product recommendations they received at e-commerce sites in 2009. These results marked a significant increase in unease with product recommendations compared to 2007 (46%) and 2008 (45%). ChoiceStream attributed the change to heightened consumer expectations as well as a lower level of expertise among online retailers, many of which are new to automated recommendations.
Since online consumers are increasingly looking to product recommendations as a service to help them make better buying decisions, this study highlights an enormous opportunity for many online retailers to blow past their competitors by providing quality and relevant product recommendations. For small sites, this means you can win over the hearts of consumers by adding a little more personalization and thought into the product recommendations – you’re site’s visitors will take notice. For bigger sites, this means a potentially bigger budget and larger focus on the right recommendation engine and the right types of recommendations, no matter what type of product you sell.
If there’s one thing that jumps out at us, it’s that consumers expect more from today’s online businesses. Only the sites that truly address the needs and wants of consumers will surge ahead in 2010. Instead of simply showing consumers a list of “complementary” products or “recommended” products based on refined algorithms, offer a touch of personal service. Display your customer support phone number, email address or live chat link on all product and shopping cart pages, and explain that your CSRs are ready and standing by to help make smart, relevant and reliable product recommendations. It’s not necessarily the high-tech solution that creates the most meaningful results.