Have you ever visited Teavana ? In case you’re not familiar, Teavana is a retailer of high quality loose leaf tea. Most of their stores are in upscale malls, and that setting provides them with the perfect spot for a bit of what I call "retail theatre."

Teavana begins the customer experience before you reach the door. There is a table with samples of exotic teas, just on the threshold of the store. A staff member greets you and asks if you’d like a sample. Typically, one sample has caffeine and the other does not, thus something for everybody. Once you take a taste (delicious), the staffer invites you into the store. From there, it’s like being taken through a tea museum by a well-trained docent. I am a coffee-drinker but it was like a whole new world was opened up to me. Everything from the lighting, the color pallette used in the store, the new age soundtrack and the smells – oh, the smells – was like walking through some type of exotic garden. Loose teas from around the world made me feel as though I was on the threshold of a whole new world I never knew existed. The staffer guided me in a loop of the store and before I realized it, we are standing at the check out counter. She removed the lid from a large canister and waved the lid toward me in short, dramatic sweeps of her arm. My nose filled with a variety of intertwined scents – chocolate, orange, cinnamon, and others I couldn’t identify, but enjoyed nonetheless.

The point is that they make a visit to Teavana a whole experience that engages all of my senses – taste, sound, sight, touch – as well as my interest. All the tea’s a stage, and the customer is a guest star upon it. (more…)

Last week during my service design workshop for Inc. Magazine, I cited the study from Bain Consulting in which 80% of executives from large public corporations believed that they were providing "outstanding customer experiences" to consumers. I asked the group of privately-held company CEOs to guess what percentage of customers actually agreed that statement. People called out "30%," "20%," "15%!" It was like a reverse auction. And yet nobody even came close to the dismal truth that only 8% of customers agreed that they had an outstanding customer experience. You could actually hear a collective gasp in the room when I told them that the number was 8% and that the execs had missed it not by a factor of two or three but by a factor of 10!

I’ve been thinking a lot about this disconnect within large corporations. Why does it exist? I have a couple theories, and the first revolves around the old saying, "familiarity breeds contempt." It’s tough to nail down who first said that, either Aesop in a fable or St. Augustine ("vulgare proverbium est , quod nimia familiaritas parit contemptum.") And while this saying is most often associated with individuals and inter-personal relationships, I think it’s true for companies and their customers. In traditional marketing there is a mad rush to get new customers, as opposed to really understanding the customers you have, which in turn, would help you attract more customers. (more…)

An article on the Design Week website discusses a new BBC reality TV show in which young designers compete to win a six month gig with designer, Philippe Starck. Entitled “Philippe Starck’s School of Design,” the show echoes the BBC’s “The Apprentice,” which echoes the original Donald Trump’s “The Apprentice” on NBC. (Talk about derivative!) But instead of overseeing the construction of casinos or golf courses for The Donald empire, the winner of this contest gets a six-month contract at Starck’s Paris studio.

Over 10 weeks, five female and seven male contestants live together in a house in the Paris suburbs. They range in age from 19 to 32 and most have product design backgrounds. In the first episode’s challenge, contestants search a hypermarket for products displaying good and bad design qualities. One designer contestent, Ilsa Parry, is a lecturer in 3D design at Liverpool Community College who has a design idea for a space-saving vertical coffin. Unknown as of yet is whether or not Starck has a catch-phrase similar to Trump’s, “you’re fired!”

In an era of rising unemployment, it’s interesting to see TV viewers continue to watch other people struggle to win jobs in a state of pre-packaged, well-lit reality. The good news is that big “D” designers and their craft are finally going prime-time, along with MBAs, fashion designers, cooks and folks who have dirty jobs.

You are invited to attend a free workshop that we will be presenting in conjunction with IncBizNet, the online business networking community created by Inc. magazine and their website, Inc.com. The workshop will be held at their New York City headquarters on February 26 from 5:30 to 8:00 pm. The program will also be videotaped and made available via IncBizNet.com, as well as the website of event sponsor, FedEx Office. More details and registration information can be found here but a summary is listed below…



Gold at Your Feet: How to identify new sources of revenue within your existing business

At the heart of entrepreneurship, there is a spirit of innovation, reinvention and thinking outside the box. Entrepreneurs and private companies are constantly striving to transform, reform, and reinvent the business landscape from the ground up in a positive, forward-thinking way. In support and celebration of that spirit, IncBizNet is hosting a complimentary, interactive executive meet up for private company CEOs around discovering new, innovative and easily accessible revenue streams within your existing business.

Inc.’s special guest Bob Cooper, national pioneer in the cutting-edge field of service design, leads New York’s fastest-growing private company leaders in identifying and realizing unseen, potential revenue streams within your current day to day business – using real-world examples and a proven step-by-step process. Bob will explore how to leverage your brand, knowledge, data, relationships and technology to drive new innovation and additional revenue without economic overhaul. The interactive event kicks off with a cocktail networking reception followed by a presentation, case studies, hands-on exercises, Q&A session.

Come join other New York area CEOs and business owners in our celebration and commitment to a successful 2009. Click HERE to RSVP. Space is limited and RSVP is required. CEOs may bring one executive guest.

Made possible by FedEx Office

In today’s Wall Street Journal, there was an article entitled, "Job Loss in the Age of Blogs and Twitter" in which they reported that Internet gambling, gaming and social network sites have all grown at the same time people are losing their jobs. Beyond job searches, the Web is "performing another important role: a social anesthesia that distracts people from the stress of unemployment." Some facts pointed out in the article:

• The number of visitors to online game sites jumped 29.9% during the fourth quarter of last year, compared with a 0.3% decline during the same period the prior year, according to comScore Inc.
• Traffic on Internet gambling sites soared 28.6% over the holiday quarter, compared with a 26.9% decline over the holiday season the previous year, comScore says.
• Last week, the online movie rental service Netflix Inc. said its number of subscribers grew 26% over the holidays to 9.4 million, compared with 18% in the same period the year before.

For some, this is a period to sulk and get lost in online Soduko. For others, it is a time to seize opportunities. This applies to both individuals and corporations alike.

Kevin Kelly has a great post on his blog, "The Technium" with thought-provoking notions about ownership, renting, and borrowing as they relate to both goods and services in both the physical world and online. Here is a great quote:

“The downside to the traditional rental business is the “rival” nature of physical goods. Rival means that there is a zero-sum game; only one rival prevails. If I am renting your boat, no one else can. If I rent a bag to you, I cannot rent the same bag to another. To scale your rental business you have to buy more boats or bags. But of course, intangible goods and services don’t work this way. They are “non-rival” which means you can rent the same movie to as many people who want to rent it this hour. Sharing intangibles scales magnificently. This ability to share on a large scale without diminishing the satisfaction of the individual renter is transformative. The total cost of use drops precipitously (shared by millions instead of one). Suddenly, ownership is not so important. Why own, when you get the same utility from renting, leasing, licensing, sharing?”

These notions bring into focus some innovative ideas for designing new services.

Kevin is a terrific writer, and a very smart guy with great insights on a wide array of topics. I also highly recommend his "Cool Tools " weekly email with tips on all sorts of things (bits and bytes) to make life easier or more interesting. You can subscribe here .

When you have some time, check out the website for the U.S. National Design Policy Initiative. This excerpt from their website sums things up:

Design serves to advance the goals of the United States’ economic competitiveness by saving time and money and simplifying the use, manufacturing, and maintenance of goods and services. It enhances democratic governance by improving the performance and delivery of government services. Thus, the American design communities offer ten design policy proposals for how we can partner with the government to help redesign America’s future.

1. Formalize an American Design Council to partner with the U.S. Government.
2. Set guidelines for legibility, literacy, and accessibility for all government communications.
3. Target 2030 for carbon neutral buildings.
4. Create an Assistant Secretary for Design and Innovation position within the Department of Commerce to promote design.
5. Expand national grants to support interdisciplinary community design assistance programs based on human-centered design principles.
6. Commission a report to measure and document design’s contribution to the U.s. economy.
7. Revive the Presidential Design Awards to be held every year and use triple bottom-line criteria (economic, social, and environmental benefi t) for evaluation.
8. Establish national grants for basic design research.
9. Modify the patent process to refl ect the types of intellectual property created by designers.
10. Encourage direct government investment in design innovation.

The report of their findings from the summit (which led to the ten design policy proposals above) can be found here: Report of the 2008 U.S. National Design Summit.

Read it over and if you agree, you can endorse the summary here.

This country is facing a number of very big problems right now, but we firmly believe that design thinking can help us (companies, cities, states, the U.S. government or non-profit organizations) sort things out, find innovative solutions and chart a path to better future. To the extent that Frontier can help make that happen with services (which now represent 75% of the U.S. economy) we are "all in."

Have the television and film industries been paying attention to the painful transition that the music industry has been going through over the past eight years? If they have been paying attention, they will realize a couple things:

1 – You can’t fight technology – There is no putting the "genie back in the bottle." No matter how hard you work to control something, there are legions of people out there who are working even harder (and for free and often with a vendetta) to undermine your control. The harder you squeeze, the harder they fight. And your hand just is not big enough to squish them all. (This applies not only to the music industry, but to dictatorial regimes as well.)

2 – You have to adapt – As much as we might like to go back to quieter, gentler times – that’s not going to happen. So if you can’t fight (see #1) then you have to adapt. Just now – after eight long, bloody years – is the music industry machine starting to adapt.

3 – Find what your customers value and provide it – It took years for the industry and many musicians to realize that there is a way to create value besides selling CDs. Live touring, merchandise, special access, works in progress, collaborations, and as-of-yet-to-be-invented models will drive value and as a result, money.  If you want to be an artist and be absolutely true to yourself, then by all means do that. But if you want to be an artist and make money from your art, then you have to create something that people value and are willing to pay for.
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Nordstrom learned long ago that you should never treat your customers like criminals. That’s why you can take as many items into a Nordstrom dressing room as you’d like. Unlike most retailers who limit you to three items and assume that everyone is out to steal, Nordstrom realizes that shoplifters represent a minuscule percentage of the people who are going into those dressing rooms.  Compare this to every other retailer, who makes trying on clothes a complete hassle by limiting you to three items, requiring you to find someone to unlock the door, etc.

At a recently opened store in Miami, Nordstrom introduced a new dressing room concept called "girlfriend dressing rooms" that have movable curtains to women to try on clothes together. Such an incredibly simple service design concept – and one that can only be realized by understanding what customers want and what they do naturally. For most women, shopping for clothes is a social activity and often a "team sport," and these new dressing rooms address that issue perfectly.

Last week at CES, I had an interesting conversation with the Business Development Director of Mindark , the Swedish firm responsible for development of the online virtual universe Entropia . Personally, I’m not a user of these games but I was intrigued by how this particular company differentiates itself, and how we as service designers could learn from it. (Their competitors, Second Life and World of Warcraft seem to get the most press.) According to Mindark, besides having much better graphics and gaming experiences (hunting exotic beasts, exploring unknown territory, battling enemies) their in-game currency (PED) is directly tied to the U.S. dollar in a ratio of 10 PED to 1 U.S. dollar. As a result you can tie your "real" bank account to the game and can move "real" money in and out of the universe.
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