Chump change, but a clever way to make more bucks

This reminds me of a tactic that UPS adopted several years ago. It didn't involve pennies...just time. A study revealed that it would be better for UPS  drivers not to make left hand turns at intersections...time was wasted and that was money lost.

 

"Chipotle’s Fuzzy Math: Why They Stopped Rounding Customers Out of Change"

by

Josh Sanburn

August 30th, 2012

Time

The next time you’re in Chipotle, check your receipt. That’s what one guy in New Jersey did, and he discovered that the fast-casual restaurant was rounding up to the nearest nickel — and it was costing him money.

Jayson Greenberg of West Caldwell, N.J., noticed something funny on his Chipotle receipts recently. The numbers just weren’t adding up. One receipt showed several items adding to $35.24, but the “total” came up as $35.25. It happened again with another purchase that was $9.24 but was totaled $9.25, and another that was rounded from $18.99 to $19.00. So Greenberg contacted a Chipotle manager.

“He said, ‘Oh, it’s a computer program. It is just rounding numbers. It takes a little from certain receipts and gives a little to others. What do you want? A few pennies?’” Greenberg told The Star-Ledger.

It turns out, Chipotle was rounding totals — both up and down depending on the price — in high traffic restaurants in New Jersey, New York, locations in Boston and elsewhere. The rationale: counting pennies takes time, and in restaurants that often have people lined up out the door, why not just round to speed the line along?

There is actually research on this very issue. MIT physicist Jeff Gore has become a de facto spokesperson for getting rid of the U.S. penny, not just because it’s lost so much value over the years, but because it actually wastes everyone’s time in line. About a decade ago, Gore estimated that we waste $5 billion a year just fiddling around with pennies to make change at a cash register. While Chipotle’s reasoning was a bit different, it appears they believed they could get more people in the door if they could decrease time at the register.

Since The Star-Ledger investigated Chipotle’s penny-pinching, the restaurant now says that the restaurants that do round will only do so to the nearest nickel rather than rounding up. Greenberg told The Star-Ledger that after he complained to Chipotle, he returned to the restaurant and discovered a new line on his receipt: “Round -0.02.” His bill should’ve been $19.02, but he only paid $19.00. Similar receipts have shown up on Consumerist.

Chipotle’s “hidden fees” bring to mind Starbucks’ shadowy “bean fee” that was disclosed last year after a Massachusetts consumer affairs bureau fined Starbucks for secretly adding $1.50 to an order of beans that weighed less than a pound.

But if Chipotle decides to round at all of its restaurants nationwide, it could make the idea of rounding to the nearest nickel more acceptable to Americans, something that has been talked about in the ongoing debate over whether we should keep the wildly out-of-whack U.S. penny, which costs more than 2 cents for the U.S. government to make. Our neighbors in Canada will take their penny out of circulation next year, meaning every Canadian business will basically be doing what Chipotle is doing — rounding to the nickel.

Yipes...consumer manipulation...well, it does work

"The Brilliant Genius Bar Manual That Teaches Apple Employees How To Manipulate Customers"

by

Will Oremus

August 30th, 2012

Slate

A number of articles lately have attempted to convey the full measure of Apple’s unprecedented streak of business success. Perhaps the most mind-blowing factoid about the company’s value came yesterday from Kontra, via Twitter: At the time of his tweet, Apple’s market capitalization had exceeded that of Google, Facebook, Microsoft, and Amazon—combined.

One reason for that phenomenal success is, of course, Apple’s products. Another is its customer service, namely the Genius Bar, where bright-faced young geeks win customers’ hearts and build brand loyalty that Apple’s competitors can’t match.

How do they pull off this “high-touch” approach? Gizmodo this week reported on a leaked copy of Apple’s training manual for Genius Bar employees. Sam Biddle summarizes: “Sales, it turns out, take a backseat to good vibes—almost the entire volume is dedicated to empathizing, consoling, cheering up, and correcting various Genius Bar confrontations.”

To wit, a section of the manual under the subheading “Empathy Exercise 2—Techniques” introduces “The Three Fs: Feel, Felt, and Found.” A sample conversation from the handbook:
 
Customer: This Mac is just too expensive.

Genius: I can see how you'd feel this way. I felt the price was a little high, but I found it's a real value because of all the built-in software and capabilities.

This tactic dovetails nicely with the section of the manual on things to avoid saying and doing. For instance: “Do not apologize for the business [or] the technology.” Instead, empathize: “I’m sorry you’re feeling frustrated,” or “too bad about your soda spill accident.”

Biddle’s fascinating post on the manual is worth reading in full. But while he reads Apple’s tactics as outlandish and creepy, if brilliant, I’d just call them brilliant. Of course the company wants employees to address tech problems without trash-talking Apple’s own products. Of course it wants them to make customers feel valued while not forgetting that the ultimate goal is to part them from their money. These are things that every company wants, and they are skills that come instinctively to great salespeople.

But when you’re a big company, it’s almost impossible to impart these skills to every single employee. Most don’t even try—they hand out a generic HR handbook that no one will read, mainly just to cover their butts. Apple’s manual, in contrast, reveals a firm so bent on maintaining customer loyalty that it will go to abnormal lengths to show its workers exactly how to behave in all situations.

The investment has helped Apple establish one of the all-time great business empires. But as Apple continues to grow, it will become harder for it to serve its customers well. The company today has some 300 retail stores in the United States, but far fewer in many fast-growing overseas markets. It’s difficult to imagine the company keeping up with demand for its Genius Bars without compromising on the quality of its service.

As it happens, the company has offered a glimpse into the Genius Bar’s future: “online specialists.” The online service, which is now available to customers in Brazil, Germany, Spain, and the United Kingdom, is meant for people serious about buying an iPad or iPhone. Through live chats, phone conversations, and “screencasts,” the online helpers guide them through the product’s features, answer questions, and even help them set up their new gizmos once they’ve made their purchase.

What it doesn’t offer is any tech support, which means this is not really an “online Genius Bar.” But online tech support is surely not far away. And if Apple wants to keep printing money, it had better start writing a manual for its online geniuses that’s just as devious as the one for the men and women who manipulate us in brick-and-mortar stores.

Marketing physics

They are everywhere...coffee mugs, posters, pens, T-shirts, panties.

"Got enough physics?"

by

Zoe Macintosh

July 28, 2008

Symmetry

The eyes may be the windows to the soul, but it helps to have other reference points. Celtic dragon knots, Che Guevara headshots, Dilbert cartoons and Shrödinger’s equation all fit the bill in the realm of expressive T-shirts.

If you're one of those people who can never have enough physics in your life, you may enjoy digging around the physics-related shirts, mugs, clocks, and other merchandise available on the Internet.

In the online age, where everybody can participate, ventures like cafepress.com allow users to design their own products and have them made on demand, either for themselves or to sell in their own stores. At the site, a simple search for "physics" returns more than 7000 matches, and even though many of the items available are not really physics-fan desirables, there is a wealth of paraphernalia to explore.

A few ideas turn up often enough to vouch for their secure place in popular consciousness: references to Schrödinger's cat, quotes by Einstein, and quantum mechanics' allotment of a general sort of freakiness.

Other items offer assurances that science is hip: "PHYSICS BABE" shows a slinky cartoon woman in a space suit wielding a ray gun, while another shirt proclaims "Science makes me cool." There are cheat-sheet designs that all but replicate a student's notes onto a shirt; there is self-deprecating humor. "Research…screwing up for fun and profit," one T-shirt cracks. Or maybe it really is the case that "78% of all statistics are made up on the spot" and "Progress is directly proportional to equipment ruined."

Many of these designs are in-jokes, intelligible and interesting primarily to those already in the know. Anyone want a Maxwell’s equations wall clock? How about this message: "Let's put the fun back in wavefunction!"

I prefer designs that communicate through graphics: pictures of archaic physics equipment, the iconic head of Nikolai Tesla with his name all in caps, or "Chillin' with my [ohm]ies." A simple image of a lab-coated man pouring liquid into a vial, labeled "SCIENCE!", appeals to me more than the slogan, "Quantum physics says you'll never find me if I stand still."

One particularly obscure shirt features a kinematic equation purporting to show "the airspeed velocity of an unladen swallow." I didn't get it, but my fellow intern Calla Cofield chuckled, explaining that it was a reference to Monty Python. "Yeah," she said, "you have to be a double nerd to get that."


And I am a sucker too...