2.4¢ : The Green Mermaid Invasion

There is no way that we can talk about customer experience without mentioning Starbucks. The black magic of coffee began before 1000 A.D. when an Ethiopian man ate the same "cherrie" that made his goals unusually hyperactive. More than a thousand years later, we are still frisky about this magical liquid all over the world.

It's not the coffee itself but the customer experience of coffee has helped Starbucks become Fortune 500. Starbucks has done something remarkable: promote something that costs about 50 cents, sold it for $3.50, and still made customers crave it. They have figured it all out what exactly their clients want and deliver the same way every time. There is rarely any selling effort necessary after the brand equity and customer loyalty been established. In fact, when was the last time we see any Starbucks commercial on TV!!

When I grew up back in Taiwan, we didn't have coffee around. Because tea has been dominating in Chinese beverage culture for centuries, the grand opening of Starbucks coffeeshop in Taipei, Taiwan was just as revolutionary as the first coffee shop in the world opened in Turkey in 1475. In Westerne's mind, Chinese tea probably is as tastely as water. However, if you ever visit Taiwan, you would feel amazed by all the tea shops at every corners of the city. Tea beverage is sold hot and cold, mixing with juice, flavored syrup, herb and all different kind of condiments like jelly, tapioca and pudding. Most of all, tea beverage is cheap – averagely 50 cents per cup, so it is very popular all over Southeast Asia countries. However, Starbucks and its franchises came to this marketplace, where per capita GDP is only half of US (China is less than 1/10), still sold a cup of coffee for $3.50 US dollars and slam-dunked the beverage business in Taiwan and China.

Starbucks becomes so successful that they opened a hundred stores in just 4 years on the tiny Taiwan island of population at 22 million, and it plans to double the store number very soon. Starbucks prospers in Taiwan by single-handedly bringing in a great coffee experience. In additional to making customized beverage (same as the existing tea shops), Starbucks tailors its food menu to satisfy local favorite. There are much more selections than just pound cake and muffin. Furthermore, Starbucks created a welcoming environment in store internationally for people to socialize, which indeed is a unique attribute in Asian culture. Unlike Starbucks in US mostly serving professionals, where everything is drive-through or pick-up efficient, stores in Taiwan draw major crowds by dedicating an entire floor for students to study or people who want to have some quiet reading; other floors are regular hang out areas where people usually play poker/chest or have group meetings. Starbucks in Taiwan becomes more like pub for guys/girls to pick up or get picked up: the difference is people are paying a lot for coffee instead of paying a lot for beer.

Now when I drink Starbucks, I not only enjoy a cup of awesome coffee but also indulge in an extravagant experience or memory associated with it and some fun time I had in the stores. Hence, Starbucks has successfully transformed a commodity to a luxury. On the business side, there is lower GDP and cheaper everything from labor to material, Starbucks business soars in Asia without any marketing, promotion or advertising. That's a true tale about customer experience.

2.3¢ : May peace prevail on irrationality

Happy Father's Day too all the fathers in the world! If you are a new parent, here is a piece of advice for you: Stop reading any news about Shiloh Nouvel Jolie-Pitt, the new born of celebrity couple Brad Pitt and Angelina Jolie.

Shiloh means「Messiah」or「Peaceful One」in Hebrew, but business surround her is nothing but normal. Evidently, little Shiloh's pictures on the cover of People Magazine not only worth $4.1 Million but also brought in a big chunk of profit to the baby clothing designer, 'Kingsley', whose T's worn by Shiloh on the day of photo shooting. Orders are pouring in to baby boutiques nationwide to purchase this $42 dollar toddler shirt which probably become too small within 30 days, sooner than guarantee money return or exchange. It's outrageous!! I admit sometimes I shop irrationally, but fortunately, I am not a parent yet. When it comes to shop for babies, are the new parents rational?

First, new parents have the motivation to dress the kids the way they dress themselves. Kingsley designer Aaron said "[My design is] sort of clothes that I would even wear [and] that I would like to put on my son." In my opinion, because babies can not talk nor express their own personality or preference, parents take the advantage and clone the baby as Dr. Evil dressed up Mini-me. I always feel sympathetic for little toddler girls with pierced ears. They certainly don't realize they look cute with earrings - they may not even care - but they have to suffer the sharp pain as a direct result of their parents' choice.

Second, new parents have the ability to spend lots of money on designer vintage baby clothing. The 59 million post-boomers have now started their own families and progressed into the parenthood with more disposable income. This MTV generation is highly influenced by heavy metal rock bands. Without a doubt, carcasses and skeletons are perfect patterns for their baby's bunny suit. Kingsley designed clothing is just one example out of thousands business for en vogue baby merchandize. Furthermore, having the same t-shirt as it on Shiloh would just make the baby feel like a celebrity too.

Third, new parents have the opportunity to sort through available sources to buy all the 'baby stuff'. For example, in additionto 232 stores in US, Baby R US has partnered with Amazon to sell literally anything the parents can/cannot think of online 24/7. Thanks to the Internet and the new trends in opulence for kids, high-end baby clothing and furniture business expands like wild fire. Going to stores after stores to look for the 'color coordination perfection' is replaced by visiting websites after websites, which I assume is more acceptable particularly for dads. They definitely have more energy and time to shop via Internet.

The conclusion seems to be positive: new parents are rational in shopping for baby. However, I have a hard time to rationalize the instant success of InkyDinkTees (wore by Jolie’s son Maddox) and Baby Björn carrier (held Jolie’s daughter Zahara). It seems like every baby thing this high-profile family touched becomes gold. Or more logically, new parents are just fooled by the ancient old PR trick: PRODUCT PLACEMENT …oh well, that's another bed time story.

2.2¢ : Immaterial Music World

A class blog entry without a given topic is definitely a more difficult assignment compared to a guided blog. I, as a student, am used to the rules, guidelines and specifications to complete a school assignment because it’s an expectation that I learned from the previous experience. In the real world, people live by rules and regulations, hence chaos and disorder is never a preferred state of the situation. Nevertheless, we adapt to changes very quickly when it’s about benefit (or, maybe, survival). I think human beings are not used to changes, but the world is changing around us. The music industry especially, as we discussed in class, is changing so much more rapidly and dramatically in the last decade than in the entire 200+ year of sound recoding history, started with Edison’s first phonograph in 1877. Everyone likes music, perhaps different type of music, so it’s not a big surprise that the general public quickly adapts to the digital format of music and never returns.

I work for a high-tech company in Austin, and my job is to work with attorneys on protecting the companies’ intellectual properties. In a nutshell, we are not looking for ugly patent litigations; we are looking for opportunities to license competitors and collect royalty. Almost all the large high-tech companies have an offensive IP licensing program to protect their rights, and I believe the RIAA brought up all the music download lawsuits simply to "protect the copyright". Because I work with law, I absolutely support the act to protect the artists rights; however, RIAA is doing too little and too late. Because the major record companies/RIAA did not participate in the creation of digital music, they can not technically stop the illegal usage or spread other than bring the problem to arbitrage. However, rule of laws are exercised differently by governmental authorities all over the world. The main reason that iTune/iPod hasn’t get as popular in Europe as in US is because peer-to-peer downloads are not actively pursued as criminal acts. RIAA is working with IFPI (International Federation of the Phonographic Industry) over the years and over 26 other countries. Hence, 2005 was the first year that UK and Germany reported more legal download than illegal ones.

However, according IFPI’s report, digital music business only accounts for 6% of the record company revenue. I personally think the on-going music download litigation is not an answer to reshape the industry. All the expenses only profit the pockets of attorney at the cost of music lovers. More effort from the industry should be spent on exploring the new era of customer segmentations and supporting more talented artists, or creating a better technology. For example, some baby boomers are technical-savvy, but some, like my parents, are just barely in touch with CDs and DVDs. They probably are not into rapping with 50cent’s In Da Club, but they may enjoy singing along everyday (seriously, everyday) with Sinatra’s New York, New York. I had to educate my parents that music on CD will be ruined after excessive times of playing, but not music on MP3. Moreover, thousands more of Sinatra classic songs can be stored/replayed without taking any space. All they need is a computer (and money to buy music online, of course). 'It’s like a Star Trek "Tranporter", but we use it on music, for now.'

As I remember from high school physics: "it is only possible to study immaterial forces like gravity by observing their effects on the physical world". Music with technology is another immaterial substance that changes our lives. People in my generation are bombarded with novelties that come with technology. We are exposed to all the media and word-of-mouth buzz which provide means to adapt to the digital music world. However, customers from certain demographic and psychographic are left behind, who apparently account of the rest 94% sales. Maybe they are the key players to revolutionize the music industry once again in the nearest future.

2.1¢ : Aveda's TLC

Hair is woman’s second face. Just like all the wonderful ways to pamper our faces, most of the women wash their hair, condition it, color it, reshape/style it and even a hair 'facial' is no uncommon. There are so many choices out there: from Suave "Don’t you look smart" (by spending less but looking just as good) to high-end celebrity brand: L'Occitane en Provence or Rene Furterer. I have been loyal to a brand called Aveda ever since I visited one of the stores.

The Aveda boutique locates in Highland Mall and its layout gives a very "Zen" atmosphere which allured me to walk in at the first time, even though I wasn’t shopping for any type of body/hair products that day. The sales woman kindly welcomed me to Aveda and offered me a cup of herbal tea without trying to sell me anything. While I walked around the shop for 5min, sipping the 10cc botanical liquid, the same girl came up to me again. And I thought 'for sure, she is going to start the usual selling spiel', but on the contrary, she surprised me again. She asked if I would be interested in getting a free hand or neck massage. Eventually, the massage relieved the tension on my neck and shoulder from shopping all day (and also seamlessly advertised their latest aromatic massage oil), making me an Aveda customer without me knowing it.

Even though I did not buy anything from Aveda that day, the lady was still very kind while I walked off. Her non-aggressive attitude was such a refreshing experience to me that I returned to the store the next time. After making several purchases, I learned that Aveda keeps the sale history of regular customers (those who allow Aveda to have their personal info), so the sales person can better assist the customers when they return, either by surveying the user experiences or recommending products that suit the customer’s new hair color or style. It is such an important customer service particularly to me since I shop a lot but I could not remember what I have purchased previously.

As far as the merchandises themselves, the obvious reason to continue to use Aveda is the product does achieve the results it claims. More importantly, Aveda carries a complete head-to-toes product line of hair/body care with environmental consciousness, which is a compelling selling point to me and to many other people who care a little bit more about our Earth. Although there are several brands on the market have similar brilliant vision, such as Body Shop and L'Occitane, Aveda is the one that goes beyond the retail and differentiate itself by franchising the salon service business. The bonus is Aveda and their professional stylists become their own end-users to understand its customers more and create the products to fulfill the needs., Just like what Rubbermaid's rep suggested in the article One Nation under Wal-Mart: "You need to be your customer" to achieve a marketing success. At the end with Aveda, I have learned first hand not only about how product performs from the professional service, but also learn about how to use product post-service and try to replicate it at home.

"Everything is worth what its purchaser will pay for it" once said Publilius Syrus. Personally, I spend more money on Aveda than an IPod on an annual basis. The relaxing shopping environment and the total customer care package make higher-priced-than-average Aveda worth every penny. After all, I am worth it. :-)

2¢ Blogging begins...

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