After my ordeal with AT&T yesterday, I spent some time thinking of a way for companies to check my credit without requiring my social security number and think I've found a solution. This idea could also be a billion dollar business. If you decide to build it, I require 1% of gross revenue as compensation for the idea. Here's how it goes.
Establish a company to serve as an "infomediary" between you and companies requiring your credit rating. Consumers would pay a small monthly subscription fee to maintain a password-protected account. The infomediary would maintain relationships with the three major credit tracking bureaus. When the consumer planned to do business with a company requiring their credit history, the process would go like this.
The transaction code would only work one time and only when requested by the matching retailer.
Using this system companies could access consumer credit history when necessary without requesting, storing, and potentially exposing anyone's social security numbers. Spread the fire. GS
Today was supposed to be a good day. It was supposed to be the day I got my iPhone. Instead, it became the day I swore a blood-oath not to do business with AT&T until it figured out how to treat customers like customers (not criminals), share information within their company, and stop putting customers at risk of identity theft with its outdated policies.
I have a wife, three kids, three cell phones with Verizon, and a land line plus DSL with AT&T.
My deal with Verizon was up and, although my experience with them had been fine, I had decided to switch to AT&T so I could get an iPhone. We had also decided to add a fourth cellular line and eliminate our land line. Because AT&T uses a different system than Verizon, that switch meant I would need to buy four new phones requiring a cash outlay of almost $600 even though I could get four new phones from Verizon for $0 simply by renewing my two-year agreement. In other words, I was willing to abandon a perfectly good company (Verizon) and pay a $600 premium to acquire an iPhone.
I was not, however, willing to risk identity theft for an iPhone, and that is what AT&T wanted me to do. Here's the sordid account.
9:00am - Amy and I enter the AT&T store in Cool Springs, TN and are given to the sales rep named Kristen. She explained the various programs, fees, phones, and rebates. We learn it will cost us $580 for an iPhone and three LG Shines. Then gave us her business card because she's paid on commission and wanted us to return to her if and when we came back.
9:30am - Amy and I go to Verizon to explore its options. We learn we can get a Blackberry Curve and three Motorola phones for $0 by renewing our plan.
10:00 - Amy and I sip Starbucks while discussing our options. We decide that the iPhone's superior Internet capabilities combined with its open software architecture (API) make it a more versatile tool for me and worth the additional money. We decide to switch to AT&T.
10:15 - Amy and I return to the AT&T store but Kristen is with another customer. We wait. And wait. And wait some more. Finally I ask the greeter if someone else can help us. She directs us to the store manager. When I asked if he could help us he said, "We're paid on commission and so you really need to wait for Kristen." Translation: "I'm not going to make any money by helping you so you will have to wait."
I said, "I understand you're paid on commission and I want Kristen to get whatever credit she deserves, but are you really going to inconvenience your customer because of your compensation policy? Couldn't you find a way to help me now and still pay Kristen her commission?"
With that he reluctantly initiated the process. He asked if I was a new AT&T customer. I said no, that I was an existing AT&T customer with a home telephone line and DSL Internet service. Then I produced my last month's bill as proof. He said he would still need to create a new customer record for me and started the process.
The first question he asked was the deal breaker. "May I have your social security number?" "No," I said, "You may not." "I need it for the application," he said. "Why?," I asked. "To check your credit," he said. "You already know my credit," I replied, "I've been paying my home phone and DSL bills to AT&T for the last three years. What's more, I"m paying for the phones today and if I don't pay my bill you can just turn off the service. You risk almost nothing. I'll give you my driver's license number. You can use that." "No," he said, "our system requires a social security number."
Eventually he said he needed my social security number to prove I was who I said I was. Again, I pointed out that I was an existing AT&T customer, that the name and address on my bill matched the name and address on my Tennessee driver's license. What's more the license photo bore a striking resemblance to me as well. Alas, it didn't matter because he was an unempowered employee--rendered helpless by policies created in offices far, far away by people who didn't have to work in a retail store or have any contact with real customers.
I told him I didn't want to give my social security number because it increased my risk of identity theft and that AT&T had other ways of checking my credit. He tried to reassure me by saying, "I've worked for AT&T for three years. You can trust me."
"Will you tell me your social security number?" I asked. He looked mortified; as if I'd just said something about his mother and Army boots. "No!" he replied. "Why not," I asked? "You've known me exactly as long as I've known you. It seems our trust of one another should be about equal. I've been an AT&T customer for three years, the same length of time you've worked for the company. We could hardly have more in common. You can trust me. If you tell me your social security number then I'll tell you mine and we can transact this deal. What do you say?"
He wouldn't, of course, and that only proved my point. And so it was that AT&T turned away one of its own customers, $600 in phone sales, and $200/month is service fees for who knows how many years.
After leaving the store I called Scott Augenbaum, the FBI's head of cyber-security in Nashville using my Verizon phone. Scott once worked at the FBI's national headquarters and helped develop cyber-security policies for the Department of Homeland Security. I met Scott while working on another project and figured he was the perfect person to comment on this issue. I got his voice mail, but when he calls back I plan to ask him a number of questions and will publish our conversation here.
When I got home I did a little research into AT&T's recent history with privacy violations, identity theft, and other complaints. What I found made me glad I'd walked out of their office without revealing my SSN. Here is just some of what I learned.
If I ran AT&T I would...
Watch for part II once I hear back from Scott at the FBI. Spread the fire. GS
Lately I've heard people using the phrase, "...in these uncertain economic times."
The last hundred years of advertising was characterized by a monologue where brands spoke to consumers through mass media. But the proliferation of media has fragmented audiences making it harder and more expensive for advertisers to reach large audiences as they once could as this video makes clear.
At the same time, new technologies from the Internet to the cell phone have enabled consumers to connect with each other as never before and, as a result, created a new way to think about marketing.
Companies must see consumers as more than advertising's target, but also the conduit through which brand messages flow. By developing marketing plans that involve and engage audiences along three dimensions advertising can have greater reach and impact.
1. Brand to Audience: Reach the right people with more relevant messages
2. Audience to Brand: Listen to your customers
3. Audience to Audience: Help customers share your brand message with their social network
I call this a media Trialogue and I believe all marketing plans should be designed to accomplish all three. Spread the fire. GS
How often do we miss the best solution to a problem because we blindly accepted a premise that creates false restrictions?
The example that brought this to mind was a question from the Vice Presidential debate. The moderator asked each candidate, "What would you do to reach across the isle?" The candidate's answers focused on their ability to create compromise solutions that Democrats and Republicans would both find acceptable. Unfortunately, this approach causes politicians to seek compromise solutions rather than the best solutions and we must live with the lack-luster results. On the surface those compromises seem like progress and they give politicians something to boast about in their press conferences, but how often do they really fix the problem?
How about this instead? Rather than compromising our solutions, what if we eliminated the problem that required the compromise?
Eliminate the isle!
The isle is a man made boundary that reinforces the separation of parties. It encourages an allegiance to a party instead of to the country. Politicians are Republicans or Democrats first and Americans second, if at all. The division set's up competition and contributes to petty bickering.
Can you imagine business doing this? Can you hear the CEO saying, "All right team. We face an enormous challenge and so I've decided to divide the company into two factions. The R faction will sit on this side of the office and the D faction will sit on the other side. The faction whose idea wins will keep its job but we won't implement any idea unless we can get a majority vote from both factions. Now, go get 'em." Insanity!
If I were president I would eliminate the isle and rearrange the seating to end partisan divisions. Democrats and Republicans would sit next to each other and this proximity would help them naturally collaborate.
I would also create dorms where congressmen and women would live when Congress was in session. I would design the building with individual dorm rooms in a circle around the outside of a central common area. Again, Republicans and Democrats would live side-by-side. Or, in the immortal words of Bill Murray, "Cats and dogs living together."
What false boundaries are you blindly accepting in your business that are leading you to compromise solutions rather than the best solutions? By questioning your assumptions can you find a better solution?
Spread the fire. GS
It's not who you are, it's who you know that makes you a more likely to buy something.
A study called Network-Based Marketing: Identifying Likely Adopters via Consumer Networks conducted by the Wharton School and AT&T found that consumers are far more apt to buy a company's product if they are "network neighbors" with existing customers. AT&T's marketing department identified 21 different market segments among its customer base (targets) and sent them direct mail promotions for a new technology product. Meanwhile, Wharton professor Shawndra Hill and her colleagues studied the target group's phone records to find people the target group had spoken to recently. They called these people "network neighbors," made them the 22nd target segment, and sent them the same direct mail piece.
They found that consumers who had communicated with prior customers are more likely to become customers themselves. In fact, the study reports,
"Network neighbors--those consumers linked to a prior customer--adopt the service at a rate three to five times greater than baseline groups selected by the best practices of the firm's marketing team. In addition, analyzing the network allows the firm to acquire new customers who otherwise would have fallen through the cracks because they would not have been identified based on traditional attributes."
The study attributed this increase to homophily and word-of-mouth.
Homophily: Similarity breeds connection. Homophily is the principle that a contact between similar people occurs at a higher rate than among dissimilar people. Birds of a feather really do flock together. This means that your best customer's friends are a lot like your best customers. No wonder they're good prospects.
Word-of-mouth: Personal influence is the most powerful force in marketing but consumer acvocacy, whether explicit (telling someone about a new product) or implicit (your friends see you using a new product) can only happen with contact.
Fanning the Flames
The third step in PyroMarketing is fanning the flames which means equipping your customers to spread your message to their social network. According to the Wharton School, this one tactic may be three to five times more effective than your best marketing efforts to your traditional consumer target.
Any friend of your customers should be a friend of yours. Spread the fire. GS