Got $945? That’ll buy you one share of stock in Amazon.com. When it went public 20 years ago it was $18 share. This week marked the 20th anniversary of the public offering, so the whole Amazon thing has been in the news a lot.
Are there lessons for the CNMI tourism industry in this? My pals and I think so. We were working full-time on Saipan tourism when we first encountered Amazon and we learned some lessons from it. I might as well mention a couple of them since everybody is talking about Amazon anyway.
Amazon has proven useful as an example of how smooth a customer interaction can be. This has long been a sticking point in the CNMI tourism industry, where tourists have sometimes been underwhelmed with the level of customer service, to include, notably, the service in some restaurants.
Critics will say that a website and a brick-and-mortar business are different things, which is true, but they do have common elements.
If anything, the Web amplifies some of these elements. For example, having to click around unnecessarily because the site is poorly designed might just take a few seconds, but it seems like a long time on the cyber-clock. Many users will just click off and not go back.
Little wonder, then, that Amazon has an uncanny ability to minimize the amount of clicks necessary to buy something. For the customer it’s as easy as falling off a log; the process is a seamless slide toward the sale.
Contrast that with, say, a poorly-run restaurant. A customer is ignored upon entering the place. Eventually, a staff member grudgingly puts down their smartphone and seats the customer. After the meal, the customer almost has to send up a signal flare to actually get the check brought over. And then, when it’s time to pay, a restaurant that serves a largely foreign clientele acts totally stymied when presented with foreign currency for payment.
In any business, not just restaurants, it’s very difficult to give customers a smooth flow through their entire experience. A manager has to really work to find the “click points” where things aren’t progressing seamlessly. I’m convinced we can’t see this stuff with a familiar eye. We usually need outsiders to help by offering fresh perspectives.
Of course, in a physical setting, customers don’t often click off by storming out of the place. They’ll usually endure a sub-par experience but they won’t go back. In Saipan’s case, given the vertical structure of the tourism market, tour agents can have a lot of clout and the feedback they get from their clients can carry a lot of weight.
In addition to giving me a “click point” way of thinking about the flow of customer service, Amazon also showed how price and quality can interact. Yeah, I knew that stuff in theory, but it’s been interesting to watch it make inroads into my wallet.
Amazon first came to my attention because its book prices were discounted. Despite its smooth service, I doubt I would have been very interested, at first, if there wasn’t a substantial price advantage.
I’ve spent a lot of my career traveling and I eventually found that, in the mainland, at least, Amazon’s quick shipping provided me with a logistical advantage on the road. In these cases, prices became a secondary issue. Speed, competence, and reliability, which is to say, quality, became the key driver for me. Sometimes I’d have books, office supplies, or even computer hardware shipped to hotels. At other times I found it easy to order gifts; if you’re stuck in a Dallas airport, and you’ve got a relative in Duluth who has a birthday, Amazon is a clean play. For these situations I found myself buying from Amazon without bothering to compare prices. Many people have confessed to me that they have the same approach now.
I’ve seen some tourism economies develop along those lines, where they were low-priced in their early years and then steadily worked their way up the quality- and pricing chain. Other tourism economies haven’t been able to pull that off.
My favorite example of the price-and-quality gig is in the auto industry. It’s Toyota. I remember the early 1970s when Toyotas were considered mere economy cars in the U.S. But Toyota also built a reputation for quality. Toyota’s line of Lexus vehicles has since become a highly-regarded luxury brand.
Anyway, that’s an update on the world of business, or part of it, anyway.
Visit Ed Stephens Jr. at EdStephensJr.com. His column runs every Friday.