Jackie Huba

Why TiVo hasn't "tipped"

If you missed our last email newsletter, we discussed how TiVo largely ignores its community of fervent customer evangelists. (Read the article here.)

While TiVo has an evangelistic customer base that rivals Krispy Kreme’s, TiVo hasn’t made the leap to become a mass-market phenomenon because the company’s culture is rooted in sales, not evangelism. TiVo’s marketing strategy focuses on promotional sales tactics vs. embracing current loyal customers who drive sales on the company’s behalf.

(What’s a TiVo? It’s a personal digital recorder that allows you to record television programs in the most unbelievably easy way imaginable. Imagine that it’s a product designed for your grandmother.)

Our virtual mailbag filled up with responses to the article. Most of our readers agreed, but one person who didn’t was TiVo Senior VP and General Manager Brodie Keast. He emailed us immediately. Some excerpts from our email conversation with him. You can be the judge on his tone :)

NOTE: LONG POST

From: Brodie Keast
Sent: Thursday, August 21, 2003 1:53 PM
To: talktous@customerevangelists.com
Subject: TiVo

Don’t know who wrote your column regarding TiVo, but I don’t believe you spoke with anyone here before writing it.

Our business is built on customer evangelism. While we can improve and intend to do more, this column is far off the mark.

Does the author have TiVo? If so, have they seen our friends and family program as delivered on the service?

Visited our website?

Have they seen the testimonial TV spots we have run nationally in the past and those currently running now in partnership with DIRECTV? Are they familiar with our Q4 programs for this year?

Have they spoken to the moderator of the TiVo Community forum? Did they know that TiVo has hosted this forum on our computer systems in the past and now provides financial support? Did they know that TiVo employees, including executives, read the forum regularly and that this drives changes in our products, policies, processes and people? Did they know that five TiVo employees from marketing, operations, customer support and other areas are active participants and post daily?

This column seems like a poorly researched cheap shot, which is as self serving as the claims the author makes against our company. Not a great way to secure new clients and evangelize yourself.

Brodie Keast
SVP and General Manager, TiVo Service
TiVo Inc.

————————–

We sent Brodie an email response explaining that we wrote the article, first and foremost, because we are big, big fans of TiVo, the product. We have owned ours for two years because someone evangelized it to us. We have personally told hundreds about our TiVo. We’ve probably helped sell at least a dozen units.

We explained that we wrote our newsletter article because everywhere we speak (over 60 events so far this year as part of our book tour), people ask our opinion of TiVo. Here’s what we tell people (and what we told Brodie):

1. Some of TiVo’s marketing is OK, but the celebrity efforts are a wash. Celebrity efforts are almost *always* a wash. Trust in celebrities is negligible. People trust their friends and family for opinions.

2. Compare the TiVo employees on the self-organized TiVo Community forum to the solitary work of Starwood Corp.’s “Lurker” William Sanders, who has engendered the fanatical devotion of the Flyer Talk Forum, and Sanders blows the TiVo employees who post to forum out of the water.

3. In proportion to what could be done with the 40,000 people in the TiVo community, TiVo’s efforts are sub-par. For example, TiVo should become the biggest sponsor of the 2004 Las Vegas TiVo meet-up that is being self-organized by the forum members. TiVo executives should be the featured speakers. TiVo may consider the community members “fringe” but as you probably know, Geoffrey Moore explained all of this coherently in “Crossing the Chasm.”

4. TiVo is a cause, not a product. Every single thing the company does should be about the cause: rallying people to change their lives. How many times have you heard people say that TiVo has changed their life? President Colleen Barrett and CEO Jim Parker say that Southwest isn’t an airline, it’s a cause. That’s TiVo, too. Considering your work at Apple, you understand this well.

5. There are few companies in the world with such evangelistic customers; in this regard, TiVo’s peers are Krispy Kreme, Southwest Airlines and Build-a-Bear Workshop (these are the case study companies in our book). But in those companies, everyone from the CEO to the secretaries embrace customers — and criticism — publicly, online and in person. They take the good with the not-so-good. We don’t see the same with TiVo.

Our cause is to show the world what can happen when companies embrace their community of passionate customers and fan the flames of evangelism. We tell the stories of those that do it well, those that don’t, and those who could if they really tried. Because we’re loyal TiVo customers, we expect *more* from the company. The opportunity to amplify the TiVolution movement via the TiVo community is at your fingertips.

—————-

We then received a lengthy email back from Keast about suggestions. Some excerpts:

1. Regarding our marketing, we have made mistakes and have tried learned from these experiences. At the same time, we have created a strong consumer brand in what we would consider record time. We have helped build a new category and lead this category in virtually any way you want to measure it. This is despite competing with much larger forces, including Microsoft. Our growth is in very large part due to the word of mouth and consumer evangelism we try to encourage and facilitate. Regarding the celeb mentions, we have found this to be effective. None of these people are paid. Consumers identify with celebrities that they relate to and trust, especially if the endorsement is based on real experience and is heart-felt.

2. Regarding the TiVo community. Did you know that TiVo employees and executives have attended, and sponsored in some way, virtually every community event, in more than one state, including summer barbecues and other meetings? The Las Vegas event will likely include TiVo participation as well. So that’s not new. However, we believe that these events should be owned by our customers, not TiVo, in order to be credible as grass roots initiatives. Our view is that if you go too far on this, the community appears “owned” or “controlled” by the company, losing it’s credibility with members. It’s a balancing act. Saturn went too far and ended up with contrived events that I believe have since been abandoned. I would offer that Apple has gone too far and that this has contributed in some way to their “cult” image and niche positioning. While you may think our efforts here are sub-par, and I’m sure we can do more, I’d say we compare well against our peer groups given we are a young company with limited resources. It may simply be that we disagree on a finer point. “Sub-par” seems unfair.

While the TiVo Community Forum has about 40K members, we believe that about 5K are active. We now have more than 800K subscribers and more than 1.8M people watching TV with TiVo (2.2 people per HH). The TiVo Community on-line is important to us, but it can’t be the only place we communicate with customers. We have a cost effective way to communicate with all of our customers, not just some, through the service itself and an email newsletter. For example, we have offered unique video content and newsletter tips on how to host a great TV event such as a Super Bowl or Academy awards party. We have offered friends and family discounts directly to our entire customer base via a video Showcase. This has resulted in increased satisfaction and sales. Our tips/tricks column in the newsletter drives an open rate on this piece that is incredible. We feature “star customers” who tell their story in lifestyle terms in the newsletter on on our website. The newsletter generates a regular flow of email contact which we then have the opportunity to respond to. Each touch point leaves a personal connection.

So to say we don’t facilitate consumer activism is unfair.

3. I would agree that TiVo is about changing peoples lives for the better and putting the consumer in charge. This is at the essence of our brand message and you can expect us to continue to step up efforts to communicate this. Not sure what your beef is on that.

4. We welcome constructive critique when it is offered in in a fair and constructive fashion, and without hidden agendas; real or perceived. As I mentioned before, we have made very significant changes to our products, service, policies, systems and people based largely on external feedback. I could give you many examples. We use the TiVo Community, our customer support center, newsletter feedback, regular customer polls and field research, accept feedback from retailers and listen to unsolicited feedback from many, many different sources. Often, I handle customer escalations with personal phone calls to better understand root issues. We try to answer every contact made to our company. To say we don’t accept feedback is unfair.

… With all due respect, and while I’m a huge fan of evangelism and creating causes, I think you know it’s a bit more complicated than that. I would suggest making your point in the context of how evangelism fits into a larger marketing plan.”

Which brings us full circle to why TiVo hasn’t tipped: Evangelism does not fit into the marketing plan, evangelism *is* the marketing plan. Evangelism is not a marketing tactic. It’s a theology. A belief system. All strategies and tactics flow from a well-defined cause. Thousands of TiVotees have testified, “TiVo has changed my life.” That’s marketing nirvana. To us, there is no “larger marketing plan.”

Will TiVo change its ways and embrace its customer evangelists? We can only hope. In the last two weeks, the TiVo website has been changed to feature customer testimonials instead of big product shots.

Before:

TiVo BEFORE screen shot.bmp

After:

TiVo AFTER screen shot.bmp

But it’s two steps forward and one step back. Customer testimonials are good; featuring them on the front page of the website is even better. But these testmonials are troubling because:

– They are overly slick; the people seem as if they could be models
– They feature the trust-busting first name and last initial only
– Specific details, like the customer’s city and state, are missing
– They lack emotion and quirkness that makes them seem real

We know that the pictured customers are real because we recently met someone who knows “Alyson R.” But if you didn’t know better, skepticism seems the more likely route.

If you’re planning on customer testimonials for your marketing, how to do them right?

– Capture the quirkiness of real customers. They don’t have to be modelesque. The Apple “Switch” campaign was successful because it featured letters from real customers with “switching” stories. The TV spots were quirky and believable.

– Include plenty of detail from customer stories and how customers actually use the product/service in real settings. Bike Friday, a Eugene, an Oregon company that makes folding travel bicycles, features customers on the front page of its web site riding across the world. During each visit to the site, the front page randomly chooses one of 67 different customer stories. Many stories feature the customer’s email address, just in case anyone wants more info. Wow! Now that’s trust on all ends of the spectrum.

Keep trying, TiVo. We’re all rooting for your success.

12 Responses to “Why TiVo hasn't "tipped"”

  1. Steve says:

    I have to agree with your analysis of Tivo testimonials. They don’t look real to me.

    The paradox of story is the more facts you include the more powerful it becomes. My favorite Apple testimonial is from Ellen Feiss, talk about quirky:

    http://www.apple.com/switch/stories/ellenfeiss.html

    There was so much buzz from Ellen’s testimonial that
    Wired wrote an article about her:

    http://www.wired.com/news/mac/0,2125,54333,00.html

  2. Steve says:

    I had one more thought about Tivo. If a company is striving to use the Customer Plus-Delta tenant wouldn’t you want to simply say thank you for any Delta comments (what can be improved) even if you don’t like the suggestions?

    There is a concept in design called egoless programming. It tries to get designers to the place where they are not defending their ego, but are open to new ideas.

    It seems that Tivo is defending their position or design. When you keep an open mind to suggestions about how to improve your company, you often receive an insight several days later that says “I just might be able to use that idea to improve our company.”

  3. Jason Rekker says:

    Great comments. I found TiVo to be suprisingly defensive! Is that how they respond to all feedback from their customers? Even if you guys were way off base, there is always something useful in feedback, and always a reason to thank people for the effort they expended in letting you know.

  4. Christopher Herot says:

    There is another community that TiVo is not using to advantage – the early adopter technophiles who form the “TiVo Underground.” In the early days of the product, resourceful customers figured out how to open up the box to expand the storage capacity, add new features, and make the TiVo part of a larger, networked future. Rather than embrace this community, or perhaps ignore it, TiVo has tried to stamp it out through actions such as encryption keys that keep the box from running anything but the corporately-provided software.

    These actions are most likely an attempt to curry favor with the television networks and the cable companies, but those organizations have their own agendas which may not include TiVo. Instead of encouraging the technophiles and using them to expand the capabilities of the system, TiVo seems determined to keep its offering bland and corporate. This will not serve them well when the cable companies start offering TiVo functionality for free as part of the set-top box.

    TiVo could afford to learn a few lessons from Microsoft and Apple. While each of those companies sell complete systems that work “out of the box” they also understand that their success derives in no small part to the efforts of a larger technical community that customizes and extends their core product. Perhaps TiVo thinks of its product as being an appliance and not a computer, but it is priced more like a computer and has all the same jacks on the back. It’s only a matter of time before the competition figures this out, too.

  5. Paul Churchley says:

    It is such a shame when senior management gets on the “defensive” rollercoaster as Keast has.

    His responses are typical of a senior managementthat has a position to defend and is completely blinkered to any and all critisism regardless of how constructive or helpful it could be. We have all seen it… a member of staff is critisised by a customer… the manager defends the staff member to the hilt in front of the customer so not to loose face and then when the customer has gone the manager repremands the staff member for the error. AAARG!

    Why can’t management be open-minded to ideas regardless of where they come from and own up to their failing… we all have them!

    I suspect that secretely he agrees with some of the ideas expressed in the article but he is unlikely to agree publically as that would amount to an admission of failure.

    Pity. If only they could focus on the customer instead of the product… they might say they do already but they clearly don’t.

  6. dean says:

    Posted to Tivo’s customer support page on 5/11/04.

    I would just like to share with you the worst customer service experience of my life.

    Background: I’ve had a tivo box activated since 12/28/03. Today is 5/13/04. The box is now hung on the welcome screen.

    A recount of my experience: After waiting for 45 minutes on hold for level one customer service, I was greeted by a pleasant rep who asked two questions and promptly forwarded me to ‘technical support.’ After another 20 minutes on hold, I was greeted by the tech support agent. Conveniently for you, I had to record the case number to provide to the tech as I guess you’re unable to track cases with calls (oh well, I don’t expect internet-like businesses to invest in customer service.) After having me unplug the device (at least the tenth time I’ve done this), and wait for 30 seconds, plug it back in and lo and behold, same problem. Then we waited for three minutes for some unknown reason only to have the tech indicate that she ‘needed to do some research for 3-5 minutes.’ When she returned to the phone, I was informed that there was good news, you’d exchange the box for me. Oh boy, my lucky day.

    But it gets better. I learned that the one year warranty isn’t really a one year warranty because I get to pay $99 for the exchange (yes, $99 on a box that is not even 5 months old.) When I inquired about why it would cost $99 as you really don’t even know what the problem is (although I suspect you know exactly what the problem), I receive the “well all of the parts are at least $99 so we’re actually ‘giving you a deal.’ Some deal.

    When I indicated that I wanted to cancel my account, I was transferred back to customer service where I was assured there was no wait. Lucky for me the wait was indicated at only 35 minutes, but I guess when you have people on hold for 30+ minutes as a regular course of business it’s not really a wait in your mind.

    I was then greeted by a young gentleman who insisted on helping me solve the problem. Unfortunately, he was as tech savvy as your tech, unplug it, wait three minutes and magic will happen. He did say that perhaps his manager could reduce the exchange price (as if it was about the money at this point.)

    So now, after ~$200 purchase price, ~$70 in monthly fees and 90 minutes of wasted time, I’m happily cancelling my Tivo service never to return. I must admit that I take solace in two facts.
    1) I will post and provide personal testimony of my experience to any site that accepts it and any person expressing an interest (and even those who don’t) in purchasing your service.
    2) That even on ~$150mm in revenue you still can’t make money. You can’t possibly be investing in customer service with only 34 support personnel, which seems deftly inadequate to support over a million subscribers. So the question for your investors is: Can you make money? Not likely over the long run if you can’t pull your customer service act together.

    In researching other sites related to Tivo, I came across an interesting quote from your EVP, Brodie Keast. “Often, I handle customer escalations with personal phone calls to better understand root issues. We try to answer every contact made to our company. To say we don’t accept feedback is unfair.” Well, here’s your chance to prove it. Your service is highly dependent upon a proprietary device purchased by the consumer for a specific purpose. The reliability and support of this device directly relates to the consumer’s perception of your service and your success. Don’t get distracted by driving further innovation and coming up with new bells and whistles when you haven’t nailed down your core business. After all, no one else is in this market (that I know of) and you haven’t nearly reached a stride in terms of market penetration. New features are great but not at the expense of basic blocking and tackling (read: customer service/support.)

    My feedback consists of a simple suggestion. You’re reps should behave as though a Tivo outage is a crisis. You want people to believe that being without their Tivo is like being without air. To do this, you must commit to delightfully replacing their Tivo DVR at no cost to them because you understand how important their Tivo is to their way of life.

    Need it overnighted because you’re taping a big show tomorrow? No problem. Would you like us to restore your recorded shows so you don’t miss that important episode? We’d be happy to.

    In my opinion, you have a highly disruptive technology that can fundamentally change the way people relate to entertainment. It would be a shame if you lost sight of the customer in your zeal to exploit everything that the technology could do today.

  7. Greg says:

    Can you please give me the email address of Brodie Keast? I am a shareholder in Tivo and I am mind boggled by how poor a job they do at marketing. In the past I have even attempted to get in touch with them through email and have received no help. I would be interested in asking him some of my own questions, which I would be glad to share the responses to.

  8. Ricardo says:

    Great comments. I found TiVo to be suprisingly defensive! Is that how they respond to all feedback from their customers? Even if you guys were way off base, there is always something useful in feedback, and always a reason to thank people for the effort they expended in letting you know.

  9. Logan says:

    For one, I know I’m a bit late on the thread, but maybe someone will see it. I got onto Google hoping to find some statistics on how TiVo did this holiday season, and behold – someone thrashing TiVo, probably out of personal hostility for one reason or another (Maybe TiVo wasn’t getting a video signal from the program source?).

    After reading this article, jumping to the previous readings, and skimming through some of the comments posted by other guests to the site, I’ve come to a conclusion; You guys have no idea how TiVo, as a company, works, nor what it’s about..

    Now, before I lay my response into the site, let me just confess: I worked for TiVo for about 3 years, separated to concentrate on school. I was a Level 2 Customer Service and Technical Support Agent for the company when I departed. I was down there on the frontline, taking calls, answering questions, fixing problems, and yes, defending TiVo to those who insist that the company is doing business all wrong. Every one of our customers knows that TiVo is built around word-of-mouth advertising. In addition, they all know how TiVo compares to all the new competition (heh, competition?). A little about me; I’m a 21 year old college student, 3 years from getting my degree in Nuclear Medicine and Radiology. I didn’t vote for presidency this year because I didn’t like the choices, but I did vote for the city to extend one of our roads to relieve some of the traffic around where I live. I agree that there have probably been a few things the company could have done differently in the past, but growing up, how many times did you figure something out the hard way? I don’t know everything, but when I voice my opinion, I make sure I know what I’m talking about (so those who wish to question my knowledge and opinions, don’t bother :) ..

    Now, for those of you who read this that have as much of a one-sided viewpoint as those above, try for the next few minutes to be open about how you see things, realize that no matter how different in terminology my analogies may be, they’re right on par in substance.

    1) How awesome can a product be that the company needs not to run an ad but twice a year to promote their product? Sure, a large part of TiVo’s business is with celebrities. Howard Stern loves it. Oprah loves it. Ellen DeGeneres. Dr. Phil. The entire NFL. And even my local radio jockeys – they’re celebrities enough. But does TiVo pay these people to promote the product? No. Does TiVo appreciate what they say about the product? Heck yeah! If you had the coolest car on the block, you’d like a little attention, too! Do you have to trust what these celebs say about TiVo? No. But why would you trust the salesman that sold you your car, when he couldn’t even tell you how much horsepower it had or what the ETC button on the dashboard did? The difference in the analogy: Your car salesman made a profit off of something he knew little about and got his product in your hands for a few bucks, while Doogie Houser just talks about TiVo because he loves it. Logic? If you trust your friends and family for opinions over celebrities, ask them. Not that difficult.

    2) Why is Brodie Keast defending the company he works for such a bad thing? All he was doing was letting you guys know that you WERE way off-based, and was simply pointing you in the right direction. Taking hostility to such an informational reply shows also your defensive side, and as quoted from a fellow guest, “there is always something useful in feedback”, so use the feedback!. Accept your mistakes, learn from them. It’s unfair to slander someone, or something, like a company, for what you don’t know. Example – maybe a little far fetched, but bear with me: Your daughter’s school principal calls you to let you know she’s being suspended for something. He has no proof that she did anything, other than the word of another student who heard about the incident through a friend that dropped out of school a year prior. Do you scold your daughter on those terms, or do you question the principal on his reasoning and knowledge on the matter? The accusations and shallow assumptions made in this article, and the one linked to it at the top, have grounded your daughters for a month and gotten her suspended for a week for something she didn’t do, and that’s sad. TiVo is a young company. Just about every feature you can find in the service is something that was inspired buy an actual customer, and just wait til you see what they have up their sleeve. Tell me that’s not customer-oriented. And to take that a step further; http://www.tivo.com/4.3.4.asp. Section titled ‘Talk to Us’. Just for those of you who missed it.

    P.S. Synonyms for ‘Evangelize’; advocate, proponent, backer, supporter, apostle, upholder, promoter … Sometimes using different words that have the same meaning add essence to the reading, helping to make the text sound less repetitive, and boring, to read.

  10. Erick says:

    I wanted to thank logan for that post. I was reading everyone elses and totally understood how bad TiVo is. When I read Logan’s post, I decided everyone else that posted on the site, including the site operators, are stupid. I now have 2 TiVo’s and they’re freaking great. Oh, and Technical support helped me hook both of them up in the same call, and literally refused to end the call with me until we were sure everything was working right. They couldn’t even see what they were doing!! How awesome is that!?

  11. Jackie Huba says:

    Logan,
    Thanks for your feedback and comments.

    However, I want to point one specific error in your remarks. You said “How awesome can a product be that the company needs not to run an ad but twice a year to promote their product?”

    In 2004, the company spent $50 million in marketing consisting of ads and rebates. So unless those two ads you mention cost $25 million each, we can safely assume there was a substantial advertising campaign last year.

    You also say that we “have no idea how TiVo, as a company, works, nor what it’s about..” I beg to differ. We have spoken to its marketing executives, studied every move they’ve made, tracked customer and employee interaction via the TiVoCommunity.com and we have been TiVo customers for 4 years.

    Plus with TiVo announcing 2004 losses of $85 million on revenues of just $107.2 million, I think it’s clear what this company is about: remarkable product, shoddy management.

  12. shel israel says:

    I’m also a TiVo fan who has probably been responsible for about a half-dozen new customers. I was as disappointed by Brodie Kest’s comments as I was impressed by Logan’s. My suggestion: TiVo should ditch the celebrity endorsement crap and use Logan as their advocate, blogger and company spokesperson. He depicts the kind of real person, with real passion that will rekindle our collective fading faith in this ground-breaking company.