Micah Solomon: Newegg is one of the largest tech e-tailers in North America. Its customer base most famously consists of gamers, DIYers, and PC builders, but extends to a wider B2C audience as well who enjoy the latest tech products. Their B2B customer base extends into SMB, enterprise and the public sector. They are rather the local phenomenon in their Southern California locale as well, where, every Black Friday, Cyber Monday, and other key shopping date, the media make a point of spotlighting the excitement and activity in its customer support at its City of Industry headquarters.
I was interested to explore how Newegg manages to compete, thrive, and grow in the highly competitive Amazon-dominated marketplace, so I spoke with their SVP of Sales and Marketing, Merle MacIntosh recently. Of course, being a customer service consultant and customer experience consultant myself, the discussion veered frequently in that direction.
Micah Solomon: Can we start with a bit of background: the evolution of your company to where you are today?
Merle McIntosh, SVP of Sales and Marketing, Newegg: Newegg got its start in 2001 and quickly became a favorite shopping destination for people building their own PCs. Our earliest customers were a very tech-savvy bunch and we quickly amassed a following within the tech community. Over the years as tech became increasingly mainstream, our customer base grew in both size and scope to include anyone in the market for tech products.
My feeling is that you've distinguished yourself through customer service and developed an unusually loyal customer base. Am I right in this impression? And if so, tell me how you've pulled it off?
Keeping our customers happy is the main goal at Newegg. And while offering the best products at competitive prices is important, our ability to support customers post-purchase has been elemental to our success. We place the highest priority on making sure customers who need us are helped quickly and completely. Great selection, great deals and great service is a potent combination and is responsible for our customer loyalty.
Is there a particular principle that has led to your growth that you could share, for the benefit of the entrepreneurs who will read this article?
First and foremost, understand your customer. Many of our employees build their own computers and are gamers. We know what tech is important and make sure we have it available for our customers. Then we sell it in the same way we would like it sold to us. This tangible connection keeps us real. It is the key to success for anyone.
Would you be generous and tell me a story of something that went wrong for you as a company and how you overcame it, again for the benefit of readers who can learn from it?
A couple of years ago we had a customer who ordered a new product and instead received a remanufactured unit. It was a simple oversight in our inventory management that we quickly resolved. But this particular customer was upset and even posted online an unboxing video visually depicting the shipping snafu. Our head of customer service reached out directly to this particular customer and had a lengthy exchange -we even explained the steps we were taking to ensure similar mistakes would be prevented. Consequently, he posted a subsequent video praising Newegg for our solution. We learned from this exchange the value of addressing frustrated customers directly and honestly. We didn't try to explain away the problem and minimize the customer's complaints. We took the feedback to heart and that made all the difference in this instance.
Now switching to the positive: can you tell me a story of "wow" service that Newegg is proud of?
One service we offer is through our Specialist chat. We put customers in touch with PC specialists who listen to customers' needs and help them put together the best system their budgets allow. It has been a big success and helps lots of people new to PC building complete their projects on their first attempt.
Have you been adding new channels to your support mix?
We aim to communicate with our customers on their own terms, using channels most familiar to them. For example, a year and a half ago Newegg was the first e-commerce company to deliver support via Facebook Messenger.
How is that going?
At the time we rolled out support via Facebook Messenger, it was a fairly untested channel for B2C communication. But that move served us (and our customers) well, and Messenger continues to be one of Newegg's integral support channels.
Any glitches or tips in this area?
It's important to understand that support channels are a moving target. Customers' communications habits evolve quickly and you need to adapt quickly as customer behavior evolves.
What keeps you up at night?
The tech landscape is always changing and things move quickly. We work hard to keep our merchandise in line with our customers' expectations and needs, but until customers actually respond, there can be nights of second guessing.
With Amazon as an always-lurking competitor, can you talk about the importance of your logistics infrastructure and how you keep that evolving and humming?
Newegg is always striving to give its customers greater options in how, when and where they receive their order shipments. For example, FedEx is a longstanding partner of ours. In addition to shipping via FedEx to customers' homes, we recently struck a deal with FedEx that gives customers the option of picking up their orders at thousands of FedEx locations throughout the United States.
Do you think about and have you been working on your environmental footprint? I know this is a concern that customers have today, particularly when they're ordering direct and therefore see the boxes and packaging involved in the transaction.
Absolutely, and it's a concern of our employees here as well--We've made a priority of lessening our environmental footprint; let me walk you through some specific steps we've taken: Newegg strives to minimize waste going into landfill or combustion centers by recycling materials such as cardboard, paper and polyurethane materials. Operating in our seven order-fulfillment centers, we ensure that all cardboard packages, paper corner boards and polyurethane foams are being recycled.
Newegg also started replacing void fill air cushions with bio-degradable air cushions beginning in 2017. These eco-friendly air cushions contain an additive that accelerates biodegradation, resulting in complete biodegradation in one to five years.