Bye, Bye WaMu - So Much for that "WooHoo"

It's really hard to dump a bank. So many things have to be untangled and unwound -- automatic deposits and payments, the brand new box of checks that just came in the mail a couple of weeks ago, physically going into the bank to close accounts, etc. I really don't have the time or patience for any of this. This is why I just hope and pray that the banks will treat me like I'm a valued customer.

Well, that was too much to expect of Washington Mutual. If you ever needed proof that the credit markets remain frozen solid to small businesses, here it is.

Ever since WaMu imploded in September when regulators seized control of the bank and pawned it off to JP Morgan Chase in a fire sale, it has been incredibly difficult for me to do simple business banking tasks. Let me explain something here: "Business banking" is not the same as everyday consumer banking. Business banking assumes higher-dollar transactions flowing among accounts, immediate posting of funds, acceptance of business-to-business checks without lots of hassles and automatic holds. That's because when you're in "business," especially if you're a small business, you need access to the funds like "now" because you're generally hustling to make sure a bill gets paid or an employee can get to the bank to cash his/her paycheck. If you have a long account history with good standing and no issues, you shouldn't have to worry about whether or not the bank is going to tie up YOUR money.

WaMu lost its shirt on the consumer side in the sub-prime mortgage fiasco, and evidently it's a complete clusterf&*^$. (See this piece that ran in today's New York Times that does a great job of summarizing how incredibly lax and stupid WaMu was in its mortgage lending: http://www.nytimes.com/2008/12/28/business/28wamu.html?_r=1&hp). JP Morgan Chase is cleaning house and clamping down so tight on WaMu's banking practices that it is completely alienating business customers who had nothing to do with the mortgage mess. I guess Jamie Dimon figures that if he loses WaMu's business customers, that's a small price to pay to whip that operation into shape.

I think that's shortsighted because business customers will drive a lot more deposit and banking activity than consumers ever will. In the last month, every time I've attempted to do something simple that I used to do without any issues, I've been stopped dead in my tracks and have resorted to yelling at the bank managers to stop messing around with MY money. And when you mess with my money, it's very difficult for you to get my business back.

Example #1: I wanted to deposit a cashier's check, which is supposed to be as good as cash, from a reputable investment bank that had not actually suffered greatly in the Wall Street meltdown. Now the check was good. Because I had to sell stock and wait for the proceeds before the check could be cut, there should not have been any dispute about availability of funds. That wasn't good enough for the manager at a local WaMu branch. The "system" proceeded to slap an automatic 10-day hold on the funds. I raised all kinds of hell and ultimately got the branch manager on the phone with the investment bank to confirm the check was good. After that was settled and the hold was released, JP Morgan Chase's "risk management" department flagged the check as it moved through the "system" and put the hold back on it! Evidently, members of the general banking public are passing all kinds of bad checks and even though the check I deposited was clearly not a fake or a fraud (and did I mention that "long account history with good standing and no issues"), I literally had to go to back to my house, retrieve the paperwork from my investment account, and bring it back to the bank to prove that I didn't have some shady desktop publishing operation in my house that was spitting out fraudulent checks.

The banks don't trust each other's paper. They don't trust their long-standing customers. This is getting ridiculous. And if you think that's crazy...

Example #2: On Christmas Eve, I was in a hurry to get to the bank because I needed to make sure I had enough money in my WaMu account to cover my payroll taxes, which the IRS automatically deducts from the account. Because I deal with so many banks, if I need to move money from one account to another, I have to literally write checks for these transfers. Again, this is not generally an issue because these are business checks, and I've been doing this for years.

Now I had been trapped in my house for days because of the winter storm, and my husband and I navigated terrible road conditions so I could get to the bank before it closed. I was in no mood for any "drama" when I arrived. I wrote a check for exactly $1,180 that I wanted to deposit, and the "system" slapped a two-day hold on it. I lost my mind...

The very first thing the bank manager said to me was, "I could lose my job if I release this hold and the check is no good." Excuse me: I am shocked that JP Morgan Chase has the WaMu workforce fearing so much for their jobs that they cannot actually do their jobs to help customers do their banking. At that moment, her job was not the issue. I needed that money to post to my account immediately as it always did so the IRS could get paid. Otherwise, I would have a big mess on my hands. She wouldn't budge on the hold. I called the executive customer service office, waited for 20 minutes on hold and still got no satisifaction. So I had to go to the other bank -- through all the snow, ice, slush, and craziness on the roads -- to get the cash and deposit it into my WaMu account.

That's when I declared war on JP Morgan Chase and WaMu. It was already insulting to me that the bank's CEO couldn't be bothered to respond to my letter. Now his underlings were treating me like I was a lowlife with no history at this bank.

As Stephen Colbert would say, JP Morgan Chase and WaMu are "on notice." It just so happens that I've been invited back to give a follow-up interview on CNN on Dec. 31 about the impact of the recession and the credit crisis on small businesses. I cannot wait to tell a national TV audience that they should never bank with JP Morgan Chase or WaMu as long as they exist.

You had your chance, Jamie Dimon.

Internet is Safe Haven for Passive-Aggressives

I take customer complaints very seriously and use them as an opportunity to improve the quality and service that we deliver to our customers. My staff knows they catch all kinds of hell if we're not on our "A Game." Nonetheless, I know we're not perfect, and there are times when we screw up, for sure. Restaurants live and die by word-of-mouth, and it could take weeks or even months to turn around negative perceptions.

The Internet has opened up a new avenue for people who may not have the courage or inclination to complain about a product or service in person. They can hide behind indecipherable screen names and go on ranting about everything that you did wrong, as if it were some sort of personal slight against them. Also, we get a lot of the "everyone's a critic" because they go out to restaurants and figure they know what it takes to operate them successfully. It reminds me of people who dole out their opinions to marketing people about advertising, for example, because they see ads on TV or in magazines and know all about it. Sure, the customer perspective is absolutely critical in guiding a restaurant, but there is so much more that customers have no idea about when it comes to pricing, menu development, and other key decisions.

I can take this for the most part, but I am disappointed when I have to see a review online about something that wasn't satisfactory about the customer's experience at the restaurant after the fact. No one ever has to leave a place of business hostile, angry, upset, or disappointed. Business owners generally want to correct the issues right on the spot.

However, once a customer hits a blog or a web site and blasts his/her complaints and disaffections to the world, it's too late to do anything about it. It becomes history and all we can do is hope and pray that most people will give us the benefit of the doubt and figure that a pattern is indeed not emerging.

So here's my request:
1. If you're not happy, tell us right then and there. If that's not an option, then contact me directly. If you don't get any satisfaction from dealing with me directly, then feel free to blog about it to the world. At least give me a chance to make it right.
2. If you are happy, PLEASE get out there and tell the world. I know I can count on hearing from people who have problems or issues with what we do, but we need to hear from the people who think we're doing a good job, too.

Marketing Through the Downturn

With my customers feeling the impact of the slow economy as white-collar-job losses mount and their investment portfolios dwindle in value, I've had to adjust my marketing strategy for Dessert Noir Cafe & Bar. Revenue is hard to come by these days, but it's critical to stay visible in the marketplace and engaged with my customers so no one "forgets" we are still here.

In the absence of budget to launch big promotional campaigns and advertising programs, I have been implementing a low-cost marketing and PR strategy. What we’re doing differently is taking advantage of our unique selling point in the market to capitalize on consumers’ moves “down menu,” i.e., buying appetizers, small plates, and desserts at lower prices rather than high-priced entrees and large meals. When we introduced our fall menu in October, we offered more value-oriented choices, including extending our happy hour to seven days a week, to give our customers more choices at lower price points. In November, we took this strategy another step farther and updated our menu to eliminate all the slow-selling items (“dogs”) so my staff has fewer food and beverage items to manage and can concentrate on delivering the core items extremely well.

Despite the downturn, consumers eventually get weary of all the bad news and want to treat themselves to a night out, and they will certainly be looking for a range of dining and entertainment options. This gives us a great opportunity to keep the business in the spotlight, particularly in the press. With that said, I have been focused on generating more publicity for my business on both a local and national scale to generate buzz and position myself as a small business expert on the front lines. PR gives us awareness and credibility, and while this approach is not different from my marketing strategy under normal business conditions, I have been even more vigilant about finding opportunities because they cost nothing but time and generate tremendous ROI on the back end.

One great resource is Help A Reporter Out (HARO). PR expert Peter Shankman created HARO, a free service which connects journalists in online, broadcast, and print media with sources on a wide variety topics, including business, finance, health, fitness, and technology. Each day HARO sends registered users up to three emails, each with anywhere from 15-30 queries per email. If there's a query that you'd be the perfect source for the journalist, you answer it directly. There are several queries a week from journalists who are doing stories about entrepreneurs and small businesses. If you are not a member of HARO, you need to get yourself signed up today.

I can tell you from experience that it works! I have landed features in the Denver Post and Phoenix Business Journal newspapers and Entrepreneur and Restaurant Startup & Growth magazines as well as contributions to the BizChicksRule and Credit and Collections blogs and the Gaebler Ventures web site. In addition to HARO, I've been "hustling" for stories on my own. Recent highlights include appearances on CNN’s “Your World Today with Tony Harris,” “Restaurant of the Week” on KATU Channel 2’s “AM Northwest” news magazine show, and remote broadcast of a local TV station’s evening news program from the restaurant.

Another option that allows me to get more bang for my limited marketing bucks is joint marketing and selling with suppliers, customers, or complementary businesses. I don’t have to look far to create joint marketing opportunities, nor do I have to spend a lot of money to achieve good results. Here’s a case in point: My restaurant is located next to our town’s main movie theater, and for the Sex and the City opening in May, we collaborated with a local salon and spa, the Grand SalonSpa, on free chair massages, prize giveaways, and $5 cosmos and logged our best sales day ever.

Being next to a movie theater strengthens our value proposition as movies are still considered “cheap” entertainment and our customers have always combined an evening at the movies with a visit to the restaurant before and/or after the show. In early 2009, I'm working with a special event promotion company, Odds on Promotions, to offer a $15,000 cash prize giveaway for a promotion that I’ll do for Academy Awards season. I think I can get a lot of buzz going around this, especially if the economy remains as dour as it is now, and again, it won't cost me a lot of money.

Business has always been challenging for my restaurant, as I've documented in this blog over the years. As I noted, we’ve been seeing the signs of this recession for more than a year and a half already. With the economy presenting challenges that are beyond my control, I have been forced to concentrate on the things I know I can control and marketing is one of those areas. Some lessons learned:

Five things not to do in tough times:
1. Panic.
2. Go off the radar.
3. Compromise on service and quality and the perception of the brand when cutting spending.
4. Lose faith.
5. Lose focus.

Five things to do in tough times:
1. Evaluate the strategy and course-correct to fit the times.
2. Keep the brand visible through low-cost advertising, promotions, and PR.
3. Take care of your best customers and engage them in a dialogue about what marketing/promotions work for them to continue to support the business.
4. Use your employees as ambassadors to spread goodwill about the business and generate word-of-mouth.
5. Use the slow periods to reflect and brainstorm new ideas when the crazy, busy times prevented you from devoting the time and energy.

There are many things you can do to keep your business visible without going broke in the process. If you have something that you're doing that's working, please share it.

20 Degrees and Counting

It's about 20 degrees in the Portland area today, and the winter storm that came in Sunday morning blanketed the region with two to six inches of snow on the valley floor and much more in the mountains. Great for the ski resorts, bad for the rest of us.

This disrupts my business tremendously. People freak out about snow in this town since it doesn't happen that often. The roads are generally not navigable as we don't have an army of snow plows at the ready whenever the bad weather strikes. Therefore, the place just simply comes to a grinding halt. The restaurant was closed yesterday and today, and I'm praying hard that we can open tomorrow. However, with forecasters calling for more snow and cold weather this week, I have several holiday parties on the books that are in danger of postponement or cancellation altogether.

With the current state of the economy -- unemployment in Oregon at 8.1 percent, more cuts to state programs and services, and general "blah" among consumers despite the holiday season -- we really didn't need another excuse that people could use for not going out and spending any money.

There are always factors beyond one's control when managing a business, but the timing really sucks on this one.

Open Invitation to Jamie Dimon

Perhaps there's someone at JP Morgan Chase who's assigned to monitor web sites and the blogosphere for any information that gets posted about CEO Jamie Dimon. If that person exists, I hope he or she will find this entry in my blog and finally get someone at that bank to pay me some attention.

Nearly a month ago, I appealed to Mr. Dimon to “put his money where his mouth is,” specifically to use the government funds that he described as “excess capital” that his bank is “actively thinking about how to put to use” in lending. The economic downturn is really taking a toll on my business, and I need to refinance and get some additional working capital "like yesterday." Needless to say, neither he nor anyone at JP Morgan Chase has bothered to respond, much less assign a banker to talk to me about my business, which has been a customer of its recent Washington Mutual acquisition for almost five years and has generated nearly $2 million in deposits. I guess he’s still “actively thinking” rather than lending.

Now, I'm usually one to follow up on packages that I send to make sure they arrive at their intended destination, and FedEx confirmed that my package to Mr. Dimon was delivered and signed for. Another thing I usually do is place a call a week or so later to follow up directly with the intended recipient, but I decided not to do that because I specifically asked for Mr. Dimon or someone on his team to get back to me, for as a customer of his bank, I should not have to chase him down and "beg" for him to respond to me. It's just simple common courtesy for someone to acknowledge receipt of a package, especially when I know that package was already delivered.

I know people like Mr. Dimon are extremely busy, but this is why he has an admin or some other assistant on his staff who could just as easily call me with a simple message that says, "Ms. Hayward, Mr. Dimon received your package and either he or someone at JP Morgan Chase will be following up with you on X date. Is there anything that your local WaMu branch can help you with in the meantime? I'd be happy to set something up for you."

Nope, that's too much to ask of a bank that has received billions of dollars in taxpayer money in the midst of this financial crisis and has a lot of my money flowing through their accounts.

I'm going to ask one more time: Mr. Dimon, please give me a call to discuss the details of my venture and how JP Morgan Chase can truly be a banking partner for me and my business. I don't want to ask you again.