CB: How to Battle Customer Experience Fatigue

Below is a blog from the Customer Bliss

How to Battle Customer Experience Fatigue

Here are three actions (and the need for a lot of responses) to help you pull the customer experience work into focus:

  1. Know Where You Are In the Process
  • You have assembled many groups of people in the company to identify customer touch points.  Yes____ No ____
  • You have brought in customers to validate and course-correct our findings. Yes ____ No ___
  • You have now held numerous sessions and people are starting to wonder what you are going to do with this mapping. Yes ___ No ___
  • You have identified and the organization has agreed upon the end-to-end customer experience.  Yes ___ No ___
  • If you walked the halls of your company and asked ten people to define our customer experience, would most give the same description? Yes ___ No ___
  • You have identified the key touchpoints most important to customers and to customer growth. Yes ___ No ___

Now the Evaluation:  Review how wide you’ve made your customer experience project.

  • Are you trying to map every customer segment or scenario?
  • Is it getting overwhelming?

If it is, narrow the scope immediately.

Critical Checkpoint: Gain agreement on one segment or one part of the business.

Many times, this work is abandoned because it becomes overwhelming and starts to stall.  Move rapidly to the identification of the top 10-15 touch points that will have the most impact on the business.  Stay focused there. Success in one area will earn the right to expand. (And focus will drive collaboration, which leads to #2.)

  1. Level-Set Your Ability to Collaborate

Your ability to collaborate is the real testing ground for the customer experience work.

  • There is agreement across the organization of your top 10-15 customer touch point priorities. Yes ___ No ___
  • You have identified the different operating areas that impact each key touch point. Yes ___ No ___
  • You have agreed to map, define and identify all of the metrics that contribute to the current experience of these key touch points. Yes ___ No ___
  • You are willing to align new teams of people working together to resolve/improve those key moments. Yes ___ No ___
  • You have committed to assign new cross-company metrics to the delivery of those experiences. Yes ___ No ____
  • You will reward these teams when complaints are reduced for the priority issues. Yes ___ No ___
  • You commit to working together to resolve these issues and rebuild key touch point experiences. Yes ___ No ___

Now the Evaluation:

Count up the No checkmarks. A number higher than three reflects a serious lack of collaboration.

If you are not willing to take the time to assemble cross-functional teams to go through the processes that drive customer experience, you can’t get into the nitty-gritty of understanding operational metrics.

Critical Checkpoint: Review how you build out solutions to customer issues.

Are they assigned by operational leader to go fix?  Change this cycle and identify the entirety of the customer issue – then create a consistent cross-functional process for experience improvement.  As part of that process, begin to build shared operational metrics (where the multiple silos that count the experience are held mutually accountable).

Reviewing, mapping and being open to change operational metrics to shared metrics will test your collaboration muscle.  Delivering a unified experience requires patience and an upfront agreement by leaders that acknowledges they are willing to change what constitutes “score!” and what is on their score card.

  1. Examine Your Communication: Are You Bringing the Organization along with the Work?
  • You have connected the dots for the organization on how each part of your operation’s communication impacts the experience. Yes ___ No ___
  • Everybody is still doing their own work.  You find this “interesting” but don’t know what to do with it.  Yes ___ No ___
  • You have made an inventory of all the projects going on around “customer.” Yes ___ No ___
  • You have made a “stop doing” list of projects and investments. Yes ___ No ___
  • You have actually stopped doing projects and are rigorously managing this process. Yes ___ No ___
  • You have created a roadmap that is being actively communicated as you progress. Yes ___ No ___

Now the Evaluation:

Marketing back progress inside the organization and with customers is often the weakest link of executing customer experience work.

In the absence of being updated and engaged, internal folks will view the customer experience meeting as the latest flavor in customer focus.

Critical Checkpoint: Before you go any further, make a simple roadmap of the different parts of your customer experience journey.

Be dogged about showing that roadmap each and every time someone talks about the customer experience work.  It will become a visual that people continuously reference. Use it to discuss actions, progress and challenges. The roadmap gives you the communication consistency required in these long-term projects.

Download PDF: Three Actions to Battle Customer Experience Fatigue

 

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Identify the Three Tiers of Noncustomers in Your Industry

In the building supply industry which consumers are considered noncustomers? What are you doing to attract them to your business? The book Blue Ocean Shift: Beyond Competing – Proven Steps to Inspire Confidence and Seize New Growth by W. Chan Kim is an awesome and eye-opening book about moving from red to blue ocean industry.Blue Ocean Shift.jpg

Identify the three tiers of noncustomers in your industry

Now we turn from current customers to noncustomers. Using the three-tiers graphic, shown in figure, (below) as a guide, ask each of the team members to think through and write down their thoughts about who might be in each tier. To help you perform this task effectively, relevant materials and templates are provided for your free download and use at Exercise Templates. Here are the questions you want to ask:

  1. Who sits on the edge of our industry and uses its offering reluctantly and/or minimally?
  2. Who considers our industry and then consciously rejects it, satisfying their needs through another industry’s offering or not at all?
  3. Who could strongly benefit from the utility our industry offers, but doesn’t even consider it, because the way it is currently being delivered makes the industry seem irrelevant or out of their financial reach?

For many people, this will be the first time they’re ever been asked to systematically think through the issues of non-customers. As we have witnessed, if an organization has given thought to noncustomers, it’s usually in terms of their competitors’ customers, not the noncustomers of their overall industry. They ask, “Who are our competitors’ customers, and how can we win a greater share of those who patronize other players?” But this is not the meaning of noncustomers in blue ocean terms. What is key at this stage is getting team members thinking deeply about noncustomers and, critically, letting them discover for themselves how little they may know or have thought about the wider opportunity landscape that exists beyond the current industry’s horizon.

Organizations often become comfortable commissioning and outsourcing large, formal market studies. Hence, it is not surprising that, at this juncture, we’ve often been asked, “Don’t we need to be supported by formal market research so we will know, concretely, who the three tiers of noncustomers are?” In response, remind them that the blue ocean shift process is built on firsthand discovery that will be done when the team goes out in the field. The purpose here is to maximize the team’s firsthand learning and confidence in what they see for themselves in the field. With firsthand discovery, the resulting strategy is likely to be executed strongly, as the confidence that emanates from the team reverberates throughout the larger organization.

Much to their surprise, team members generally find that, by struggling through this exercise independently, they flesh out a rich list of noncustomer groups and are really pushed to broaden their thinking. Equally important, they see how tightly focused on existing customers their strategic lens has been. When people are spoon-fed answers by having reports commissioned up front, they seldom realize what they don’t know, and too often easily conclude that they “got it, knew it, no big deal,” when, in fact, they didn’t have or know it, and it is a big deal. People seldom realize what they don’t know or appreciate the value of what they’ve learned if they haven’t struggled to obtain it themselves. Making people discover firsthand that what they know-and don’t know-is key to getting them to internalize and value what they learn.

After each of the team members has compiled their list of noncustomers, ask them to share their thoughts about whom they put where and why. The objective now is for the team to identify and select the people or organizations they collectively see as the dominant noncustomer group or groups in each tier. Note that team members may continue to feel a bit uneasy, because they’re being asked not only to move away from what they know, but also to share their thoughts in front of their colleagues. Some unease is good, however, because it means that team members are being pushed to broaden their current understanding. As each of the team members contributes their thoughts on each of the three tiers, you should record and post them in front of the group. This allows everyone to see the whole team’s thoughts, which in itself is eye-opening, as they get to appreciate the differences and similarities in how each of them views the same market reality.

As people share and debate their selections and the thought processes behind them, team members’ understanding of who potentially belongs in each tier starts to deepen. So does their confidence that opportunity exists in the untapped demand that lies beyond the boundaries of their industry as it’s currently defined. Typically, as members discuss the validity of one another’s reasoning, a number of customer groups are crossed off, and different sets of customers get grouped together, producing fairly solid agreement among team members as to whom they see as the main non-customer groups in each tier. With this, a good understanding of the industry’s total demand landscape starts to come into focus.Noncustomer in various industries.jpg

The Power Of Moments

I highly recommend reading The Power of Moments: Why Certain Experiences Have Extraordinary Impact by Chip Heath, Dan Heath. Are you creating memorable moments with your customers and memorable experiences in your everyday life?

The Power Of Momentspower of monments.jpg

What are these moments made of, and how do we create more of them? In our research, we have found that defining moments are created from one or more of the following four elements:

ELEVATION: Defining moments rise above the everyday. They provoke not just transient happiness, like laughing at a friend’s joke, but memorable delight. (You pick up the red phone and someone says, “Popsicle Hotline, we’ll be right out.”) To construct elevated moments, we must boost sensory pleasures — the Popsicles must be delivered poolside on a silver tray, of course-and, if appropriate, add an element of surprise. We’ll see why surprise can warp our perceptions of time, and why most people’s most memorable experiences are clustered in their teens and twenties. Moments of elevation transcend the normal course of events; they are literally extraordinary.

INSIGHT: Defining moments rewire our understanding of ourselves or the world. In a few seconds or minutes, we realize something that might influence our lives for decades: Now is the time for me to start this business. Or, This is the person I’m going to marry. The psychologist Roy Baumeister studied life changes that were precipitated by a “crystallization of discontent,” moments when people abruptly saw things as they were, such as cult members who suddenly realized the truth about their leader. And although these moments of insight often seem serendipitous, we can engineer them -or at the very least, lay the groundwork. In one unforgettably disgusting story, we’ll see how some relief workers sparked social change by causing a community to “trip over the truth.”

PRIDE: Defining moments capture us at our best-moments of achievement, moments of courage. Tb create such moments, we need to understand something about the architecture of pride – how to plan for a series of milestone moments that build on each other en route to a larger goal. We’ll explore why the “Couch to 5K” program was so successful-and so much more effective in sparking exercise than the simple imperative to “jog more.” And we’ll learn some unexpected things about acts of courage and the surprising ripple effects they create.

CONNECTION: Defining moments are social: weddings, graduations, baptisms, vacations, work triumphs, bar and bat mitzvahs, speeches, sporting events. These moments are strengthened because we share them with others. What triggers moments of connection? We’ll encounter a remarkable laboratory procedure that allows two people to walk into a room as strangers and walk out, 45 minutes later, as close friends. And we’ll analyze what one social scientist believes is a kind of unified theory of what makes relationships stronger, whether the bond is between husband and wife, doctor and patient, or even shopper and retailer.

Defining moments often spark positive emotion – we’ll use “positive defining moments” and “peaks” interchangeably throughout the book – but there are categories of negative defining moments, too, such as moments of pigue: experiences of embarrassment or embitterment that cause people to vow, “I’ll show them!” There’s another category that is all too common: moments of trauma, which leave us heartbroken and grieving. In the pages ahead, we’ll encounter several stories of people dealing with trauma, but we will not explore this category in detail, for the simple reason that our focus is on creating more positive moments. No one wants to experience more moments of loss. In the Appendix, we share some resources that people who have suffered a trauma might find helpful.

Defining moments possess at least one of the four elements above, but they need not have all four. Many moments of insight, for example, are private-they don’t involve a connection. And a fun moment like calling the Popsicle Hotline doesn’t offer much insight or pride.

Some powerful defining moments contain all four elements. Think of YES Prep’s Senior Signing Day: the ELEVATION of students having their moment onstage, the INSIGHT of a sixth grader thinking That could be me, the PRIDE of being accepted to college, and the CONNECTION of sharing the day with an arena full of thousands of supportive people.

Sometimes these elements can be very personal. Somewhere in your home there is a treasure chest, full of things that are precious to you and worthless to anyone else. It might be a scrapbook, or a drawer in a dresser, or a box in the attic. Maybe some of your favorites are stuck on the refrigerator so you can see them every day. Wherever your treasure chest is, its contents are likely to include the four elements we’ve been discussing:

  • ELEVATION: A love letter. A ticket stub. A well-worn T-shirt. Haphazardly colored cards from your kids that make you smile with delight.
  • INSIGHT: Quotes or articles that moved you. Books that changed your view of the world. Diaries that captured your thoughts.
  • PRIDE: Ribbons, report cards, notes of recognition, certificates, thank-yous, awards. (It just hurts, irrationally, to throwaway a trophy.)
  • CONNECTION: Wedding photos. Vacation photos. Family photos. Christmas photos of hideous sweaters. Lots of photos. Probably the first thing you’d grab if your house caught on fire.

All these items you’re safeguarding are, in essence, the relics of your life’s defining moments. How are you feeling now as you reflect on the contents of your treasure chest? What if you could give that same feeling to your kids, your students, your colleagues, your customers?

Moments matter. And what an opportunity we miss when we leave them to chance! Teachers can inspire, caregivers can comfort, service workers can delight, politicians can unite, and managers can motivate. All it takes is a bit of insight and forethought.

{Grow}: Why great customer service doesn’t matter like it used to

What are your thoughts on the future of customer service? Is the customer’s experience as important as it was ten/twenty years ago? Below is a blog from the Businesses Grow By Mark Schaefer:

Why great customer service doesn’t matter like it used to

I was helping a financial services company with their marketing strategy recently and job number one was defining their point of differentiation. They had done an enormous amount of preparation for our meeting, including a SWOT analysis and a detailed and honest competitive assessment.

At the end of all this work, their stated point of differentiation amounted to “we have great customer service.”

And they did. But to their dismay, I punched a hole in that strategy and said their fine service didn’t really matter as much as they thought it did. Let’s find out why.

Great customer service is like air

There’s a television commercial airing in America that compares the service of major wireless providers. “It’s 2017” the spokesperson says. “Everybody has great service now … so why pay more?”

I believe this is true for most business categories. Today, the table stakes are exceptional service. To be in business, you need to be great because if you have terrible service, you’re going to get Yelped out of the market in a month. The hyper-connected hive mind has forced everybody to have great service, or at least provide equivalent service.

Even if you could possibly PROVE that your service was 10 percent better than your competition, that’s probably not a significant point of differentiation.

In the case of my customer, they DID have great service but the reviews and ratings were equally stellar for their competitors:

  • My customer’s rating: 94
  • Competitor 1: 91
  • Competitor 2: 90

In this case, touting great customer service as a point of differentiation is like saying “Hey, we have clean air in our store!” or, “Now featuring the city’s coldest water fountain.” It probably doesn’t matter. Everybody has great customer service because if you don’t you’ll be shellacked on customer review sites.

Sparkles as a point of differentiation

Every Christmas, my daughter and I go to a German restaurant in New York called Rolf’s. We go for one reason — every inch of space in the tiny restaurant is covered with Christmas lights. It’s beautiful. If you want to get in the Christmas Spirit, this is the place to go.

Last year, we went to the restaurant and were turned away despite the fact that my daughter had made a reservation three weeks in advance. She had called all day to confirm the reservation and nobody picked up the phone. She proved this by showing them ten consecutive calls to the restaurant on her phone.

Nevertheless, they would not honor the reservation and we were expelled by the rudest hospitality worker on the planet. We vowed to never set foot in this restaurant again. When I looked at their rating on Yelp, to my surprise, this restaurant had an average rating below two stars. One typical review:

After seeing how beautiful this place looked on Instagram I was shocked at how RUDE the host was. And how packed the place was. The food was nothing special and expensive. Never again. And yet, there was a line to get in stretching down the block.

Why would such a terrible place have a line stretching down the block? It’s because they’re sparkly.

Sparkles, it seems, trumps food, service, and price. Think about that. This restaurant doesn’t need to invest in service or quality food, it just needs to buy another $2.99 string of Christmas lights.

And that’s OK because they’re more sparkly than anybody else and enough people care about that to turn a good profit.

Will Rolf’s terrible restaurant survive? Probably. New York is a huge city. As long as there enough people who vote for sparkles over quality they’re fine. They made their calculation and it’s apparently paying off.

Service is important, but it might not be different

How can you explain Rolf’s? The service is bad, but the experience is unique. In this case we see that the customer experience even overcomes the poor food and the jerk at the door. To be clear, I don’t think most businesses can ignore service and quality. But I also don’t think service is the point of differentiation it might have been 20 years ago.

The game-changer has been social media and review sites. The ability for any person to leave a review or post an embarrassing photo has had the effect of keeping businesses honest. In some ways, greater service levels are necessary simply to avoid YouTube humiliation.

It’s certainly not impossible to stand out through service levels, but when I hear a business claim “service” as their core marketing message it’s usually a red flag for me. I think the battleground moving forward isn’t necessarily customer service, it’s customer experience.

What are your thoughts on the future of service, marketing, and experience?

Mark Schaefer is the chief blogger for this site, executive director of Schaefer Marketing Solutions, and the author of several best-selling digital marketing books. He is an acclaimed keynote speaker, college educator, and business consultant.  The Marketing Companion podcast is among the top business podcasts in the world.  Contact Mark to have him speak to your company event or conference soon.

 

HBR: Making Time to Really Listen to Your Patients

Do you think the following concepts around patient care can be applied to the building supply industry? What is the cost of hurried encounters with your customers? Below is a blog from the Harvard Business Review by Leonard L. Berry and Rana L.A. Awdish:

Making Time to Really Listen to Your Patients

Modern medicine’s true healing potential depends on a resource that is being systematically depleted: the time and capacity to truly listen to patients, hear their stories, and learn not only what’s the matter with them but also what matters to them. Some health professionals claim that workload and other factors have compressed medical encounters to a point that genuine conversation with patients is no longer possible or practical. We disagree.

Our experiences — as a critical-care physician whose own critical illness led her to train physicians in relationship-centered communication (Rana Awdish) and as a health services researcher who has interviewed and observed hundreds of patients, doctors, and nurses (Len Berry) — teach us that hurried care incurs hidden costs and offers false economy. In other words, it might save money in the short term but wastes money over time.

Why Listening Matters

Actively listening to patients conveys respect for their self-knowledge and builds trust. It allows physicians to assume the role of the trusted intermediary who not only provides relevant medical knowledge but also translates it into options in line with patients’ own stated values and priorities. It is only through shared knowledge, transmitted in both directions, that physicians and patients can co-create an authentic, viable care plan.

A doctor’s medical toolbox and supply of best-practice guidelines, ample as they are, do not address a patient’s fears, grief over a diagnosis, practical issues of access to care, or reliability of their social support system. Overlooking these realities is perilous, both for the patient’s well-being and for efficient delivery of care. We believe not only that a clinician should share medical decision making with the patient but also that it must occur in the context of an authentic relationship.

The Costs of Hurried Encounters

Compressed medicine has real risks. Clinicians become more likely to provide ineffective or undesired treatment and miss pertinent information that would have altered the treatment plan and are often blind to patients’ lack of understanding. All of this serves to diminish the joy of serving patients, thereby contributing to high rates of physician burnout. These consequences have clear human and financial costs.

The medical literature increasingly offers potential solutions to the inefficiencies that rob patients of physicians’ time and attention, including delegating lower-expertise tasks to non-physician team members, improving the design of the electronic health system, and greatly reducing the paperwork bureaucracy that adds little or no value. We can create more space for active listening. Unhurried medical care may be elusive, but it is practical.

Reimagining Roles

Beyond time pressures, the typically unquestioned roles that physicians and patients assume also inhibit relationship-building. In their medical training, physicians often are taught to maintain a clinical distance and an even temperament. They are warned not to get too close to patients, lest they internalize the suffering and shoulder it themselves. The best physicians, we know, reject this advice because it diminishes their humanity and disadvantages their patients, who need more than a highly-qualified body technician, especially when they’re seriously ill.

Patients learn roles, too: adhere to the doctor’s plan, squelch errant thoughts that might sound foolish, don’t ask too many questions, defer to the expert, be “a good patient.” In a new article we co-authored with others, we show that many patients, especially those with serious disease, behave like hostages in the presence of physicians — unwilling to challenge authority, understating their concerns, requesting less than they desire. Most physicians certainly don’t want patients to feel like hostages, but the patients often do. When patients feel like hostages, the ideal of shared decision making is a pipe dream.

It’s no wonder, then, that for patients with serious illness, the emotion they most often cite is “overwhelmed.” The diagnosis, the options, the treatment, the myriad side effects, the change in identity when living with disease — all of it can indeed be overwhelming. In this complex, fraught situation, people need a compassionate guide — a wise, comforting sherpa who knows the mountain, the risks of various routes, the viable contingency plans. The physician-sherpa should be a partner on the journey, not simply a medical operative, extracting formulaic rules and implements from a toolbox. Patients need and deserve much more.

When doctor and patient join forces, the team dynamic dismantles the harmful hierarchy. Both members of the dyad can rely on each other because neither owns all the data that matter. Speaking at a White Coat ceremony for medical students, Dr. Rita Charon, a pioneer in the rising discipline of narrative medicine, stated:

I used to ask new patients a million questions about their health, their symptoms, their diet and exercise, their previous illnesses or surgeries. I don’t do that anymore. I find it more useful to offer my presence to patients and invite them to tell me what they think I should know about their situation.…I sit there in front of the patient, sitting on my hands so as not to write during the patient’s account, the better to grant attention to the story, probably with my mouth open in amazement at the unerring privilege of hearing another put into words — seamlessly, freely, in whatever form is chosen — what I need to know about him or her.

An Organization that Listens and Heals

Not hearing the patient’s voice harms the patient and the clinician. They don’t have the benefit of pooled knowledge, ability to make fully informed mutual decisions, or time to build trust. Health systems that want to avoid those pitfalls need leaders who invest in shaping an organizational culture that values hearing patients’ voices. Here are some steps such organizations might take:

  • Share patient stories and related lessons at every meeting. Perhaps one should be a story of success (what we did well for a patient) and another of a failure (where we must improve).
  • Offer a communications curriculum to clinical and non-clinical staff. The professional development should be engaging and dynamic so that adult learners seek it out because they view it as worthwhile.
  • Encourage and reward clinical curiosity, whereby generous questions are asked to elicit generous patient responses. Emphasize listening for not just what is said, but also how it is communicated. Consider a narrative-medicine component.
  • Convene patient advisory boards that meet regularly with practice leaders to convey concerns and make suggestions about improving patients’ experiences.
  • Use multiple methods to identify and systematically address impediments in clinicians’ daily work — the “pebbles in the shoes.” Examples include rounds, conducted by senior leaders, with both staff and patients; staff focus groups and anonymous surveys; and CEO feedback meetings with small groups who speak openly about what prevents them from delivering better care.
  • Create a balanced scorecard of physician performance that tracks not only productivity but also professional development, team building, safety and quality metrics, timeliness of care or access, communication skills, and care coordination — measures that matter to patients.

A Way Forward

Medicine is constantly evolving as new ways to treat, heal, and even cure emerge. We must continually reflect on the changes, and correct the course as needed. This work cannot happen in a vacuum of forced efficiency. Physicians, patients, and administrators all must maintain and build on what is sacred and soulful in clinical practice. We must listen generously so that we nurture authentic, bidirectional relationships that give clinicians and patients a sense of mutual purpose that no best-practice guideline or algorithm could ever hope to achieve.

Forrester: Become Customer-Obsessed Or Fail

Are you building a better customer experience with technology? Below is a blog from the Forrester by Michael Gazala:

Become Customer-Obsessed Or Fail

What’s the top imperative at your company? If it’s not a transformation to make the company more customer-focused, you’re making a mistake. Technology and economic forces have changed the world so much that an obsession with winning, serving and retaining customers is the only possible response.

We’re in an era of persistent economic imbalances defined by erratic economic growth, deflationary fears, an over-supply of labor, and surplus capital hunting returns in a sea of record-low interest rates. This abundance of capital and labor means the path from good idea to customer-ready product has never been easier, and seamless access to all of the off-the-shelf components needed for a startup fuels the rise of “weightless companies” which further intensify competition.

Chastened by a weak economy, presented with copious options, and empowered with technology, consumers have more market-muscle than ever before. The information advantage tips to consumers with ratings and review sites. They claim pricing power by showrooming. And the only location that matters is the mobile phone in their hand from which they can buy anything from anyone and have it delivered anywhere.

This customer-driven change is remaking every industry. Cable and satellite operators lost almost 400,000 video subscribers in 2013 and 2014 as customers dropped them for the likes of Netflix. Lending Club, an alternative to commercial banks, has facilitated more than $6 billion in peer-to-peer loans. Now that most B2B buyers would rather buy from a website than a salesperson, we estimate that one million B2B sales jobs will disappear in the coming years.

To thrive in the age of the customer, winning companies will embrace four mutually reinforcing market imperatives in order to become a customer-obsessed company: 1) For speed, tap into mobile connections; 2) For intelligence, set up systems to gather customer knowledge; 3) For impact, build a better customer experience; and 4) To become flexible, embrace digital transformation.

Most companies have made some progress on mobile, big data, customer experience, and digital transformation initiatives. But the most advanced companies — including McDonald’s in France, Home Depot, Salesforce and T-Mobile — truly embrace customer obsession when their strategies combine these mutually reinforcing imperatives.

Delta Air Lines recognized that improving customer experience – with a focus on eliminating cancelled flights – could make a world of difference in its business. Mobile apps for customers, flight attendants, and pilots streamline the experience for everyone. Making these applications sing required retooling back-end systems and led Delta to acquire staff and technology from travel technology firm Travelport. The result of this focus was a 13-point year-over-year jump in its Customer Experience Index score. Learn more about what Delta and other leaders are doing to thrive in the age of the customer in our new report, “Winning In The Age Of The Customer.”

Transforming a company to become truly customer obsessed is difficult. The four marketing imperatives are your path to success, and business technology (BT) powers the change. To thrive in the age of the customer, CMOs must partner with CIOs to advance the BT agenda, creating the technologies, systems and processes that increase agility, facilitate innovation and improve customer experience.

 

HBR: Shoppers Need a Reason to Go to Your Store — Other Than Buying Stuff

Does your store make small pickups a convenience? Should our building supply stores provide a compelling or memorable physical experience? How do you balance between time-well-saved and time-well-spent for your customers? Below is a blog from the Harvard Business Review by B. Joseph Pine II:

Shoppers Need a Reason to Go to Your Store — Other Than Buying Stuff

The holiday season, which is by far the most important time of year for retailers, highlights the increasingly intense battle between physical stores and online websites. Given the large number of casualties this year — witness the bankruptcy filings of such venerable institutions as Toys ‘R Us, The Limited, H.H. Gregg, Gander Mountain, Payless Shoes, and RadioShack, to name but a few — retailers must finally wake up to the core terrain over which they’re fighting: customers’ time.

Online retailers offer consumers time well saved. People can find what they want, when they want it, with incredible ease and convenience, and with the physical good shipped directly to their homes in a matter of days (and increasingly, in large cities, hours). As often as not, they don’t even have to pay shipping costs, and returns are a relative breeze. While the U.S. Census Bureau puts e-commerce’s share of the U.S. retail market at less than 10% as of the first quarter of 2017, online sales are growing at almost 10% per year. Should that trend continue — and it appears to be accelerating slightly — online retailing will account for nearly 20% of the total in 2025, over 30% in 2030, and about 50% in 2035.

To address this threat, one path physical retailers can take, of course, is to compete by going online themselves and even using their physical stores as a pickup spot — a strategy that many bricks-and-mortar retailers have taken. (One retailer I know saw a 35% bump in sales when it gave customers the option of picking up merchandise in its stores that they had bought online.)

But that alone will not save many retailers’ physical stores. They have to provide a compelling reason for consumers to visit them that online retailers can’t match. The best way is to compete on the basis of time well spent — to offer an experience so engaging that customers cannot help but spend time with you! And the more time they spend with you, the more money they will spend.

Consider what I think is the best new retail format in ages: Eataly. This Milan-based retailer (which so far has 13 stores in Italy, five in the United States, and five others in other countries) manages to combine all things Italian cooking into one amazingly engaging space: a café, one or more restaurants, a cooking school, and — especially — rows and rows of Italian groceries, kitchenware, and small appliances for sale. Consumers often spend hours there, and then memorialize their visit with photos posted to their Instagram feed or other social media outlets.

Many retailers (even banks) incorporate cafés to engage the senses and encourage consumers to linger, such as Restoration Hardware’s new 70,000-square-foot place in Chicago, which features a courtyard café, an espresso bar, and a wine room. Others, such as cosmetics retailers Lush and SABON, focus on getting consumers to experience their goods in the store, knowing that will increase the chances they will make a purchase.

Another approach is to focus on the story of each product, as happens in L’Occitane en Provence when customers encounter associates. Yet another way to offer time well spent is to stage special events, which even Walmart is doing this holiday season: It’s hosting 20,000 parties across its 4,700 stores, knowing that’s something Amazon cannot do. The Christmas season, of course, furnishes the perfect time-tested tactic that has worked for decades for department stores: Santa Villages and other Christmas extravaganzas for which people gladly pay to give their kids a festive experience.

Interestingly, many of the most engaging retail experiences have come from manufacturers. There’s American Girl Places, which immerses girls in its doll’s stories; Nespresso Boutiques, which lets people experience its espresso machines before they buy them; LEGO Stores, which feature play and building; and, of course, Apple Stores, where every product is live and workshops offer skills, “geniuses” offer support, and sessions offer inspiration. (Even Starbucks started out as a manufacturer before Howard Schultz turned it into an experience stager.) And recognizing the demand-generating power of physical engagement, numerous online retailers have opened up their own bricks-and-mortar stores; examples include Warby Parker stores, Bonobos Guideshops (bought by Walmart), and mass customizer Indochino Showrooms.

Those that are best at staging experiences have even figured out that when consumers truly value the time well spent they encounter in these places, the retailer can charge for that time via an admission or membership fee. Billed as the world’s most beautiful bookstore, Livraria Lello, in Porto Portugal, charges an admission fee of €3 just to enter the store — and then consumers get that money back if they make a purchase. Universal CityWalk in Hollywood charges from $5 to $50 (depending on location and time of day) per vehicle — not for parking per se but specifically to send the signal that it is a retail place worth experiencing.

Generally, though, retailers charge for particular experiences within their stores and do not charge for admission to their stores. American Girl charges for its café experience, a photo shoot and magazine cover, and even a doll hair salon experience (not to mention birthday parties that can run into the thousands of dollars). Recreational Equipment Inc. (REI) charges customers $20 to $40 to tackle the 60-foot climbing walls and structures it has in its flagship stores, offering instruction and also essentially getting customers to pay to try out its mountain-climbing equipment. And the Mall of America charges for the various rides in its Nickelodeon Universe theme park in the middle of the mall.

Wingtip, a men’s store in San Francisco, doesn’t charge for the retail experience — as engaging as it is, with superb merchandising of clothing, including a bespoke experience, plus wine and spirits, cigars, and a barbershop fulfilling its theme of “Solutions for the Modern Gentleman”; instead it created the Wingtip Club in the top two stories of its building for which it charges membership fees. The club is a refuge from the bustle of the city, with a lounge, bar, game room, whiskey corner, and golf simulator; members spend hours at a time there. The price of a membership is a $3,000 initiation fee and then $200 per month for unlimited access. All members (men and women) receive a 10% discount on merchandise.

There will always be physical stores for pickup convenience and the commoditized or very inexpensive merchandise like Dollar Tree stores sell. But providing a compelling or memorable physical experience is a different strategy that can work. Physical retailers must choose between time-well-saved and time-well-spent strategies. Whatever they do, they should be careful not to choose a middle-of-the-road approach that fails to excel at either.

Original Page: https://hbr.org/2017/12/shoppers-need-a-reason-to-go-to-your-store-other-than-buying-stuff