Zappos Culture – © Zappos.com, Inc, 2011
“A company’s culture and a company’s brand are really just two sides of the same coin. Brand is just a lagging indicator of culture.”
Tony Hsieh, CEO of Zappos.com
It’s time for organizations to pay as much attention to the employee experience as the customer experience…
The essence of a highly distinctive customer experience lies in the emotional connection made with the customer. Research by Ogilvy for their annual BrandZ loyalty survey found that companies “…successful in creating both functional and emotional bonding had higher retention ratios (84% vs. 30%) and cross-sell ratios (82% vs. 16%) compared with those that did not”. This is a significant difference and one that is more than sufficient to negate the effects of any economic downturn. It’s why brands like Burberry, Zappos and O2 have continued to grow their customer base and thrive while their competitors have lost market share and seen declining loyalty from both customers and employees.
To emotionally bond with your customers, you must first engage your employees
So how do you create customer experiences that create an emotional bond with your brand? More and more organisations are coming to the realization that in order to deliver a great customer experience you must first create an engaging employee experience. The challenge is that many marketers are more comfortable with the first 4 ‘P’s of marketing (Product, Price, Place and Promotion) than they are with the 5th ‘P’ of People. How do you get that unpredictable, fickle and shifting population of employees to understand and deliver the brand? In many organisations marketers don’t really look to their colleagues in HR for help because they in turn don’t really understand brand behaviour. So what can we learn from how the ‘BOLD’ brands have addressed this challenge?
- Having a purpose beyond profit – This may come as a shock but most employees do not leap out of bed in the morning excited by the prospect of making more profit for their organisation that day. Profit may motivate senior executives but it rarely does so for the front-line unless they are shareholders too, as in the case of the John Lewis Partnership. What motivates employees is feeling connected to the brand promise. That can be ‘Delivering Happiness’ as in the case of Zappos or ‘saving the planet’ as in the case of the World Wildlife Fund. If you ask employees of Umpqua – the community bank based in Oregon – what their brand promise is, they will tell you ‘making customers feel dealing with Umpqua was the best thing that happened today’. Quite a tall order for a bank! Connecting people to a purpose is an important way of helping them feel good about your brand and we know from our research that there is about an 85% correlation between the way your employees feel about the brand and the way your customers do. One organisation that understands this relationship is the mobile phone operator O2, as CEO Ronan Dunne explains:
“If you cannot turn your employees into fans there’s no way you will turn your customers into fans”
- Hire for DNA not MBA – There are many bright, well-qualified people out there that you can hire, but only a few of them will be the right fit for your brand. Find the people who share your values and then teach them the skills they need; not the other way round. Umpqua advertises for employees in retail trade magazines, not the financial services press, because it wants people who understand customer service rather than banking. Hiring for DNA requires clarity in the first place about what the brand values are at a deep level. As Robert Stephens of the Geek Squad says:
“The values the company possesses should be distinct and define the DNA. They should be impactful with specific language used to define those values; not the saccharine, sugar-coated terms that are meant to please anybody and everybody”
- Create a cult-like culture – Sustaining a culture is very hard, particularly if you are growing. One of the things these brands do is to reinforce their uniqueness through the use of ‘rites and rituals’. Umpqua has a daily ‘motivational moments’ session where everyone gathers to hear someone sing a song, tell a joke or conduct a short exercise in some way related to their purpose. Zappos encourages their employees to be ‘weird’. They engage in ‘Zuddles’ which are short, motivational work-group meetings. Such iconic events help create and protect a unique culture.
Above all, marketers must make that 5th ‘P’ central to their strategies, and HR’s role must be to help turn the brand promise and values into behaviour. Reg Sindall, Executive Vice President of Corporate Resources for Burberry, sums this up well:
“I set three very basic ground rules for the HR team … The first one is that you are a part of the team, and the team, ultimately, is the brand … The second one is that there is no point in having a hospital without doctors, so you need to be the best technical experts you can be. If someone from another function comes to an HR specialist and says I want your help or advice on something, you’d better know what you’re talking about. But if you just do that then there’s a danger that you’ll offer the latest theoretical advice. And so the third simple rule that we introduced is that, above all else, you’ve got to be commercial. You’ve got to be grounded in the business needs…”
For too long, organisations have been fragmented with each functional silo doing what it thinks best for the organisation. Too often, ‘best’ is defined by functional processes and theoretical practices that are largely undifferentiated. The question the whole organisation has to answer is: “How do we create an employee experience that is going to differentiate our brand and enable our people to deliver the brand promise?” Therein lies boldness.
You can download the free ‘BOLD – how to be brave in business and win’ iPad app from the App Store to compare your own organisation with the BOLD brands.
To see a video of the app being used go to www.boldthebook.com