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Hilton and Zulily Find Rewards in Customer Delight. So Can You! 

Blake Morgan | Jun 26, 2017 604 views 2 Comments

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Matthew Dixon and Nick Toman, authors of The Effortless Experience, penned an article with Karen Freeman in the Harvard Business Review called “Stop Trying to Delight Your Customers.” They wrote about a research study done by the Customer Contact Council, a division of the Corporate Executive Board, that was conducted with 75,000 people who had interacted over the phone with contact center representatives or through self-service channels such as the web, voice prompts, chat, or e-mail. Delighting customers, they found, doesn’t build loyalty, but add “reducing their [the customers’] effort — the work they must do to get their problem solved — does.”

Essentially, the authors argue that focusing on customer delight is a waste of time — don’t go above and beyond. While I agree that reducing customer effort and running a more efficient operation increases customer satisfaction and loyalty, I believe running a culture of customer delight impacts the internal culture of the company. In contrast to a culture of delight, how do employees feel when they must tell customers no all day? They are told to stick to scripts and they cannot offer extras for problems that occur. This is how most contact centers are run, with employees kept on short leashes. The entire operation runs strictly in order to spend as little money as possible.

Most companies believe the contact center has nothing to do with relationship building, but when agents feel like they have authority to do things that sincerely delight customers, the contact center culture is affected in powerful and positive ways. If you raise the level of the culture, granting agents room and budgets to do things for customers, you clearly change the way the agents feel, and that changes the way customers feel.



Is this really the time to rain down on the companies that focus on customer delight? While, as the article says, delighting customers is a “Herculean effort,” it’s still a noble and important pursuit. Most companies provide abysmal customer experiences, and it can be hard to tell who is more miserable, customers or employees. But when customers are miserable, employees are miserable too. And when employees are miserable, customers are likewise miserable.

Next, let’s talk about how and why customer delight is generally a good idea.

Hilton Makes It Right

Mark Weinstein, SVP and global head of customer engagement, loyalty, and partnerships for Hilton Worldwide, believes in delighting customers, but he adds that when you build an infrastructure to enable the culture, it’s no longer “customer delight”: it’s simply how your company operates.

Weinstein spoke with me about Hilton Worldwide’s “delight” program. He recognizes that, at times, delight programs can be degrading. In essence, “You’ve boiled down my day of inconvenience for a few cents.” Let’s say a customer’s flight is delayed and she misses an important event like a wedding. The delay was the airline’s fault. For service recovery, that customer is then given a few bonus miles for the inconvenience. That’s almost worse than if the company did nothing. Not doing enough in service recovery can backfire on the company.

Adding up the cost of all the moments, Weinstein says, doesn’t create a strong impact for the customer. For example, you’re at a movie and the movie freezes. The movie theater calculates that, for your inconvenience, the theater will enter you in a contest to win a soda. This offer trivializes the customer experience. When Hilton Worldwide decided it wanted to do something different with its service recovery program, there was an internal debate about what proper service recovery looks like. Eventually, Hilton rolled out a program to all its brands called the “Make It Right” program. If there’s a customer problem, the agent is empowered to refund the full amount of the hotel stay to the customer. After rolling out this program, Hilton realized it cost the same to refund the full amount that it would to provide a freebie here or there.

Hilton Worldwide believes in empowering its agents to achieve first-call resolution. The company doesn’t want customers calling ten times, and customers don’t want that either! With every call, the company is doing its best to route the customer to the person who can solve the problem. There are limits and penalties, though, it’s not a free for all.

While there are extreme examples, such as during storms, where Hilton is refunding mass numbers of customers for inconveniences, the company sets those aside and looks at averages and service recovery across its hotels. Hilton headquarters — if it sees repeat offenders, such as a property with a lot of refunds going out — charges repeat offenders an administrative fee, in order to encourage those hotels to review the underlying problem and address root issues. Headquarters wants the individual properties to have skin in the game. “We have a partnership among the hotel, the teams, and the brand to deliver a customer experience,” said Weinstein.

Zulily Trusts Agents’ Judgement

A culture that delights is one that accounts for customer variation. Agents aren’t forced to use scripts! As consumers, most of us can think of a time when we had an emergency, and a brand either left an imprint on our memory by going out of its way to help us or the brand told us no and left us with a very bad taste in our mouth. Ideally, agents will meet customers where the customers feel comfortable engaging with us, and we will go outside of normal processes when it makes sense.

Consider this story, which features online flash deals site Zulily; it recounts a woman’s experience with her purchase. The woman is Kelly Blue Kinkel, and in a public Facebook post in 2016, she wrote:

I sincerely hope this post goes viral, because I just hung up from one of the best customer service experiences of my life. I ordered a winter coat from Zulily a few weeks ago. When I received my order, I could see through the packaging that the coat material wasn’t going to work well with the two breeds of dogs we have. Coarse dog hair and certain materials don’t mix. I called customer service and asked how to return the unopened coat for a refund. I spoke with a sweet young man named Patrick, and he let me know he would refund my money immediately. I asked again how to send it back, and he said, “Please don’t send it back. If you know someone who needs a winter coat or if you would like to donate it to a charity, that would make us very happy.” I honestly thought he was kidding. It took me a moment to realize he was completely serious, and then came the tears. I just don’t know other companies that do this, do you? I thought Zulily was pretty incredible before, but after today, I’m a customer for LIFE. The world needs more LOVE like that. Honest business. Honest ethics. How refreshing!

This post generated 134,000 views and 60,000 shares. It always pays to do the right thing — but doing the right thing demands a culture in which employees can make judgment calls, one in which they are operating without having a script. Not only did this story generate a ton of attention for Zulily, but I’m sure it referred business their way as well.

The business environment today demands that we make accommodations for customers. We must allow employees to do right by the customer, even if it means going outside standard processes.

Delighting Customers Saves Time!

Let’s talk about time. When you empower your agents to get things done without approval, you save your company a lot of time. Consider this quote from George Stalk, author of the 1989 Competing Against Time: How Time- Based Competition Is Reshaping Global Markets:

“Capitalizing on time [is] a critical source of competitive advantage: shortening the planning loop in the product development cycle, trimming process time in the factory, drastically reducing sales and distribution—managing time the way most companies manage costs, quality, or inventory. In fact, as a strategic weapon, time is the equivalent of money, productivity, quality, even innovation.”

These examples show that investing in your customer relationships after the sale is not a waste. Investing in your customer relationships will build loyalty among your customers, and inspire advocacy.

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2 Responses to Hilton and Zulily Find Rewards in Customer Delight. So Can You!

  1. Shilpa Gaddikoppula June 27, 2017 at 12:11 am (4 comments) #

    I second your thoughts about customer experience Blake! Empowered employees add to the companies’ bottom line, enhance the brand value while acting as torchbearers to an organization’s mission, vision and value.

    I’d like to add that most of the services industry is transforming from reactive support to proactive support and automation. This effortless experience will definitely translate into increased customer loyalty.

    Thanks,
    Shilpa

  2. Teresa Allen July 5, 2017 at 11:36 am (4 comments) #

    Totally on board with your conclusions Blake! As a Hilton Honors devotee I have truly noticed the impact of the new Hilton culture. Putting customer service and delight front and center certainly cannot hurt!
    Teresa Allen – Author Common Sense Service

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