More and more organisations are coming to the realisation that in order to deliver a great customer experience you must first create an engaging employee experience. There is no doubt that creating a powerful customer experience requires the full and continual commitment of the people responsible for making it happen. This article describes how brands like Zappos, innocent and The Geek Squad create ‘wow’ experiences for their employees and customers and, in so doing, outstanding results for their shareholders.
The essence of a highly distinctive customer experience lies in the emotional connection made with the customer. As Tom Ford said when he was Chief Designer at Gucci. “A brand is a memory”. It is how it makes the customer feel about the experience. Indelible memories are more often created by the intangible attributes than the tangible. 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 the economic downturn. It is for this reason that brands like Burberry, First Direct 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.
How then, do you create customer experiences that create an emotional bond with your brand? The answer lies in having a great product for sure – Apple would not be the brand it is without leading edge design – but just as importantly, it is the ability to have customers interact with your products and brand at a deep level that creates true loyalty. Anyone who has visited an Apple store and received help at the ‘Genius bar’ or spoken with one of the highly knowledgeable and enthusiastic store associates would know that the in-store experience is a stage for the brand and the store people the actors who bring it alive. Just as with any theatrical production, casting, direction and rehearsals are essential to top performance on the night.
What struck us in conducting our research was the unusual attention paid to the employee experience by the brands we studied: brands like Zappos, innocent and The Geek Squad.
We have just completed two years of research with leading brands for our forthcoming book ‘BOLD’. The book tells the story of 14 brands who are challenging the rules of business and delivering highly distinctive experiences. The stories are told through the words of the executives, employees and, in some cases, the customers themselves. What struck us in conducting our research was the unusual attention paid to the employee experience by the brands we studied: brands like Zappos, innocent and The Geek Squad. The qualitative research was supported by a survey where we measured the perceptions of the BOLD brands with a control group of executives from other organisations. The BOLD companies outscored the control group on the 8 dimensions and 40 practices measured in our survey by a significant margin. You will have to wait for the book to be published for the full detail but what I can share with you is that one of the dimensions that showed greatest difference was what we labled ‘A cult-like culture’. Now the term ‘cult’ tends to carry negative connotations. It conjures up images of fringe religious groups of some kind following the warped vision of a charismatic leader. But if we examine what makes a group ‘cult-like’ the attributes are neither good nor bad; it is the vision or purpose that drives them that is good or bad and which provides the context for their actions.
One brand that has attracted an enthusiastic following of customers is the US on-line retailer Zappos. Zappos sells shoes and other items of apparel but that is not its purpose. According to Tony Hsieh, its Chief Executive, the purpose of the organisation is to deliver happiness through ‘wow’ experiences. He calls it their ‘secret sauce’. The organisation defines a ‘wow’ experience as one that goes way beyond what you expected. One example is when Wendy Fitch, a regular Zappos customer, posted an ‘out of office’ announcement in her Outlook saying that she was away on a charity run for breast cancer. When the Zappos e-mail letter she subscribed to, bounced back one of the agents in the call centre picked it up. During her lunch break the agent purchased a gift card and sent it to Wendy with this message;
‘Hello, Wendy, while working through e?mails from our amazing customers, I came across your auto?reply. Normally we mark them as auto?replies but yours caught my eye. I just wanted to let you know what an admirable thing you are doing. We at Zappos are proud to have you as a customer and as a part of our family. Thank you for being a wonderful person’.
So what was it that motivated that agent to take that action? From our research we would suggest there are a number of key factors.
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. This may serve to motivate the senior executives but it rarely does so for the front-line unless they also happen to be shareholders too as in the case of the John Lewis Partnership. What motivates employees is feeling connected to a cause. That cause can be ‘Delivering Happiness’ as in the case of Zappos or ‘saving the planet’ as in the case of the World Wild-Life Fund. If you ask employees of Umpqua, the community bank based on Oregon, what their purpose 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! The financial services sector is one that generally has low levels of emotional engagement with its customers.
Hire for DNA not MBA. We wrote about this in our first book ‘Uncommon Practice’ but we found that it is still true for these brands. The fact is that 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. We tell our clients ‘Hire for DNA not MBA’. In other words find the people who share your values and teach them the skills they need. Umpqua advertises for employees in retail trade magazines, not the financial services press because it wants people who understand customer service rather than banking. Tony Hsieh offers recruits $2,000 at the end of their first week of training to leave the company. Why? Because he only wants people who are passionate about the brand and committed to what it stands for.
Rites and rituals. 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 what we describe as ‘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’ which means they organise parties and theme events where people dress up and have fun. They engage in ‘Zuddles’ which are short, motivational work-group meetings. Innocent, the UK smoothie maker holds its AGM (A Grown-Up Meeting) where all the employees gather to hear the latest news and then have a barbeque. The Geek Squad, the computer support firm, uses language and titles to reinforce the zany culture whose sole purpose is to ‘Save your ass’ if your computer should crash. Their employees are called ‘agents’ or ‘double-agents’ and encouraged to share their stories of daring-do in helping customers through the intranet site but also social media.
You may be reading this and saying to yourself ‘Well, you might be able to do that kind of thing in the States but not here’. You would be wrong. We have seen examples of brands that focus on purpose beyond profit, hiring for DNA and encouraging rites and rituals in the UK, US, Brazil and Asia. Of course, if these practices are false or forced, they become trite and will not deliver value for your brand; but when they are driven by a common purpose and shared values, when they are sincere, when they create a great employee experience and when they result in a ‘wow’ experience for customers- they work.
Copyright. Smith+Co 2010. http://www.smithcoconsultancy.com/
Hi Shaun thanks for a good post and I look forward to reading your forthcoming book. I’ve coined the phrase B2Me to cover what I consider to be almost a new channel in organisations where they make a much closer link between the business and employees and customers. All the examples of good practice have as their context something like insight and understanding and not revenue. Increased revenue is a by product of deepening relationships and engagement between a business and its staff and customers.
I saw another version of the DNA/MBA theory the other day, the 3C’s – Competence, Character and Chemistry. The advice was to train for 1 and recruit for 2 & 3.
If there is any benefit to living through a few business cycles, it’s to see that things are forgotten faster than they are transmitted to the next generation. An unfortunate truth.
Your post re-links something that should never be disassociated. The quality of relationship between customer and employee is a function of both recruiting the right DNA but also firing it up and keeping it nurtured.
The leadership piece is even more crucial since it grants permission for people to be amazing in their response to others. In fact to be more accurate, to mirror what they themselves are receiving.
Karma is a chain reaction. The antiquity of the word tells us this has been known and forgotten for multiple generations.
Brands that have ‘Wow’ boast a proud heritage.
I thought my favourite David Ogilvy quote might make an appropriate addendum to your article – “If we recruit people bigger than ourselves we will become a company of giants; if we recruit people smaller than ourselves we will become a company of pygmies”. The reason why organisations aren’t switched into recruiting people with the right DNA or based on the 3C’s (thanks for that one Ray excellent) is because the people doing the recuiting are afraid of giants and prefer to recruit people with the right cultural fit i.e. “just like them”. A new approach to recruitment will only work when the fears of the people doing the recruiting are first addressed.
Thank you for the posts and replies to my article on Employee Engagement. Convergys have done some research recently where they found that there was almost a 1-1 correlation between the employee experience and the customer experience. In other words, if you want to know what your customers think about your brand- ask you employees. Ronan Dunne, the CEO of leading mobile firm O2 in the UK, has a saying; “it only works when it all works”. You cannot treat the employee experience as separate.