Ama 2014 conf. cust experience tutorial 2.0

PROPRIETARY AND CONFIDENTIAL

Michael Million

[email protected]

Tutorial: Optimizing the customer experience

2014 Annual Conference Inspired Marketing

Brand-Driven Growth Strategy

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2AMA 2014 Annual Conference - Tutorial

You’ve got to start with the

customer experience and

work back toward the

technology – not the other

way around

Steve Jobs

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We see our customers as

invited guests to a party, and

we are the hosts

It’s our job everyday to make

every important aspect of the

customer experience a little

bit better

Jeff Bezos

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Starbucks spent less than

$10MM on advertising from

1987 to 1998 yet added over

2,000 new stores to

accommodate growing sales

Starbucks' popularity is based

on the experience that drove

its customers to highly

recommend their store to

friends and familyHoward Shcultz

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A trio of anthropologists

recently published an article based on

observations at three independently

owned coffee shops and three

Starbucks locations around Boston.

Their intention was to determine how

effectively Starbucks are able to

provide the same community-based

social environment associated with

traditional coffee shops.

How Starbuck’s drives loyalty - a study in customer experience

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The biggest surprise was that

Starbucks actually provided a more

welcoming environment than any of

the three local coffee houses.

They credited one Starbucks with

having the most vibrant sense of

community, and observed that the

baristas there knew many patrons by

name and could anticipate their orders.

The anthropologists also noted that the

Starbucks baristas were friendlier to

new customers than the bespoke

hipsters behind the counter at the local

places.

Same everywhere, but we still make you feel special

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Agenda

• Warm up Exercise 15

• Foundational Terms & Focus for Today 15

• Inspirations & Examples 15

• Methodology Applied to a Case 30

• Break-outs & Report-backs 45

• Conclusions

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What are some of examples of great customer experiences?

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What makes them so great?

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Where does customer experience sit in your company?

How much of a priority is it?

How is it viewed in the

organization?

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Where does customer experience sit in your company?

Who’s responsibility is it?

How is it managed?

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Agenda






• Conclusions

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What is customer experience?

Cumulative Impact Definition

Multiple touchpoints over time, which

result in a real relationship feeling, or

lack of it.

- Wikipedia

A set of expressions, impressions, and

interactions between a customer and

company that result in certain

perceptions of that company that, in

turn, drive some type of action in the

near or long long-term

- M. Million

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Distinct Economic Offer Definition

A personal and memorable experience

that creates a distinct economic offer

different from the goods sold and

services delivered

A company's ability to deliver an

experience that sets it apart in the

eyes of its customers serves to

increase the amount of consumer

spending with the company and,

optimally, inspire loyalty to its brand

- Pine and Gilmore, Experience Economy

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Psychological Underpinning Definition

An interaction between an organization

and a customer as perceived through the

customer’s conscious and subconscious

A blend of an organization’s rational

performance, the senses stimulated and

the emotions evoked and intuitively

measured against customer expectations

across all moments of contact

• Not just about the rational ”what” but also about

the emotional “how”

• More than 50% is subconscious, or how a

customer feels

• Factors such as the emotional, cultural, social,

and physical aspects are often over-looked

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Different approaches toward customer experience

Like segmentation, the right approach depends on knowing

specifically what the business challenges are and objectives you

seek

• Financial – how do we squeeze costs out

of the system, get customers to pay more

(e.g. airlines charging for pillows), or

expedite transactions (path to purchase)?

• Operational – how do we streamline

operations to make it more efficient from

end to end (e.g. process reengineering)?

• Technical – how do we enable the

system to be more productive,

manageable, and interconnected (digital

enablement)?

Internally Oriented Externally Oriented

• Functional path – how do we make

customers’ journeys easy, informative,

and helpful throughout?

• Emotional path – how do we address

customers’ changing psychological or

emotional needs as their decision-

making evolves (e.g. decision anxiety,

confusion, frustration, boredom)?

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An argument for a “Brand Experience” Approach

The world is growing increasingly complex and fast-paced

We are inundated by more and more marketing messages (and yet, we

don’t trust them any more than we used to)

Technology improvements are enabling more and more companies to

get the basics right (e.g. convenience, reduced wait times)

Copying is becoming increasingly easy – “sameness” of more and more

products and services / making differentiation ever more difficult

Brand experiences will drive tomorrow’s success and allow companies

to stand out (products, services, and even “good” experiences aren’t

enough anymore)

We look for and value what is personally meaningful to us -

experiences we have with companies seem to matter more

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So, what is a “Brand Experience”?

Interactions so impactful and uniquely identifiable to a particular

company, that they define the brand in customers’ minds,

distinguish the company far and away from its competitors, and

have a high influence on future behaviors

• Nordstrom's sales representatives going above and beyond

• Tumi’s lifelong repair policy

• Apple’s Genius Bar

• Uber’s payment system

• Others????

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Benefits of a “Brand Experience”

According to studies by McKinsey,

brand experiences are the most

powerful form of word of mouth driving

activity - accounting for 50 to 80

percent in any given product category.

Brand experience is inherently social,

it's built on ideas that people want to

spend time with and that people want to

share.

50% to 80% of word of mouth -

driven by brand

experience

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70% of consumers trust brand

recommendations from friends, but only

10% trust advertising.

UK Energy supplier, E.ON developed EON Open

House, a store in Nottingham, UK that educates

local customers about smart meters, which are

being fitted for free across Nottingham.

The project proves the power of brand experience

by delivering positive advocacy when traditional

methods had previously failed the brand; Net

Promoter Scores of +88% vs. E.ON Customers

control of -17.7%.

- The Guardian

70% trust brand

recommendations

from friends

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The Keller Fay Group research shows

that good brand experiences are three

times more likely to spark

conversations than an ad.

Furthermore, over 50% of

conversations triggered by an in-person

experience account for pass along and

purchase.

>50%Account for pass

along and purchase

3XMore likely to spark

conversations than

advertising

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I don’t want to be sold to

when I walk into a store.

The job is to be a brilliant brand

ambassador. Don’t sell! No!

Because that’s a turn-off.

Build an amazing brand

experience, and then it will just

naturally happen. Angela Ahrendt

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A great brand experience is about knowing and interpreting

Know thyself

(inside-out)

• Who you are

• Where you’re going

• What your brand

stands for

Know thy customer

(outside-in)

• Who they are

• What’s most

important to them

• What their

journey is like

InterpretInterpret Brand

Experience

• WHAT can we do for

customers that makes

their journey better

• HOW can we do it in a

way that is uniquely us

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Great brand experiences have six things in common

1. Brand first, transact second

2. Distinguishes customer types

3. Focuses on what matters most

4. Makes people feel special in some way, at some point

5. Designs for continuity and intent (across channels, platforms,

and path to purchase)

6. Measures, manages, and continuously improves

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Agenda






• Conclusions

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VIDEO

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https://www.youtube.com/watch?v=Y1nzWY3JFJQ

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How would you characterize the Virgin America experience?

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Grab a pillow, take a nap

The Swedish manufacturer of hand-

made luxury beds, strives to make

consumers’ experience

transformative, from the first time

they lay on the bed until the bed

arrives in their bedroom.Guests are encouraged to take off

their shoes, pick their own personal

pillow, and even take a private nap on

the bed of their choice.

This simulation coupled with the

highest level of hospitality

distinguishes Hästens and burnishes

the brand like no other form of

marketing can.

Winner of Sweden’s prestigious Signum award

for quality of long-term branding in 2013

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I’m here to take care of you

Each customer service representative

is available around the clock and

empowered to act on customer issues.

They are assigned to customers, stay

with them throughout their problem

resolution process, and get to know

them as individuals.

They often provide a personal touch,

like occasionally sending flowers to a

customer or their partner to mark a

birthday.

These gestures turn a faceless and cold

experience into something more special,

and give the brand a real heart and

soul.

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Non-stop coffee

Through remote diagnostics each

Nespresso machine is technologically

enabled to feed up-to-the-minute

information of its status including rate of

consumption, water temperature,

pressure, extraction, etc., so local

Nespresso service offices get warning

to proactively address issues vs.

waiting for a service call.

This preventative maintenance has

significantly increased the uptime of its

machines and allows Nespresso to

more continuously brew great coffee for

discriminating guests.

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Agenda






• Conclusions

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Roadmap to build a brand experience

DIAGNOSE (customer, journey, brand)• Know thy customer, their journey, and their contexts

• Know thy customer pain points / improvement opportunities throughout the journey

• Know thy brand, what makes it special, and what type of experiences it should provide

CREATE & BUILD (messy innovation, front-end design, engineering)• Interpret what you know about the target customer and your brand

• Envision the impression and interaction / look, feel, etc.

• Build out how things fit together to turn the vision into a reality

STRATEGIZE (business, brand, prioritization, plan)• Clarify business objectives and growth strategy

• Determine brand intent / role of brand in driving business objectives

• Pinpoint interactions that matter most (what, when, and where you should spend efforts on)

• Determine “your” CE principles

EXECUTE & OPERATIONALIZE (systematize / routinize, manage,

monitor)

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Decimated by the financial crisis, a miracle was needed

In 2005, the US power boating industry

was 307K units …. by 2011 it was 139K

units – a decline of 55%

24’-36’ Sport Cruisers (Sea Ray’s core)

was down even more – the hardest hit

The 50’-70’ yacht class ($3M boats -

custom homes that float) represented

the best opportunity for Sea Ray to

begin growing again, as it was expected

to recover the fastest, but ….

Sea Ray had very little presence or

product in the category, and …..

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Opportunity in the small yacht class, but so much was unknown

…. the organization knew very little

about the market from a consumer

perspective:

• Who were the consumers for these

products?

• How did they perceive Sea Ray?

• What kind of experience did they

expect and weren’t receiving from

strong competitors?

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Approach

DIAGNOSE (consumer, journey, brand)

STRATEGIZE (business, brand, prioritization, plan)

CREATE & BUILD (messy innovation, front-end design, engineering)


monitor)

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In-depth research with target consumers around the world

• Industry reports

• Boating life social media

• Competitor websites

• Executive interviews

• Product development plans

• Ethnographic interviews at the

world’s largest Marina’s

• Dealer / broker interviews

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Know thy customer

Observations Traits What they Value Expectations

Buyers are

surprisingly

grounded

Wealthy people

Who also

Work hard

In it for the long haul

Sharp, quick studies who understand

customer service. Those who keep them

from wasting their time will earn credit.

Responsive

Buyers are

restless and

driven

Self-made

Who also

Respect their roots

What has been earned

They’re not famous and they’re not

blue-bloods. They’re searching for

‘superior’ things have true merit.

Real

Cruisers are

emotional

amplifiers

Stretched thin

Who also

Crave relationships

Their time, above all else

Boating gives them a meaningful way to

connect with who they are, with those

they love, and with the natural world.

Connected

Every buyer is

unique in

personality and

expectations

Characters

Who also

Appreciate details

Cultivating rapport through

graciousness

Treating them with same thoughtfulness

and attention to detail that they strive to

uphold matters to them a great deal.

Personal

Genuinely

rooting for Sea

Ray

Nostalgic

Who also have

Discriminating tastes

Familiar things reinvented Evolutionary

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Know thy customer journey

Service Area Pain

Prep & Strike • People just want to get out on the water—prep tasks take up valuable time for

owners and their guests

• Even the smallest issue discovered during prep can spark frustration when

people are waiting to leave the dock

Maintenance • Owners have little faith in the quality of maintenance and suspect corners are cut

Repair • The repair process feels opaque and lacks responsiveness

• Owners don’t know who they are supposed to call when certain boat parts fail

Enhancement • Pricing for a post-production change is often a negotiation that feels like being

“nickel and dimed”

• There is very little support from the manufacturer, most of the load is on the

owner

Hospitality • Taking a boat out isn’t a spontaneous adventure—it requires significant planning

to account for things out of a boater’s control (e.g., weather)

• People want to enjoy themselves on the boat with food, drinks, and various other

provisions, but it requires a lot of time

Crewing • The responsibility of operating a boat isn’t something people want to take on all

the time—there are many ways to enjoy a boat, and some owners feel locked into

one

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Know thy brand

PARENTAGE

“Who” is behind the

business

PURCHASER

“Who” buys it

PURPOSE

What it’s

designed for

PROCESS

Custom vs.

Production

PLACE

Where it’s built

draws heavily from

parent LMVH to give

the brand a “luxe hotel”

feel

long-standing association with

007 solidifies position in the

market - British quality with

polarizing attitude

the romantic side of old Italy

the modern, flashy, sexy side of Italy

draws heavily upon

its roots in fishing /

known for tank-like

construction and

sports car-like

muscle

Opportunity

for Sea Ray

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Roadmap toward brand experience

DIAGNOSE (customer, journey, brand)




monitor)

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Know thy brand intent

Purpose

• To re-energize the business by establishing a strong foothold in the luxury yacht class

• Drive $X in revenues at %Y margins over the next three years

• Engage consumers who historically wouldn’t have considered Sea Ray for a purchase in

the class level

Positioning

• For those who have earned it along the way and are never satisfied

• Sea Ray L-Class provides both the style and substance they seek in a 50’–70’ yacht

class

• By being responsive, real, connected, personal, and authentically Sea Ray

Persona

• ARCHETYPE: The Warrior King

• Relentless progress

• Confident outlook

• Passionate about craft

• Connected to what’s important

• “Bring it on” attitude

• Respectful and respected

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Know thy brand intent

Grit & Grace

Here’s to those who started small. To the

ones who made it to the top without

putting people below them. The ones

who climbed the corporate ladder, or just

built their own. Here’s to the best of us,

who never think themselves better than

anyone. To ones who put class in the

working class. The ones who started

small. But have gone big. This is the

yacht for people who’ll simply call it a

boat.

Essence

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Determine “your” Customer Experience principles

Service Area Promise

Prep & Strike EasyArrive at the dock, get in your boat and go. When you’re finished, throw your keys

to the valet, and they will take care of the rest. It’s that simple.

Maintenance DependableOwners can trust their maintenance crew to keep the boat safe, pristine and

ready for use.

Repair ResponsiveOwners experience no hesitation around how to get something fixed. Repairs are

as fast as possible, very transparent, and resolve every issue entirely.

Enhancement AdaptableDirect manufacturer support to make sure owners are confident in their ability to

make changes without negatively impacting the quality of the boat.

Hospitality InformativeThe boat isn’t just ready for operation, it’s ready for enjoyment and comfort.

Owners step on to the boat understanding the most pertinent information about

their trip before they leave and know there’s someone they can trust.

Crewing LiberatingOwners, particularly operators, can easily hire a trustworthy captain, first mate or

any other support person to fill in when operation feels like a burden.

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Determine “your” overarching Brand Experience principle

From To

SCALED PERSONALIZED

This guided the entire customer experience including awareness,

web site, events, manufacturing plant, customer care & service,

delivery, personal touches, ongoing management

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Examples of how “scaled” to “personalized” will play out

AWARENES

S

Special interactions vs. a broad campaign / let the new boat be

discovered by targets vs. blasted to the masses

WEB SITE Concierge service that put prospects directly in touch with a Sea Ray

representatives to do a proper job of introducing the new yacht and

inviting users into a dealer where both would meet with them

EVENTS Intimate, luxury-filled settings of ~100 attendees at unique locations

along the coast.

DELIVERY Sea Ray captain to come with boat / walking customers through

vessel in detail, dealer training

PLANT Turning it into a design / experience center where prospects can tour

the site / hands-on selection of materials (vs. picking out of a

catalogue – getting the “feel” of the material)

BUILDING

PROCESS

VIP parties, emailed pictures of progress, extending into a bound

book, construction manager attention

PERSONAL

TOUCHES

• Anniversary of purchase celebration

• Scaled models

• Stocking refrigerator

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monitor)

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The Coastal Tour

Events that let boaters experience these

boats in a personal, familiar setting to

paint a picture of the brand and how it will

fit in with their lives.

A variety of casual cocktail parties on the

back of a boat to larger gatherings at

yacht clubs and posh private residence.

Hosted in a way that highlights each

region through food and culture but offers

a hint of signature Sea Ray style (Maine

lobster in Montauk, stone crab in Miami).

Sotheby’s to coordinate parties at multi-

million dollar homes one the coast; other

partners included Aston Martin, and Merril

Lynch to make events about luxury, not

only Sea Ray

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Tours of the Design Center (annex of the manufacturing plant)

Reception

Grab a drink and get to know each other

Current Models/ Options Gallery

A seasonal and customized approach for

each customer visit and model they are

interested in

The Lab

Give customers an inside

look at customization

possibilities or new ideas

that the design team is

experimenting

Test Drive

Give them an in- person

at how it all comes

together

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The Design Center – Getting There

Make the entire experience surrounding

the factory tour as seamless and

enjoyable as possible, while maintaining

‘our version’ of luxury. It should feel more

like a courtship and less like a traditional

sales experience.

Arrange for all the travel to and from the

facility. Treat them to the kinds of

privileges they are used to receiving in

when they make other purchases at this

scale.

Entertain them beyond the facility. The

relationships built will create meaningful

connections that Sea Ray needs with this

group.

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Pop-up Showroom

Creating a portable showroom is an

efficient way to bring the best of Sea Ray

(and this new sub-brand) on the road in

an impactful and immersive way.

Mobile pop-up container can be quickly

setup at marinas, dealer events or

anywhere else SR has opportunity to

connect.

Coffee, wifi and iPads available to view

and/or download SR app.

Build a brand gallery that echoes the

platform of Determined Spirit: product,

lifestyle, innovation, etc

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Boat Shows

Approach boat shows from a more

conceptual standpoint. Certainly the

boats themselves are on stage, but we

are selling the Sea Ray lifestyle too.

This is not just an opportunity to show a

huge inventory of boats and short period

of time. This is a time to tell the story of

Sea Ray’s future.

Consider a genius bar approach where

customers interact with Sea Ray experts

in a controlled environment and explore

the boat of their dreams.

General rules of authentic hospitality go

a long way at crowded places like this.

Consider unexpected drinks and

refreshments.

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Digital

Leverage digital as much as possible

during this time. Put off publishing print

material until the full fleet is launched in

2014. Leverage digital now in order to

get out ahead and spread your message

farther faster.

1. A dream app built for bragging

2. An owner’s app built for use

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Yacht Delivery

A Sea Ray expert/captain should meet

the owner at their slip and deliver the

boat, complete with stocked fridge and

snacks. Every boat should be delivered

with a tablet featuring an interactive

owner’s manual.

The captain should stay with the owner

and take them for an expansive test

drive making sure that they are

comfortable with every aspect of their

new yacht at the helm, below deck and

in the engine room.

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Execute & Operationalize

CUSTOMER

CARE

• Best in class warranties, prioritization of issues – rise to the top of

first handled

• Sea Ray individual assigned to resolving issue / seeing it through

- accountability

ONGOING

MANAGEMENT

• Dealer certification

• Elaborate customer surveys

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Results, so far

• Launch at the 2014 Fort Lauderdale International Boat Show (FLIB)

was extremely successful

• Sales have exceeded goals by +25% to date

• Business is sold out until next year

• Interest generated for next new models carrying the L-Class brand

and experience

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Agenda






• Conclusions

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Break-out Exercise (30 minutes to discuss / 15 minutes to report)

1. Pick one of your session mate’s company

2. Flip chart what the company’s brand stands for / what makes it special

3. Flip chart a profile of the company’s target customer

4. Flip chart the primary phases in the customer journey

5. Select 1 – 2 touchpoints that provide good opportunities to improve the

experiences and inject the brand

6. Brainstorm ideas for making the touchpoint a brand experience

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Agenda






• Conclusions

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Three things to remember from today’s session

1

2

3

Brand experiences will become increasingly

important in driving business outcomes

You must know your customers from the outside

in, know yourself from the inside out, and interpret

both to build an effective brand experience

Establishing ”your” customer experience principles

that stem from a brand-driven business strategy is

key in guiding developments and operational

change

Art & Photos

Ama 2014 conf. cust experience tutorial 2.0