Monday, February 3, 2014
LEARNING FROM BRANDS THAT DELIVER
A WINNING EXPERIENCE
“It’s time to get beyond the product we sell
and think about the experience we deliver.”
When it comes to bonding with customers – creating the kind of loyalty where customers go beyond preferring to insisting on your brand of product or service – it’s their experience that is the critical and deciding factor. Two weeks ago we featured five brands that we believe have found a way to deliver a winning experience: American Airlines, American Express Platinum, Amazon Prime, Apple and Coca-Cola. (If you missed this article access this link to read it: userfiles/file/BHExperiencesThatMakeADifference.pdf This article shares five learnings and recommended actions from these creators of positive experiences.
- Segment your customer base – Our brands cannot be all things to all people nor can they afford to do so. We not only need to segment the market but we should also consider segmenting our customers. American Airlines with its Concierge Key services for their most elite fliers and American Express with their Platinum card offering premium services for their wealthiest members are both involved in segmenting their customer base. They are providing special treatment to those whom they consider to be among their best or most profitable or, perhaps, influential customers. These represent the customers who mean the most to their franchise. We’d wager that despite the higher cost of serving these customers they are amongst their most, if not their most, profitable.
- Consider “exclusivity” to engage and reward customer performance – There is value inherent in exclusivity (as in exclusive membership), especially when tied to performance. The fact that the experience isn’t for everyone and requires performance makes selection and membership all the more valuable to the customer. It conveys a level of status and prestige, and affords the customer with bragging rights. In the movie “Up In The Air,” George Clooney plays an executive who has amassed more than ten million-miles. He uses his Concierge Key card to seal his seduction of a fellow frequent flier woman traveler he meets at the bar (that’s Hollywood for you). She is in awe of his status and the miles it has taken to achieve it. As per the American Express Platinum card, it seems to elicit more attention and better service from merchants. They perceive the cardholder to be important in terms of her/his ability and willingness to make (many) purchases of premium brands.
- Create value-added pay for play – Many of these experiences cost the brands that are offering them. The services that contribute to winning experiences don’t necessarily come cheap. So some brands require payment, which makes membership self-selective. Actually this can be a very good thing. Sort of like separating the wheat from the chaff as it relates to the quality of customers and/or ability to attract and service them. It also means that there must be a perceived value to these services and resultant experiences. The American Express Platinum card is $450 per annum. No, that’s not cheap! But when you tally-up the benefits and services it seems to be well worth its cost and premium versus the Green and Gold cards offered by the same issuer. Amazon Prime costs $79 per year. Why pay $79 per year when Amazon is free? Once again, the services and experiences derived from the services are perceived to more than offset the costs of participating for these customers. (Amazon Prime is considering raising their fee this year.) And, we are fans of Apple’s One-to-One program. We gladly dish out $99 a year in order to learn how to get the most out of our Macs, and ourselves.
- Attract, retain and encourage usage – Many marketers focus on attracting new users and neglect retention. Can anyone here say “J.C. Penney’s?” The objective of these marketers, however, appears to not only attract (or trade-up) but also retain customers. It also encourages frequency of use or, as characterized in some categories, increased utilization. The Coca-Cola Freestyle Fountain vending machine dispenses more than 100 individual brands, some of which aren’t available anywhere else, to enable consumers to create their own unique beverage experience that’s a refreshing change of pace. The Apple ecosystem of interconnected products and devices delivers a seamless user experience that serves to encourage purchase of other Apple product offerings and, importantly, retention. It helps immunize their customers from migrating to newer technologies. Their Genius Bar staffed by real people speaking your language, whom you can deal with face–to-face versus over the telephone with someone thousands of miles away, to help you resolve any technology issues you are experiencing, is quite comforting. So, even if there is a glitch with the product the very opportunity to speak and work with someone helps reverse what may have been a negative experience into a positive one.
- Create “intangibles” to develop a “Whole Product” offering that is differentiated from competition and more meaningful to customers – Airlines, electronic devices, credit cards, online retailers and even soft drinks are pretty much commodities. There is not a lot of difference in one product offering versus another in the same category. Oh yes, there may be some minor differences in features but they all do the same sort of things and work in the same basic ways. Intangibles, on the other hand, add to the physical product to create a Whole Product offering that delivers a user experience. Intangibles are non-material elements such as servicing, terms, etc. Mac is more that a physical computer. It includes its Genius Bar support, One-to-One instruction, Apple Care and even its retail outlets among other services. When one purchases a Mac one receives more, much more than a personal computer that helps create a favorable experience. Concierge Key is not part of the physical aircraft that American Airlines uses to whisk its customers from one point to another. There is nothing physically material about its services but it is an intangible that has a material impact on the experience its elite customers enjoy. R&D provides us with the tangible elements of the product but it is we marketers who develop the intangibles to create a Whole Product that drives differentiation and preference.
This is not to suggest, by the way, that these brands are perfect. They’re not! One is liable to have a poor experience with any one of these somewhere along the line. However, they are clearly thinking “customer experience” and attempting to make it a positive one in order to build a relationship as opposed to tally a mere transaction. They are exhibiting a desire to better serve their customers than competition, going beyond their physical product offering.
Here are some personal actions you may want to consider to deepen your learning about creating positive experiences and avoid creating negative experiences for your customers:
- Make a note of positive and negative experiences you encounter with brands and companies;
- Identify the causal factors contributing to your experiences; and
- If you’d like, share your learning with us and we’ll share them with others.
Importantly, make it real. Brainstorm how you might apply your learning to your brand or business to deliver a winning experience that will serve to create brand loyalty.
Richard Czerniawski and Mike Maloney
© 2003 Brand Development Network (BDN) International. All rights reserved.