Category Archives: Brand Experience

How Apple Re-invented Premium

apple_storeLI Crop

It was 1991 when we got our first Mac. It was a Macintosh LC, nicknamed “the pizza box”, and “LC” I now know stood for Low Cost, but I don’t remember it being cheap. In fact, at over $2000 it was the most expensive thing I had ever bought, next to my car. A relentless series of desktops, PowerBooks and MacBooks, and now iPhones and iPads later, I still buy Apple products and expect to pay substantially more than for non-Apple choices. My new iPhone is at least two-times the cost of an Android smartphone.

By definition Apple products are premium because they cost more. But what needs to be recognized is that Apple has re-invented what premium means, and this re-invention is as profound as the innovation of the products they sell.

Luxury is a very old idea

Premium is often regarded as synonymous with luxury, and signaling luxury relied on showing off what society regarded as scarce or difficult to attain. Luxury is an extraverted idea. The display of a Rolex on a wrist, or Mercedes in the driveway is display of achievement and status. Yet over generations of marketing, many of the signals of luxury are whitewashed over mundane products to give them a premium aura, creating nothing but hollow bling. Additionally, manufacturers and retailers look for a range of pricepoints on the shelf… to trade-up shoppers to higher priced items via cosmetic upgrades or additional (often unnecessary) features. Lastly, luxury can be associated with being pampered, but many comforts that used to be exclusive, like air-conditioned vehicles, have been made common. Overall, arriving at premium based on the symbols of luxury is often an illusion, and consumers, especially millennials, are realizing it.

Premium is now introverted, not extraverted

Today premium is no longer an extraverted, but an introverted idea, thanks to Apple. There is certainly social currency in having a Macbook, iPhone, or the soon to be cool Apple Watch, but they represent a new kind of premium not about scarcity or pampering, but about potential. The luxury of potential does not rest on the cultural symbols of a society based on privilege, aristocratic splendor, or the imperialistic conquest of exotic furs and spices. Apple represents the unlocked potential of achievement, not the spoils. This is a game-changer for all premium brands, and will require re-tooling or we will see new, introverted premium brands quickly overtake the old guard. For younger affluent consumers, a Tesla is more desirable than a Mercedes, and the Apple Watch may well be more desirable than a Rolex, because they are more than products- they are accessories for a new attitude. This new attitude redefines what is valuable around who is in our lives, our sense of purpose, and how we engage, not what we own.

Apple may not have set out to redefine premium, but whether intentional or not, it is the result of their behavior as a Brand. To reverse-engineer Apple’s formula for the new premium idea, here are three phenomena that have added up to the “premium of the future” based on a change from extraverted to introverted.

Introverted Premium is the Why, not How or What

Traditional luxury often originates as fine craftsmanship, but it creates objects that are coveted and displayed, not ideas that are scalable. I will credit Simon Sinekback in 2009 for illuminating the idea of “Why” as a powerful way to lead and inspire organizations and appeal to consumers. Apple is obsessed about its “why” and as a result it creates products and experiences that are premium. To quote Sinek regarding his why-centric Apple idea- “Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user friendly. We just happen to make great computers. Want to buy one?” These are introverted motivations. Simple, user friendly, even beautiful are qualities that we value personally, not to be broadcast socially. The simplicity allows one to express oneself and work more effectively, and beauty is both a metaphor for simplicity and an inspiration for our own great works. This earns our respect and creates desire. “Why” is the center of the circle, but how we all connect with the why is more mysterious, and just as important to being premium.

Introverted Premium transforms the Brand idea into a religion

Since the birth of the Macintosh with it’s graphical interface, “simple” has been the singular idea underpinning the Apple brand. The quest for simple unleashed computing on the masses in a way that may never have happened without Apple. But having a strong idea, a “why”, can only have success if it becomes religion and drives action. Apple made simple-ness into a kind of religion (albeit a “lowercase” religion). It had a prophet in Steven Jobs, a “spiritual center” in Cupertino, a liturgy in the famous Macworld EXPOs, and zealots from the creative class. Apple’s advertising and communications felt different and amplify “simple” into the belief that Macintosh is for smart, creative people who need a way to express their individuality, which attracts evangelists. The religion of Apple is always moving forward and bringing our own stories along with it. The brand provides us with technology-based optimism: an introverted doctrine of progress based on the individual’s escalating ability to achieve and connect.

Introverted Premium is an experience, not a thing

Apple is an experience above all else, and the majority of that experience happens when we are alone with our devices. After all, we unlock our experiences with our own personal Apple ID’s. We have our music, our apps, and our friends all personalized and organized in an Apple way. We create our own versions of the experience inside of a digital world tethered together and enabled by Apple.

It is easy to equate experience with a place like the Apple Store, but when your Brand is like a religion the store becomes a temple. The Apple Store creates a place to gather as a community and see other Applepostles. The store is a locus for the Apple idea that is experienced personally everywhere, without walls. The Apple experience is portable and omnipresent, and introverted. It is tactile in the products, aesthetic in the interfaces, audible in the sounds, human in the sales and support, empowering in the functionality, and it is well managed at every touch-point.

Characteristics of the new premium

The experience delivers consistently in these three areas, providing the clearest definition of the new introverted premium:

  1. It consistently presents a “why” brand idea through design, communications, and behaviors, and does not rely on the extroverted motifs of status and luxury that can be obstacles to acceptance or irrelevant to many cultures and groups.
  2. It allows the triumph of our own stories over its own. It pulls the believer into an optimistic view of the future, with an endless well of innovation that will give us more power and control- the keys to new capabilities. The Apple Watch, for instance, promises to take our Apple experience into a new story of healthcare and wellness. We don’t doubt that it will.
  3. Finally, the brand experience of Apple is about how we feel, not how we want others to judge us. This is the ultimate change in the premium paradigm.

There will always be luxury goods in the classic sense of Louis Vuitton and Prada because there will always be elitism. The future, however, will require a new perspective on premium, pioneered by Apple. Brands that seek a premium position in sectors like automotive, retail, travel, and dining will win by embracing an introverted, experience based mindset, the sooner the better.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Tweet the author at @chillbidley

Switching Shoppers off Autopilot

Having an Experience Requires Switching off Autopilot

Having an Experience Requires Switching off Autopilot

It’s common today for shoppers to be on autopilot when they are in a store. They resort to their routine of going through the motions of shopping and the list is the flight plan. What puts shoppers in a buying mood? What kills the mood? Will they reward the retailer with more trips? These are critical questions for retail success. With the focus today on Brand experience, shoppers may not even pay attention long enough to know they are having one. Or worse, the experience will be negative.

Getting to Engagement

In order to get the shopper off of autopilot and into “Experience mode” requires waking up their positive emotions and getting engagement. But getting to this state of engagement requires acknowledging their mission and not trying to distract them from it, and then they will naturally partake in value-adding experiences.

To Illustrate, think about the last flight you took. If you are like me, even if you wanted coffee or a snack you probably passed by the Starbucks and a couple news stands to get to your gate and then back-tracked to get coffee and a protein bar. This was because we have a primary mission that dominates our behavior- make sure that Gate C7 is actually the right gate and the plane is on-time. The primary goal of getting home dominates our behavior, so we are oblivious to all other stimuli. Autopilot is getting to the gate. We may be aware that we passed Starbucks, but coffee is a lower priority so we neglect it.

The Importance of Insights

Learning this insight several years ago, we completely re-designed a banking experience so that we could eliminate the customers’ focus on line speed and instead have an experience. Observational research found that customers did not notice promotions, offers, and product merchandising because their attention in line was focused on the tellers. Anxieties like “why is that guy taking so long”, and “which teller will be available for ME next” dominated their thinking. They were consumed by the mini-soap opera going on and certainly not in a mood to process messages or learn. Managing their stress was taxing, and much more important than the marketing messages they were surrounded by. In fact, when interviewed on exiting, most customers couldn’t recall any signs or merchandising existing at all. They were not in a buying mood and not registering any positive Brand associations. The experience was negative.

The unpredictability of the time it would take to do banking made the activity stressful, and the Brand was seen as unsympathetic. The customers’ emotions were active, but negatively. Feelings of anger, and states of frustration and restlessness were dominant because they could not efficiently complete their mission. Not only did they not engage with marketing messaging and merchandising, the tellers had to diffuse stressed, impatient customers at the start of their eventual interaction.

Innovating to Overcome Anxiety

In order to provide a Branded experience and actually engage with waiting customers, the entire process of serving them needed to be overhauled. Autopilot in this case was scanning the teller counter and continuously processing the time it was taking. We innovated the way customers experienced the bank by managing their wait time differently. Customers “checked in” and were given an estimated wait time that was reasonable, which removed their anxiety and eliminated the drama. They were then relaxed and able to browse the communications and service displays, and become engaged in the experience. They were open to learning and buying – switching off the autopilot. The bank opened in a new market with this concept and surpassed all their projected performance goals.

Easy Does It

Getting customers to embrace an experience requires understanding their autopilot and the potential anxieties and negative emotions driving their behavior. Diffusing anxiety unlocks their willingness to engage. In retail this means creating stores that are easy to shop and have the basics right, like being organized and in-stock. Until then everything is turbulence. Help the shopper find what is on their list FIRST, and then they will pay you back with their time and attention. Granted, some retailers like TJ Maxx thrive on the treasure hunt, but shoppers have that expectation when they invest time in a TJ Maxx trip. And even then the racks have consistently marked size ranges within clearly designated departments.

So going through the emotions beats going through the motions. Capturing insights that can clarify where shoppers have stress will provide ways to overcome emotional headwinds. Only then can autopilot be turned off and Brand building experiences come to the forefront. Marketing and merchandising concepts work smarter, not harder to get attention and engagement. Invest first in helping the customer get what they came for, then engagement will follow and experiences will actually happen.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Designing for the hOS – Human Operating System

hOS 1600 x 680

Our Brain Hardware runs on the hOS

I remember as a child being fascinated by documentaries about primitive tribes who survived, even thrived, by being at one with their environment. They seemed to have had a sixth sense when it came to finding food and hunting. The hunters would know the direction their quarry was heading and how far ahead they were, not just by their foot tracks, but also by broken twigs, patches of fur, and other wilderness forensics. The hunter was in tune with the sun and wind and could make quick judgments based on observation and intuition.

We are all potential tribal hunters because all humans share remarkable powers of observation and intuition. It is what perpetuates our species. Primitive man was more directly dependent on these skills for survival than we are today, but we have the same senses, and the same brains. We are born with these capabilities: a shared hOS- Human Operating System. Our hOS learns from our experiences and enables us to fulfill our basic needs and pursue our wants. We are all programmed by our experience and adapted to our contemporary time and circumstance. We are continuously unconsciously sensing and responding to our environment and behaving accordingly.

Where primitive man used these skills to hunt prey and find dry firewood, we use them to do more mundane things like drive cars and, yes, shop and buy. Science tells us that we are not consciously aware of 95% of the decisions we make, an important requirement of living in a complex, potentially over-stimulating world. Our hOS is designed to push routine activities into our basil ganglia; an area of our brains that works quickly and reflexively to address familiar tasks. This frees our conscious mind to handle new things without being overburdened with stimuli, but more importantly, allows our emotional brain, the amygdala, to guide us by how we feel.

We no longer track rabbits in the snow, but when we shop we are utilizing the same skills of observation and intuition. We “know” where things on our lists should be, what should be adjacent to what, and when and how to use store signs and read situations from the behavior of other shoppers. We know what to avoid or ignore and what to engage and embrace.

But confusion leads to stress and makes our system crash. When our environment throws a threat at us, or doesn’t make sense, we get flush with adrenaline and want to run or lash out. According to Daniel Goldman the stress hijacks our amygdala and we act irrationally. In order to proceed we need to restart. This is a bad situation when we are trying to build brands and create successful retail experiences.

The experience design must acknowledge this hOS reality and simultaneously accommodate and seduce… be basil ganglia friendly and amygdala ticklish. It’s like a hit pop song the first time you hear it, with the unconsciously familiar rhythm and melody combined with a surprising “hook” and catchy lyrics that make us smile.

Experience design needs to accommodate the subtle cues that shoppers depend on to feel at ease, like instinctive navigation, intuitive adjacencies, and adequate information so they will not get stressed. Great experience design always needs to begin with the elimination of pain-points, otherwise the experience will be deemed unworthy… bad hunting grounds.

To be hOS-friendly an experience needs to have respect for the momentum that the shopper already has and the feelings that motivate them. What experiences are already cataloged in the basil ganglia that should not be challenged? What are the consistent cues that are shared across the retail landscape that create a perception of good hunting grounds? Don’t obstruct the need to be efficient, effective and unthreatened only to be different. Designing around these known needs will enable the emotional aspects of the experience to be fully felt and the differentiating aspects of the brand to be salient. They will allow the amygdala to trigger the positive feelings and emotions that drive preference and choice.

If our primitive tribal ancestor were along with us as we shop they would be impressed by our ability to hunt in this seemingly overwhelming environment called a store, let alone successfully complete an online order. But, underneath it all is the need to appeal to the same basic code, the same hOS, sensing and reacting, enjoying the hunt enough to return to your hunting grounds.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Making an Experience Sharable

Link blog format

 Some words that we use frequently and automatically are taken for granted. Recreation is one of those words. I don’t mean the concept I mean the actual word. We think of recreation is an activity, but delve into the language and what emerges is the idea of re-creation. Recreation is activity worthy of remembering, or re-creating in our minds.

The aim of any interaction with a Brand should be recreational. The experience should leave a a positive residue that is worthy of memory, and sharing. We want the audience to re-create the good points out loud… one-on-one or with social media. Naturally when we enjoy something we want to share the experience. Things seem more real, more tangible, when we can see and feel the reaction of others. Enjoyment validated is enjoyment experienced.

We share positive and negative experiences because we are social beings, meant to live in groups and watch each other’s backs. If we could travel in time back to pre-history, I would bet that our ancestors would engage in stories about happening upon a field of berry bushes (positive), or the time they startled a mama-bear (negative). These stories inevitably become exaggerated and embellished as they are retold. The net result is that they teach others what to seek and what to avoid.

Research by the Nobel Prize winner Daniel Kahneman speaks to the idea that we commit experiences to memory in specific ways. Kahneman’s discovery of our “experiencing selves versus remembering selves” tells us that an overall positive experience can be “ruined” in our memory because of one profoundly negative element. When we are in the moment we are engaged in consuming what is happening with our senses and responding. What Brands and experiences must connect with is the remembering self, that storytelling part of our memory that we can access and share. In Kahneman’s words, “what we get to keep from our experiences is a story”.

The challenge with Brands and experiences is to not only mitigating negatives, but to prime the story and make it’s retelling more likely, and more salient. Much has been written about “storytelling” and it’s role in brand and marketing, but I want to add a different slant. We want our Brand to be a mentor, the customer to be a hero, and a transforming journey, but what storytelling “seeds” are we planting in the customer’s head for them to share. How can the experience provide a memorable landscape, populated with signature events and landmarks that can be re-created and re-told?

These experiential landmarks are key to creating memorable, and therefore sharable experiences. And to be really sticky in the memory, they need to be personal. The trap of many experience designs is that they reach for the “big bang”. They offer an initial value in the ability to be the new cool thing. The first folks who visited a Rainforest Cafe had a story to tell, but it was about the newness of the experience and getting credit for seeing it before others. After that the experience stories became about the food or the prices and a downward spiral ensued. There was no more storytelling fuel as the experience wasn’t personal, it was  “mass”. The signature event didn’t refresh or connect one-on-one with individuals. It was one gigantic landmark; an event.

Effective landmark experiences add up to a story versus explode all at once. And they provide a memorable context for personal experiences to happen. They can be architectural spaces, exciting merchandising and displays, scents and sounds, but the common denominator is that they must be unique to the brand, and play a supporting role to a personalized interaction.

An effective way to to think about a sharable experience design is to test the story-worthless via scripting the story you want told. Work the story back to the design and keep refining. What contexts need to be created and what personal interactions need to be orchestrated? The goal is to get to that pre-historic moment where the delights and amazement of finding the berries crowd out the unfortunate encounters with bears.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Admiring a Brand for the Wrong Reason is the Biggest Branding Mistake

Apple Logo

Do you have Apple Envy?

Several years ago I was put in charge of informing how a giant telecommunications company should rebrand after a major acquisition. The client saw their past as an era of “utility monopolization” and all of the consumer negativity that comes with it. The post-merger future appeared to present an opportunity to start a new chapter, and be an iconic brand that people would love and respect, versus tolerate. The available resources put towards the new brand seemed limitless, so the potential for this big change seemed plausible.

What resulted was what I dubbed “Apple Envy”, and it inspired me to look at brands in a fresh way. Following Apple was a potential trap. Did the audience for telecommunications services want their provider to be like Apple or did emotions and “belonging” not drive their choice?  We did exhaustive research on what does drive choice in this space and concluded that consumers did not. In fact they hated the idea. They certainly didn’t want the current brand, but they did want one that helped them do more and be better connected to the world.

So can a brand be iconic and not be another Apple… not be a rockstar? This client’s brand was an American institution so it seemed destined to make an impact, but how and why?  The answer appeared to lie in how we as humans attach to brands, not how brands project themselves to us. Understanding Brand Attachment was going to provide the answer, and it did.

I won’t disclose the details behind the eventual solution for this client, but I will share what I believe to be an important aspect of how we all should approach Branding, based on how customers engage and attach with Brands.

To begin, we humans are not hardwired to create relationships with corporations; we are wired to relate to each other as fellow humans. We identify each other by name and we categorize each other based on perception and experience: friend versus foe, strong versus weak, supportive versus destructive, etc. We can see this categorization in action when we feel in need. Who do we turn to when we feel lonely, feel depressed, need leadership and wise counsel, or maybe need a ride to the airport? This categorization process is fundamental to our social abilities as humans.

Brands are the personification, or humanization, of corporations. We can’t help it. As humans we automatically evaluate corporations as human entities. We project our human bias onto whatever and whomever we have a relationship with. This can be seen in our behavior towards our pets. Who hasn’t felt like their dog is sad when we leave them alone? We project our human feelings and emotions onto a dog or cat irrationally and expect them to be like us emotionally. In reality the opposite is also at work. Our dogs and cats project their “dogness” and “catness” onto our behaviors. A recent scientific article just proposed that cats see their owners as giant, benevolent felines. We import each other into our respective realities. Likewise we project our human bias onto organizations, and Brand is the manifestation of that projection.

The mistake many Brands make is benchmarking against a homogenous, monolithic notion of a great brand. The reality is that there are myriad ways a brand can be great, or iconic, just as there are many ways a person can be great. We categorize people as great leaders, athletes, entertainers, hard workers, and on and on. We would not expect an Olympic champion to go through a makeover and become a world-class chef.

With brands the first level of categorization is utility. Not basic utility, but a higher order idea of what we need from them as human surrogates. This first division is Affinity or Enabling.

Affinity brands fill our need for identity; to define ourselves to others, project our values, and our basic need to belong. Affinity brands end up on tee shirts and tattoos. Apple is an affinity brand, as is Harley-Davidson, Nike, and Rolex. These brands are iconic in the way celebrities are iconic. These are the friends we want to be associated with. The cool kids who make us feel good that we know them.

Enabling brands fill our need to be more powerful and effective. They give us “Superpowers” to become like comic book heroes. Enabling brands give us extreme capabilities like the ability to get a package from New York to LA overnight, or get a pizza to magically show up in 30 minutes. We don’t wear enabling brands on tee-shirts, but they make us feel secure and empowered on the inside. They make us feel smart.  UPS, Delta, and Verizon are enabling Brands, and iconic. These are the experts we go to when we have a problem. These are our BFFs.

There isn’t a “preferred” place to be with this Affinity/Enabling classification. Both fullfill a need and both have icon potential. It is like male and female; they are different but equally human. I also believe that it is more of a scale than an absolute, but be careful not to try to be both. Take a stand. The point is that a brand should know how its desired audience desires to attach to it and the utility it provides. For existing brands, like my telecom client, it is not impossible, but unnecessary to change from what they were (Enabling) to what they aspired to be with Apple Envy (Affinity) and they fortunately saw the logic.

In today’s customer-centric, brand-experience focused world, an understanding of Brand Attachment is not an option. Resources are too scarce and there is less time to correct mistakes. So start by asking yourself if your brand would pass the tee-shirt test. Would your shirt make you feel like you were really cool or delivering a delicious pizza?

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Honoring the Toaster: The Ultimate Customer Experience Mentor

The humble but indispensable toaster

The humble but indispensable toaster

Being a consumer today is a lot harder than ever. How we do the things we need to do every day is changing at a dizzying pace. Simply interacting with all our devices, our car stereos, the ATM, stores, and even healthcare providers require us to learn and relearn the means by which we get the results we want. This learning requires an investment in time and energy, usually only to have an “upgrade” result in us having to start nearly from scratch. Usually the upgrades have the motive of simplification and/or added functions, but many seem to change for the sake of change… except the toaster.

When is the last time that you needed to relearn how to use a toaster? As an appliance, toasters are perfect in their functional transparency and clarity of purpose. They are comically simple. In fact, we take these wonders of the industrial age for granted.

When I think about approaching a customer experience challenge, I think about how I would “toasterize” it. Toasterizing requires some creative thinking in metaphors, but it can uncover what is providing a great experience versus what is superfluous and driving customers crazy.

Here are the reasons why I believe a toaster represents the ideal experience.

  1. It manages expectations. It says what it is and does what it says. An orange is orange, a fly flies, and a toaster toasts. Enough said.
  1. It cannot be easily substituted. If you don’t have a toaster, you probably will forego toast. Toaster ovens are overkill.
  1. The operation is intuitive. I think I was only shown how to operate a toaster once in my life and I did not have to be shown again.
  1. The inner workings are not mysterious. You can actually see the thing doing its job. The little wires inside get hot and look hot, and the bread turns to toast in front of your eyes.
  1. The process is sensorial. You can actually tell the moment the bread turns into toast by the toasty smell.
  1. The user settings are direct. Toast the bread longer for dark (or burnt) toast, shorter for light toast. If the toast is too light you can push it down for more time. If you burn it its your fault.
  1. The time it takes to do the job is consistent and reasonable. The sub-conscious knowledge of how long the toaster takes allows you to multi-task effectively.
  1. It does one thing and is not insecure about it. The toaster is one of the elite appliances that can set out on the counter full time, so it has a big ego I’m sure.

The toaster’s more modern cousin, the microwave, is indispensible but a horrible experience that is tolerated versus enjoyed. (Bring to mind any service providers you may have?). How does it work? What do the frozen dinner’s instructions require from me? Will this food now burn me when I open it or eat it? Add your other complaints here… Would you rather toast that dinner if it only took 2 minutes?

Improvements on the toaster are barely non-existent. Sure there are some fashion concessions, and I have seen one that burns a Hello Kitty face on the toast, but the inner workings are the same. The toaster has reached appliance nirvana.

For such a humble gadget, the toaster is a master at delivering what we want from it, and therefore has become indispensable. It delivers great value and we give it a place in our collection of must-have objects. I find that the toaster test is a great way to casually evaluate your experience on the 8 points above. Ultimately the toaster is simple and intuitive and a great experience role-model. So the question is… is your customer experience a toaster or a microwave?

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

Brand Experience versus Customer Experience: Twins Separated at Birth?


Natural Happy Girls

 

Is there a difference between Brand Experience and Customer Experience? The answer makes me think of stories about identical twins separated at birth and reunited many years later. Amazingly many have the same hair styles, similar jobs, and they like the same flavors of ice cream even though they never met. Why? Because they share the same DNA, which is more powerful than circumstance or environment.

 

BX…CX… What’s in a name?  In business today there is a lot of energy put toward managing either Brand Experience or Customer Experience. Based on my involvement with both I want to set the record straight on the key differences. Like identical twins they share the same DNA therefore they look and act similarly. With twins their differences are influenced by the families that raised them and may result from having different cultures and customs. Likewise Brand and Customer Experiences have different upbringing but their common DNA makes them overwhelmingly similar.

Regardless of nomenclature, experience management and innovation is strategically important to growth. What drives the difference between BX and CX are three things:

1. The Brand building versus customer service bias of the organization

2. How the differentiating and value adding aspects of the experience are inspired

3. How success of the experience is measured and tracked.

The initial difference is cultural bias. If the organization has a Brand driven culture, the bias is toward a Brand Experience mindset. If the organization has a customer service driven culture, the bias is toward a Customer Experience mindset. “Brand” is a complex idea that many organizations embrace but is not often codified, so in the absence of a clear Brand idea and proposition, strong customer-centric values are a fine substitute. Here either bias has a noble purpose. My client experience bears out that a great experience design can result from Brand or customer service scenarios.

 

Design inspiration comes next. Both BX and CX development processes involve journey mapping and seek to define touch-points and create value-adding and differentiating experiences. Both must bridge the digital and physical seamlessly, address a variety of segments, and accommodate different need states and occasions. They also seek to address problem resolution as a key opportunity to shine. Their DNA is the same. The difference is in inspiration. Brand Experiences look to actively and passively embed Brand-building into the experience whereas Customer Experiences do not have the same primary motive.

Brand-centric organizations have defined Brand attributes and an activation strategy (which should be based on data and customer insights). The experience design is an opportunity to leverage the power of the Brand strategy and build positive equity on specific attributes as intentional additions to the customer experience. This Brand building may not pay dividends immediately, but it is a longer-term investment that synchronizes with Brand messages in advertising and other Brand communications to build equity and brand salience. Alternatively, in the absence of a defined and pervasive Brand, Customer Experiences are focused more on delighting customers in the here and now. They must have core-tenants that are linked to strong customer-centric values. These have the net effect of a Brand, but they are not directly inspired by a defined Brand idea. It’s like getting to your destination using a map or by familiar landmarks. The important thing is that you arrived.

 

Success criteria is the ultimate differentiator of BX versus CX.  Brand Experience adds Brand-derived attribute tracking to the measurement. It all ladders up to the need to correlate attribute performance to business performance and see the effect over time on Brand sentiment. Ultimately both Customer Experience and Brand Experience measurement have “macro” metrics that inform Brand sentiment… like net promoter scores, defection rates, etc., but Customer Experience measurement may not include (or they just “throw in”) Brand related measures.

 

So the wrap-up is this: if you are asked to manage or execute an experience innovation initiative, don’t get hung up on semantics because the core DNA is the same. All Brand Experiences are inherently Customer Experiences, and all Customer Experiences result in a Brand Experience by default. Both put the customer at the center with insights and empathy as they seek to create proprietary experiences that foster enduring relationships versus mere transactions. The important thing is to be consistent or else the confusion could bog your organization down.

Smart Little Piggies use Bricks and Mortar

Three_little_pigs

With the latest report from A.T. Kearney on Recasting the Retail Store in Today’s Omnichannel World, I am seeing an acceleration of studies that confirm the importance of brick and mortar retail. The stats are clear and confirm more than surprise… 92% of retail sales still come from stores. Another popular form of evidence that retail is alive and well is that the pure-play online retailers are opening bricks and mortar locations or pop-up stores. Why are all of these articles striving to defend retail stores? As I read this report and others like it, why do I feel like they are telling me what the weather is like when I can just look out my window? We shop because stores meet needs that ecommerce cannot. If we could get all our nutrition from a magic pill wouldn’t we still enjoy eating?

In my view the problem with bricks and mortar retail isn’t the Internet, it’s the neglect of the asset.

Traditional retailers only have so much capital, and pressure from Wall Street to show growth is enormous. Stores as a point of distribution are costly. Stores are expensive to design, build, maintain, and staff. They also are expensive to refresh. For the past several years, IT, ecommerce, digital loyalty programs, and now omnichannel activity have won the battle for capital in the boardroom. Investors want to see retailers embracing the mobile/digital shopper and the ecommerce channel. And “digital” spending is propelled by its own arms race, and no retailer wants to be left behind. As retailers spend on these initiatives they become ongoing budget requirements that didn’t exist a decade ago. In many cases they do not generate the revenue to be self-sustaining, so they dilute the capital that used to be spent on stores. In other cases they are exciting innovations that keep a retailer relevant. Meanwhile the stores provide the majority of revenue.

Case in point: Near the end of the last decade I was involved in selling a major rebranding initiative to Sears. The goal was to give them a new reason for being, a new proposition, and a renewed relevancy that would ultimately impact the store experience. Understandably this is a perennial problem at Sears and Branding is only one aspect of the fix. We were convincing and won the business against formidable competition…but the project never started. It was determined by the C-Suite that the investment wasn’t worth it, and that their Shop-your-way loyalty program was the best way out of their troubles. Meanwhile the Sears stores continue to be stuck in the past and a festering burden on their relevance.

This spending on non-bricks and mortar initiatives is not wasteful; in fact it is transforming retail for the better if you are a shopper. But it is not good business to neglect the store experience, as indicated by the evidence presented in these A.T. Kearney style reports. Understanding the way consumers want to shop and being there for them is still central to great retail. The issue is that the spending on these healthy distractions has caused a neglect of the “traditional aspects” of the shopping experience that are delivered by the physical store. And the longer retailers take to invest in remodeling the more expensive it will be.

I like the A.T. Kearney report because it encourages retailers to re-evaluate the role of the physical store. At some point the seamless omnichannel experience will reach a plateau, or at least a consistent budget requirement, so that adequate innovation dollars will move back into bricks and mortar. Retailers would be wise to not wait too long. After all, remember that bricks and mortar are what gave the smart little piggy the power to keep out the big bad wolf.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com

What Would You Pay to Shop at Your Favorite Store?

How much for your time?

How much for your time?

The thought of paying to shop is a ridiculous idea, but we all do it. We pay with our time not our cash. If we think about store experiences this way… as products people buy… it can change how we should innovate retail experiences.

The thought of paying for a retail experience came to me as an epiphany while I was on a panel discussion on ‘bricks and mortar retail in a digital world’ at the Consumer Electronics Show in Las Vegas last year. The question from the panel leader was about the challenges retailers face creating loyalty. My response was “I pay $79 a year to be loyal to Amazon”. It’s true. If I am willing to pay to be an Amazon Prime customer I am going to certainly look there first for the merchandise I want so I can benefit from my membership. The enticement to become a member was ‘free shipping’, and the math seemed fair, but now by brain dilutes the cost over the entire Amazon experience and I feel value beyond the shipping savings. I can’t imagine NOT being a Prime member.

This pay-to-shop model is not new. It has been around at least since the dawn of warehouse clubs. Costco, Sam’s, and BJ’s are all acutely aware that they have to provide member value, and filter their decisions based on this foundation. They know if their members are not perceiving an annual savings AND a great experience they will bail. The issue with the club operators is that the added value is not “environmental” in the form of store design, but believe me when I say they put an equal amount of energy into the design of their  store experience via curated assortments, adjacency and operations, the treasure-hunt atmosphere, and exciting seasonal merchandising.

Amazon Prime and Club stores are monetary costs, but when they choose a retailer shoppers are still weighing the cost of their decision, but with the currency of time.

I have a client friend who ran dealer development for a major equipment manufacturer who once said to me “When someone asks me what a tractor costs I tell them it costs what we sell it to the dealer for. What they pay is that plus the value the dealer adds in the sales and service experience.”  Forget the Prime and Club models and think in terms of how your store, your department experience, and your category solutions deliver an experience that is worth 10 or 30 minutes versus 10 or 30 dollars. This can be a transformational way of thinking about innovation in retail.

A time/value framework can be a simple one for approaching both how a store delivers today and how it could be delivering more tomorrow.  For known value items like detergent and milk the assumption is that price parity or better must rule. But for other wants and needs that are not price sensitive, and certainly part of a “reason to visit” a retailer, ask how the experience of shopping before, during, and after the trip can be worth more than the “stuff”. How can it make the shopper feel smarter, more attractive, more hip, more…something. The goal is to have an emotional end-benefit that is constantly and consistently delivered in the experience and reinforced through communications. The result is the shopper driving…or clicking past competitive retailers to get to their preferred store.

Today the seamless store experience and the digital experience are the “how”. These are the vehicles, but like driving a car they are made up of smaller experiences like acceleration, cornering, and braking (and cupholders, and a great stereo, and power seats) that make the experience a joy. Try thinking about the value you are getting for your time the next time you shop. We all do it subconsciously already, just become aware. It just might lead you to a new way to innovate.

Link

When retailer advertising and reality collide

Petco Ad

Petco’s new Ad campaign. Does it over-promise?

Petco has begun a new ad campaign aimed at pulling at the heartstrings of pet owners and building an emotional connection to their brand, but like any brand-building advertising, the commercials are writing checks that the store experience has to cash. I admit that the ads are a refreshing break from the sea of urgent offers and endless deals that we are exposed to continuously on our TVs. With the line “The power of together”, they are well written, well executed, and amplify our awareness of the connections we have with our dogs and cats. The “co” device links this notion of our lives being enriched by our pets with the otherwise emotionless Petco name. The ads may drive consideration for Petco, but what happens when shoppers give Petco a try?

Retailers need traffic, and ultimately the ads need to drive shoppers to change their behavior and switch from Walmart, PetSmart, or their grocery store and become Petco regulars. But there is a big risk in inflating this emotional balloon and setting expectations too high. Can the stores and the associates live up to the promise? The ads, in fact, are built around the out-of-store experience with your pet, but where is the role of the store in the brand promise since it is the primary brand touch point? I do shop at Petco and I believe the ads validate my choice, but I shop there because they are smaller stores and easier to get in and out quickly. That is a real benefit.

The root of the issue is that Petco is not a lifestyle brand, it is a brand that enables shoppers to find what they need to take care of their pets. Lifestyle brands (great examples are Harley-Davidson and Nike) need to create an emotional connection with their customers to create value and drive demand. They create products that are like empty vessels which they fill with the dreams and aspirations of their audience. The emotions fuel the “want”. Most retailers create value through providing access to needs and wants, not creating needs and wants, and they are easily substitutable by other stores or channels (with the exception of fashion specialty retailers). Being biased toward lifestyle, the Petco ads do a better job of selling the virtues of owning a pet than providing a reason to shop their stores. If anything they stimulate consumers to take better care of their pets, but that could just mean trading up to premium food brands at any store.

I have seen numerous retailers venture down the seductive path of over promising in advertising. These campaigns may give the audience goosebumps, but they don’t communicate a strong “why shop here” or deliver a commensurate emotional reward in the store. Don’t get me wrong… store experiences need an emotional component, but an advertising campaign alone is not the solution. Great experience strategy and design are the means to creating an emotionally rewarding store experience. So here is my message to retailers: when your agency pitches a highly emotional campaign, ask if it is selling any benefits provided by your actual store experience.

I do believe that there are retailers out there who are getting it right, and are able to reconcile what their brands are about while communicating a plausible promise their stores can and do deliver.

First is Radio Shack’s Superbowl ad, featuring the “80’s called and want their store back” idea. Radio Shack went right at their main problem- the perception of irrelevance. The quick transformation of the store in the ad to a new image and experience was celebrating the store like no ad I had ever seen. Whether they have converted their whole fleet to deliver on the promise I do not know, but the stores around me are refreshed, so it worked (I bought some batteries).

The second, and more prolific, is the “Corner of Happy and Healthy” campaign by GSD&M for Walgreens. This campaign is rooted in the accessibility of the store and the authority of Walgreens as a headquarters of good health. The tagline is also versatile enough to work for category specific messaging in weekly ads and in-store displays, so it becomes a piece of the experience itself.

For retailers, the store is the story. Lifestyle brands can use emotions to play a big role in driving demand and creating preference, but emotional brand messaging to drive traffic for a retailer is a slippery slope that can lead to dissatisfaction if the experience is not aligned in a reinforcing way. Play to your store’s strengths and how your brand creates value through the experience, then activate the emotional content in the store itself.

Bill Chidley is a Partner and Co-Founder at ChangeUp. Creating Innovating Experiences that Drive Growth. http://www.changeupinc.com