Welcome to the Experience Economy

An Introduction to Customer Experience

Eliana L. Medeiros
Copyright © 2017 Eliana L. Medeiros
All rights reserved.

ISBN: 1542300142
ISBN 13: 9781542300148

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To my beloved children, Tiago, Carolina, and Victória. I love you. May this book always
remind you that everything is possible if you really work for it. #excellence

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 Contents

Welcome

- The Why

- Misconceptions and Interpretations

- Fast Facts

- The Evolution of CX

- Relentless Alignment

- CX Fundamentals

- CX’s Ultimate Objective—Brand Advocacy

- Customer Insight

- CX Measurements and ROI

- CX Assessment Tool—The LEX Model

- Case Study—Metro Bank

- The Customer Experience Executive

- Conclusion

Acknowledgments

About the Author

Notes

Bibliography
Put your customer at the heart of everything that you do.
You can’t go wrong with that.

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 Welcome
The question you most likely have on your mind as you hold this book right now is
“What will this book do for me?”

Let me start by saying that this book will put you in the know on the biggest competitive
advantage that is being used by the most successful brands and organizations in the
twenty-first century—think Starbucks, Commerce Bank, Apple, Uber, Tesla. This
advantage is customer experience (CX).

We are now in what is called the age of the customer. Technology and other
socioeconomic factors have given customers more choices and power than ever before.
This has also given them control over the brand image. After all, studies show that 90
percent of customers trust a recommendation from another customer, but only 4 percent
believe the traditional marketing.

On top of that, technology has also enabled disruptive businesses to change the
competitive landscape dramatically and frequently. Organizations can no longer
consider only the competitors in their particular industry. Anyone is a potential
competitor. Just think of how Apple changed the music business, how Uber changed the
taxi industry—the list goes on and on. Organizations must constantly adapt or die.

To survive, businesses need to change from their product-centric silo mentality to a

customer-centric one that drives innovation by focusing on an outside-in approach. This
requires them to have the customer at the center of all they do. It’s no longer about
building a product and then finding customers; now you need to have the customers and
then find a product that helps them in whatever need/pain point they have. It’s
fundamentally an entirely different perspective.

However, it is now the most successful way for a company to create brand advocates.
What is a brand advocate, and why do companies need them? Brand advocates are
customers who are fiercely loyal, and they are critical for businesses that want to
maintain a sustainable competitive advantage long term, as customer advocates purchase
the product, buy again, and recommend the product to others, generating positive word
of mouth. However, to turn customers into brand advocates, organizations and brands
need to be reliable, since advocacy only comes with trust. They also need to provide their
customers with a remarkable, unique experience that creates an emotional connection.

Customer advocacy is the only way to survive, and that’s where customer experience
comes into play. The best, most successful businesses know this and use it to their
advantage. Just think of how Starbucks was able to change the coffee industry, charge a
premium for a latte, and build a multi-billion-dollar global empire out of it. Or how
Metro Bank, of which you will find a case study in this book, was not only the first new
high street retail bank in the United Kingdom in more than 150 years but was also able to
start with no customers and achieve 100 percent annual growth since its inception in
2010.

Customer experience is their secret weapon, and it’s time for you to know all about it.

It has been almost twenty years since “Welcome to the Experience Economy” was
published in Harvard’s Business Review. My book’s title is an homage to this
groundbreaking article. The piece condensed what the future of business would be in the
twenty-first century.

This book is not meant to be an extensive analysis of all aspects of CX. Instead, I want
you to consider this manuscript a curated instrument in which I have condensed
concepts in a way that helps you understand the essentials of customer experience and, I
hope, inspires and challenges you to start putting some ideas into practice immediately
and to delve further into the topic.

I was fortunate to work for one of the best luxury companies in the world, an incredible
company that, in a way, pioneered the concept of differentiated customer experience as a
competitive advantage, not only to retain the customer but also to get the customer to
love us and refer us to others. I was one of the first customer experience leaders in
Europe, so I didn’t have a lot of people to copy from or benchmark with. It was in some
ways a very, very lonely road, full of trial and error, as I tried to figure out what
customer experience was and, more importantly, what it meant to the organization and
our brand. These experiences taught me a lot, but I kept gaining knowledge through my
startups and, most recently, through my pro-bono consultancy service, Living the
E.Xperience (LEX), where I work with luxury industry startups to build a sustainable
customer-centric strategy and a culture that drives innovation. So the principles, the LEX
model, and the insights that comprise this book have been tested and refined throughout
the years in my work.

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I hope that by sharing this book with you, I can save you hundreds, if not thousands of
hours and thousand or even millions of euros by helping you understand what customer
experience is and how to implement this business practice quickly and effectively.

My financial background has always allowed me to understand the broader picture and
view customer experience as a competitive edge that enables an organization to come
together to achieve the ultimate business objective, which is to make money. As an
entrepreneur, I have learned the hard way that even with the best of intentions, if you
don’t make money, you won’t be able to thrive or help others. It is that knowledge I want
to share with you in this book.

This book, however, is not about luxury customer experience, far from it. Even though I
have applied every single concept in this book to my work with luxury companies, the
business truths you will read here can be tailored to work across the board. In fact, I have
deliberately stayed away from luxury brands as much as possible, to make it clear that
customer experience is applicable to every industry and business from the lady who sell
cakes from her small kitchen all the way up to the biggest corporations on earth.

It is true that many nonluxury companies have taken best practices from luxury
industries. Steve Jobs’s Apple, for example, took so much from Ritz-Carlton that the
Apple genius bar staffers also have credo cards. Apple also hired Burberry’s former CEO,
Angela Ahrendts, as their SVP of retail. The results of this strategy are there for all of us
to see. Apple has turned its stores into such a great experience for its customers that the
company has the highest revenue per square meter globally, and in the process, it even
managed to redefine luxury.

Unlike in the past, businesses nowadays need to be balancing acts of efficiency,

effectiveness, and experience. The purpose of this book is to give you more insight into
the forces that shaped the rise of customer experience to “the single most important
factor for business success,”i as well as to share some of the tools that will enable you to
harness this competitive advantage so you can successfully apply it to anything from a
one-employee startup to a global organization.

This book you’re holding is for doers who believe the customer is indeed king and most
certainly not for those who are looking for the quick, no-effort magic formula for
business success. Or those who think that, by reading this book or simply paying lip
service to the importance of the customer, they are already there. No, this is not for
halfhearted, not-invested people. As any great CEO of any innovative, successful
organization will tell you, great results require a truly relentless alignment to whatever
you decide to be, and that means hard work, focus, and effort. As always on the path to
excellence, the rewards are enormous. So if this doesn’t suit you, let me respectfully

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advise you to put this book down and go spend your most valuable asset—time—on
something else.

This book is for you if you fall into any one of these categories:

- If you are a senior executive responsible for the defining business strategy and
leading an organization or an area within it, this book will help you be
successful.
- If you are an entrepreneur who owns a startup or is planning to start a business,
this book will give you insights that will allow you to create a better strategy for
your business.
- If you are a team leader or manager, this book can help you understand what
CX is, what it means to provide a differentiated customer experience, and what
your role is in helping your team deliver it.
- If you are an individual contributor in an organization working in either the
front or back office, you are the one who provides the experience and brings the
brand promise to life. This book will help you understand that an organization
is no better than the service it provides to its customers.
- If you are a college student, customer experience is the future, and you will be a
significant part of it. This book will allow you to have a better understanding of
the market needs and a more holistic view of what drives business success in
the twenty-first century.

So please read it, learn from it, and copy as much as you can from it. I know I would!

Eliana Medeiros

June 2016

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 Chapter 1
The Why

Everything starts with the customer.

—Louis XIV

In this day and age, when every product that comes along will be mimicked, improved
upon, and likely sold at a lower price by someone else a few months later, it is a no-
brainer that we have all become commoditized. And with all the changes that are
happening around us and shaping our world and the markets, we are only now starting
to realize what we need to do to build successful businesses. In that process, it has
become apparent that the clear majority of organizations cannot only sell products or
services. While a great product is a vessel to get into the game, it is most certainly not a
sustainable long-term differentiator. Therefore, businesses must now provide a superior
experience to their customers because, while anyone can copy what you do, they cannot
copy how you make people feel. And when 77 percent of customers say that they would
rather have an experience than buy a productii, you know the transactional society has
come to an end. Customers are now looking not only for the best product but also for an
experience that adds value to that product.

In every interaction a customer has with an organization, he or she will form a perception
of what the brand is. This means that every touchpoint counts for the brand image.
Among other socioeconomic factors, the Internet and technology allow customers to
control the brand image. Because potential customers now have access to product
information and customer opinions, even while they’re inside the store purchasing the
product, the majority actively look for those opinions before deciding to buy.
Considering these changes, company strategies needs to change for businesses to thrive.

Customer experience has become a significant competitive advantage and, in some

businesses, the most important differentiator, because we all know that making
customers happy works 100 percent of the time. Just think about it. Everything we like to
surround ourselves with, from the places we like to go to the people we like to be with,
have one thing in common. They make us feel good.

This means that customer experience is fundamentally about helping customers achieve
what they want to achieve. It’s about organizations enabling their customers’ lifestyles.
To ignore this new millennium business model rule means that whatever you provide
will be seen as a commodity. Therefore, the cheapest product will do.

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Let me make something clear: customer experience is not fluff or KUMBAYA. Customer
experience has become a truly important business principle; in my experience, it is up
there with strategy, marketing, and so on. Companies that consistently provide their
customers with a differentiated, memorable, and tailored experience are the ones that are
growing market share. In a study from Oracle, 93 percent of executives said customer
experience was one of their top three priorities and 97 percent stated that it was critical to
their business success.iii As you might imagine, the top reasons businesses invest in CX
are not just to make customers happy but to improve customer retention, reduce costs,
improve customer satisfaction, grow market share, and increase cross-selling and up-
selling. Addressing each of these reasons positively affects bottom-line revenue. An
actual customer experience transformation can tackle all the results listed above;
however, despite almost everyone claiming they are customer-centric and that CX is a
focus area for them, only a few truly execute it, allowing them to reap the rewards.

A Bain & Company study showed that businesses that excel at customer experience grow
revenues between 4 and 8 percent above the market. Another study by Inc. magazine of
the five hundred fastest-growing companies noted that the top ten of these enterprises,
which grow at a rate of more than 1,000 percent a year, have a few common
denominators. Each has a great product, each is fully centered on its customers’ needs,
and each is very focused on the customer experience. Their CEOs are obsessed with their
customers, treating them as assets.

I am talking about billions here. Take, for example, Metro Bank UK, which has grown at
a rate of 100 percent a year in every year since its launch. Furthermore, it is worth
highlighting that the startup bank started without a single customer and with a loan from
investors back in 2010, in the middle of financial instability and at the peak of the
negative perception of banks and other financial institutions. Nevertheless, its intense
focus on providing added value for its customers and relentless alignment when
executing its customer-centric model allowed Metro Bank to reach 800,000 customers and
have six billion euros in assets five years later. The bank achieved what others deemed
impossible; in the words of its chairman, Vernon Hill, it has “high growth in a
nongrowth world.”iv This means that focus is the most important requirement for success
in today’s fast-moving world. If you can focus and be relentless in aligning your strategy,
brand, and customer experience, you can succeed.

Metro Bank has also managed what very few can provide—unparalleled customer
service, even though it has a cost-focus strategy. Metro Bank is always refining how its
services are delivered to continue to be the game changer and to make banking fun. The
bank doesn’t have customers; it has fans. Those fans are brand advocates who open
accounts, buy other products, have a long relationship with them, and recommend them
to others. Several studies confirm that customer experience is highly correlated to loyalty.

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Its army of fans allowed Metro Bank UK to spend only seventy thousand euros in
marketing in 2015 and still grow at a rate of 100 percent and have 71 percent brand
awareness. Metro Bank understands that human relationships always precede financial
results. This is why words like passion, emotion, purpose, and love, which once had no place
in the business world, are now becoming part of organizations’ language. Take, for
example, Saatchi & Saatchi’s Lovemarks, which focuses on helping brands become
beloved, or the fact that 2016 was considered the year of emotionv. Because
breakthroughs in neuroscience have allowed us to better understand the role that
emotions play in our purchases and decisions, the whole discussion around business
purpose has to change. Because of the changes in customers’ behavior and the
innumerable choices of products they have, companies need to be clear about their
purpose to connect at a deeper level, not only with their customers, but also with their
employees. The purpose cannot be making money; that is a result. The purpose needs to
be something more meaningful that will improve people’s lives in a way. You can see
that through the rise of social entrepreneurism in recent years.

And finally, passion at work. It has become clear that while traditional marketing sets the
expectations, it is employees who deliver the experience. In a world in which more than
three-quarters of all employees are not engaged with their jobs, it is difficult for them to
innovate and provide a unique, memorable, personalized experience. An organization
needs employee advocacy first to be able to succeed in this highly competitive world. It
needs employees who feel part of something bigger and are empowered to come up with
innovative solutions that don’t just answer to the customer’s needs and emotions but
actually anticipate them. This is the only way to remain relevant in this ever-changing
world. You need to build the future, and disengaged employees won’t be able to help
you achieve that. The organization’s culture is so important and too often neglected. The
culture must enhance and reinforce the strategy.

For non-customer-centric companies, which are the clear majority, customer experience
involves a significant cultural change or evolution. Culture is usually underestimated,
but it shouldn’t be; as Peter Drucker stated, “Culture eats strategy for breakfast.” No
business model succeeds in the long term without a strong culture to support and
enhance it. Furthermore, since customer experience is a competitive advantage that must
be truly embedded to achieve its fullest potential, it needs to be part of a business’s DNA.
The culture needs to live it and breathe it at every moment. It’s about building trust
because trust is the glue that keeps everything together, and culture is what ensure that
things get done as they should. It is only through that consistency that the customer will
be able to believe in the brand and build an emotional connection that leads to brand
advocacy, which is the ultimate goal of customer experience.

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Hence the importance of leadership. Leadership provides direction and defines not only
what the company does but also what it doesn’t do. It constantly asks if the company’s
strategy, brand, culture, and customer experience are relentlessly aligned or pulling the
organization in different directions. Leadership, through its relentless focus, ensures
employees have line of sight to the business purpose because a strong alignment is a fast
track to success. In the end, customer experience is about making organizations the most
successful they can be for life by making their customers happy.

I feel that in my enthusiasm, I’m jumping ahead of myself and giving everything away at
once. Since this book is an introduction to customer experience, let’s begin by talking
about the current reality and the background of the rise of the relevancy of customer
experience (CX) in business strategy and go from there.

Let’s start.

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 Chapter 2
Misconceptions and Interpretations

Popular opinions, on subjects not palpable to sense, are often true, but seldom or
never the whole truth.
—John Stuart Mill

Perhaps because customer experience is relatively new and evolving, there are a few
misconceptions about it. I want to talk first about two mistakes that always leave me
wondering why so many times in business people prefer the narrowest approach to
something when often the bigger benefits lie in taking the broadest view of things.

The first misunderstanding: customer experience is customer service

People interchange both terms as if they mean the same thing, well, all I can say (in the
nicest way possible) is they don’t. To better understand this let’s look at the differences
between the customer experience and customer service in figure 2.1.

It is clear that service is a part of the customer experience, just like marketing or billing. It
is a critical component of the customer experience, as it significantly influences the
consumer’s perception of the experience. Customer service is usually a function, a
department within the organization. Customer experience is to be seen as a competitive
advantage that focuses on understanding the customer’s needs and emotions, developing
leadership, and empowering employees so the organization can deliver its value
proposition consistently. Customer experience and customer service are linked and
strongly influence customer advocacy.

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The second misunderstanding: customer experience is customer-centricity

Here again, people interchange these terms as if they mean the same thing, and once
more, all I can say is they don’t. Let’s look at the differences between the customer
experience and customer-centricity in the figure 2.2.

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As you can see, customer-centricity is at best the evolution of customer experience. Such
advancement happens only when the whole “customer thing” goes from the heads of
everyone in the organization to their hearts and souls and becomes truly embedded in
the organization’s way of being and doing. Customer experience professionals all over
the world work every day to make this shift a reality. Ideally, the organization in which
you are implementing customer experience will already be customer-centric; the task will
be far easier and will yield much better results.

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Summing it up, companies that do not put the customer at the center of what they do can
still apply the customer experience discipline to their businesses. However, because it is
the organization’s interest that takes center stage and not the customer’s, they only
consider the customer’s needs to a certain extent. Most commonly, they apply a
simplified segmentation of customers and a basic understanding of the customer needs,
enough to establish an emotional connection to increase their revenue and long-term
sustainability.

The several interpretations of customer experience

Customer experience is still a relatively new discipline, but it already has as many
definitions as the Internet allows. Now, I don’t want to get into an unfruitful discussion
about why you shouldn’t call your customer service agents customer experience
managers, partly because we already discussed that but also because it depends on how
the organization views customer experience. And to be fair, even inside an organization,
people can have different understandings of what it is. The figure 2.3 demonstrates three
of the most common business outlooks to experience that have an impact on how
customer experience strategy is implemented inside the organizationvi.

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 Chapter 3
Fast Facts

Data is not useful until it becomes information.

—Seth Godin

Sometimes, and I know it is mostly due to my finance and project management

background, I just want facts. Straight-up bullet points of what is, without any of the fluff
that, more often than not, creates confusion rather than providing clarity. I had the
pleasure of working with a chairman, Mark W. Booth, a leader I greatly admire, who
taught me that simple things people can understand for themselves are far better than
anything that requires an expert by their side deciphering it for them. In that spirit, I
share with you in plain terms the results several studies from renowned sources such as
McKinsey & Company, Bain & Company, Forrester Research, the Nielsen Company, and
Gallup, to name a few (figure 3.1.) These studies demonstrate why best-in-class
companies are using customer experience, why it is so relevant for businesses success at
this moment, and why it will remain so in the coming decades.

Also figure 3.2 shows some fast facts about the ultimate objective of customer
experience—to turn customers into brand advocates. This goal is crucial because word of
mouth has become the most powerful marketing tool. Just ask yourself, when you want
to book a hotel, do you go directly to the hotel website to reserve the room, or do you
first go to TripAdvisor to see customers’ reviews of a hotel before booking it? And you
probably read the lowest-score reviews (even if it’s just one in a thousand) before making
your decision. However, there is more to brand advocacy, as you will see in chapter 6,
which examines the topic from both the internal (employees) and external (customers)
perspectives.

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 Chapter 4
The Evolution of CX

Everything needs to change, so everything can stay the same.

—Giuseppe Tomasi di Lampedusa

Some background

Customer experience has evolved significantly, from primarily being considered a part of
customer service responsibilities to the point where it encompasses every interaction the
customer has with the organization, the end-to-end journey. In his brilliant book
Customer Experience 3.0, customer service guru John Goodman explains the progress
stages from CX 1.0 to CX 3.0. Figure 4.1 is a snapshot of his definition of these stages.

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So why did this evolution occur? What caused this mutation of customer experience into
a holistic view of the customer and the impact of the whole organization in the
experience it delivers?
Several factors contributed to this advancement of customer experience. Since 2010, we
have been in a period that Forrester calls the “age of the customer.”vii

This new age in which the customer is indeed king came about primarily because now
more than ever, the buyer has an enormous number of products to choose from and a lot
of information to help him or her decide among them.

No longer do customers believe what traditional marketing tells them; twenty-first-

century consumers are incredibly savvy. Their expectation is of high value, speed, and
reliability, regardless of the channel they are using. Companies that understand this and
can deliver value in a consistent way are the CX leaders and reap the benefits of it, by
growing 4 to 6 percent above market revenue. Forrester, in its 2015 report “The Revenue
Impact of Customer Experience,” showed how just a one-point gain in the Customer
Experience Index (which measures ease, “enjoyability,” and whether or not customer
needs were met) can equate to a significant benefit to the company’s bottom line. (See
figure 4.3.)

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The six socioeconomic drivers

Change or evolution, whatever you want to call it, is now more than ever the norm for
companies that survive in this fast-paced, highly challenging, and competitive
environment. Customer experience and innovation focused on a customer-centric
approach are so far the best answers to those changes. Product by itself can no longer
keep businesses ahead of the game, and the rules of the game have changed and keep on
changing, primarily because of technology, which enables disruptors to pop out from
everywhere. Just look at Airbnb or Zipcar (figure 4.4.)

To understand why CX is currently the big buzzword in business, you must first
understand the six primary socioeconomic factors that have led to an upsurge in
customer power, causing companies to shift from a product-centric approach to a
customer-centric methodology.

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 - The 2007–2008 financial crisis
A lot has been written about the financial crisis, so there is no point dwelling too much
on why it happened. I’ll only focus on how it contributed to the rise of CX. During the
financial crisis, customers found out what some companies and key businesses in the
world economy that had been considered points of reference for all others were actually
doing internally, and it was a huge disappointment.

Take, for example, Lehman Brothers. Its mission statement was “We are one firm,
defined by our unwavering commitment to our clients, our shareholders, and each other.
Our mission is to build unrivaled partnerships with and value for our clients, through
the knowledge, creativity, and dedication of our people, leading to superior returns to
our shareholders.”viii A company that had integrity as one of its core values, a symbol of
financial stability and trust for more than one hundred years went bankrupt. And we all
had the (dis)pleasure of finding out that it was most certainly not living its mission
internally. The expectation that its brand image had created was not aligned with the
organization’s actions and behaviors.

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Customers had so trusted companies like Lehman that they had given them their life
savings to manage, along with their dreams and futures. These same companies allowed
customers to get loans for houses that they couldn’t afford and at inflated prices. It
seemed that all had been done because of greed. Gordon Gekko was alive and well. The
impact on people’s lives was significant. Jobs suddenly disappeared, families lost their
homes, individuals lost their life savings, and basic needs such as security were severely
affected.

It was the beginning of austerity and financial uncertainty, and the impact of this crisis is
still visible today. Young people struggle to find jobs, and when they do, they find that
salaries are not as high as they used to be. Precarious working conditions, long-term
unemployment, the rise of debt, and the decrease in wealth changed people’s perceptions
of organizations and brands. The crisis meant the loss of innocence; people realized the
projected brand images didn’t really reflect how the businesses operated internally.
Cynicism grew, and customers would never simply believe again.

The crisis also contributed to changes in consumer behavior. For example, the younger
millennials saw the impact of the crisis on their parents, while the older ones felt the
impact directly. This turned them into savvy consumers, not allowing the norm to dictate
their purchasing habits. This is part of the reason the new generation is redefining luxury
and the luxury industry. For consumers overwhelmed with information and living in this
fast-paced society, time has become the ultimate luxury.

The economic downturn also showed the new generation that consumerism wasn’t the
key to making people happier, so they started to seek out experiences that were genuine
and reliable, instead of simply acquiring material goods. Accordingly, millennials
perceive high tech as high end, mainly due to Apple, which reinvented luxury. Products
need to be original, innovative, and unique; experience is everything; and well-being is
promoted. Great examples of this are Scandic, the hotel on the go, and Touch, a patch
developed by Amazon.

We can then conclude that the crisis had a significant influence on the mental and
emotional behavior of consumers by making them less wasteful, more mindful of their
purchases, and increasingly focused on their well-being. It caused an evolution in the
concept of brand, from an inside-out to an outside-in approach.

- Web 2.0
With the rise of the web 2.0 and new technology, social media allowed everyone and
anyone to express their thoughts and feelings anytime and anywhere.

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No longer were the communication and image of the brand controlled by the
organization; the customers now also have something to say on that topic and a
significant network to say it to. (See figure 4.5.)

Due to the loss of trust after the financial crisis, consumers value other users’ opinions
more than the traditional marketing from organizations.
This means marketers have lost the control of the brand image. It now belongs to the
customers, and they will provide the brand image based on their experiences with the
organization.

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In a survey done in 2015, only 4 percent of the respondents said they trusted traditional
marketing. On the other side of the spectrum, Nielsen’s global study showed that 70
percent of customers trust other consumers’ opinions posted online, and 92 percent
believe in the recommendations of someone they know. The tables have turned. It’s no
longer enough for a business to tell consumers what it is; it must be that and prove it at
every interaction in order for the brand to maintain its reputation with its customer base
and potential customers. It is about trust, which at the end of the day means reliability.
To understand the magnitude of this shift, please see the figure 4.6. Looking at it you can
see that if you translate the active social accounts into a percentage of the total
population, you could say that roughly—for better or worse, it will depend on the
customer experience you provide—29 percent. That means that one in three people in
our global village is using social media.

Add to that that customers want to be perceived as product experts. They want to be
curators of content. A 2012 article in Fast Company actually called content curators “the
new superheroes of the web” and stated: “Yesterday, 250 million photos were uploaded
to Facebook, 864,000 hours of video were uploaded to YouTube, and 294 BILLION e-
mails were sent. And that’s not counting all the check-ins, friend requests, Yelp reviews
and Amazon posts, and pins on Pinterest.”ix

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For all this volume to happen, people need stories to tell, and brands, by providing a
differentiated experience, can provide just that. Curation is about surveying what is out
there and making a judgment about what matters and what doesn’t, drilling down to the
essence and telling the story in a way that is compelling and educational. It is, at the end
of the day, an act of passion, and to inspire passion, brands need to have a great brand
emotional bank account with their customers, meaning organizations should give them
(value) more than what they take from them (price). A brand starts this emotional bank
account by setting the right expectations about its purpose, why it came to be, what
added value the brand brings to the world and to the customers ’ lives, and how it will
make it easier for people to get the job done. An excellent example of this clarity and
setting the right expectations is Google’s mission statement: “to organize the world’s
information and make it universally accessible and useful,”x and everything that they do
is around that. Think of Google Maps, Google Analytics, Google Converter, Google
Translator, and so on.

Therefore, brands need to inspire people. They need to make people love them more if
they want to have brand advocates who will freely do marketing for them in this age of
social media.

- Globalization
Globalization has been defined as “a process of interaction and integration among the
people, companies, and governments of different nations, a process driven by
international trade and investment and aided by information technology. This process
has effects on the environment, on culture, on political systems, on economic
development and prosperity, and on human physical well-being in societies around the
world.”xi The rise of globalization is exposing consumers to different influences than just
their countries or location. We are now—because of all the technology advances—able to
know what is going on in another part of the world immediately. Therefore, more than
just focusing on a simple product-centric approach, companies are looking to establish
global brands. This is mostly due to the way these brands are perceived by customers.xii

26
There are two perspectives on globalization in terms of consumer behaviors George Ritze
believes that globalization is leading to a uniformization of the culture. The western
culture, because of its power, has its values and ways of living being shared throughout
the world and becoming part of other cultures customs and therefore strongly
influencing consumption.xiii On the other side of the spectrum, you have Kevin Robins,
who sees globalization leading to a greater diversity of cultures rather than uniformity,
seeing what global brands offer as an extension of what is already locally available.xiv

27
He also reasons that an individual’s consumption is based on a way that is relevant to
him or her, which of course also leads to greater diversity. That can be seen in the long-
tail concept, which was developed by Chris Andersonxv. This idea shows how pre-
Internet, we lived in a world of hits where only best sellers were commonly available,
and post-Internet, even products that are not as popular, products that are really niche,
can be available and accessible via online stores. This is because it is difficult for physical
stores to sell “niche within a niche” products; they take up shelf and storage space in a
way that is unprofitable for the seller. Online stores, however, don’t have the physical
constraints of brick-and-mortar stores. Therefore, sellers can have a larger selection and
make money through the aggregated sales of those products. Thus, long tail wouldn’t
have been possible prior to the Internet. Amazon is a pioneer in e-commerce and an
example of the long-tail theory. That is why it can call itself “Earth’s biggest selection”;
the sheer number of products it has listed for sale surpasses that of any physical store.

Because global competition has become so fierce, it’s been called a red ocean because of
all the blood spillage. And to be fair, even blue oceans struggle after a while. Products get
copied all the time because the whole world has access to information. Whatever you
come up with in Portugal can be mimicked in Brazil. And the product can be improved
upon, sold at a cheaper price, or both.

Remember when you had to wait for something to finally be sold in your country or for a
friend to travel abroad to get it for you? Those days are over. The Internet allows us to
buy products online, even those that are so niche they’re hard to find in brick-and-mortar

28
stores in any part of the world, which then, without further hassle, appear at our
doorstep. We can now pretty much search the world for the products we want.

A few years ago, I was organizing an event, and we wanted to have particular type of
straws for people to drink from, the kind of thing that is only huge when you are
planning big events. We looked all over Europe, and we found straws that matched our
requirements exactly, but they were very expensive, especially for the number we
wanted. After a few Google searches, we found Alibaba Express, and guess what? A
lovely lady in China was selling the same exact straws we wanted for a fraction of the
price, even including the shipping charges. When we got the order, not only was it neatly
packed, but it also included a lovely card from her. That is a winning formula.

Thus, for businesses, competition is now literally everywhere. The “easy access to
information and friction-free purchasing is making consumers agile and less loyal.
Technology and social-network-enabled shopping strategies will allow this trend to pick
up steam well into the recovery and beyond.”xvi Consumers have never had so many
products available to them, which means that a good product is merely the entry vessel.

- Availability of products
On the last factor, I mentioned that consumers have more products available than ever.
This extensive range of choices combined with a lack of time makes customers less loyal.
It is increasingly harder to get people’s attention because, with so many offers and so
much information constantly bombarding them, it is only natural that they ignore what is
not actually relevant to them. Companies often seem to forget that customers only care
about themselves and what suits them best. You also have to acknowledge the fact that,
in most western countries, people have reached lifestyle levels at which their basic needs
are covered, the levels of comfort are high, and time is scarce and therefore precious.

In our current society, technology is shaping the way we live, and one consequence of
this is that we are overloaded with information, always on, and we are becoming more
impatient. We want everything fast and easy. As a reaction to that increasing overload,
customers are also focusing on mindfulness, on the artisanal—few but unique, highly
customized products, which in many instances they can cocreate alongside the brand.
We can even consider for reference the Maslow pyramid of needs (figure 4.9.)

People in most western countries are now looking into self-actualization and self-esteem.
“Because the new consumer largely exhausted the things he must buy, he is focusing
instead on what he wants to buy and is, therefore, looking for opportunities and
experiences that could make life happier and more satisfying.”xvii

As you will see in the figure 4.10, the results of a study done by JWT Intelligence
regarding consumer trends for 2014 and beyond seem to confirm the conclusions above.

29
30
31
The study concluded that people prefer experiences over things and have a desire for
immersive experiences. They no longer only want products; they want experiences. What
stood out for me was the fact that the results were consistent among all three generations
that were analyzed. Millennials, generation Xers, and boomers were all asked if they
valued experiences more than material items, and 77 percent said they did. So this is not
a just a generation shift; all three generations crave experiences.

Make no mistake—at the end of the day, what people want from a brand is something
they can talk about at home, at work, and wherever else they go. This is called social
currency, which “is a common term that can be understood as the entirety of actual and
potential resources which arise from the presence in social networks and communities,
may they be digital or offline. It derives from Pierre Bourdieu’s social capital theory and
is about increasing one’s sense of community, granting access to information and
knowledge, helping to form one’s identity, and providing status and recognition.”xviii
Social currency is made up of six dimensions. (See figure 4.11.)

This concept has become increasingly important due to the rise of social media. Keep in
mind that everyone now has to produce content, and the experience a brand provides
them will give them just that. For companies social currency is critical because it drives
brand loyalty. Based on his study about brand social currency, Eric Joachimsthaler, CEO
of Vivaldi Partners, believes that companies should use social currency as a way to
measure brand value. There seems to be a correlation between high social currency and
premium price, meaning that brands that have it can demand higher prices. However, it
is essential to understand that the importance of the six dimensions that make up social
currency varies by brand category, Kellogg School of Investment professor Philip Kotler
states that, for example, “Harley-Davidson gets a high return on social currency, but
Crest toothpaste would not profit from investing in building social currency.”xix

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 - The difference between customer expectation and what companies deliver
In the Bain & Company article “Closing the Gap,” the authors explain how, in a survey of
more than 350 companies, 80 percent of those companies said they delivered a “superior
experience.” Bain quizzed those companies’ customers, and the results were entirely
different; only 8 percent of the customers agreed that those organizations were indeed
delivering a superior experience.

So why the disconnect?

Traditionally, companies have been product-centric, meaning the goal is to provide the
best product for the customer. Thus, they focus on what they believe is best for the
customer, without a real understanding of why, how, and when people use their
products.

I remember reading The Little Red Book of Selling, a book by sales guru Jeffrey Gitomer
many years ago and being surprised to find out that companies typically don’t know
how to answer the most important question of all—why customers bought from them.”xx
How could companies not know or even try to understand why their customers bought
from them? How could they expect their businesses to be sustainable in the long term
through ups and downs with all the changes in the world if they didn’t have the answer
to that question. The fact is they didn’t, and today, in the big-data era, most of them still
don’t.

33
Alexander Osterwalder, the author of three of my favorite business books—Business
Model Generation, Business Model You, and Value Proposition—mentioned that in a
workshop in Oporto, he kept asking this simple question: “What’s in it for the
customer?” Attendees kept answering with their views of how people would benefit
from the products and—surprise, surprise—they were normally product focused, talking
about features, and so on. Peter Drucker said, “The customer rarely buys what the
company thinks is selling him. One reason for this is, of course, that nobody pays for a
‘product.’ What is paid for is satisfaction.”xxi

Many years later, the same truth still applies, now more than ever. Product-centric
companies do not use the lens of the customers to truly understand who they are and
their journeys, needs, and emotions to find out what the best solution for the customers
is. They end up having disengaged customers who are merely satisfied and therefore
available to go to next competitor that offers even the slightest improvement on their
product. Startups end up failing completely because they follow this “if you build it, they
will come” mentality. People will come only if your offer helps them with whatever pain
point (problem) they have or job they have to accomplish. When a business forgets its
customers, customers forget about the business. That is why the most successful brands
tend to be CX leaders. Brands like Apple, Southwest, Starbucks, and Disney, which I
have already mentioned and will keep on mentioning, because the unfortunate reality is
that there aren’t that many other organizations doing it right. Steve Jobs said it best when
he said, “You start with the customer experience and work backward,” because it is truly
only through that exercise that you will uncover the expressed and unexpressed wishes
of customers, and a lot of time, the pot of gold lies in those unspoken needs when you
tap in to something even before people had consciously realized they needed it (figure
4.13.)

The world is changing and what people want and expect is also shifting. Customers
expect experiences that are both effortless and convenient because they have less time.
This means that companies must find new ways to engage and retain people’s attention.
As previously mentioned, most companies tend to be product-centric. Nevertheless, if
they want to close that gap, they must start with the customer, and this requires a
significant change in perspective for most companies.

Innovation is not the myth of the creative, elusive genius that says some people have that
gift, and others don’t. Innovation is a muscle, and with structure and practice anyone can
achieve it. Companies need to use the available tools, like customer journey mapping,
which traces the journey of the customer as he or she experiences the product;
visualization, making it tangible and concrete; storytelling, the importance of which we
see rising because it is an excellent way to convey a message and brings the listener along
on the journey; and so many other tools. In summary, they must take full advantage of
design thinking for innovation if they want to understand their most profitable
customers and help them get the job done, in a way that ensures they keep coming back
and recommend the products to others. In other words, brand advocacy.

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 - The generation shift
As mentioned before, we are in the midst of the biggest generational shift of expectations
and behaviors in history. All the previous socioeconomic factors significantly contributed
to that change. Millennials, or generation Y, have a very different set of expectations than
those in previous generations—generation X, boomers, traditionalists. They also have a
strong influence on the other generations’ purchasing habits, so it’s worth understanding
this cohort, which in 2015 represented two billion of the world’s total population and was
estimated to have a global spending power of 2.45 trillion euros.

Millennials have been severely affected by the financial crisis of 2007 and 2008 (factor 1).
The crisis reduced job opportunities, allowed companies to pay lower salaries, and put
people in more precarious working conditions. This is why this generation is known as
mileurista/mille euro in Spain and Italy and as the seven hundred euros in Greece. In
Portugal I called them the unemployed generation, because in 2014, 26 percent of people
under thirty in the country were unemployed. Because of this, many have left the
country or still live with their parents or are financially supported by them.

This combined with globalization (factor 3), plus the fact that are they living their lives in
an ever-changing world, and all the newly available technology, including the web 2.0
(factor 2), has molded their lives.

35
The study done with millennials in the United States by Goldman Sachsxxii showed that
the largest generation in US history, when asked how important it was for them to buy
things that other generations always aspired to have, gave the following answers:

- Purchase a house: 40 percent deemed it extremely important; 30 percent

important but not a top priority.
- Buy a car: 30 percent considered it extremely important; 30 percent important
but not a top priority.
- Purchase a TV: 15 percent deemed it extremely important, 30 percent important
but not a top priority.

Based the results of the survey, it’s clear that millennials don’t have the same wants as
the generations before them.
Goldman Sachs called the group “the renter generation” because they would rather share
and rent than actually own, which is giving rise to the concept of the sharing economy.
You can see this in the growth of businesses whose primary focus is renting things, either
clothes—for example, Chic by Choice—or cars like RelayRides, hailed as the Airbnb for
cars by Fast Company. This is a noticeable impact of the financial crisis (factor 1).
Millennials are very price conscious and want to play it safe because their economic
conditions are less favorable than those of previous generations. Also, technology allows
these businesses to exist and flourish. We must understand that almost all the
information consumed by the millennials is experienced electronically. This is a tech-
savvy generation.

They base their purchasing decisions on a combination of quality and price first and
convenience secondly. The utility aspect is also extremely relevant. This means
millennials are changing the meaning of luxury and therefore how luxury companies do
business. Luxury is now being redefined as high tech, easy, utilitarian, and inclusive.

Millennials like to be seen as product experts, which links to social currency, mentioned
in factor 4 (availability of products). They also like to cocreate and truly have a dislike for
mass marketing, preferring curated content instead, since they trust the opinions of other
customers more than the organizations’ marketing.

This represents a challenge but also a great opportunity for brands, in terms of brand
advocacy.
In a fast-paced world, which overloads people with information, millennials see time as
the ultimate luxury. They believe in work-life balance and want it. They don’t see health
as simply ensuring you don’t get sick, but as part of overall well-being. This is
observable in the explosion of health clubs that look more like high-end nightclubs,
some of which, like Equinox Fitness, are very exclusive, and the sportswear industry,
with top designers and celebrities either designing or collaborating with top brands.
Companies like Nike are ahead of the trend and have aligned their value proposition

36
with products like Nike FuelBand. Let me not forget the rise of mindfulness, which
ranges from meditation, with apps like Headspace, which teaches you how to meditate,
to coloring books for adults. The popularity of these books is so high that in April 2015,
the bestselling title on US Amazon was not one of the usual suspects but in fact illustrator
Johanna Basford’s coloring book for adults.

FutureCast, a company dedicated to the study millennials, says they are digital natives at
their core, with a strong desire to change the world, which affects the way companies are
doing business. There seems to be a rise in social entrepreneurship, which Forbes
magazine called the new black. This type of entrepreneurship is, per Ashoka (an
organization devoted to supporting social entrepreneurs), all about innovative solutions
to the world’s most pressing social problems.

One example of this trend is TOMS (Shoes for Tomorrow), which was started in 2006
with the promise that for every pair of alpargatas sold, another pair would be given to a
child in need around the world. Eventually, as the organization’s product portfolio grew,
the same model was applied to their other products. This became their famous one-for-
one model. This model was such a success that it has been widely copied, and Bain
Capital acquired 50 percent of the company in 2014, when the organization was valued at
€581 million.

Overall, millennials seem to be very keen on entrepreneurship.

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38
 Chapter 5
Relentless Alignment

Strong alignment accelerates success. Poor alignment creates confusion, delays,

and competitive risk.
—Forrester Research

By first looking at six factors that led to the rise of CX, we were able to start from the
beginning, which is for me the only way to truly understand why it has emerged as the
single most important aspect in achieving success for companies in all industries.xxiii

The takeaway from it is that customers are now more empowered and connected than
ever. This means that for organizations to succeed in this “age of the customer,” they
must leave behind the old product-centric mentality dogmas like the quote from Henry
Ford: “If I’d asked customers what they wanted, they would have said faster horses.”

Now is the time to use customer experience for what it is: a competitive advantage that at
its core has the real understanding of the customer’s needs, wants, and pain points,
enabling an organization to continuously improve the experience it delivers and drive
innovation that will allow the business to evolve and thrive in the long term.

When working with an organization’s business, I typically use the LEX model (see figure
5.1), a continuous process model, not only to assess the company’s current alignment, but
also to show how everything is linked and why the customers should always be front
and center of every one of the company’s decisions. We will discuss this model in greater
detail in chapter 11.

39
Relentless alignment is by nature difficult, and as the organization grows, it becomes
even more challenging. Companies are struggling, for example, because technology is
evolving so fast, it’s tough to simply keep up. That is why we see a company with “many
channels” instead of multichannel or omnichannel, where nothing seems linked, and the
customer is left trying to figure out how to get himself out of the maze of channels the
company has created. This is no way to succeed. Anything that a business is not doing,
someone else will, and as soon as there is something better, you are out. That is why the
most successful companies right now are frequently the ones that provide a great
experience, allowing the customers to move seamlessly from one channel to another in
the way that best suits them, while always ensuring the experience is useful, easy,
desirable, and exclusive to that brand. For this to happen, companies must focus on being
relentlessly aligned, which at the end of the day is about reliability, meaning customers
know what to expect, and get what they expect always, with a few wows in the middle.

How does an organization achieve consistency, which is what leads to reliability and
therefore trust?

By ensuring that everything flows from strategy.

40
I always say the first question to be answered is “What is the business purpose?” That is
the fundamental question, the basis from which everything must grow. That way, when
in doubt, leadership and the organization can always go back to that. More often than
not, the answer I get is “to make money,” which is, of course, the ultimate objective.
Indeed, no business is sustainable, regardless of how noble its purpose, if it is not
profitable. Furthermore, it needs to succeed financially if it wants to continue doing
good. However, making money is a result, because in business, human relationships will
always precede financial results.

Your brand needs to convey to the world your business strategy, why you are different
from all others out there. Any gap between the strategy and the brand and you start
seeing brands doing things that do not reflect what the organization is. Suddenly, its
seems like they are everything and anything, diluting the value proposition, which
causes a severe impact on the business.

Finally, your CX puts in place actions that continuously bring your brand
promise/business purpose to life. It is your “reliability engine.”xxiv

Companies that have these three pillars aligned are the most successful businesses
because they can create and deliver a unique, memorable, tailored experience to their
customers. Just think of the Apples and Nikes of this world; those are the organizations
getting market share.

41
Strategy

In real life, strategy is actually very straightforward. You pick a general direction and
implement like hell.
—Jack Welch

Something that should be clear from the get-go is that whatever CX strategy a company
puts in place, it must above all add value to the business purpose (i.e., it should derive
from it, not be a Band-Aid put on top of it).

Therefore, it is always relevant that when developing the organization’s customer

experience methodology, the company looks at its competitive strategy—what is it that
makes people choose the organization’s product over all competitors out there? Is the
value proposition clearly understood? Which of the three value disciplines—customer
intimacy, performance superiority, operational excellence—have you decided to use to
deliver superior customer value? Because this is what you will be bringing to life through
your customer experience (figure 5.4.)

Often when I’m working with an organization, it seems like they are trying to be all
three, which frequently translates internally to conflicting goals and a lack of a line of
sight (i.e., how everyone describes the way their current work contributes to the bigger
picture). Traditionally, each silo tends to focus only on its expertise, so when this “we are
everything and anything” is in place, you literally see people from the different silos
defining the organization’s competitive advantage from their own point of view. This is,
at the end of the day, a symptom of many serious issues, which often involve leadership
and/or another common evil, lack of strategy. Externally, the customers get confused
because the brand keeps sending mixed messages—think a luxury hotel with cheap
toiletries. Most of these happen in organizations that have no clarity of purpose and
don’t seem to be able to get out of their own way.

42
A business needs to be great at one of the value disciplines, as that is what it will be
known for. For example, BMW is clearly great at performance superiority; its mission
statement (“The BMW Group is the world’s leading provider of premium products and
premium services for individual mobility”)xxv is aligned to that. At the other two—
customer intimacy and performance superiority—it needs to be good. Notice I said good,
not average or acceptable. Undoubtedly, if BMW does not have a service aligned to the
expectation of their luxury/premium customer as to how he should be treated, or if it
does not manage its processes in order to increase efficiency and effectiveness, it won’t
exist for long, regardless of how great the product is.

Let’s imagine for a second that a brand-new bakery—Delicious Bakery—just opened

close to your home. It sells the cheapest bread in the whole city, plus the bakery is
beautiful. It has lovely employees who truly have a passion for serving and who actually
seem to anticipate customers’ needs. However, the cakes, bread, and other products they
sell are just not that good. Would you continue to buy your baked good at Delicious
Bakery? Even if you did, because you were a merely satisfied customer, as soon as
someone else could deliver the same level of service at the same price but with a better
product, you would change immediately (figure 5.5.)

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Let’s look at two companies that set the benchmark across industries—Ritz-Carlton,
which focuses explicitly on customer intimacy, and Apple, which focuses on the product,
i.e. performance superiority.

The hotel chain mission statement is one of the most complete:

The Ritz-Carlton Hotel is a place where the genuine care and comfort of our
guests is our highest mission.

We pledge to provide the finest personal service and facilities for our guests who
will always enjoy a warm, relaxed, yet refined ambiance.

The Ritz-Carlton experience enlivens the senses, instills well-being, and fulfills
even the unexpressed wishes and needs of our guests.

This is supported by its motto: “We are Ladies and Gentlemen serving Ladies and
Gentlemen.” This motto exemplifies the anticipatory service provided by all staff
members.xxvi

44
It is absolutely clear from this that the Ritz-Carlton focuses on a tailored solution,
excellence service, and building relationships, so it needs people with excellent
interpersonal skills who have a passion for service. The company is not trying to have the
most innovative hotels in the world. The hotels match their strategy with an excellent
experience that involves all five senses, but they are a vessel for the company to deliver
its legendary service. Apple, on the other hand, is focused on the products, their cool
slick designs, innovative features, and technology. The company mission is “Apple
designs Macs, the best personal computers in the world, along with OS X, iLife, iWork
and professional software. Apple leads the digital music revolution with its iPods and
iTunes online store. Apple has reinvented the mobile phone with its revolutionary
iPhone and App store, and is defining the future of mobile media and computing devices
with iPad.”xxvii

It couldn’t be clearer what value discipline Apple is pursuing. To deliver it requires

creative people, an environment that fosters creativity, and a structure driven by research
and development (R&D).

Just like the Ritz-Carlton with its renowned leadership center—a business that became
possible because it was the first organization to win the Malcom Bridge Award, the
prestigious continuous improvement recognition, twice in a row. This ability to focus
relentlessly on the strategy has allowed Apple to be more than just a computer company.
It has disrupted the music industry, the watch industry, and the Internet business and
created products we didn’t even know we needed but now can’t live without.

This success doesn’t happen overnight, and it requires leaders to have clarity about the
business purpose and use it as the beaming light to define their strategy and articulate it
clearly in their mission statement and in everything that flows from it.
Both organizations discussed above live their purpose inside and outside the
organization, to the extent that Apple is now synonymous with innovation and Ritz-
Carlton with excellence in service for all industries. Apple even took some cues from the
Ritz-Carlton on how they train the staff at their stores, even going so far as to copy and
adapt to their brand the famous Ritz credo card.

This happens because clarity of purpose allows these organizations to build an

experience that can connect at an emotional level with their customers and, more
importantly, with their collaborators, who are the ones who deliver the experience every
day. (I will discuss this further in chapter 6.) Your business model needs to have adding
value at its core and be crystal clear about how it will be achieved.
Tools like the brilliant business model canvas from Alexander Osterwalder and Professor
Yves Pigneur also help drive not only innovation but also strategic alignment. It forces
you to look at the organization as a whole through its nine blocks—value propositions,
customer segments, customer relationships, channels, key activities, key resources, cost
structure, and revenue streams—and refine it until it is a vessel to deliver the business
purpose. xxviii

45
This relentless alignment allows companies to clearly define who their customers are,
how they will help them, why customers should buy their products, and how they can
generate revenue in the strategy stage. This also allows the organization to understand
that “the essence of strategy is choosing what not to do,”xxix which is incredibly
important. The strategy is never concluded; it is a continuous process that allows the
organization to seize the opportunities or overcome the obstacles at hand at any given
moment.

Brand

Brand is the articulation of the business strategy.

—Nader Tavassoli

Once an organization has its strategy figured out, it can start looking at the brand. Put
simply, based on the business purpose and its strategy to bring it to life, how does it
want to be perceived by the world? Why is it different from everyone else out there?
What does the business stand for? This will be shown by how the organization positions
its brand, what the brand values are (these are more than what the organization does;
they also tell what the organization doesn’t do), what the value proposition is, the brand
personality, and of course, customer experience.

As always, let’s start from the beginning. What is a brand?

There are many definitions of brand. I think the term itself, just like customer experience
and strategy, has been used too often and sometimes in confusing ways. I don’t want to
write a thorough description of what brand is, but I will talk at a high level about the
concept of brand, so you understand why CX is so important in the building of the brand
image and the delivery of the brand promise.

46
After studying several definitions of brand, professors Leslie de Chernatony and
Francesca Dall’Olmo Riley concluded that despite multiple descriptions, most of them
fell into twelve themesxxx, which you can see in figure 5.8.

Once they categorized the definition into the twelve brand themes, they grouped them
into two buckets—the company perspective and the customer perspective. The figure 5.9
shows that split.

47
After the study, the professors concluded that “the brand exists mainly by virtue of a
continuous process whereby the value and expectations imbued in the brand object
(product or service) are set and enacted by the firm’s staff and reinterpreted and
redefined by the consumers.” xxxi

48
Thus, while an organization’s traditional marketing sets the expectation, it is through
living the brand internally (collaborators) and externally (customers) that the brand
comes alive. Hence the importance of clarity inside the organization regarding what the
brand is about. If people don’t know, they can’t deliver its promise consistently.

In their 2016 HBR article “Build Your Brand as a Relationship,” Mark Bonchek and Cara
France, state that the first three stages of branding were brands as object, idea, and
experience, and the following wave will be brand as a relationship.xxxii This is 100 percent
aligned with the overall discipline of customer experience, especially in the final stage of
CX—called customer-centricity; maturity; or, as Professor Barbara Kahn defines it,
authenticity—in which there is no separation of what the brand is from the why of the
business, its purpose. It is this raison d’être that connects customers and partners into a
long-lasting relationship with the organization and/or brand that is based on
collaboration and trust. Brands like Nike are in the vanguard of this concept of brand as
relationship. How the brand interacts with its customers is an actual value exchange, a
two-way partnership. Take, for example, Nike’s 2012 London Olympic Games social
media campaign #Findyourgreatness.
In China, traditionally only athletes who got gold medals and broke records were
considered great. Anything else was considered failure. This, of course, had a social
impact; kids found sports intimidating. Aware of this, Nike China decided to align the
brand’s social media campaign with changing mentalities by challenging the status quo.
The company did this by creating a seventeen-day interactive social media campaign
throughout several Chinese social media outlets, which at the time had seven hundred
million Chinese users combined.
Every time an athlete lost or didn’t get a gold medal, Nike validated his or her efforts as
greatness. For example, when China’s top female tennis player, Lin A, lost in the first
round on day one, Nike populated social media with reaffirmations of her greatness:
“Failure is not the opposite of greatness. Not trying is.” Nike did this for both winners
and losers to reinforce that greatness was on both sides. The strategy was successful.

49
Newspapers and sports commentators on Chinese TV started to use Nike’s quotes about
greatness, while celebrities and influencers joined the buzz, giving it more power and
making it their own. #Findyourgreatness was the most talked-about social media
campaign in China. Mentalities started to open up for a shift on what greatness was,
making room for changes in perceptions and behaviors in society.

All this is critical once linked with what was discussed in chapter 3, specifically:

- Marketers no longer have control of the brand image; customers do. They are
the ones who define the brand by what they think and say it is. Remember we
are, after all, in a world where only 4 percent of people say they trust
companies’ marketing, and 90 percent say they trust recommendations from
other consumers.
- All the evolution in the field of neuroscience produced discoveries that show
how emotion plays a critical role in purchasing decisions. Feelings are so
important that Temkin Research, a top CX consulting organization, called 2016
“the year of emotion.”xxxiii Forrester Reasearch, in its latest study of customer
satisfaction, concluded that how people feel after interacting with the brand
trumps satisfaction and ease as an indicator of customer loyalty. Consequently,
how the customer feels about the interaction, which is their perception of what
happened, is far more important than what you do. This means that how you do
it is as—or dare I say, more—important than what you do, because it is about
emotions. Relationships only exist if there are feelings and reliability.

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It is in that emotional connection that you will get your brand advocates, which you need
to ensure long-term sustainability. (More on this in chapter 6.) Giving people what they
want is a now basic in business; everyone is expecting at least a good product or service.
There is an old saying in marketing: “if you want to kill a bad product fast, just apply
your best marketing to it.” It is becoming evident that what is currently more important
is how people feel when interacting with the organization. This can lead to the
conclusion that ultimately it is about happiness.

Warren Buffett, the oracle of Omaha, has stated that he likes to be in businesses where
people come away happy; hence his investment at companies like Disney and Coca-Cola.
Another business success story comes from Tony Hsieh, CEO of Zappos, an online store
that started out selling shoes and eventually expanded to other apparel items. When
talking about his business and its enormous success, he said that his company is in the
happiness business, and shoes are merely the vessel to deliver what they call happiness
in a box. They could sell other things, but they would always be in the happiness
business. This brand purpose based on the positive emotions of both customers and
employees is reinforced by relentless alignment to its loyalty business model. This
business model is focused on ensuring that resources are employed so as to increase the
loyalty of customers and other stakeholders to meet or surpass its corporate
objectives.xxxiv

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One of the outputs of this business model is the relationship marketing that Zappos uses,
which focuses primarily on customer retention rather than on just making another sale.
All this combined generated so many brand advocates internally and externally that
Zappos’s financial results were again a confirmation that human relationships always
precede successful bottom-line results. Zappos was sold in 2009 to Amazon in a €1.1
billion deal.

Now more than ever, brands need to be far more than logos or taglines. In this heavily
commoditized world, the brand can be an essential differentiator. David Ogilvy defined
brand as “the intangible sum of a product’s attributes”xxxv because of the feelings the
product evokes. Accordingly, it is about emotions and the experience it creates because
of them. We can then easily say that brand is the perception that customers have of the
product or service.

In this setup, CX is, therefore, of paramount importance to businesses because it

translates the brand promise into concrete actions and behaviors that the organization
must put in place.

As previously mentioned, Nike has always been at the forefront of innovating around the
customer experience and what a brand is. The company has evolved from selling
running shoes to providing a running experience through Nike+. The slogan for Nike+ is
“Your Personal Trainer. Anytime. Anywhere.” How does Nike transform that promise
into a reality?
Nike now sells shoes with sensors or wristbands (Nike FuelBand). This equipment
records how you run, and information on how you can improve your running is then
provided to you via an app. Based on the brand’s personas, Nike developed three apps
that their customers can choose from:

- The Nike+ Running app, which focuses on monitoring your progress. You can
share results with friends and even show the level of running you are in by
displaying the color of the level on your wristband. You can compete with your
friends by sharing result or invite them for a Nike+ challenge, and you don’t
even need to be together to do it.
- The Nike+ Fuelband app is focused on getting you more active every day by
transforming everyday activity into NikeFuel. It is about keeping you motivated
to move and be healthy. It’s a product for people who are short on time but still
want to be active.
- The Nike+ Training Club app is about community and being social while
exercising. You can choose a team and train with other people. You can take
pictures of the training, personalize them, and even post them on social media.

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The three apps focus on the different personas’ needs, wants, and emotions to help and
support Nike’s customers in attaining their individual goals. We will discuss what
personas are and how important they are in today’s business in chapter 8.
Nike’s case is an excellent example of servitization, which is defined as “the delivery of a
service component as an added value when proving services.”xxxvi

What is servitization? Companies that were mainly focused on manufacturing or even

agriculture are now moving toward becoming product-service systems. This business
model, called servitization, means that products are integrated into the services. We can
directly link this to the fact that in developed economies most products have been
commoditized and markets saturated, making it difficult to compete and survive based
on product alone.

Another example of servitization is a Portuguese agriculture company called Quinta do

Arneiro. This company produces organic vegetables and fruits and has developed a
subscription service. Weekly or every two weeks, in the comfort of your home, you can
get a curated selection of seasonal organic vegetables, and you can personalize your
basket. It is a classic product-service system case.

Customer experience

The customer is not dependent upon us—we are dependent upon him.
The customer is not an interruption of our work—he is the purpose of it.
The customer is not a rank outsider to our business—he is a part of it.
The customer is not a statistic—he is a flesh-and-blood human being completely equipped with
biases, prejudices, emotions, pulse, blood chemistry and possibly a deficiency of certain vitamins.
The customer is not someone to argue with or match wits against—he is a person who brings us
his wants. If we have sufficient imagination, we will endeavor to handle them profitably to him
and to ourselves.
— Kenneth B. Elliott

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Once the organization strategy is defined and the brand figured out, the next step is
working out how to bring them to life consistently through actions and behaviors. In
other words, you need to build your reliability engine, and that is what CX helps you
achieve.

Throughout this book, I have been providing information about customer experience,
what is it is, and why it is important. Now let’s take a look at its formal definition. I want
you to bear in mind that there are a lot of descriptions of customer experience out there,
mostly because the definition depends on which angle you are looking at—usage, habit,
or living.
I prefer Forrester’s definition, which is “Customer experience is the perception that
customers have of their interactions with the organization.”xxxvii I prefer it because it
embodies a combination two important perspectives:

- The customer view, which is outside-in, as customer experience is dictated by

all the interactions customers have with the company.
- The organization’s view, which is inside-out, which means that to deliver the
experience in a consistent way, the company needs to have a holistic view of
how the organization offers the end-to-end customer journey experience.

Let’s look at the following scenario.

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Nanny Phee is a company whose purpose is to help parents raise healthy and happy
babies. The company’s CEO states that its mission puts the customer right at the center of
everything the organization is and therefore does. The company fulfills this intention
through its business model, which evolved from manufacturing to a product service
system to keep up with changes in consumer needs, market changes, and trends. Years
ago, the company only manufactured and sold baby products such as baby bottles, breast
pumps, and clothes, but nowadays Nanny Phee also provides parents advice, support,
and guidance through its My Nanny Phee services. Basic services are free; however,
premium services, including My Nanny Phee bracelets, which allow parents to monitor
their babies’ health indicators around the clock, and a dedicated virtual nanny, are paid
through an annual subscription. When parents have questions or doubts or need
anything related to the baby, they can contact their nanny through a dedicated number,
their Nanny Phee app, the website nannyphee.com, and physical stores through the
country. The customer-facing collaborators are called nannies. They are specialized
pediatric nurses and graduates from top nanny schools such as Norland College. Their
role is to ensure that all parents have the right information, tools, and guidance at the
right time to help raise a happy and healthy infant. For every Nanny Phee brand product
sold, a similar item is given to a child in need.

The organization targets :

- Customers who are first-time parents, who traditionally still have lots of
doubts and uncertainties about taking care of babies and their needs;
- Working mothers with little time to shop, who can get the products through the
subscription process just by clicking on a button;
- Parents whose children have health issues such as asthma or other diseases that
require constant vigilance;
- Parents who just want to have greater control of the situation; and
- Parents who like anything social, as the premium services allow them to take
part of an exclusive community of parents, where they can post pictures, discuss
parenthood and baby-related topics, and attend private events both online and
offline.

Nanny Phee’s tagline is “Together for healthier babies.” Its value proposition is to make
it easier for parents to take care of their children by providing them expert assistance and
top products.

Now let’s envision for a moment (only don’t panic) that you are soon to be a first-time
parent. You get a personalized e-mail from a company called Nanny Phee, which you
have vaguely heard of somewhere. The e-mail congratulates you on the good news and
provides a detailed map of your area of residence, which includes the nurseries,
kindergartens, parks, pharmacies, pediatricians, and baby product stores, with
customer/user reviews to help you decide. It also provides the name of a personalized
contact for you to call in case you need more information about raising a happy and
healthy baby.

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You don’t know if it is because this is your first child or because the e-mail was so
personalized that it seemed that Caroline, the person who had written it, knew you and
your needs well, or because it was such a friendly e-mail, but you decide to call the
number provided.

The person on the other end of the line greets you by your name in a warm and cheerful
tone of voice and says she has been waiting for your call and is delighted to be speaking
to you. She introduces herself as Caroline, your Nanny Phee nanny. You strike up a
conversation with her, which is very informative about some of your doubts regarding
the last pregnancy trimester and taking care of newborns, but you also talk about the
Nanny Phee. To your surprise, nanny Caroline doesn’t try to sell you anything. She is
more focused on helping you. At the end of the conversation, Caroline informs you that
she has a surprise gift for the baby that will be delivered to your home in a week’s time.
She also asks you if she can keep in touch and says that she will send an e-mail with all
her contact information, in case you need her help. You can’t help but accept because she
was so friendly and helpful and made you feel as if she cared.

As you hang up, you notice that you have an e-mail from nanny Caroline. In the e-mail is
not only her contact information but also a personal invitation to Nanny Phee’s exclusive
prenatal classes with its chief nanny via the company’s app. You decide to download the
app, and as soon as you open it, you are greeted with a welcome message from your
nanny Caroline. The app is personalized with your name, the estimated date of birth that
you provided, and a countdown to the big day.

One week later, the gift arrives, and it is a teddy bear with a key for you to take to your
nearby Nanny Phee store whenever you want. One day, you are taking a walk close to
one of the stores, and you decide to go in and see if this location can accept the key,
despite not being the store closest to your house.

The store is lovely, with a delicate baby smell. The music is soft and mellow, and all the
employees look friendly, approachable, and put together in their uniforms of pastel t-
shirts and overalls. They are working, but each of them stops and greets you with a
warm hello as you pass by. One of them welcomes you to the store with a warm and
friendly greeting and introduces himself as nanny Andy. He asks how he can be of
assistance to you. You show him the key. His smile brightens even more. Nanny Andy
congratulates you on the pregnancy while scanning the code on the key with his
smartphone. He reads the information and using your name, he says that based on your
conversation with nanny Caroline, she had decided to offer you a colic-reducing baby
bottle set from the Nanny Phee brand. He reiterates it’s an excellent choice for you, as the
item was recently named one of best baby product of the year because it visibly reduces
babies’ colic pains. You ask if you can get it there or will need to collect it from the store
in your area. Nanny Andy smiles and says that he would be delighted to give you the

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gift himself, unless you preferred to go to the store near you. He would also record the
present in your customer profile, so if you needed any help replacing the bottle or
obtaining a lost part, the store could assist you immediately.

As you leave the store, you feel happy, excited. It was such relaxed atmosphere. Andy
was interested and assisted you without pushing you into making any purchase. The
colors of the toys, clothes and baby products were so uplifting. The five senses of the
store made you feel comfortable and at ease.
As you are arriving home, you notice you have a message in your Nanny Phee app. It’s
nanny Caroline, thanking you for picking up the personalized gift for your baby and
reiterating her availability to help you. Later that evening, you google Nanny Phee to see
the word on the street (or better yet, the web). The feedback from customers, medical
specialists, partners, and employees on social media, traditional media, and forums
confirms what you felt about the experience and proves to you that Nanny Phee is really
focused on helping parents all over the world raise happy and healthy babies. You share
everything with your partner, especially the stories of the babies whose lives were saved
because of the exclusive technology they have in their bracelet device and the children in
need that the company helps with its one-for-one model. You go to bed with the decision
made that you need to sign your baby up for the My Nanny Phee program.

Great story, but how often do you get such a seamless, effortless, feel-good experience as
a customer? This experience is far from being the norm, despite the 80 percent of CEOs
who claim their companies provide a superior experience. It is almost certainly the
exception, with only a few companies in the world de facto mastering it to its fullest
potential. One can’t stop wondering why this is so. There is nothing in the story that is
impossible. It is simply about human interactions and using technology that is already
available to mass customize in an aligned way with a company’s brand promise.
Processes supported by technology allow the company to have a 360-degree view of its
customer’s experience and consequently better support the customer in his or her
journey, as a trusted friend would. The Nanny Phee story exemplifies the power of
technology to support the consistent delivery of superior customer experience because
when well used, it can indeed help you personalize your services and provide a seamless
experience that is flexible enough to adapt to different customers.

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It is worth diving a bit more into this, as advances in technology have allowed businesses
not only to collect big data but also to interact with their customers through many
channels. It is a challenge but also a great opportunity for businesses to excel when it
comes to building strong relationships with their customers in this time of encouraged
heterogeneity.

Looking at this evolution of the points of interaction—the channels that companies use to
interact with their customer—gives us further clarity about this dichotomy businesses
face (figure 5.17.)

It is important that brands don’t solely focus on having a lot of channels that may not be
aligned and don’t allow companies to have a single view of the customer and customers
to enjoy a seamless experience, as this is the only way to deliver a truly memorable
experience to their customers. Therefore, the question is how companies can provide a
superior experience, in which each customer is seen in 360 degrees?

The answer lies in CX.

This alignment is only possible if, in the words of Jeff Bezos, “you’re truly customer-
obsessed” and “start with what the customer needs and work backward.”xxxviii Because in
order to get into that flow you must walk in your customers’ shoes (empathy) and use
their lens. This is fundamental if you want to understand the job the customer needs to
do and how you can support it.

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“What does all that mean?” you might be asking. Take the following examples: a bank
customer making a savings deposit is not just another transaction; it could be someone
who is putting away hard-earned money for his children’s college tuition. A patient who
checking into the hospital is not just another procedure or a bed but someone who needs
reassurance that he and his health are the most important thing and will be well taken
care off. An airline passenger is not just an occupied seat on a flight from A to B; it could
be someone who needs to attend a meeting that may secure him the job of his dreams or
is traveling to see his family after a year living abroad due to his job. A cardholder calling
the credit card company to say he has lost his credit card is not just another call to the call
center but could be someone who is traveling abroad with no other means to pay for the
hotel and other expenses that he will incur during his stay.

This change of paradigm, which many call an outside-in approach, is at the core of what
CX is and allows you to see things in the way the customer does, what is frequently
called the customer lens, and build from there.
Once that is done you, get the why they need it/use it, which allows you to define how
you will better support them and what you can surely do and offer them.xxxix

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The three Bs

For me, CX can be summed up by the relentless alignment of business, brand, and
behavior, also known as the three Bs model, developed by the London Business School
professor Nader Tavassoli.

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Frankly, in my experience, without such alignment, customer experience is an
incomplete business principle that is never as fruitful as it could be. Everything must
align back.

When I came across the framework, it was like a confirmation of all my years of work,
and it demonstrated that I was not alone in the way I approached the customer
experience discipline. I use the three Bs model regularly, especially when reviewing the
CX strategy of any organization I work with or study. For that reason, I believe it is
worth sharing a very high-level overview of the model with you.

The model’s objective is to help build a strong brand; hence the significant focus on the
need for consistency among what the business purpose is, how the brand represents it,
and the behavior that is portrayed. This reliability allows customers to build trust and the
brand to differentiate itself, which creates fertile ground for turning customers into brand
advocates, while enabling the company to stand out from its competitors in this heavily
commoditized world. The brand flourishes because it is truly the brand essence that
drives everything the organization is and does and thus what is presented to the
customer at every interaction.

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One of the many examples that Professor Tavassoli uses to illustrate his model and its
benefits is the diaper brand Pampers. Pampers moved from a product-centric approach,
in which its focus was the product’s attributes—dryness into better sleep (customer
benefit)—to one that linked it to babies’ development (transformational purpose).

To execute this change of perspective, organizational changes were made. More women
were assigned to work on the brand because of the focus on mothers and children. The
company recruited people who liked babies, regardless of the positions they were going
to fill. Therefore, empathy for the Pampers customers was natural because the employees
themselves either had gone through that experience or shared the business purpose and
its values. The key metrics to evaluate the product also changed to align with the values
of the company, so both were in line with the values of the parents.

Because of this shift in its purpose, Pampers was able to expand its product line. It was
no longer a diaper company; it was a company focused on babies’ development. Think of
Apple when it dropped the computer from its logo because when it changed its purpose,
the brand was far more than a computer company. With its wider scope, Pampers
developed tissues for the stage when a child could clean him- or herself up. The brand
also developed Pampers Village, an Internet community that shares information with
parents about baby development. With the insights gathered, new products such as stage
diapers were also developed.

This new strategy paid off financially. Huggies, one of Pampers’s competitors, was the
top-selling diaper brand in the UK market. However, this transformational process made
Pampers more competitive. Why? In part because of all the insights the company gained,
but also because Pampers significantly increased its number of brand advocates as it
evolved into a trusted friend of parents. Pampers went on to became the number-one-
selling diaper in the United Kingdom, eventually causing the exit of the previous
number-one brand, Huggies, from the market.

Companies that are relentless in aligning their business, brand, and behavior are the
most successful companies. Think Southwest, Nike, Starbucks. Why? Because this
alignment allows them to tackle three of the top challenges of business. By being
relentless, organizations can reduce costs, grow, and improve their customers’
experience. That is what a truly aligned CX transformation can do for you.

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 Chapter 6
CX Fundamentals

Success is neither magical nor mysterious. Success is the natural consequence of

consistently applying the basic fundamentals.
—Jim Rohn

Now that we have a clearer understating of what CX is, it’s time to discuss its essentials.
There are five core components to customer experience. They are the CX strategy,
customer insight, CX design, the employee experience, and CX management. I’ll skip the
customer insight and the employee experience because we will be discussing them in
detail in chapters 8 and 9, respectively. Without further ado, let’s start with CX strategy.

We have already discussed strategy and the need for everything the organization does to
flow from it. Thus, CX strategy resides within the business strategy. It must reinforce and
add value to it and of course to the brand. CX strategy needs to help the business fulfill
its purpose; otherwise, it will be a waste of the organization’s valuable resources instead
of being a competitive advantage. It’s all about, as you’ve probably guessed by now,
relentless alignment.

The CX strategy must include the user experience strategy. These cannot be separated, as
the first is about defining, organizing, and delivering the most effective and efficient way
for the organization to engage its customers and turn them into advocates, which is
exactly where the latter plays a significant role.

A great tool to use when defining your CX strategy is the LEX model, as shown in
chapter 4. More on how to use this model in your business in chapter 11.

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CX design

When you have your CX strategy ready and you have worked on getting valuable
customer insight, it is time to start looking at CX design.

My take on CX design is that it should incorporate everything that has an impact on the
customer experience. I mean every touchpoint, so it needs to include user experience and
service design, because again it is about obsessive alignment and to achieve it everything
needs to fit in beautifully like a puzzle. The more you segment the work, the less aligned
and efficient it will be because with the right strategy, all service design and user
experience flow from the CX strategy. After all, the service you provide is a crucial part
of the customer experience; it literally can make it or break it. Research shows that seven
in ten customers will stop doing business with a company due to a poor service
interaction. Now, are most companies seeing things that way? No. However, research
shows that to achieve the holy grail of business success, this is the way to go. Anything
else will leave you with an almost-there feel. This is why a customer experience
transformation within an organization is not for the faint of heart and requires strong
leadership with a strong sense of purpose. (More on this later.)

Design thinking is a problem-solving approach that is human centered, possibility

driven, option focused and iterative.xl When applied in the context of CX, design thinking
generally follows this process:

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65
You can also use the approach to design thinking developed by University of Virginia
professor Jeanne Liedtka, of which I am a huge fan. At its core, it focuses on answering
the same four crucial questions: What is? What if? What wows? What works?

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A perfect example of great experiences and services that are designed is the luxurious
Cosmopolitan Apartments, in Warsaw. The condominiums are located right at the center
of the city, in the middle of all the buzz; it is the ultimate prime location in Warsaw.
The complex was the vision of Karolina Kaim, a seasoned CEO who brought her years of
experience in the hospitality and leisure industries into the design of the customer
experience of the residential building.

The exercise started with an in-deep analysis to understand the building’s potential
customers—their personas, needs, wants, and emotions. These were people at the top of
their careers, typically businessmen who were always on the go and needed a place in
Warsaw as a hub for all their international traveling and who enjoyed the city’s nightlife.
They valued time, efficiency, and professionalism.

With that knowledge, the Cosmopolitan team created an experience of ease, comfort, and
beauty that is effortless and allows the apartment owners to take maximum advantage of
their scarce “me time.” The sales stage also allowed the team to collect feedback from not
only potential customers but also customers who had purchased apartments, which
helped them refine the CX design.

Armed with all these insights, they developed an experience that includes a concierge
service that is available seven days a week, in person, by phone, and through a dedicated
web platform. Thanks to this, the residents are kept up to date on the newest and most
interesting events. Cosmopolitan’s concierges assist the residents by arranging both
everyday matters and extraordinary events. Among other things, they book tickets to
cultural events, take care of the residents’ laundry, and even walk their dogs. A fitness
club with a personal trainer and a nutritionist ensures focus on the residents’ well-being.

A distinctive scent was developed for the building. The condominium has five top
restaurants serving food delights ranging from the “Wine Taste by Kamescki,” to
“Ceviche Bar by Martin Gimenez Castro,” and the very French patisserie “Odette Tea
Room.” Employees of the Cosmopolitan embody the value of the brand. Meeting the
building sales consultant Lucja Rosiak, you can see that she not only represents the brand
but also lives it, and through her, the experience is greatly enhanced.

The Cosmopolitan is able to provide a smooth customer journey because, from the
awareness stage through the purchasing and experiencing stages, every detail has been
taken into consideration. The team focused on the overall journey and then thoroughly
analyzed into each touchpoint.

Such an approach is strongly aligned with the research from McKinsey that
demonstrated that customer satisfaction is more linked to the customer’s perception of
the journey than to individual touchpoints.

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CX Management

Customer experience management (CXM/CEM) is the collection of processes a company

uses to track and oversee the customer experience to achieve the ultimate CX objective of
turning customers into advocates. This is vital to ensure that you are maintaining and
enhancing the experience you want to deliver in a reliable way. CEM is ideally used
alongside the customer journey map, a design tool that allows enterprises to understand
all customer touchpoints with the organization through the lens of the customer, which
we will talk about in chapter 8. The tool allows greater visibility of the areas that need
improvement and of which touchpoints are the moments that matter. The company can
then measure those moments, identify customer satisfaction drivers, and provide a road
map for projects and CX strategy based on continuous improvement of the experience.

The CEM includes the following:

- CX metrics. Here the focus is on establishing the most critical moments and
factors that influence your experience and determining the metrics to quantify
the quality of your customer experience and allow you to benchmark.
- CX measurement. Once the CX metrics have been determined, you can establish
a CXM program that gives consistent and reliable information you can share
inside the organization, tying it to business outcomes.
- CX analysis. An in-depth analysis of the CX metrics will allow you to
understand why your customers buy from you, why they are subsequently
buying again or going to your competitors, and whether or not they are
recommending your product.
- CX improvements. Once you have quantified your experience and matched it to
the reality of the organization, you can start creating a pipeline of CX projects
that will help you improve the customer experience. This is paramount because
the dynamic and culture of the organization (Jeanne Bliss calls it the “power
core”) will affect which projects are prioritized and how they will be executed.
The number of upgrade projects a company can take on at one time will depend
on its resources, organizational culture, leadership, and other factors.
- CX leadership. Once the CX projects are defined, it is time to establish who will
do what, depending on how the company is structured and how it decides to
manage its CX transformation. From creating the role of a chief customer
officer/chief experience officer to creating cross-functional teams that will tackle
the projects, similar to the six-sigma approach, anything is possible. It all
depends on the company’s strategy. Since internal communication and line of
sight tend to be problems, an organization’s CX journey tends to be a cultural
evolution. It is also important that channels are put in place to communicate the
CX initiatives, wins, and direction, ensuring that all employees can see what is
going on and can reinforce the strategy in their day-to-day tasks.

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It is worth highlighting once more that customer satisfaction is more linked to the
perception of the customer of his or her journey than any individual touchpoint; your CX
management program should take this into consideration to deliver the best results.

The difference between CEM and CRM

According to Bernd Schmitt, “the term ‘customer experience management’ represents the
discipline, methodology and/or process used to comprehensively manage a customer’s
cross-channel exposure, interaction, and transaction with a company, product, brand or
service.”xli CEM has as a focal point the optimization of the end-to-end customer journey.
It has, therefore, a holistic approach that focuses on the outside-in methodology,
ensuring that things inside the organization revolve around and anticipating customers’
needs and wants while providing a tailored experience that allows the company to create
brand advocates.

CRM is about how the organization manages its interactions with its customers and
potential customers. It tends to focus on certain functional areas of the business, such as
marketing, customer service, and sales. It is, therefore, a more siloed approach and tends
to have an inside-out focus—for instance, marketing using CRM to send personalized
newsletters or new product information to customers. CRM is about maximum efficiency
and is traditionally highly focused on generating sales. Because of this CRM tends not to
be enough of a strategy to create an experience that creates brand advocates.

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The four cornerstones of customer experience

As mentioned, the best way to increase the gap between you and competitors is currently
customer experience. The most successful companies are those that widen that gap year
after year by continuously focusing on the experience they provide to their customers
and use the data they gather to get new insights and to improve and innovate. Let’s be
serious here. You are not going to lose customers to a company that is 1 percent, 2
percent, or even 5 percent cheaper; you’ll keep them as long as they are happy with
experience you provide.
To have an effective CX strategy that you can actually implement you need to have in
place the four cornerstones of customer experience. The first is purposeful leadership. I
am a firm believer that only with a great CEO can a business deliver an excellent CX
strategy and therefore a remarkable experience. You see, everything derives from
strategy and solid execution; only great leaders can get a stellar team to develop an
excellent business model and implement it relentlessly. In my experience, anything else
just delivers a mediocre or good-enough experience, and for that, the effort is simply not
worth it.

The second cornerstone is customer connectedness. To provide a great customer

experience, you must not only sympathize, which is about feeling compassion and
sorrow for others, but also empathize, which is all about putting yourself in someone
else’s shoes and walking a good mile in them. To achieve empathy, you must understand
your customers and have a 360-degree view of what they need, their emotions and
desires, and why. This is how you can genuinely help them: not by deciding how you
think they want to be helped (golden rule), but by finding out how they want to be
helped (platinum rule). You need to start with the customer. By asking how, when, and
why, you can help the customer get the job done. You must also end with the customer,
getting his or her feedback, so you are in this continuous improvement cycle of listening
and learning that allows you not only to correct issues immediately (doing it right the
first time), but also to innovate and evolve. That is the path to keeping existing customer
happy and bringing in new ones.

The third cornerstone is compelling brand values, which ties back to what we already
discussed in chapter 5 (and on every other page)—relentless alignment. What you do and
how you do it need to be 100 percent aligned for you to deliver a consistent, reliable
experience. Strategy must drive the brand, and the behaviors must flow from it.
The fourth cornerstone is engaged employees. I’ll be talking a bit more about this in the
next chapter. In essence, this keystone means that in all steps in the scope of talent
management, from recruiting to hiring to managing and developing the talent, you must
ensure you are always tying things back to your business purpose. Having the right
talent adds value to your business strategy.

To be a customer-centric company, the organization needs to be structured in a way that

revolves around the customers’ needs and emotions, but more focus must also be placed

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on the touchpoints with the customer. Thus, in every and any interaction between the
customer and the organization, the quality and consistency are ensured. Nothing is
neutral; the customer will either feel unhappy, satisfied, or delighted after an interaction
with an organization.

I agree with Jeanne Bliss that the CX an organization provides to be its “litmus test.”xlii
Unless there are a clear path and an actual understanding of the company’s values, you
have a schizophrenic brand, and customers don’t like that. Remember that the essential
thing is reliability, not the wows. Putting it plainly, the organization must deliver exactly
what it promises. For this reason, it is important that expectations are set correctly,
because once you set the wrong expectation, it is hard to continue from there. Also,
because customers expect there to be no hassles or problems, you must always deliver
what you promise.

However, as you know, problems happen, so you need to have a robust recovery system
for when things go wrong. This means aligned processes, systems, and tools and
empowered employees. Problems, when properly handled, are excellent opportunities to
show your customer focus and obtain that wow. These issues are to be seen as gifts as
well, since they allow you to make the necessary improvements so you can do it right the
first time. For this to happen, you must become a learning organization, combining the
VoC (voice of the customer) with the VoE (voice of the employee) and VoP (voice of the
partner.
Companies usually ignore the importance of doing it right the first time. From their
inside-out perspective, if one customer had the same issue twice in six months, that
would simply be seen as two issues in the sum of all the company’s interactions, and two
issues are not significant. But from the customer’s perspective, having the exact same
problem twice means the business is not listening and that he or she is not valued, and
that perception is the reality.
On the other hand, if the customer screams loudly enough and the issue surfaces at the
top of the organization, the problem is corrected or at least gets a Band-Aid.

The proper setting of expectations and doing it right the first time are fundamentals
because they are about trust, and trust is the glue that keeps all relationships together.
Consequently, if you don’t get them right, you can never expect to get to a level at which
you can build an emotional connection with your customers, which is the only way to
ensure brand advocacy.

A siloed organization is never the most efficient, effective, and customer-centric

organization. This is not a criticism but a fact. People in a high-siloed culture only see
things from their area’s point of view and don’t see that what they do has an impact on
the customer’s experience and the organization’s delivery as a whole. They tend to be
more focused on the function of their area than on the purpose of the whole organization
and how they fit into it.

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The customer journey typically crosses all the silos because every single department and
function in the company has an impact on the customer experience. Therefore, to be at
maximum performance, a customer-centric company must work internally as a network
in which people with different expertise and backgrounds come together for the same
objective. This is why purpose is so important—it links everything together.

For a company to be truly customer-centric, it must live that ideology from the inside
out. Collaborators need to live the brand values internally so they can deliver and
demonstrate them externally. Accordingly, leadership needs to lead by example, as it
always should, because people will copy what they see.

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The journey to CX maturity

It is quite an investment for most companies to become truly customer-centric because it

means a significant shift in the way they work. As you may remember, most
organizations are and traditionally have been product-centric. They focus on having the
best product for the customer instead of the best solution for the customer.

CX is a broad and complex business principle; it requires a clear strategy to achieve CX

maturity, meaning that what you do, are, and believe (a.k.a. your purpose) drives
everything you do because it is embedded in the organization. Bruce Temkin from the
Temkin Group as defined five stages that companies have to go through to reach this
levelxliii, which Professor Barbara Kahn called “authenticity.”xliv

The first stage is interested.

This is where the company becomes aware that it needs to be more competitive, be more
profitable, and so on. Therefore, the company starts looking at what is out there that
would suit its needs and looking at defining the CX metrics and CX strategy to quantify
the experience. These are the first seeds of the cultural change. At this point, leadership is
the biggest internal driver of the initiative and starts by raising awareness of this new
possibility.

The second stage is invested.

At this point, the company has begun to put in place its CX measurements and has
developed the CX management program to ensure problems will be fixed. Leadership
starts working with the rest of the organization to ensure their buy-in, which is essential
if the CX transformation is to be successful.

The third stage is committed.

Once the fixes have been identified, they lead to the redefinition of processes. Inside the
organization, people start to understand that what is happening is not another “flavor of
the month” and start to understand it.

The fourth stage is engaged.

The processes have been redefined and systems and tools are in place to empower
employees to deliver the experience. A particular focus is placed on talent management,
from recruiting to training, managing, and developing talent. By this time, it is evident to
the organization that its employees must live the brand to deliver its values and
propositions consistently.

The fifth and final stage is embedded.

When it reaches this level, the company has undergone a significant transformation.
Customer-centricity is now part of its DNA, and everything in the organization not only

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embodies but also reinforces it. Employees have gone through a cultural evolution and
are ready to personalize, promote, utilize, and internalize it. At this stage, the company is
living its purpose, and customer-centricity is not only on the minds but also in the hearts
and souls of everyone in the organization. It is, therefore, emotional and personal.

The duration of each stage will vary significantly due to several factors, such as company
culture, leadership, the organization’s size, and so on. Typically, achieving CX maturity
takes from six months for small startup companies to one to three years for more mature,

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bigger, and more complex organizations. So again, a CX enterprise is not for the easily
scared but for those who love to persist and above all persevere, and for that you will
require the by-now-famous (I hope) relentless alignment.

Customer experience in mature companies and startups

I can’t finish this chapter without answering one of the questions I get quite often: “What
is the difference between customer experience in mature organizations and startups?”
This is a relevant inquiry because it allows me to clarify what I believe to be the
fundamental distinction when it comes to CX in both types of organization.

Customer experience in mature companies is mostly about aligning the different silos of
the organization to focus on the customer in order to deliver the brand promise
consistently. Typically, as organizations grow and mature, the status quo and the chaos
settle in, and the customer becomes this sort of distant relative who just means more
work on top of the “real work.” Therefore, CX for mature organizations is most
commonly about changing the culture by making it more customer-centric.

On the other hand, customer experience for startups is about ensuring that from the
beginning, the entrepreneur sets up his or her organization to deliver the business
purpose in a reliable way. This goal should be aligned with the customer needs, so CX
for startups is about creating from the beginning the culture that will enhance and
deliver the brand promise consistently.

In a nutshell, while for the mature company customer experience is mostly about
changing or shifting the culture, for a startup it’s about building a culture that adds value
to its strategy, because as Peter Drucker so correctly said, “Culture eats strategy for
breakfast,”xlv and MIT professor Bill Aulet’s spin on this quote takes it even further:
“Culture eats product for breakfast, strategy for lunch, and everything else for dinner.”xlvi

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 Chapter 7
CX’s Ultimate Objective—Brand Advocacy

The purpose of a business is to create a customer who creates customers.

—Shiv Singh

Creating brand advocates is the ultimate goal of customer experience, both internally,
because you need a highly engaged (some would say inspired) team to deliver your
experience in a reliable and innovative way, and externally, because to have a long-term,
sustainable business, you want your most profitable customers to be brand advocates.
Let’s not forget your partners, who also need to understand what you are trying to
achieve (your purpose) and support you in delivering your experience. In this day and
age, advocacy is not an option but a must.

Brand advocates—external

Your brand advocates are more valuable than any advertisement you can buy.
—Dave Kerpen

A company’s success is defined by how well it creates and maintains its customer base
because to continue to exist it needs to make money, and the customers are the ones who
provide that. So it only makes sense that companies focus on their customers’
experiences to keep that revenue stream flowing in a healthy way.

Studies demonstrate a correlation between satisfaction and loyalty. The better the
customer feels about the interactions he or she has with an organization, the greater the
likelihood of his or her becoming a brand advocate.

Now, satisfaction is only one part of the equation. To achieve brand advocacy, brands
must set the right expectation from the beginning. I always say, it is better to under
promise and over deliver than the other way around. This leads to satisfaction, but it is
also the first stepping stone to achieving customer trust. Whatever the value proposition
a business has, it must always be delivered. Even when things go wrong, you have a
chance to validate your value proposition and show how great you are. Issues are an
opportunity for you to showcase your strengths and to learn, so the problem won’t
happen again (doing it right the first time). This is what takes you to reliability and
makes you trustworthy from a customer perspective. At this point, customers
understand not only that you can help them achieve what they want, but also that you
are what you say you are. That’s another notch of trust.

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Finally, you need to be able to build an emotional connection, and that only comes when
the customer feels he or she is your first priority and that you value him or her, both as a
customer and as an individual. You show this by putting flexibility into your processes
so they adjust to the emotions and needs of different customers. This requires
empowering your employees to truly care for the customer as an individual. For
example, you cannot mix speed with hurry. A customer call should be answered as
quickly as possible; however, once the agent picks up the phone, he or she should take
the time to fully engage and assist the customer, have a dialogue. Some companies
calculate the time agents are on the phone, establish per-call limits, and measure their
performance based on that. That is to mix speed with hurry. Speed is good; hurry is
terrible when it comes to creating brand advocates.

Brand advocacy and profitability

Think for a minute about your favorite brand. You might even feel like you can’t imagine
the world without it. Then ask yourself why it’s your favorite brand.

Brands provide people with social currency by giving them something to talk about at
home, at work, and anywhere else they might go.

By now it is also evident that when deciding to purchase something, people prefer
customer recommendations to traditional marketing. If you take into consideration the
fact that brand advocates normally have a large networks, both online (between two
hundred and fifty to four hundred and fifty people)xlvii and offline, with whom they love
to share their recommendations and opinions about products, you can start to get an idea
of where I’m going here. If you add to that the fact that we live in an era in which more
than two billion people are using the same social media platforms, you can begin to fully
grasp the importance of brand advocates in today’s business success.

I recently read an article that mentions six different types of brand advocates, but the
core is always the same. A customer who is a brand advocate is one who loves the brand,
buys more, has a longer customer life cycle, is less sensitive to price, and is less likely to
“cheat.” He or she has a connection to the brand and therefore will contribute to its
success with ideas and suggestions, defend it from its detractors, and of course talk about
the brand on his or her network.

What are the benefits of having brand advocates?

- On average 65 percent of all new customers are referrals of an existing

customer. Who doesn’t want that, right?

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 - Advocates are ambassadors who recommend a brand without receiving any
form of compensation for their advocacy. They provide reviews and ratings and
support other customers and potential customers by replying to queries and
product problems on social networks. They also defend the brand against
detractors.
- These advocates normally have extensive offline and online networks to whom
they like to recommend the brands they support, so you can appreciate how
powerful their word of mouth is. It’s no wonder they are considered the most
powerful marketing tool. Remember the Nielsen worldwide survey results in
the fast facts infographic in chapter 3.
- On average, brand advocates buy at least twice as much as other customers.
They will purchase your product(s) repeatedly and will be less likely to cheat on
you, meaning they have a higher customer lifetime value (CLV).

Summing up: “Brand advocates are highly satisfied customers who go out of their way to
actively promote products they love and care aboutxlviii, which allows businesses to grow
and achieve better financial results.

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Brand advocacy—collaborators

People make the experience.

—Eliana Medeiros

You are never going to have raving fans (external brand advocacy) unless the
organization is its biggest raving fan first.

Why are your collaborators your ultimate competitive advantage?

One of the main reasons I started Uirtus Academy is that I have always been very
disappointed in how organizations manage their human talent. Professor Larry Smith
said it best when he stated, “Wasted talent is a waste I cannot stand.”xlix I couldn’t agree
more.

So many times, you see people’s talent shrinking instead of growing, either from poor
leadership (the frequent root cause) or because you can only truly be as successful as the
environment you are in. Undoubtedly, we have an issue in this area. This is evident from
the results of a 2013 global study on employee engagement by Gallup, which showed
that approximately 87 percent of the world’s workforce was not engaged with their jobs.
Can you imagine if those 87 percent were actually doing what they loved and
contributing to their fullest potential, which is what several studies have shown is what
the majority of us truly want to do? The organizations we know today would be very
different places, and I have no doubt, based on my experience as a coach, that the
changes would be for the better.

This failure to tap in to something so unbelievably precious moves me at a deep level

because I firmly believe we all are talented and unique, and when in full alignment, what
we give surpasses anything anyone can expect or dream of. This is another reason
purpose is so important.

Let’s imagine you are an accounts payable coordinator at our now-famous Nanny Phee.
It is tough to get up every morning from Monday to Friday for at least 253 days in a year
to insert numbers in an accounting software system, but it is easier and even fulfilling if
by doing so you know you are helping families raise happier and healthier babies, which
are the world’s future. Then you are not in the sell-product business; you are in the
helping-others-be-happier-in-their-lives business, and that’s a whole other paradigm.
Studies show that the latter increases productivity, contribution, and inner motivation,
because humans are wired to do something meaningful that helps others, and that allows
you to do something relevant.

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Now, I know this to be true myself, since I have had the pleasure of leading and
managing world-class teams. I learned that talent—when nurtured and fostered—rises
and delivers above any strategy you come up with or value you expect. That is the power
of talented people when they are “in the zone” (i.e., when they are passionate about what
they do and are valued for it). After all, even Steve Jobs said that to do great work is to
love what you do. The value they bring is unmatchable. You can replace anyone;
however, you will never replace the talent and uniqueness he or she brings.

That is why I prefer to call employees “collaborators.” They are talent who will
collaborate in making your dream as a leader come true, in a better and greater way than
you ever thought possible. Walt Disney clearly understood this, as he famously said,”
You can design and create, and build the most wonderful place in the world. But it takes
people to make the dream a reality.”l Look what his belief has done for his brand.

For people to deliver an excellent, differentiated CX and to be in the zone, you have to go
all the way back to strategy. The strategy defines why, how, what, and who is needed in
the business to deliver its purpose and add value to it consistently. This means that it is
important that companies hire the right talent who will complement their business
strategy, not just because of their skills but, more importantly, because they share the
purpose, values, and behaviors of the organization. One of the biggest mistakes I see
companies making all the time is they want to hire fast, get that warm body in so the task
is done when this is such a high-consequence decision that time should be taken to do it
properly. Skills can be learned; attitude is much harder (close to impossible) to change.
That is why companies like Netflix only hire people who embody their nine values and
the Ritz-Carlton prefers not to fill a position until a candidate is the right match for its
culture. Hiring has tremendous potential consequences, so you need to take some time,
to make the right decision. I have on several occasions taken up to half a year to hire
someone for a position and sometimes even decided not to hire anyone, rather than just
adding another team member because I could or I needed someone. It always proved to
be the right decision in the end.

However, it doesn’t end there; you must continuously train and develop the talent so
that everyone knows and understands the direction of the organization and lives the
brand in their minds, hearts, and actions, always. Stretch assignments are a great
development option, as they combine learning and growing by taking people out of their
comfort zones to experiment with new things, which can shift their perspectives since
they now have more and different information, increasing their understanding of the
business and how they can contribute to it. The line of sight is often underestimated in
business, but the lack of it in an organization can have brutal results.

Rewards are important, and you must pay accordingly. Too little can demotivate, and too
much doesn’t mean employees will be more motivated. There is a delicate balance, and

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that is another reason great leadership is so critical. In my opinion, it is the most
important factor in having an organization in which employees are genuinely brand
advocates. A quick reading of the employee pyramid of needs below, which is the result
of a study by Bain & Company, published in Harvard Business Reviewli,makes it evident
that for employees to get to the top of the pyramid, leadership also needs to do what it is
supposed to do: support, inspire, and create and maintain an environment that keeps
people motivated, unfailingly.

Therefore, one of the reasons I’m such a huge believer in the customer experience
discipline is that there is a clear understanding that people are the ones who deliver the
experience. Traditional marketing sets the expectation, but it’s the people inside the
organization who de facto create and deliver the experience. This means that an
organization is no better than the employees who interact with its customers.

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Hence, collaborators are a core component of CX called the employee experience, or EX.
One of the four cornerstones of customer experience is engaged employees. Why not
merely employees? People who are in the zone, engaged, and inspired bring a lot of
value to the table. Consequently, and unsurprisingly, companies that excel in EX tend to
be extremely successful financially.

Going back to the Bain & Company research on employee engagement, one of the
conclusions of the study was that if satisfied employees were productive at a level of 100
percent then inspired ones—the advocates—would be productive at a level of 225
percent.

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We could then say that a business would need three dissatisfied employees to generate
the same productivity output as one inspired or advocate employee. The Gallup study
mentioned earlier in this chapter shows that this means businesses are literally throwing
billions of euros away.

Other studies also show that 67 percent of customers leave because of indifference on the
part of a company employee. It takes at least twelve good experiences to overcame one
bad experience. Add to that the fact that after a bad experience, people tell at least six
people, or they go online where they can tell hundreds or thousands in one go, you can
see why EX is so important for CX and the business’s bottom line.

So, this is not about a KUMBAYA movement. And we all know very well that when
working with people, things are never going to go perfectly. Instead, it’s about aligning
everything (remember relentless alignment) to ensure you get to the result you need to
keep your business and deliver your purpose for a long time, which is making money—
being profitable. Employees are arguably the most significant contributor to that.

As discussed, organizations must always deliver their brand promises to build reliability,
which leads to trust and allows them to establish the emotional connection that can turn

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customers into brand advocates. For that to happen, you need collaborators to be
inspired employees who are brand advocates and are empowered. Leadership is
responsible for making sure every employee is bringing the strategy to life.

What is the purpose of each person in the organization? It is to bring the mission to life;
it’s the leadership’s role to ensure people have the line of sight and live the mission daily
in their hearts, minds, and souls. Leaders must build a culture that fosters and enables
that; otherwise, the purpose or the plan, however, brilliant it might be, won’t flourish
because culture doesn’t support it.

Research shows that companies with a great EX deliver better customer experiences and
have higher profit margins.

Take, for example, Southwest, which is the most profitable airline in the world.
Originally its mission was “Freedom to fly.” They articulated their mission statement by
having as brand values cheap and cheerful, which would give everyone a chance to
travel. This meant they needed efficient and effective processes, systems, and tools. They
also needed happy employees and a happy culture, which, unlike the cheap, couldn’t be
copied. Southwest knew it had to select people who shared its values and understood its
business purpose, so the organization focused significantly on the hiring process and
talent management.

The company knew from the beginning that it needed a culture that lived and sustained
its strategy. There are metrics and communication in place that allow Southwest
employees to connect the dots between what they do and the goals of the organization.
That gives employees a sense of accomplishment, pride, and belonging, which increases
motivation and the desire to contribute. Their customer-centric culture, evident in the
words of its founder Herb Kelleher, who always said that Southwest was “a customer
service company that happens to fly planes,” is alive and well inside the organization.
This doesn’t happen because of beautiful words but instead because all their actions are
genuinely about making sure the employees live the brand internally and consequently
can deliver it externally in a consistent way.

As a result, they have an outstanding EX and have in their customers an actual army of
brand advocates who are so hard core that on 9/11, Southwest customers literally
donated money to the company because they were concerned its might not survive the
flight restrictions imposed at the time. Southwest’s relentless alignment proved to be the
right thing. It is the airline company that has flown more passengers domestically in the
United States than any other commercial airline, and a quick look at its accomplishments
in the figure 7.6 confirms exactly that.

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Another excellent example of relentless alignment, which also focuses on excellent EX to
ensure it delivers its business strategy, is Union Square Hospitality Group. Its customer-
centric culture has allowed its restaurants to become renowned hotspots and earn several
awards in the hospitality and culinary world, including eleven James Beard Awards,
which are known as the Oscars of the food world. CEO Danny Meyer, when asked about
the ingredients of his success, stated, “The first key [to great hospitality] is hiring people
on your team for whom making people feel good is as or more important that how good
they are at what they do.”lii

So again, it starts with the people inside the organization. Customers don’t love a brand
if the company doesn’t love it first.

The whole employee experience ties in with the what was defined in a Harvard Business
Review article as the service-profit chain, a model widely used to measure the
performance of services.liii It links customer loyalty with employee satisfaction and
internal service quality.

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Partners in the experience

We talked about customers and employees. Now it’s time to talk about another
important pillar of brand advocacy that is often underestimated: the suppliers/partners.
Rarely do companies invest in creating a clear supplier/partner journey map, which, like
the customer journey map and the employee experience map, would allow them to get
insights into not only the moments that matter, but also areas for improvement.
However, many companies nowadays outsource and therefore have other
organizations—their suppliers/partners—providing the service to their customers, thus

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affecting the experience.

Having worked with companies that work in such a way, I was always surprised that
when they talked about the suppliers, they did so as if they were external to the
experience the companies delivered. When their customers provided less-than-favorable
feedback, they would shrug their shoulders and say, “Well, it’s not us, you know; it’s the
supplier.” Or “The customer knows it’s not us. We don’t even know why they are
complaining.” You see, in their minds they only had responsibility for what they directly
provided. However, that is an inside-out perspective. As a customer, when you buy a
product from an organization and a brand, you have expectations, and those must be
fulfilled. If they’re not, you don’t care about who failed, because for you, as the customer,
it was the brand that failed. It is the brand image of the company that is damaged, not
that of the supplier. I have even seen people say to a customer, “It wasn’t us. It was our
supplier. We will speak to them.” My only comment to that is don’t bother saying that,
because the customer couldn’t care less. If it is your supplier, it is your responsibility. Get
the right provider to do the job, or you lose and your brand image will be damaged.

As mentioned before, CX is the sum of all the interactions a customer has with an
organization. You can add for clarity that it also includes those interactions that the
company outsourced to another vendor.

Because companies tend not to explain their business purpose and CX strategy to their
suppliers/partners, these providers are left with just quantitative indicators—volume,
price, and so on. They don’t know why they are the ones that have been selected or how
they align with the company’s purpose so they can better support the company.

It is also important to focus on getting suppliers/partners that share your mission and
values. An example of this is the luxury artisanal ice cream company Jeni’s Splendid Ice
Creams LLC. Jeni’s is a company in Columbus, Ohio that has always focused on using
fresh organic ingredients from local suppliers. Its mission is to be devoted to making
better ice creams and bringing people together. To achieve this purpose, Jeni’s focuses on
customers, employees, and suppliers. This enables the company to grow its business as
“a community of people, with artful attention to detail and the customer experience, and
get continuously better at the same time.”liv
As part of its focus on the suppliers/partners, Jeni’s developed what they call “the
fellowship model.” The model is about the partnership Jeni’s built with fellow business
owners who share its values and purpose. These companies supply the ingredients Jeni’s
uses to produce its premium ice cream. In the opinion of the management of Jeni’s, those
relationships enabled the company to develop an excellence product and experience for
its customers. There is a whole web page dedicated to Jeni’s suppliers/partners and their
products.

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This focus and alignment has proven to be a fruitful and profitable strategy. Jeni’s was
founded in 2002 with one store in Columbus. Today, it ships nationwide and is sold in
750 grocery stores all over the United States. It has ten self-owned scoop shops in
Columbus plus thirteen scoop shops across the rest of the United States. Not bad for a
company that operates in a highly competitive, saturated market.

Even the fact that listeria was detected in a batch of Jeni’s Ice Cream back in 2015 didn’t
tarnish the company’s reputation. This is primarily because the company acted as per its
values. It recalled all the ice cream, discarded it, closed the scoop shops, stopped
production, and communicated directly with its customers, suppliers, and employees.
During the listeria crisis, Jeni’s decided to close its production kitchen, so it was not able
to produce any ice cream. Due to its strong focus on relationship building and ensuring
everyone was a partner in the experience, brand competitors offered to help, and Jeni’s
ended up using the kitchen of one of them to relaunch its ice cream production while its
own kitchen worked to solve the bacteria issue.

From my long supplier/partner experience, I can tell you there are many upsides to this
approach and hardly any downsides, unless you consider the time invested in making
them true partners in the experience a cost. (Don’t laugh. I have seen that happen.) Those
advantages are as follows:

- Partners/suppliers can generate leads and sales. They know a lot about your
market because they probably are or were providers for your competitors. They
also know your customers if they serve them directly, and sometimes they even
know them better than you do. They may also know potential customers. If they
are your brand advocates, they can help you personalize and get you new
customers. Never, ever underestimate this point.
- As with everything, emotion plays a significant part. If you build a great
relationship that is founded on trust, consistency, and collaboration with a
supplier/partner, your customers are going to be better served, and issues and
potential issues can be sorted out much faster or will cease to exist. This leads to
an increase in the partner/supplier engagement and consequently performance.
- The improvement of your service will further enhance your point of
differentiation and competitive advantage.

In summary, the purpose of brand advocacy, be it internal and external, is about how
people feel. Employees, customers, and even partners want to feel they are part of
something they believe in and want to contribute to its success. People are hungry for
sensations and feelings.

The purpose is the glue that ties everything together.

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Customers want uncommon, remarkable, and effortless experiences that not only satisfy
their needs but also tap in to their emotions. An example of this is the fact that, despite
the ability to go online and the number of people with access to the Internet on their
mobile devices, 97 percent of customers still want to go to a physical store. Therefore, it’s
about emotions, feeling, and connecting, which implies that the experience we provide
lives and dies in people.

All of the above can be summed up by saying it is all about people. We are all now in the
people to people business.

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 Chapter 8
Customer Insight

The more you engage with customers the clearer things become and the easier it
is to determine what you should be doing.
—John Russell

CX starts with a genuine understanding of how your customers live. This is how you
truly grasp their needs, wants, and emotions; get an idea of where those pain points are;
and tap in to their unexpressed needs, which not only creates empathy but also helps
new ideas spark. This is why customer insight has been considered a driver for service
innovation.

Technology opens the door to new possibilities. It is up to companies to take advantage

of all these opportunities to generate products that people actually want. An excellent
example of this is Uber. Now, you may love it or hate it, but the fact is that, by focusing
on customer insight, Uber was able to innovate and disrupt by figuring out what
customers wanted from an industry that had hardly made any changes to its processes
since it was founded. They looked at the job to be done by taxi customers and the pain
points of the service.

I still remember calling to get a taxi, and either a) no one would pick up the call in the
taxi dispatch office, or b) the dispatch office would answer and say there weren’t any
taxis available, or even worse c) confirming the request but having the taxi never show
up, prompting several more calls and causing me to arrive late to important events. I’d
also have to go to the ATM in advance to take out money, because the cab drivers didn’t
accept credit cards. The service was dependent on the driver’s mood and will. I’ll never
forget getting told off by a taxi driver because I only had a five thousand escudos bill
(equivalent to twenty five euros) to pay for a three-hundred-escudo (equivalent to one
euro and a half euros) ride. I was so shaken by this that I vowed never to take a taxi cab
again and focused on getting my driver’s license instead. The stress and hassle were just
simply not worth the value I was getting.

Apparently, I wasn’t the only person in the world feeling those pains. In 2010, in the
beautiful city of San Francisco, based on their findings, Uber founders created a unique
value proposition—one that is centered on convenience, reliability, and customization for
each individual customer. With it, they gave us what regular taxis could not provide
consistently, which was reliability. The rest is history. Uber now has a presence in 270
cities worldwide, with taxi drivers and taxi companies protesting in every new
location they came into. The problem wasn’t Uber. The issue was that taxi companies

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simply never looked to innovate by focusing on their customers’ needs. Instead, they
remained transactional companies, based on a product, which was taking customers
from A to B. Uber is only a disrupter because the industry left room for it. Let it be a
lesson that with great customer insight, technology, and information, no industry can
claim that it is not vulnerable to competitors coming in with a brand-new value
proposition anymore. That is why it is important that you get as much understanding of
your customers as you can so that you can anticipate trends, needs, and unexpressed
wishes. I typically say that innovation and customer insight are intertwined. Apple, Hilti,
and IBM are fantastic examples of that.

But it is not just Uber. Even your favorite local restaurant or bar needs to give customers
what they really want, as this is the foundation of great businesses, and their success can
be predicated on this single principle (figure 8.1.)

This is why, when we see a failing business, we are watching the inability to figure out
what customers truly want. Take Blockbuster, which went bankrupt in 2010 precisely
because it failed to understand that its customers wanted convenience and ease, getting
the movies wherever they were and not having the hassle of returning them, for
example. Netflix, on the other hand, focused on those two wants and took advantage of
the emerging technologies. It started to use streaming in 2007, as an answer to customer
desires. It keeps growing, and it is now present in 190 countries around the world. By
being a customer-centric company, Netflix built a strategy that delivered a great value
proposition: effortless Internet streaming 24/7, supported by an excellent customer
service and in a cheap, efficient way. It was the classic story of David versus Goliath, and
due to insight and relentless alignment, young “David” won once more. Companies can
no longer just sit and make innovation part of their R&D departments. In today’s world,
innovation needs to be nurtured and used by the organization as a whole, so the
company can continue to survive and thrive. Customer insight is a powerful tool to help
the business innovate, as it can uncover many opportunities that weren’t even considered
before. Peter Drucker in all is wisdom said, “The customer rarely buys what the business
thinks it sells him,”lv and customer insight is an excellent opportunity to find out why
people do purchase from you.

As we now know, customer expectations are evolving alongside technology, making the
customer journey shift as well. How can companies gain that understanding that makes a
difference between being just another brand out there and being a beloved brand?

Through customer research, you can grasp not only your customers’ expressed needs but
also their unexpressed ones and their emotions.

You use customer data to see patterns and correlation among factors that affect
customers. By using data from tools such as sentiment analysis, surveys, contact center
data, price sensitivity, and the number of products sold and to which customer segment,
you can get a sense of what is happening so you can adjust, correct, and anticipate and
therefore make the right adjustments in your company.

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93
However, customer data never gives you the full view of what is happening and
sometimes can even skew facts. For example, in surveys you need to go beyond the
cultural difference bias. An American will not rate the service the same way as a
European. And within Europe, an Italian customer will not rate the service the same way
as a German customer will. One way to overcome this is to combine survey scores with
the customers verbatim. But more importantly, you need to partner customer data with
customer insight.

Customer insight is the qualitative approach, in which you use personas, focus groups,
and interviews not only to put yourself in the customers’ shoes but also to walk in them.
By observing them and going through the customer journey with them, you get very
insightful information, which can represent the difference between having a good, an
average, or an excellent product. It is through the customer insight that you get the
customers’ deepest desires, often things that they couldn’t verbalize or didn’t know they
needed. It is there that the pot of gold lies when it comes to business success.

Now, warning: there can be a big difference between what people say they want and
what they actually want. When Cadillac started to work on the launch of a car that was
family friendly, the minivan, the results of customer research, focus groups, interviews,
and so on was that customers disliked the product and would not buy it. Cadillac went
ahead with the minivan, and it remains its best-selling vehicle.

Discovering what people actually want requires a high-touch process, a people-centered

approach to research. What is required to obtain that acumen and transform it into
actionable items?

Here is where design thinking (DT), which we discussed in chapter 6, comes into play.
As previously mentioned, DT is a problem-solving approach that is human centered,
possibility driven, option focused and iterative. It works really well with UX (user
experience) and service design; even though they are not the same, they have many
similarities. CX borrows a significant number of tools from design thinking to create a
remarkable, customer-centric customer experience.

Let’s review Professor Jeanne Liedtka’s 4-Whats framework:

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To truly understand the challenge or opportunity, you first need to assess the current
situation; you need to start by asking, “What is?” This allows you to identify how can
you eventually help customers get the job done. Who are your personas?
At this stage, you need to have a dual focus. You research information externally, with
customers, partners, and other outside agents. Design tools used here include the job-to-
be-done interviews, observations of people living the situation (ethnographic approach).
You also do internal research with employees via employee interviews, observation of
employees executing their tasks (ethnographic approach), and service safaris, which
enables you to understand, from a customer perspective, how the service works and
what the experience is.

With all the information you have collected with these tools, you can then use another
design thinking tool, customer journey mapping (CJM), to map out the journey of the
customer as he or she experiences the product and service. It is important to reiterate that
the customer journey starts well before the purchasing of the product or the customer
even being aware of the product or service, and it continues on well after the purchase.

From an organization’s point of view, this involves many components and multiple
touchpoints. You must manage your customer journey; remember, however, that it is the
customer who defines when the journey starts and ends. CJM pays particular attention to
the job to be done, focusing not only on the functional but also on the emotional side.
This is extremely valuable because most of our unexpressed wishes end up being on the
emotional side, so this tool can uncover hidden opportunities to create greater value for
people. And it is here that the treasure lies when it comes to innovation and creating
things people didn’t even know they needed but then can’t live without. This is exactly
why Steve Jobs said, “Get closer than ever to your customers. So close that you tell them
what they need well before they realize it themselves.”lvi

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Customer journey maps also allow you to have a clear understanding of the moments of
truth because not all interactions are the same. Moments that matter are defined as those
moments when what you do can make or break the relationship with the customer. They
are the most important moments because they have a high amount of emotional energy
for the customer; consequently, they are the ones at which the organization must delivers
its promise without any compromise. For example, when a customer signs up with an
energy company because he or she has purchased a house, the customer expects the
service to be installed as soon as possible and without issues. If the installation is not
scheduled in a timely manner and the customer needs to follow up or there are problems
with the installation, the customer might decide not to use the service or, if bound
because of contractual obligations, not renew with that company when the contract is up.
The customer journey map, by providing a view of those interactions from a customer
perspective, gives the company the opportunity to carefully manage and design the
touchpoints and journeys to create moments of excellence. Imagine, for example, your
frontline staff; they typically play a significant role in moments that matter. You want to
have them ready to understand when they are simply to perform a task and when they
are to create a memory. You want them to know that when selecting between these two,
they are deciding to create either a moment of misery for the customer, which could lead
into an “I want my money back; I no longer want to do business with you” situation; a
moment of mediocrity, which typically translates to the customer thinking, “What’s the
point? This company just couldn’t care less”; or a moment of excellence, in which you
have managed to surpass the customer’s expectations and delivered something that was
unexpected. Here you get “It is always a pleasure working with you” or “Don’t change
anything—you are such a great company.” To be able to consistently deliver moments of
excellence in the moments that matter, employees should always keep in mind the
purpose (the bigger picture) not the function (the narrow perspective).

The map also provides the opportunity to look at the customer journey from the
standpoint of each of the brand’s personas. This is extremely important in a world where
customer heterogeneity—the diversity of customers—is on the rise. The same company
can serve many different customers; the only similarity is that they use the product or
like the brand. This is a real challenge because often their needs and emotions are
extremely different, and whatever you do should be flexible enough to support that
customer miscellany. With the map, you can understand each persona’s needs, wants,
behaviors, and emotions and manage how to incorporate that flexibility in your
processes, systems, and tools, so you can be consistent regardless of the persona your
organization is interacting with.

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Take, for example, a five-star resort in the Mauritius. On the same day, a young
newlywed couple is arriving, and so is a regular customer, a middle-aged top business
executive who, when traveling to the island to handle his business, always stays there.

Now the basic expectation is the same: a high-quality room and a bed to sleep in.
However, the needs and emotions of the young couple—a sense of novelty, celebration,
excitement—requires excitement from the hotel team as well but also some guidance and
support. On the other hand, the seasoned business executive’s needs and emotions are
significantly different. He requires a sense of familiarity, anticipation, efficiency, and
professionalism, so the hotel team needs to ensure all is prepared accordingly, in a way
that anticipates his needs and guarantees the customer that all is handled to provide him
a hassle-free experience.

Now you are ready to move to the “what if” stage to generate ideas and solutions. Here,
workshops with different key stakeholders (for example, employees from various areas,
customers, partners) allow people to create together. As each participant brings different
ideas, thoughts, feelings, and perspectives, the workshop facilitates creative insights and
better ideas and also creates a sense of ownership and engagement. There are many ways
to run the workshops, but the rule of thumb is they should always be structured in such a
way that all participants have enough time to participate and contribute.

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Once you have a good number of ideas, you are ready to move to “what wows,” and
here it’s about narrowing those ideas to the ones that hit the sweet spot. A workshop
with different key stakeholders to cocreate and to test ideas could be a great approach.
You can add prototyping to test assumptions and even use another design tool called
visualization to make the concepts tangible. From drawing an image to telling a story,
your imagination is the limit, further enhancing the understanding of the ideas and how
much they hit gold.

After they conclude this stage, they can move to “what works,” and here, it’s about
testing the prototypes in the real environment. You do learning launches to get even
more insight on what works and what doesn’t or may need some tweaking.

It is important to highlight that before you even start, you need to have the process for
gathering data well defined in order to not waste precious time and resources in a wild
goose chase that will end up not yielding the results you wanted. I see this happen too
often, mostly because senior management is too eager to get the results—since, most of
the time, it’s an already-late attempt to fix something that should have been fixed before.

Also, make sure that you know what your goal is. Is it to understand if a new concept or
idea is of any interest to the customer or to know why less than 50 percent of your
customers renew their subscriptions with you, or even what the customer intent is the
moment before he or she buys? Knowing your goal is essential. Once you have that clear,
you can decide your approach. For instance, if you want to understand customer intent
the moment before purchase, your research should include an in-depth understanding of
all touchpoints before purchase. Prepare accordingly. If you do workshops or/and
interviews, make sure you recruit the right stakeholders and above all have employees
from different departments. Everyone should understand the objective of the activity,
how they contribute to it, and how the information they provide will be used. (Make sure
you have release forms for them to sign.) Once all that is done, go ahead and conduct
your research. Don’t forget to collect your observations along the way; they will be
handy when you start preparing your recommendations or sharing the findings. Put
your information to work for your organization. How can your results improve the
customer experience, drive innovation, and improve effectiveness and efficiency?

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 Chapter 9
CX Measurements and ROI

Customer experience is the single most important factor for a business success.
—Don Peppers and Marta Rogers

Let me start by telling you that, as everybody knows, measuring the customer experience
is a real challenge. However, it is necessary because CX needs metrics not only to create
its strategy but also to measure its performance and continuously improve and drive
innovation.
In this chapter I am only going to focus on a few key metrics out of the many you can
use. These will help you get started and grow from there.

The good news is companies like Forrester Research and other top consulting brands
have created their own CX index that allows you to benchmark and be able to articulate
the possible financial results for your company if you embark on a customer experience
transformation. I will talk about those, so you can understand what is out there and then
see how you can apply it to your business. The ROI of customer experience is a hot topic
that is worth talking about. The final purpose of a business is to make money, and if you
can’t articulate the bottom-line results the CX transformation is going to deliver to your
organization, it will be very hard to have the chief financial officer and the rest of the top
management team buy in, which will make it almost impossible for the initiative to
succeed. (I have learned that the hard way.) The good news is that it isn’t as hard as it
seems. Studies do show that there is a strong correlation (R=0.86) between the customer
purchasing decision and the experience that he or she has when interacting with the
brand or organization. However, there is more, and we will talk about it.

Measurement

Your unhappiest customers are your greatest source of learning.

—Bill Gates

Loyalty prediction metrics

The top three ways companies currently measure their customer satisfaction are the
customer satisfaction score, the customer effort or ease score, and the net promoter score.
These management tools act as indicators of customer loyalty and therefore help predict
future customer growth and ultimately profitability.

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Customer satisfaction score (CSAT)
This measurement tool is used by companies for a much longer time than the other two.
Customers are asked. “How would you rate your experience with (insert company name
here)?” The scale is from zero to ten, with zero being very unsatisfied and ten being very
satisfied.

The idea behind it is that customers who are happy with the service will tend to
recommend it. Generally, the CSAT focuses on one particular interaction, like purchasing
a product or a call to the contact center. Some companies are bypassing that by adding
“in the last twelve months” to the end of to the CSAT question. This allows the company
to understand the midterm satisfaction. As mentioned in chapter 5, the customer
satisfaction score is considered a leading predictor of customer loyalty, and recent studies
show that the CSAT is a better loyalty predictor than the NPS.

Net promoter score (NPS)

This satisfaction measurement was introduced in 2003 by Fred Reichheld as an
alternative to the CSAT, but now the tools are believed to be complementary. The
customer is asked to rate on a scale from zero to ten “How likely is it that you will
recommend (insert company name) to a friend or a colleague?” Customers who respond
with a rating of zero to six are considered detractors and therefore less likely to be brand
advocates. On the other side of the spectrum, you have the customers who responses
with rates of nine or ten. These are called promoters, and just like the name suggests,
they tend to be the brand advocates, spreading the word to other customers, buying
more, less sensitive to price, and everything else we have discussed extensively in
previous chapters. Finally, you have the ones who respond with a rating from seven to
eight. They are considered passive and fall in the middle of the scale. Your NPS score will
be the difference between your percentage of detractors and your percentage of
promoters.

The idea behind it is that, while promoters tend to recommend the brand to others,
studies show that people tend to share more negative experiences than positive one,
meaning that companies should focus on the detractors, to move them to passive or
promoters and therefore reduce the negative word of mouth.

I find NPS on its own to be too vague, as it doesn’t tell you what to improve. It gives you
the what but without the why, which sometimes leaves leaders wandering around and
doing everything and anything to move it to achieve the annual customer satisfaction
goal. This can lead to a significant waste of money, time, and resources; that ends up
demotivating the employees and eventually significantly delaying or even killing the CX
transformation.

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Because NPS is so commonly used, you can benchmark yours with other organizations
and industries.

There is significant controversy about the NPS and its validity. I decided not to discuss it,
mostly because I never use NPS in isolation. I use it as a complement to the other two
metrics to measure the effectiveness of customer experience instead.

It is worth mentioning that the NPS is a strong predictor of customer retention.

Customer effort score (CES)

Developed by CEB in 2010, the customer effort score or customer ease score has as its
core idea that, contrary to general belief, customers do not need to be constantly wowed.
Instead, the focus should be on getting the basics right and reducing customer effort in
getting the job done. If companies can help customers quickly and easily, they will be
able to gain their customers’ loyalty. Based on that, the customers can also rate the
following question on a scale from zero to ten, zero being strongly disagree and ten being
strongly agree: “How much effort had you personally to put forth to handle your
request?” There is a newer version of the question, which is a statement: “The
organization made it easy for me to handle my issue.”

CES is a loyalty predictor for service interactions, allowing the organization to determine
customer service improvement areas. Before the 2015 Forrest Research study regarding
customer loyalty, CES was considered the best indicator of customer loyalty. More on
this ahead.

All three of these metrics have pros and cons. They can be used in isolation, but I can
assure you that they are more useful when used to complement one another. Research
shows that there is a strong correlation between CES and NPS, meaning that the less
effort a customer has to put in to get the job done, the higher the likelihood of his or her
having a high NPS score, which should not come as a surprise, based on what was
mentioned in chapter 2 regarding the importance of service in the customer experience.
To have a holistic view of how the customer perceives the experience with the
organization, both measures should be used because, while CES measures only service
interactions without a deeper look at the root cause of the customer issue, NPS is a much
broader question, which is intended to gauge the relationship as a whole. When followed
by the open comment answer, it can give you a much broader view of the situation.
Therefore, in your survey, you can ask a question or questions regarding CSAT and add
the NPS question and the effort question as well. It all depends on how much detail you
want to go into and the information you want to capture.

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Customer experience benchmarking tools

Forrester customer experience index (CXi)

This is an annual benchmark of customer experience quality among large global brands.
Criteria for its rankings include how effectively the respondents felt their needs were met
and how would they rate the ease and enjoy the ability of their experiences. It is
considered the holy grail of CX benchmarking tools and is widely used by experts and
CX professionals.

Watermark customer experience ROI annual study

This study, done by the renowned consultancy company, looks at the cumulative total
stock returns for the top ten and bottom ten publicly traded enterprises in Forrester
Research’s customer experience index rankings. Note: Forrester Research reports that
instead of stock performance, company revenue is a better indicator of CX success.

Temkin Group insight report

Also an annual report, it is produced by the Temkin Group, a company specializing in
CX. Bruce Temkin is a former Forrester Research analyst. The report, also widely used by
CX professionals, measures the customer experience by asking customers to assess the
success, effort, and emotion components of their experience. They also measure loyalty
by asking the respondent to rate likelihood to recommend, reluctance to switch, and
willingness to repurchase.

Ideally, you want to have a CX management dashboard with all the relevant metrics to
measure your experience. You should add to it all numbers pertinent to your
organization’s customer experience, which most certainly will include employee metrics
such as the employee survey and product and customer profitability, among others. No
two dashboards are the same, as CX adjusts itself to the business, not the other way
around. The important thing is to focus on the key success metrics. Normally there are
many, and out of those, there should be one that is the most significant.

The scorecard will allow you better find patterns and correlation among metrics, making
it easier to identify the most important leading indicators. It needs to be updated
regularly and consistently.

ROI of customer experience

Know what your customers want most and what your company does best. Focus on
where those two meet.
—Kevin Stirtz

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Oracle’s 2015 survey of four hundred executives demonstrated that there is still a lack of
clarity when it comes to making a connection between investing in the customer
experience and seeing results in terms of business outcome—customer retention and
revenue.

Despite this seeming to be a challenge concerning justifying the ROI of CX, the results of
companies that use this competitive advantage extremely well speak for themselves. For
instance, the stock results of the top ten companies with the highest Forrester CXi from
2007 to 2013 outperform the ten organizations with the lowest CXi by 70 percent.lvii

Forrester compared CX leaders and laggards regarding revenue growth between 2007 to
2015, and the result was impressive. While laggards’ income tended to either decline or
have a small increase (2 to 3 percent), the CX leaders grew revenues by more than 10
percent.

Figure 9.1 shows the Forrester Research findings in terms of potential revenue gain after
CX improvements. Positive and negative feelings are transformed into sentiment scores.
Some companies like United Airlines ask their customers directly what emotions they
have felt at the end of the flight. Some companies, in the fast-food industry, for example,
are already adding facial-expression analysis to their emotions metrics. In its 2015 report
“How to Measure Emotion in Customer Experience,” Forrester Research explained how
emotion trumps satisfaction and effort as a leading loyalty indicator.lviii This means that
any good CEM program requires the inclusion of emotion metrics such as the ones
mentioned above. I know from experience that emotions are typically seen as the kind of
“fluff stuff” that senior management doesn’t get. Even most CX professionals sometimes
find it difficult to articulate and explain the subject and to link it to bottom-line results.
Since part of my professional background is in customer service, the importance of
emotions is something I had mastered many years ago, because service is all about
emotions. I can recall several occasions when yours truly simply couldn’t help a
customer achieve his or her goal, and it sure wasn’t effortless for the customer, but how
my team or I made the customer feel during the situation managed to turn his or her
opinion of the experience around. This led to calls, e-mails, and letters of appreciation,
gratitude and customer advocacy. How customers feel is strongly influenced their
perception of the whole experience. You want to use these metrics to measure your
most profitable customers, to have an understanding of how they perceive the experience
and to identify satisfaction and emotion drivers behind their scores. This valuable insight
will allow you to become a learning organization that is always improving from an
outside-in approach.

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Another of Oracle’s customer experience surveys of thirteen hundred senior executives
demonstrated that top management at organizations understands the need to provide an
exceptional customer experience that is based on relentless alignment. It has been
estimated that by not doing so, the potential revenue loss for their organizations is 20
percent of their annual revenue or one million euros for a five-million-euro company.

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The most important thing to measure the ROI of your CX is to have clearly defined goals
from the start. The proven and tested reality is that a great CX transformation will not
only improve the customer experience but also allow the business to grow and reduce
costs. However, you need to have clarity about the exact numbers you want to achieve.
For example, if your goal is to have a sales increase, you need to establish how many new
customers you want coming in and the number of customers leaving. If it is reducing
costs, you need to determine, for example, how much you want your complaint-
handling costs to decrease.

There are more ROI for brands that invest in a great customer experience. Studies show
that these companies actually reduce recruitment costs but also, unlike the general
assumption, don’t have to pay employees sky-high salaries because the brand is so
attractive and adds prestige to the employee’s personal brand. Still, in the realm of
employee-based brand equity, CX leaders tend to attract better people. There is also an
increase in the brand value, as brands with a remarkable CX are seen as superior and
therefore more valuable than brands that don’t offer a great customer experience.
Remember how much Zappos was sold for? It also leads to the opportunity for those
brands to charge premium prices for their products. Luxury brands have longed tapped
into that. People pay, on average, twelve time more than what the products or services
cost because the brand value is much higher than the rational aspect. Or on the other
hand, the leader can increase the returns because they sell more (volume premium), like
Zara.

A brand with an excellent CX is also able to reduce its marketing costs related to
acquiring new customers because of the powerful word of mouth (WOM) of its
customers. It also takes less time to gain new customers. The period between awareness
and purchase can be dramatically reduced because of the brand value, which further
reduces sales costs when it comes the time to acquire new customers. Regarding existing
customers, the brand’s superior experience reinforces the brand strength, and customers
tend to be brand advocates, which means they keep longer relationships with the brand.

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 Chapter 10
CX Assessment Tool—The LEX Model

Here is a simple but powerful rule: always give people more than they expect to
get.
—Nelson Boswell

Nowadays, it seems like everyone has developed some sort of conceptual model. The
truth about these models is that they do help, considerably, when it comes to strategy.
Defining and designing a business strategy is hard work. That is why hardly anybody
says they love it or live for it. A good strategy is also rare, despite the word being
dropped at every opportunity in business. The reason I know this to be true is that, being
a strategy geek, I can see the lack of strategy in an alarming number of organizations that
I have, for one reason or another, interacted or worked with. For me, the hard part of
developing the Living the E.Xperience model, a.k.a. the LEX model was gaining the
knowledge that can only come from almost twenty years of experience in the luxury
industry, with the last nine of those years being relentlessly focused on excellence to
create a differentiated customer experience. Reading, learning, debating, and—most
importantly—working with the finest of brands, such as the Four Seasons and UEFA,
and with top global business gurus like Mark Booth and Jeanne Bliss have all been
invaluable to my personal and professional experience. All these interactions helped me
draft the road map that made the LEX model come to life organically when I worked
with my first startup customer. It was this model that allowed that British customer to
increase its NPS by two points and see its sales grow by 35 percent only five months after
its implementation. After that success, I knew I had to put on the paper the framework I
had instinctively used based on years of experience with so much success.

Let’s first focus on some of the specifics of the LEX framework. The model draws
inspiration from my coaching background, in the sense that I use mostly questions in
every cornerstone of the framework to trigger answers and insight, which will generate
action from whoever I’m working with, be it the CEO and/or founder only or with his or
her team. This system is a bit like a scientific model because at every cornerstone we try
to answer several questions, iterating as much as possible along the way, to validate
assumptions and gather new perspectives.
With what we learn and collect, we decide why, what, how, where, when, and if we
move to the next cornerstone or not. The model can be used at any stage of the
organization, and it is an excellent guide to ensure that the startup is focusing on the
right things when creating its customer-centric culture and that the mature company
identifies areas that it needs to work on continuously to achieve sustainable customer-
centricity. Therefore, the model can and should also be used to improve the existing
customer experience.

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Six cornerstones comprise the LEX model—product (which in this book means both
product and service): strategy, brand, customer experience, continuous improvement,
and innovation. There is no set cornerstone for you to start from; you simply start with
the one that is most relevant to your business, project, or initiative at that moment.

Product
Don’t find customers for your product, find products for your customers.
—Seth Godin

In his 2003 TED talk, Seth Godin told how Coca-Cola Japan launched a new product
every three weeks because it was clueless on what worked and what didn’t.lix

The thing is, and my apologies for repeating myself, the world has changed. You can no
longer launch a product and see if it sticks. You need to start with the customer, a
particular type of customer who has a need for that product, and work the product with
the customer in a way that helps satisfy his or her needs to do done in an easier, faster
way. You need to talk to customers and iterate and reiterate until you achieve the perfect
fit. Realize that you must be obsessed with customer-centricity and always start from the
customer, because that is how you are going to find the intangibles, which is where the
pot of gold lies. Give them something they didn’t even knew they needed and wow
them. A great product is now merely a vessel to be in business, and it’s your base to grow

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from. Do that remarkably well. Because if you do, your customers will buy, make repeat
purchases, and tell other people about your product, and pretty soon everyone will want
a piece of what you have to offer.
Don’t try to be everything to everyone. You need to figure out what your personas are
and why they care about your product and sell it to them. Be laser focused on your
customer target and go from there.

You will know you have a great product by how many people who have purchased the
product buy it again and recommend it to others. How many of them say it is a great
product or service?

Invest in your product; it is the foundation of your success. Continuously improve it to

make the product better and better for your customers, making your customers happy.

Take Amazon, for example. Through its research, the company uncovered the fact that its
customers would be delighted if they could receive their orders on the same day. So they
worked on ways to achieve this, and today, in many locations around the world,
Amazon fulfills that wish. The company continues to work on the means to expand that
service.

Questions for this cornerstone:

1. What are our potential customers’ need and wants?
2. How can we support their goals?
3. Our product—what customer pain points does it fix?
4. What needs does it satisfy?
5. How does it help?
6. What gaps would our product fill?
7. How can we assist the customer to do the job that needs to be done?
8. What were the findings of our primary market research?
9. What are our personas?
10. What are our target customer segment expectations and values?
11. How would our customer define a great product?
12. What do we want less of?
13. How can we improve the product?

Strategy
Strategy is about making choices, trade-offs; it’s about deliberately choosing to be
different.
—Michael Porter

We have already talked about strategy in chapter 5, so I won’t delve too much into it
again. The main thing to keep in mind here is that your strategy defines your playing
field, and therefore, everything that you do derives from it.

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You need to have a business model, as it will allow you to think carefully and thoroughly
about why you exist, how you can deliver that reason for being, and finally, what you do
to deliver it in a sustainable way.

Questions for this cornerstone:

1. Why should our customers select us over our competitors?
2. Why do we want to be customer-centric?
3. What market will we target?
4. What is the customer segment we are focusing on?
5. What is our customer lifetime value?
6. Have we identified our most profitable customers?
7. How can we serve our most valuable customers efficiently and effectively and also
provide a remarkable experience?
8. What are our key numbers?
9. What is our number-one success metric? Have we defined what it should look like?
10. How will people be aware of our product?
11. How will people purchase it?
12. What is our business purpose, and how will we consistently deliver it?
13. What is our mission statement?
14. What is our business model?
15. What are our business’s short-, medium-, and long-term goals?
16. What people and organizational structure will add value to our competitive
advantage?
17. What would our potential customers pay for it?
18. Are we communicating the company strategy, mission, and vision clearly to all
employees?
19. What is top management’s focus?
20. What is our competitive advantage?

Brand
Define what your brand stands for, its core values and tone of voice, and then
communicate consistently in those terms.
—Simon Mainwaring

As mentioned in chapter 5, a brand is a very powerful thing for the imagery and the
intangibles it creates. A study conducted by Coca-Cola demonstrated that fans of the
brand, when simply seeing the logo, would actually feel the same emotions as if they
were drinking it. Hence, the importance of brands. To have a strong brand in this highly
commoditized and competitive world, where traditional marketing no longer conquers
all, and content marketing is considered by some experts as mere entertainment for
marketers who have lost control of the brand image. The consistent delivery of a unique,
remarkable customer experience can be the difference between success and failure.

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Your brand promise must always be delivered at every customer interaction to achieve
brand advocacy externally, and for that to happen, your employees must live the brand
internally every day.

Questions for this cornerstone:

1. What is our brand promise?
2. Does it clearly set us apart from our competitors?
3. Are we setting the right expectations?
4. Have we defined our brand values?
5. Are we guided by them?
6. Is our value proposition clear and aligned to our customer needs?
7. What is our brand positioning?
8. Do our employees understand the brand purpose?
9. Do we live the brand internally?
10. What is our unique value proposition?

Customer Experience
Know what your customers want most and what your company does best. Focus on
where those two meet.
—Kevin Ztirtz

The primary goal is to consistently deliver the business purpose and your brand promise
to create reliability that leads to advocacy and ultimately profitability. You need to have
your customer right at the heart of everything you do.

The big question here is how you can manage your resources efficiently, effectively, and
in an aligned way to achieve that consistency. If you are smart at planning, you can have
the best of both worlds: a higher volume of high-quality outputs at a lower cost.

Based on the figure 10.2, when taking a silo perspective, each area will account for its
department’s issues.

Take, for instance, the customer service department of an organization; its metrics can
show that in one hundred calls, there were only issues with four calls. The customer
perspective is quite different; he or she sees everything as a whole because his or her
experience goes through all the silos. Let’s say that a customer has subscribed to a new
cell phone provider. The product is great, but he is having some issues with the
activation of the contract. He goes to the website but struggles to achieve what he wants,
so he decides to contact the customer service department. Customer service doesn’t quite
solve his issue, but according to how they are measured, they were able to handle the
customer request at first contact and therefore serve the customer. The customer decides
to go back to the store where he bought the plan to get things sorted out. Despite the
organization looking at metrics and seeing that it is only one call in twenty that has an
issue, for the customer the experience had far more than one issue. In reality, it had

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several, and these caused a significant impact on his perception of the organization and
the brand.

At this moment, every successful company is relentlessly focused on its customers and
their experiences. Every CEO is obsessed with customer complaints and what customers
need, and they keep the customer close, very close. They call them, visit them to
understand their needs and emotions, and through that insight improve their
organization to deliver a better customer experience. In the end, you could say they are
relentless in delivering happiness to their customers because they know it is a strategy
that wins 100 percent of the time. Just think of Zappos, Amazon, Nike, Southwest, Ritz-
Carlton, Metro Bank, Zipcar, Uber, Airbnb. They all sell an experience of happiness; the
product is the vessel.

Questions for this cornerstone:

1. Are we able to deliver our brand promise in every interaction our customers have with
our organization?
2. Are we a customer-centric or a product-centric company?
3. How does the consumer interact with our organization in his or her day-to-day life?
4. Are we selecting talent who share the same values and purpose as our brand?
5. What are the value drivers that build customer advocacy in our market?
6. How do customers rate their experience with us against those drivers?

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7. Have we established between one and ten projects the whole enterprise can work on
to improve our rating against those critical drivers?
8. Why do our customers prefer us to our competitors?
9. Are our marketing, operations, and human resources working together as a network
to define and deliver a unique customer experience?
10. Have we mapped the customer journey? And the employee and the partner journey?
11. Have we established a CEM program?
12. Are our decisions taken from the insights we obtain from our CEM program?
13. Have we set the behaviors that are crucial to bringing our business purpose and
brand promise to life?
14. Have we relentlessly aligned the strategy with the brand and the behaviors to deliver
a unique customer experience always?
15. Do we have a clear line of sight?
16. Does our leadership act as champions of the CX strategy?
17. Is our leadership customer-centric in it behaviors?
18. Are our most profitable customers at the center of all our decisions?
19. Do we ensure our onboarding of new employees reinforces the communication of our
mission and purpose?
20. Is our recurrent training ensuring that all employees understand the company
strategy, mission, and vision, so everyone works in the same direction toward the same
goal?
21. Are we rewarding employees who deliver our mission statement by putting the
customer at the center of all they do?
22. Do we have the right processes, systems, and tools to help our employees deliver the
experience with reliability?
23. How do we design and deliver experiences?
24. Are we focusing on designing each customer journey and not solely focusing on
improving individual touchpoints?
25. What does our customer want?
26. Does our experience satisfy our customer needs?
27. Is our experience effortless, enjoyable?
28. Are we efficient (can I get more outputs with fewer inputs), effective (get I take more
value from my inputs), or experience (emphasis on the customer and creating
experiences for them) focused?

Continuous Improvement
Your customer doesn’t care how much you know until they know how much you care.
—Damon Richards

When a customer complaint goes all the way up to Amazon’s CEO, Jeff Bezos, his
approach is very simple and ensures a drive for excellence and continuous improvement
inside the organization. He e-mails the department that is accountable for the issue,
asking for the issue to be resolved so it never happens to another customer. A simple yet
powerful request that reminds everyone that they are on a quest to provide a superb and
differentiated customer experience to their customers.

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It is this relentless focus on listening and learning that separates the average businesses
from the great ones. Great companies know that this continuous improvement of
processes, systems, and tools can never stop, as it is through it that effectiveness and
efficiency will be sustained while helping the business do it right the first time (DIRFT). If
organizations want brand advocates, they must listen and learn from their customers,
employees, and partners, so they can truly understand the experience they provide and
improve it.

Top organizations are focused on their important numbers and on refining everything
they do to achieve them. Ideally, you know what your important number or numbers
are. And becoming a listening and learning organization can help you attain those
numbers and will determine your future success.

Questions for this cornerstone:

1. What frustrates our customers and prospects?
2. What is our customer research telling us?
3. Are we continuously and consistently focusing on our data?
4. What does our data tell us?
5. Do we have a robust VoC program?
6. How about a VoE? And the VoP?
7. Have we mapped our processes to ensure consistency in the delivery of the
experience?
8. Where are the bottlenecks?
9. Which bottlenecks need to change to deliver the biggest result with the least effort?
10. Are we doing it right the first time?
11. Are we using our customer insights to improve the process, product, systems, and
tools?
12. Are we linking our improvement projects with the moments that matter in the
customer journey? Especially the broken ones?
13. How do we measure customer satisfaction and continuously evaluate and work on its
drivers?
14. How do we decide which CX projects are the most important?

Innovation
Every day we’re saying how can we keep this customer happy? How can we get ahead in
innovation by doing this?…Because if we don’t, someone else will.”
—Bill Gates

It’s important for businesses to keep their fingers on the pulse to stay relevant. They must
be thinking of innovative ways to truly differentiate themselves, either through
technology or by other means, in a world that has become extremely commoditized.

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Never be satisfied with the quality of your product. Continually strive to make it better
in the eyes of your customer. Adjust, adapt, rework, so you can innovate and thrive. To
achieve this, we have already talked in depth of design thinking and how important it is
to bring innovation in products or services to the organization’s day-to-day routines.

Let’s look a few important things to think about when considering innovation in terms of
customer experience.

The characteristics of the experience

I need to do a recap here. I need you to go way back to the beginning. Actually, to what
inspired the title of this book, the HBR article “Welcome to the Experience Economy.”

I keep talking about CX and the importance of consistency and relentless alignment, but
how do you create an experience that delivers real value to the customer? You can think
of experience design using the four realms of experience that Pine and Gilmore
demonstrated in their HBR article. From the four realms figure 10.3, you can see that you
can create an experience in which the individual is either active or passive. For instance,
you are passive when watching a movie but active when doing your daily run. You can
also create an experience in which the individual is absorbing or immersed in the
experience itself. For example, the customer can be attending a class and therefore
absorbing the information or going to a spinning class, where he or she will be immersed
in the experience.

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Most companies focus only in one of the quadrants. However ideally, to hit the sweet
spot, an experience should include parts of all four quadrants.

To be able to design an experience that adds value and taps into the four realms, you
need to have a deep insight of your customers so you can identify a customer need or
pain point. It is through that that you will be able to uncover unexpressed wishes,
emotions, and behaviors that can lead you to reimagine your product or service.

Another thing worth highlighting is that when designing a great customer experience, it
needs to be effective and effortless and to make people happy.

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I think a great example that sums up this piece about innovation is the company
Birchbox, which is an online subscription service that every month sends its subscribers
samples of beauty products ranging from perfume to nail polish. It started in 2010
targeting only women, and today it has millions of customers and more than eight
hundred brand partners. The company’s headquarters is in New York, and the business
has expanded operations to the United Kingdom, France, Spain, and Belgium and has
now extended its offer to men. The founders, Katia Beauchamp and Hayley Barna, came
up with the idea after realizing that a friend who was a beauty editor would curate
beauty products to recommend and by noticing the challenge that it was for people who
were newbies to the beauty products to know what to buy, among so much offer. Also,
they drew information from their personal experience—one of them was beauty-product
savvy, and the other one was a newbie, struggling to find her way through the thousands
of products available, finding out what suited her best, what was appropriate, and what
worked. They realized that women wanted that curated experience to guide them. So
they came to the conclusion that their mission was “to help women cut through the
clutter of the world to find products that really work for them.”lx

The next step was how they would do it; how could they help women find out what
worked? They decided to go for a subscription business model that would allow its
subscribers to receive a beautiful box every month, with a selected assortment of five
makeup and beauty sample products, which subscribers could try to see if the products
worked for them.

They also manage to get top brands on board to provide the samples, without Birchbox
having to purchase them. For the brands, it meant direct marketing to potential
consumers and the ability to generate WOM.

The subscription price is ten dollars in the United States of America and ten euros and
ninety five cents in Europe a month. The contents of the boxes are personalized per the
subscriber’s preferences, interests, and needs, and every month something different
arrives.

The new business model generated a significant buzz on social media. Subscribers posted
videos on YouTube of them happily and excitedly opening their Birchboxes, which
increased the brand awareness significantly.

Since its inception, Birchbox has seen some competition, such as YouTube sensation
Michelle Phan’s business, Ipsy. However Birchbox, through all the information that it’s
able to collect from its customers, decided to open an online store and once again
innovated beauty industry retail by inaugurating its first physical store in New York.
One of the changes is products are not displayed by brand as in traditional beauty retail
stores but by function, so it is easier for customers to see the range of products they can
select from based on their needs, with the help of an assistant.
The bricks-and-mortar store lets customers enjoy the Birchbox experience in a more
physical way. The store also allows Birchbox to gain more insight into consumer trends,

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behaviors, and needs, which is fed back into the business to drive improvements in the
customer experience.

Birchbox’s focus is to ensure that, regardless of the channel, customers have a delightful
experience that brings a smile to their faces. For that, it has developed “winks.” Its VP of
retail development and customer experience, Benjamin Fay, reminds everyone that the
brand has a deep respect for people’s time. So if customers choose to spend time with
Birchbox, the experience is designed to be rewarding and to brings a smile to their faces.

Due to its pioneering business model, the company could innovate in a heavily saturated
and highly competitive industry. It has proven itself capable of achieving the sweet spot
regarding innovation.

Questions for this cornerstone:

1. What frustrates our customers and prospects?
2. What is our customer research telling us?
3. Are we continuously and consistently focusing on our data?
4. What does our data tell us?
5. Do we have a robust VoC program?
6. Have we designed our experience?
7. If so, did we ensure that we focus on including features of all four realms in it?
8. How can we improve what we currently do?
9. Are we recurrently assessing the current experience?
10. Are we ensuring our organization works as a network, so know-how and insights are
shared in order to generate new ideas?
11. When working to produce ideas, do we ensure we are working with customers,
partners, and employees from different parts of the organization?
12. Are we iterating our way to a new product? Or do we only focus on an inside-out
approach?
13. Is innovation only a responsibility of our R&D department?
14. Does our new idea hit the sweet spot?
15. Are we using an innovation model to assess what is, what if, what works, and what
wows?

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 Chapter 11
Case Study—Metro Bank

The words growth and bank are not supposed to fit together but by redefining
how the service is delivered we managed to create this hyper growth.
—Vernon Hill II

When I first heard of Metro Bank at a customer experience conference in Amsterdam

back in the fall of 2014, I was extremely impressed. Listening to Chris Brindley, at the
time the bank’s managing director, talk about the Metro Bank CX, its strategy, its brand
and how it designed an experience that was 100 percent relentlessly and fiercely aligned
with its mission and vision was incredibly refreshing. It was also reassuring to think that
even banks can truly be customer-centric instead of just talking about it. So strong was
Metro Bank’s belief in its business model that it challenged the status quo by opening the
first high street bank in the United Kingdom since 1830.

Chris Brindley himself was the perfect ambassador for the Metro Bank service innovation
approach to banking. I usually say that the leaders of an organization set the tone, and
his tone was clearly outside-in, a the-customer-is-at-the-heart-of-all-you-do type of
leader. And because, in my experience, that is so incredibly hard to find, since
unfortunately most of the time it is just lip service, since I met Mr. Brindley, I haven’t let
him go.

All the above illustrates most of the reasons that, when I was thinking of a case study to
illustrate the whole content of this book and really bring the concepts home, Metro Bank
was at the top of my very short list because, unfortunately, very few companies do
customer-centricity well, in an authentic way that is part of their DNA. (Don’t just take
my word for it; the Temkin Group’s yearly reports continually show that there is indeed
a lot of room for improvement.) Metro Bank is the embodiment of authenticity and of the
bottom-line results that the relentless alignment of strategy, brand, and customer
experience around the customer can bring to an organization.

Let’s take a closer look at Metro Bank.

Banking has long been a product-centric business. The focus is to sell products and
services that are in the bank’s best interest, not the customer’s. Bank customers don’t
know or understand everything that is going on with their deposits, loans and
investments because banks have turned simple transactions into complicated things.

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In the United Kingdom, banking was in the hands of the four big players—Barclays,
Lloyds, Royal Bank of Scotland, and HSBC. It had become a commodity, with banks
actively competing on price and totally ignoring the customer and his or her experience.

Vernon Hill, encouraged by a British friend, Anthony Thomson, who eventually became
the cofounder of Metro Bank, spotted an opportunity to do in the United Kingdom
exactly what he had achieved in the United States with Commerce Bank, which was to
disrupt the banking industry and in the process create a high-growth company in a
somewhat no-growth business.

Commerce Bank started with one office in New Jersey and a €1.4 million investment back
in 1973, when Vernon Hill was only twenty-seven years old. It went on to become a very
successful venture before being sold to TD Bank NA in October 2007 for €7.9 billion. It
had grown to five hundred locations around New Jersey, New York, and metro
Philadelphia. Commerce Bank had become one of the fastest-growing banks in the
United States. There were twenty-four thousand banks when it opened for business, and
it ended up being the eighteenth-largest bank in the country.

Without acquiring other financial institutions to grow, before the sale, Commerce Bank
had €32 billion in assets. Its market cap went all the way up to €7.9 billion, and it had a 23
percent, thirty years compounded shareholder return. Its growth was so great that if you
had invested in Commerce Bank in 1973, you would have realized a 470-times return on
your investment. This was a company that, despite the traditional belief that banks don’t
grow without acquiring other banks or competing in rates, managed to grow 24 to 25
percent a year and managed, in the words of its founder, to “turn a mundane business to
a high-growth, exciting business with very high returns.”lxi

How did they do it?

They redefined and rebuilt how the services were delivered by focusing on turning
customers into fans. They decided to be a customer-centric organization. Their
differentiation strategy was a relentless focus on service, and with this they disrupted the
banking industry in the United States. In their own words, Commerce Bank was not a
bank but a retailer that happened to operate in the banking sector. Therefore, their
benchmarks were the best brands: Apple, Amazon, the Four Seasons. Those are the
brands that have fans, people who not only buy but are loyal to the company and bring
their family and friends. Thus, what Commerce Bank wanted were brand advocates.
Commerce was the only bank in New York City with a five-star rating from The New York
Post.

The Commerce Bank business model was based on convenience and service. It was
grounded on this model that Vernon Hill opened the first new retail bank in the United
Kingdom in more than 150 years.

Let’s use the LEX model to assess Metro Bank’s alignment.

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Product

Metro Bank was born in 2010, after eighteen grueling months of intense work, as British
authorities were not prepared to welcome a new high street bank, since none had been
opened for more than a century. Regulations and laws were outdated. Also, just two
years before, the financial crisis had killed most, if not all, of the faith people had in
financial institutions. To top it all off, no one knew if that loud and brash brand would
endure, and consultants (whom Metro Bank never hired) said it was not needed and
wouldn’t succeed.

Nevertheless, Hill and his team of seven employees, who included Metro Bank CEO
Craig Donaldson, believed they were on to something. After all the business model had
worked brilliantly in the United States. Also, Vernon Hill had shopped the big four, as
the British call their top four banks, and realized that they were not a threat to the success
of his model, as they were completely product and price oriented, unlike him. His bank
had a real differential from the established banks.

After doing their own analysis and research, Hill and his team looked at the top ten
things people hated about their banks—literally googling it—and interviewed people to
understand what the most important drivers for people to choose a bank in the United
Kingdom were. From the analysis, they realized that service was a primary driver for
people’s dissatisfaction. The most important drivers for people to change banks, contrary
to what the market research consultants kept saying, was not the rates but convenience.
They found that 29 percent of individuals wanted branches near where they lived or
worked, and 22 percent would choose a bank based on the recommendation of a family
member or friend. Only 9 percent would choose based on products and services and 7
percent because of the interest rates. It was evident then that customers wanted a better
banking experience. They wanted value and service, and those were more important to
them than rates.

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To keep things simple and focused, they decided just to be a deposit bank that also
loaned money but not to handle investments or wealth management. They would serve
both personal and business customers.

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Strategy

The Metro Bank founding team got down to how they would change the banking
business: by working with this insight to refine their business model, one that added
value to everyone, drew in the customers whoever they were, and generated revenue.
And while they were at it, they would revolutionize the British banking customer
experience. They considered themselves a retailer of financial services, not a bank.
They faced some risks at the time:

- Could they raise the capital to launch Metro Bank? They did, with 99 percent US
investors.
- Could they get the license? They did, and in the process, they forced the UK
authorities to dust things off and start working on improving the process for
new banks to enter and succeed in the competitive landscape.
- Could they build an IT system that supported their value proposition and
allowed them to deliver it consistently through every channel? They did, by
using T24 software by Temenos.
- Would the British customers accept the bank and become fans? Judging from
the bank’s 100 percent year-over-year growth, one would have to say they did.

The purpose of Metro Bank was to provide a differentiated experience to its customers
based on service and convenience. It wanted to be the local bank in every community it
served. Through that, the bank expected to turn customers into fans and build a great
brand. Hill and his team wanted to give regular people the chance to have excellent
service in their community bank without the usual pain points of banking they
uncovered in the research stage, like complex rules and complicated processes.

They knew that they had to be where their potential customers were for them to become
actual customers. Opening physical stores on the corners of buzzing and full-of-traffic
high street locations in high-density areas was crucial to the execution of their business
model, because that was how they would grow. They knew that once people experienced
the service in the store, they would become customers, due to the uniqueness of Metro
Bank’s value proposition. Customers would start by opening an account and eventually
would ask for a loan. The physical stores were paramount to their business model
success. There is a strong correlation (0.98) between the opening of new stores and
customer growth. Metro Bank had a low-cost differentiation strategy. It paid the lowest
deposit rates in its market. Metro Bank’s advantage was that, while UK banks tended to
spend lots of money to promote their services externally (as they were not internalized,
i.e., part of the organizational culture), the service was terrible, and some banks had
negative net promoter scores.

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The aim when Hill and his team started was to have 200 stores by 2020 in greater London
and 5 percent of the total deposits in that area, equaling twenty-nine billion euros. In
2015 the bank adjusted its strategy to having 120 locations by 2020, but still with twenty-
nine billion euros in deposits. The change was made for two main reasons: the fact that
stores were trading almost three times as much as forecast and the fact that they were
spending more on infrastructure and technology because they were growing at a higher
rate than expected. In their business model, they incorporated that deposits create value.
Customers would give them their deposits for the long term for a better retail experience,
and since they would have the lowest interest rate in the market, the service needed to be
second to none. Otherwise, why would people choose them? That is why Metro Bank is
all about service and convenience.

Brand

Metro Bank has two slogans. The original one is “Love your bank at last,” which is a
simple way to convey their service excellence business model and pretty much state that
they were innovating. Traditionally, no one would associate the word bank with love, so
people knew Metro Bank was up to something different and the at last was to further
increase the gap between new bank and the establish banks, reinforcing that they were
never able to build that love relationship. Its new slogan, “Join the revolution,” adds to
the previous one in transmitting its disruptive spirit. As Metro Bank continually states,
“No one needs another me, too.”lxii

The organization aspires to be a great brand. It is Vernon Hill’s belief that great
businesses can build fans and that in legendary brands, the customer and the company
become one (authenticity). In that sense, Hill and his team are relentless and so obsessed
that everything from the pens to any of their customer channels (internet, call center, etc.)
is brand aligned. So strong is their commitment to this that they took a break in their
store expansion, as they feared that their exponential growth could negatively affect the
reliability of their brand. They knew that they couldn’t compromise the stores’ service,
which is one of the key pillars of turning customers into fans and recommending that
others do business with them as well.

The importance of the three primary elements that the bank selected to build a great
brand (figure 11.3) shouldn’t be underestimated. Metro Bank firmly believes in its
business model and execution. Therefore, it doesn’t invest too much in advertising. And
unlike other banks, they never advertise price or rates; they only advertise their unique
service and convenience. In 2014 the bank invested only €116,000 in marketing, and the
number of customers grew by 100 percent. In 2015 it spent even less, approximately
€70,000, yet its brand awareness was 71 percent.

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Hill and his team decided to invest in improving the service and culture instead. This
generated incredible word of mouth and great PR, which led to the bank receiving
awards and being recommended by Mumsnet, the United Kingdom’s leading parenting
network. The endorsement happened because of Metro Bank’s focus on children through
its Kids Rock program, which teaches children about the importance of saving and
educates them financially and also because each of its state-of-the-art stores, which cost
€3.1 million each, has a baby-changing room. In 2014 The Mail named them the “best
current account” in Britain. Fairer Finance named them the number one bank when it
comes to customer service, with a score of 93 percent. The second-place bank had a score
of less than 10 percent.

Metro Bank is fanatical about the brand. Everything is brand aligned, and nothing is left
to chance, including the five senses. Metro Bank uses design as a competitive weapon,
and it is Shirley Hill, Vernon Hill’s wife, who is responsible for ensuring the branding
integrity and, through her design company, defining the look and feel of the Metro Bank
stores. The stores immediately set Metro Bank apart from its competition with their
grandeur, bright red and blue colors, meet and greets (more on these later), lollipops, and
dog biscuits. Even from the outside, you know you are about to experience something
different. One of the bank’s values is transparency. Therefore, all stores need to have a
minimum of sixteen feet of glass. The locations of the stores are everything, so it is hard
to find new places to open them. Nothing is left to chance; their positioning, typically on
a high street corner (ideally with traffic lights), allows Metro Bank to avoid paying for
ads, as the stores are its best advertisement.

To ensure that its business model is evident externally and internally, Metro Bank
delivers and executes its value proposition day in and day out in many ways. Here are
some of them:

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- It’s open seven days a week, three hundred and sixty-two days. The bank’s
hours are 8:00 a.m. to 8:00 p.m. Monday through Friday, 8:00 a.m. to 6:00 p.m.
on Saturday, and 11:00 a.m. to 5:00 p.m. on Sundays and bank holidays.
Locations open ten minutes before these opening times and remain open ten
minutes past the closing times.
- The bank opens more business accounts on Sundays than during the whole rest
of week. This happens because during the week people with SMEs are working
and don’t have the time to go to the bank.
- It offers instant account opening for personal accounts. It takes a maximum of
thirty minutes to set personal accounts and ninety minutes for business
accounts.
- When you open an account, Metro Bank deposits three euros in your account.
It’s a small amount, but the gesture is very significant.
- Metro Bank offers a small, simple, and straightforward line of products and
pricing. Not only is it clear for customers, but it also helps the whole team focus
on what is most important—managing customers. Since Metro Bank does not
work with investments or wealth management, companies that provide those
financial services recommend it to their customers, because it is not seen as
competition.
- Each store has a €58,000 Magic Money machine that counts coins free of charge
for customers and noncustomers alike. Once you drop in your coins, the
machine will count the money and print you a receipt, and you can get your
money there and then. Because Metro Bank does activities at local schools, if
children can guess, within a euro of two, how much they have in their piggy
banks, they get a branded prize.
- If children make deposits in their accounts for five months in a row, Metro Bank
gives them six euros (five pounds). The bank calls this the Magic Money 5 for 5
Club, and the idea is to get children excited about saving.
- Metro Bank offers a safety deposit vault. This was something many banks in the
United Kingdom had stopped doing, as they deemed it too complex. In the
words of Vernon Hill, the complexity the other banks were talking about was
having a customer fill out and sign a form and then handing him or her the
keys. Metro Bank’s safety deposit vaults have proven to be a big hit with the
Asian communities in greater London, as they tend to have jewelry that is only
used in special ceremonies and require a safe place to keep it. Because Metro
Bank is open quite early and closes quite late, they can pick the jewelry up early
on the day they need it and return it at the end of the same day. This has been so
successful that the bank is almost out of deposit boxes, and the safety deposit
income covers one of its biggest fixed costs, the ground rent for every Metro
Bank store.

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 - The bank also has what it calls the “Dogs Rule.” While people can’t take their
dogs into other banks, in Metro Bank pets are welcome. For the dogs, there are
biscuits and a branded bowl of water. And when the customers leave, they can
take a branded bowl with them. There’s even a poop scoop so employees can
pick up any mishaps from the pets.
- It’s Family-Friendly Zone initiatives include not only the Magic Money 5 for 5
Club and Kids Rock, which are all about children feeling welcome at its stores,
but also the Money Zone, which is Metro Bank’s school program. Its main
purpose is to work with schools and the community to teach children the basic
principles of money, saving, and banking. Schools that join the program are
provided a full set of teachers’ notes that range from lesson plans to ways of
linking the Money Zone to the wider curriculum and books for the children. In
2014 14,500 school children went through the program.
- Through the Dogs Rule and the Family Friendly Zone, the organization is able
to tap in to the quickest ways to get into people’s hearts, which are their
children, grandchildren, and pets, and almost immediately build an emotional
connection that generates fans, not customers.
- Metro Bank is the only bank in the United Kingdom with a drive-through. The
Slough store, which is located in a suburban area, allows parents with children
and disabled customers to do business in a way that is much easier for them.
- The branded pen is a simple but strong example of how obsessed Metro Bank is
in terms of the alignment of its strategy, brand, and behaviors. Most retail banks
in the United Kingdom have nonbranded pens attached to their counters. The
message they send is “Don’t steal from us,” which has a negative connotation
and sends the wrong impression to customers. This happens because things are
viewed from a cost center perspective. Somewhere, those responsible for the
cost center that manages the pens decided they could cut some costs there and
create some savings. This happens because it is not the customer and the
customer experience that are at the core of what the organization is doing but a
siloed mentality that is focused on an inside-out approach. Metro Bank, true to
its value proposition, doesn’t chain the pens; it has branded pens that it gives
away. The goal is not to reduce the number of pens given out but to increase it.
The bank says its goal is to have three pens in each household in greater
London. Vernon Hill famously stated that, when he was leading Commerce
Bank, in one year it gave away twenty-eight million branded pens. A small
gesture, not expensive but 100 percent aligned with Metro Bank’s brand
promise, that sets it apart from the other banks.

These are differentiators that not only separate the brand from its competition by
executing on its value proposition but also give its customers social currency. Things for
them to talk about at Sunday lunch, on social media, and to their friends and family,
reinforcing the brand’s strength, bringing more customers in, and keeping the ones it has

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longer. Because Metro delivers on these consistently, its customers are brand advocates.
This is what’s permitting Metro Bank’s customer base to expand at record rates.

Customer experience

To fanatically execute on its strategy and brand promise, Metro Bank has put in place
systems, processes, and tools, as well as a culture that reinforces and adds value to its
business model. The bank says that it doesn’t put itself in the customers’ shoes; it actually
walks a mile in them.

As previously stated Metro Bank does not consider itself a bank, but a retailer that
operates in the banking industry. Consequently, it is not from banks that it takes best
practices, but instead from power retailers like John Lewis. Metro invented its own mode
of banking when it came to service, innovating its way to success by completely
disrupting the industry and going back to the basics of business when it came to the
products it delivers. The bank ensures that its model, in part inspired by fast-food chain
McDonald’s (Vernon was a franchisee), provides consistency in every store and at every
interaction, leading to reliability and ultimately to customer trust and profitability.

Most banks in the United Kingdom are closing branches and pushing people to the
Internet and the cell phone in an attempt to lower costs. Metro Bank’s model is based on
its physical locations, which is where it demonstrates its values and value proposition
live and in color. To open a personal or business account, the customer needs to go to the
physical store. This is how Metro Bank controls the influx of new clients. It is Metro’s
belief that if it allowed new customers to open accounts online, the number of customers
might increase even faster, and the bank wouldn’t have the infrastructure to continue to
deliver its unique value proposition consistently.

Still, its most used channel is mobile. People only go to the branch for certain things, such
as opening an account or talking about a mortgage, and bank employees are ready to
deliver an excellent experience to them on those occasions.

This human interaction helps create a stronger emotional connection that turns
customers into fans and gets Metro Bank the word of mouth it needs, as it invests very
little in marketing. Fans are the core of its business model; through them Metro Bank
expects to achieve its customer growth and without them it’s not possible to achieve
long-term sustained growth. There are many channels for customers to interact with the
bank, which allows customers to select the ones that are the most convenient for them.
Metro Bank invests heavily in technology. This ensures customers an effortless, seamless
experience when using any of its channels, allowing a single view of the client in real
time. This allows the bank not only to provide better support but also to anticipate needs
and potential issues. In 2015, Metro Bank invested €35 million in upgrading its
technology. The bank uses Microsoft Dynamics and T24 from Temenos as their core
banking systems, which are fully integrated and upgradeable, which keeps costs low.

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Aligned with the themes of convenience and service, every one of Metro Bank’s forty
stores (at the end of 2015) had a meet-and-greet person at the entrance to provide a warm
welcome and to quickly take customers to whichever colleague could help them with the
question that brought them there. Since people only go into the store for a special reason,
Metro wants to make the interaction efficient and effective and also a great experience.

Of customers who come in to open personal accounts, 89 percent of them leave with their
account fully activated or, as they say at Metro Bank, get out working. This means their
credit and debit cards are fully enabled, their Internet account activated, and the credit
process approved. The process end to end lasts between fifteen and thirty minutes.

For business customers, 60 percent get out working. The process takes up to ninety
minutes, as opposed the average of six weeks that it takes for other banks. This process
ensures that people’s needs are fulfilled at the point of sale and at the time that they
choose.

Metro Bank has also established its customer lifetime value (CLV), and because it doesn’t
segment its customers (that would go against its principles, as Metro Bank believes every
customer adds value), this is a major factor when it comes to making decisions, such as in
a customer dispute. Most of those discussions between banks and their clients in the
United Kingdom are on average because of €140 euros. Since the Metro Bank customer
lifetime value largely surpasses that, plus all the work and costs a dispute generates—
filling out the forms, telephone calls, team members’ time—the bank is delighted to give

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customers the €140 back. They know that everything they do below the CLV is a plus.
Currently, Metro Bank’s net promoter score runs between 75 and 80 percent, the highest
score in the banking industry in the United Kingdom. It is followed by First Direct with
66 percent. All other UK banks have significantly lower NPS scores: NatWest, which is
third in the ranking, has an NPS of 33 percent.

And 62 percent of Metro’s new customers come via referral by existing customers.
Customers choose Metro Bank because of the whole experience, from how they are
treated to the stores to the hours to the mobile app to the online experience, and so on.

To achieve everything that has been mentioned, Metro Bank is strongly focus on its
organizational culture. The bank understands that everything it does can be copied
except the culture, which cannot be replicated. The culture of the organization needs to
reinforce the model, so it needs to be everywhere and to be unique.

The culture starts at the recruitment stage. Metro Bank only hires people with strong
interpersonal skills who have a passion to serve. As they say, “If you don’t smile at the
interview, you most certainly won’t get a job at Metro Bank.”lxiii The bank trains for skills
and hires for attitude; this ensures the right fit. Also, preferred hires have experience in
retail or hospitality, so most employees come from John Lewis, Sainsbury’s, and so on.
Up to 69 percent of Metro Bank’s staff do not have prior banking experience.

Once people join the organization, they train for six weeks. Two days cover the
operational aspects of the job; the remaining five and half weeks are about serving and
engaging with the customer. On their first day at work, they meet and talk with Craig
Donaldson, Metro Bank’s CEO. He talks to the new team members (there are no
employees at Metro Bank) about the mission, the vision, the model and the culture,
explaining to them the importance of the latter for them to be able to execute the former.
The bank is all about carrying out its business model 100 percent because even at 99
percent, “there are still real people that were not served properly.”lxiv Team members
either “fit in or opt out.” Because the bank has a “don’t drag the body” rule, if you don’t
fit in it will unleash your talents to another organization immediately. Metro Bank
doesn’t want anyone tarnishing the brand, because every interaction the customer has
with the brand will either pull him or her closer or push him or her away. There is no
such thing as a neutral. That is the because every interaction the customer has with the
brand will either pull him or her closer or push him or her away. There is no such thing
as a neutral. That is the point of the “walk a mile in the customer’s shoes” principle; it’s
about real empathy.

The company is very focused on training and development its team members so they can
deliver AMAZE regularly.

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Metro Bank also uses technology to ensure that everyone has access to any question that
has ever been asked of them and its answer, which will include the appropriate forms
when applicable. The tool used for this, called Metropedia, allows team members to be
quicker and lose less time getting back to customers and is updated daily. Vernon Hill
stated that he wouldn’t know how to run the business without Metropedia.

There is also a rule that you only need one team member to say yes to a customer, but
two team members are required to say no. In Metro Bank’s vocabulary, no is a dirty
word. Team members have two options: they can either say “Yes, let me take care of it for
you” or “Let me find out a way to get this solved.” In this process, they find any rules
that might hinder them in turning customers into fans. For those rules Metro has the “kill
a stupid rule” policy. Every single keyboard has a kill a stupid rule button that sends the
information to the department that reviews the rules to be analyzed and followed up.

In 2015 Metro Bank invested €35 million in technology and €23 million in training.
Because processes and technology do all the hard work, people are liberated to do what
they do best—AMAZE, turn customers into brand advocates, improve the culture, and
make the team better.

There are no sales targets, as the bank believes they drive the wrong behavior. Metro
wants its people to focus on the customers, and there are rewards and recognition for
those who excel at executing the model.

Instead of using a mystery shopper to see what people are doing wrong, Metro has what
they call the magic shops to check what people do incredibly well. It wants the
relationship between the leadership and employees to be based on trust.

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After nine months, all team members are eligible to get a professional banking
qualification. Salaries are on the lower side of the industry spectrum, but this doesn’t
seem to affect the employee experience negatively, as 96 percent of Metro team
members—approximately two thousand employees—are proud to work for Metro Bank.
The remaining 4 percent are happy to work at the bank, and in true Metro Bank form,
this is something it is actively working on improving, as it means that there are areas for
improvement in the employee value proposition.

Just as the team members are the ones who bring the Metro Bank experience to life, those
in leadership roles ensure that the team members have the right tools, processes, and
systems to deliver it. Leaders must energize and coach people. To ensure execution of the
leaders’ roles, Metro Bank has three additional values for leadership beyond AMAZE:

- Inspire. Leaders must inspire their team members to deliver and execute the
Metro Bank business model, live the brand, and be part of the culture.
- Nurture. Leaders must help their people be better at what they are or what they
do, ensuring the leaders’ jobs get easier along the way. As talent rises, fewer
issues occur, more innovation happens, and people become more empowered
and engaged.
- Game changer. Leaders must help drive innovation within the organization, and
challenge the status quo.

Being that the Metro Bank culture comes from the top down through the vision of its
chairman and CEO, customer-centricity is embedded in all it does and is at the core of its
business model, allowing the whole organization to be relentlessly aligned because the
team members see the behaviors and values being lived by their leaders.

This purposeful leadership resulted in Metro Bank’s CEO being named the United
Kingdom’s highest-rated CEO with 99 percent approval in an anonymous employee
survey conducted by Glassdoor in 2016.

Continuous improvement

The bank uses the 90/10 principle, meaning that 90 percent of what it does is based on
customer insights and feedback and 10 percent on things that neither the customer nor
the industry know yet that they need. And since everything the bank does is about
actually living the brand and executing the value proposition uncompromisingly,
continuous improvement plays a pivotal role. Vernon Hill said that Metro Bank “needs
to be better tomorrow than it is today”lxv because it must deliver the best experience
while complying with all the regulation and laws. It cannot afford to betray itself in its
quest for fans, not customers.

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All the value-added initiatives mentioned in the brand section come one way or another
from customer or employee feedback. For example, there is no rule that banks have to
ask people for two forms of identification to open an account. Banks do this because it
saves them work, as they have outdated technology, and the customers do the all the
work for them. Metro decided that people just need to bring a photo ID, and technology
could do the rest of the work.

Metro Bank relies on technology and its processes to generate continuous improvement
and therefore is always refining the experience. By using a third-party banking
applications from Temenos, the T24, Metro can keep costs low while providing a
seamless experience to the customer. A study from Deloitte and Temenos showed that
companies that used this third-party system had on average a 19 percent higher return
on assets and 6.5 percent lower cost-to-income ratio.

The kill a stupid rule process is a great, accessible way of bringing continuous
improvement to every corner of the organization. It not only embeds the customer-
centric culture but generates improvements that are not expensive and are mostly
common sense. For example, why should banks close at 4:00 p.m. when people are still at
work and won’t have a chance to get there? People could try and go at lunchtime, but
that’s when the banks also send their people to lunch, so you have big queues and
terrible service. This process also enables people to be coached and learn, as they always
get feedback about the rule they have submitted.

The financial institution considers itself a listening and learning organization, as it looks
at the VoC and VoE to understand what can be improved to more effectively and
efficiently deliver the best experience to the customer. There are regular board meetings
at which leaders spend three hours going through complaints and customer comments
and define what improvements can come from them.

How does Metro Bank determine if it is indeed generating fans and what requires
improvement?

Metro Bank uses the deposit as the core indicator that it is getting fans—deposit growth
by store, for example. They also look at how many accounts are opened; how many
people are switching to Metro Bank? And the key number is the comparable store
deposit growth, just like a retailer. No other UK bank does that.

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This continuous improvement focused on what customers want also saves Metro Bank
some money. Take, for example, the opening of a personal account, which takes between
fifteen to thirty minutes, and most clients leave with their accounts fully operational. For
Metro Bank, it also means significantly lower costs. For example, the bank now collects
customer signatures on their tablets; this saves two minutes in opening the account and
ten minutes in the back office, simply by making the process more efficient for the
customer. On top of that, the change saved €874,000 on paper, and productivity is 15
percent higher every day.

Typically, banks also send about five letters to each customer: one for the debit card,
another for the PIN, another for the credit card, and so on, so a significant amount of
money is saved on that, especially if you consider that Metro Banks opens on average one
thousand new accounts a day.

Innovation

Metro Bank’s objective is not to be the best UK bank; its plan is to break the mold and
truly revolutionize the industry by looking outside it, taking best practices from power
retailers, and applying them to its business model.
The goal is to be a great brand, period. So its benchmarks are the best trailblazing retail
brands, and it most certainly looks at what is happening outside the banking industry
and what those great brands are doing, then leverages it back with its business model.

Vernon Hill said he wants to “Appleize” the banking sector, and its starts with the fact
that Metro Bank sees itself as being in the retail business, not banking. The bank also
wants high growth and high returns, which leads to a keen focus on continuous
improvement and innovation in order to differentiate itself while keeping costs low. As
disruptors, revolution is in Metro’s DNA. As we have seen, innovation happens top-
down and bottom-up because the customer-centric culture fosters it. It’s not just about
how to ensure that the customer gets what he or she wants. (“An easy way to cancel my
card when I lose it” was the comment a customer made in one store, which was
overheard by one of Metro Bank’s developers.) More importantly, Metro provides its
customers with things they didn’t even think they needed but can no longer live without.
(The developers created a “freeze card” tool that allows people to literally switch their
cards on and off in the Metro Bank app whenever it suits them. If a customer loses a card
or forgets it in a purse or jacket, the problem can be solved in an easy and fun way.)
Naturally, this demands a continual quest for what’s next.

Metro Bank Results

Metro Bank chose a service differentiation strategy that was customer-centric and had a
cost leadership aspect to it. Its relentless alignment has proven to be its biggest
advantage, with growth exceeding both forecasts and expectations.

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Instead of just talking about giving customers what they want, Metro Bank delivers it,
which is a refreshing change from the usual lip service banks tend to pay to being
customer oriented without any real and consistent actions that validate it in the eyes of
their clients and employees. The model drives the results; Metro Bank simply ensures
that everything it does, from hiring people to technology to look and feel of the stores,
supports its delivery.

Metro Bank leadership firmly believes in executing the model at every interaction. They
say there are no “neutral moments,” because it is their belief that once you decide to
accept that, you agree that mediocrity is acceptable for your customers.

Being a startup with a high growth, Metro Bank must keep a strong focus on the culture
in order not to dilute its value proposition and ensure that it has the right people in its
model. Also, high growth can have a significant impact on the reliability of the customer
experience. This needs to be a top priority for Metro Bank if it wants to continue to build
a fan base and thus be able to expand its operations to the whole UK territory eventually.
These two are currently the bank’s biggest challenges on its path to building a great
brand.

Have no doubt that Metro Bank UK, just like Southwest Airlines and Apple, is a
disruptor that came up with a new business model that ended up elevating its whole
industry to another level. In the case of Metro Bank, it was all about bringing fun into
banking by aligning technology, people, and place to deliver unparalleled convenience
and service to its customers and becoming a world-class brand along the way.

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 Chapter 12
The Customer Experience Executive

The CXO/CCO is a disruptor within the organization, helping the company to

innovate and become more competitive by focusing on the customer.
—Eliana Medeiros

In a book about introducing the public to customer experience, I have to talk about the
role of the person responsible for stirring the CX inside the organization. The titles vary
significantly, from customer experience manager to chief experience officer. Sometimes
they are inserted in the customer service functions, others in the marketing function, and
sometimes they have no link to a functional area and reporting directly to the CEO.

There are so many possibilities that it really is up to what suits the organization best and
drives it to achieve whatever results it aspires to. This is a role that disrupts the
fundamental structure of companies.

Above all, there needs to be clarity on why the organization needs someone managing
the CX. What does it want to achieve? What is the strategy? This should determine how
the customer experience executive role fits within the organization. Does it make sense
that it is more functional, meaning it oversees some functional areas? Or should it be
more of an advisory role, in which the executive manages a smaller team and acts as an
advisor and consultant? Or even a mix?

I would, however, like to highlight that in my experience it is a more effective and

efficient process when the role reports directly to the CEO, and it is an executive position
on par with the usual suspects (CFO, CMO). He or she must have a seat at the table.
Otherwise, the customer will never be a priority within the organization. If anything,
because there are a lot of politics and foreign waters one needs to navigate to execute a
CX transformation inside an organization. But again, this will depend significantly on the
business’s existing internal culture. It is crucial that the CEO is not only on board and
aligned but also heavily involved and a champion for CX.

The role of the CXO is to ensure that the whole organization is working to deliver an
experience that is 100 percent about the customer. He or she does this to ensure that the
customer experience the company provides is a competitive advantage that allows the
business to grow and increase its bottom-line results.

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For the CXO to achieve this, he or she needs to understand what the value drivers are for
the customer; to interview customers, employees, and partners to map the customer
journey; and to comprehend what the customer moments of truth are. This allows the
CXO to work with all functional areas to identify the company’s moments of truth to
ensure that the value proposition is being delivered at every interaction with the
customer. This means reviewing internal processes, systems, and tools with other
departments and supporting them to achieve customer-centricity and line of sight to the
strategy, the mission of the business.
The role is slightly different in a mature organization and a startup. In mature
companies, the role is changing or supporting the evolution to a customer-centric culture.
In startups, it is about building a customer-centric culture.

This is not a “let’s go and visit customers and be a brand ambassador” type of job; this is
about leadership, coaching, strategy, service, and financial savvy. It requires deep
expertise. No, not everyone can do it, unless they are willing to juggle many, many hats
and have the right skill set and, even more importantly, the right attitude. That is why it
is recommended that the company chooses someone from within the organization (nine
out of ten CXOs are existing company employees) who already understands its ins and
outs. However, a seasoned CXO from outside the company can jump into the role and
help the company achieve customer-centricity.

To ensure that customer-centricity is embedded in the organization and therefore a

sustainable competitive advantage, the CXO needs to work in close collaboration with
the CHRO and the CMO. I call this the holy trinity of customer-centricity, because you
need to work internally and externally to get the whole company on board and these key
departments need to work closely together for that to be attained.

Many discuss an expiration date for the role, because once the company achieves
customer-centricity, what is next for the CXO?

On average, CX transformation takes between one and three years. So again, it depends
on the company’s strategy. How will the organization continue to live its customer-
centricity and maintain the achieved sustainability?

The role is still new and evolving as I write these lines. It is worth considering the CXO
as a kind of COO, but from the customer-facing side. So the CEO needs to have clarity
about what the company wants to achieve and prepare the organization, especially the
executive team, for this new position. But also, as the company reaches the stage of
authenticity, what can the CXO do to ensure it will continue this way? In an evolving,
hectic, competitive market, this kind of project is not a one-off. That is why the CXO
needs not only to achieve sustainability but also to support the company in maintaining a
superior customer experience despite the evolution in technology and changes in
consumer trends and behaviors. So innovation should play a major role in the CXO’s
responsibilities, not only when the organization is going through the CX transformation
but also once it has concluded.

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 Chapter 13
Conclusion

At the end it is the customer that counts.

—Warren Buffet

I want to leave you with some relevant final thoughts about customer experience that I
firmly believe are worth taking the time to read, reflect upon, and generate debate about
in your organization. Then come to your own conclusions.

- CX is about people, people, people, and people as customers, as employees, as

leaders, as partners.

- Great experiences don’t happen by luck; they are designed. They come from the
real understanding of customers’ needs and wants. In the words of Steve Jobs,
you need to “get closer than ever to your customers. So close that you tell them
what they need well before they realize it themselves.”

- Big data provides a tremendous opportunity, as it can indeed help you better
understand your customers’ needs and wants, enabling you to develop
products and create journeys that truly enhance their lives.

- Customer experience is a competitive advantage. Therefore, your CX strategy

needs to demonstrate the impact it will have in the bottom-line (i.e., the value it
generates). If you cannot quantify it, correlate it to what it does for the company
performance, you won’t be successful and whatever you start will soon be
finished. Remember the ultimate objective of a business is to make money.

- The essence of CX is how you make customers feel. It is about companies

enriching people’s lives. In a legendary brand, the customer and company
become one. Some of the most beloved organizations, like Apple, Metro Bank,
and the Portuguese brand Delta Café, have something in common, a stellar
customer experience.

- Now, more than selling products (and remember, they need to be great
products), it’s about selling an experience. Playing it safe is no longer safe for
today’s organizations. It’s how you deliver, not only what you deliver.

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- When I talk (repeatedly) about relentless alignment, I am most certainly, 100
percent including the execution part. Execution is everything. Let me repeat,
everything. You can build your business model, decide to have customer
experience as your competitive advantage, talk about having a great culture and
how to engage your employees and all that, but if you don’t deliver it and you
don’t support it with actions and behaviors, please don’t expect miracles. That is
hope in its lowest form, which is waiting for something to happen when you
haven’t really done anything to make it happen. In business, if you want to
succeed, you need to have hope in its most elevated form, which is working for
things to happen. The latter takes you places; with the former, well, you might
as well just toss a coin in the air and wait for all your competitors to get your
business and get you out of business.

- Always choose quality over quantity. If you handle the quality, the quantity will
come. Metro Bank is an excellent example of that. It managed to obtain high
growth in a nongrowth world.

- Today’s multi–touchpoint, multichannel, always-on, hypercompetitive market

is not for the faint of heart. It is for the innovative, the creative, the not afraid to
fail, and those willing to take risks.

- Customers now may have as many as four different mobile devices, which
means they are always connected. Thus, even inside a store, they can look for
information and other options available. Half of all millennials uses social
media, forums, and online customer reviews before they make a purchase. You
need to work on making your experience as seamless and effortless as possible.
To achieve this, a single view of the customer is a must, so be obsessed with it,
and look for how you can move from multichannel to omnichannel.

- To deliver an omnichannel experience, you cannot work in silos, where each

area is only focused on its own part. You need to think as a network where
everyone is part of the CX puzzle. Yes, this is a great challenge, but with it come
great opportunities. Just look at what companies like Nike, Apple, and some
selected few are doing. They are embracing these new possibilities and building
a whole new future for their organizations. In that process, these brands are
adding value to people’s lives and creating new stories and feelings that
reinforce emotional connections and create brand advocates. These companies
know that they are in the happiness business, whatever shape that takes in what
they do. At Amazon, for example, it is same-day delivery and the one-click
button.

142
- Go back to the Stage of the S-Curve graph in chapter 4. You must remember that
companies that do not innovate or redream their businesses simply do not
survive. Just think of Kodak. Danny Meyer, the CEO of Union Square, who
owns some of the top US restaurants said it best when he stated that “if you are
hot today, no matter what your business is, you will be cold tomorrow.”lxvi

- To innovate and deliver a unique customer experience, you need a culture that
reinforces the model, because it’s your employees who provide the day-in-and-
day-out experience and reliability that leads to trust. This requires consistency,
which means you should always be on brand so that you can deliver your
unique value proposition in every single interaction.

- Measure everything you do concerning CX consistently and methodically to

confirm the impact.

- Customer experience is for the bold, outside-the-mold leaders and businesses,

because very often it requires letting go of short-term profits for long-term
success. It’s for the ones that are in it for the long run. No sprint race, it is
instead a marathon, so yes, indeed, it is not for everyone. If you decide to go for
it, remember to start small. The right 1 percent improvement can make all the
difference.

- Remember relentless alignment at all times. Whatever you do, it must align
back. Nobody said this was easy, after all. As they say at Amazon, “The hardest
job is the last yard,” and that’s why you should be fanatically, totally obsessed
with execution.

- Making your customers happy works 100 percent of the times, regardless of the
industry you are in or if you are B2B or B2C.

- The formula of coming up with a product and then finding customers for it no
longer works. That is the reverse of what it should be—finding customers first
and creating a product that helps them next.

- Don’t focus solely on the touchpoints. Look at the customer journey as a whole,
so you can understand what the customer is trying to achieve and figure out
how can you help. This will give you a better idea about the why, the how, and
the what when designing the individual touchpoints.

143
- An excellent CX is currently the best way to generate the most powerful
marketing tool—word of mouth. In the words of the amazing Maya Angelou,
“People will forget what you said, people will forget what you did, but people
will never forget how you made them feel.” We are all in the happiness business
now. It’s all about adding value to your customers.

- Customer experience only succeeds in an organization if the employees are

strongly aligned with the business purpose and have the line of sight to how
each of them as an individual contributes to the company’s strategy. This is a
requirement because CX is an advantage that works based on the culture of the
organization. You can’t buy it; you can only build it from the inside and
reinforce it through continuous improvement.

- Your internal culture will make or break your strategy and therefore your
customer experience. You can’t be customer-centric and deliver that competitive
advantage consistently if your team members’ behavior and actions are not 100
percent aligned with it. The culture needs to be a total fit with the strategy and
the brand.

- For a culture to succeed, it must be based on trust, as trust is what holds all
relationships together, employees-organization and brand-customer.

- To have a strong culture, you need to have the right talent inside your
organization, because “a company is no better than the employee who is serving
the customer.”lxvii The process starts even before the recruitment stage.

- You must be agile in updating, correcting, and improving things and reiterate as
often as possible with customers to ensure what you do and how you do it
delivers your value proposition continuously and consistently.

- While startups must focus on building a customer-centric culture from the

beginning, mature companies very often need to go through a significant
evolution process from being product-centric to being customer-centric. This is
in itself a massive undertaking that can take on average from one to three years,
depending on, among other things, size, technology, and of course, the
organizational culture.

- Customer experience transformation may start small, but to ensure gains and
keep the momentum, celebrate all wins, (big or small).

144
 - While touchpoints are critical, you need to manage the customer journey. For
example, at an electricity company, customer service might have a high
satisfaction score when it comes to the handling of customer calls to activate
service—the touchpoint. However, maybe, looking at the whole customer
journey, that step is unnecessary. So always look at the bigger picture and then
narrow it down.

- Research has shown that, by managing the customer journey, you will be able to
improve the quality of the service while also reducing costs. So the old myth
that to provide great experience one needs to spend more is being put to rest.
Technology has enabled organizations to provide mass customization at lower
costs.

- A great CX transformation will affect the customer base, the sales revenue, and
the customer value.

Final Thought

Before letting you go, I want to leave you with this thought, which is not a criticism,
merely a fact. After reading this book and understanding how in today’s world with so
many changes in terms of how brand is perceived and where, in order to keep up and
survive, the vast majority of executives (93 percent) say that customer experience is their
primary focus for the coming years, why do most companies still allocate larger budgets
to traditional marketing, which is about setting the expectation, instead of investing in
relentlessly executing their brand promises by uncompromisingly delivering their
unique customer experience in order to generate positive word of mouth?

To me, it is as if they forget that “the customer experience is the next competitive
battleground”lxviii and that “reliance on what worked in the past [is] no longer
sufficient.”lxix However, in fairness to them, change is an option because indeed survival
is not mandatory.lxx So in the end, it is up to business leaders to decide how successful
they want their businesses to be and how long they want their businesses to be in the
game.

I sincerely hope you found this book insightful, and if you take just one thing from this
book, let it be that every interaction that a customer has with an organization counts, and
the companies that understand this best and untiringly work to improve those
interactions in an efficient and effective way that reinforces their strategy are the most
successful ones and that outgrow their competition by far. #excellence

145
146
[Blank page]

Thank you for reading this book. I hope it was a worthwhile experience. If not, you
should know by now that feedback is a gift, so please share it with me at
eliana@uirtusacademy.com. The previous blank page is for you. While not everyone
owns a business, everyone is a customer, so please write down your best customer
experience, and based on what you learned in this book, look to understand why it was
the best experience. How did it make you feel? What was it that the brand or
organization did that made you feel that way?

Since we live in the social media era, please feel free to share your story on Instagram
@uirtusacademy.

147
148
 Acknowledgments

This book has been a labor of love, and as with everything that involves such an amazing
feeling, it could not have been done in solitude. You always require the help, support,
inspiration, and guidance of others. It is a mammoth task that one simply cannot do by
oneself. To the biggest contributors who allowed us all to be holding this book in our
hands. I want to say thank you:

Jeanne Bliss, John Goodman, and Professor Nader Tavassoli, I couldn’t have asked for
better teachers. Your work had the deepest impact on mine and took my career to places
I couldn’t even have imagined.

Ana Jacob, for being the ultimate supporter a friend could ask for.

Ana Teresa, my true fan and my friend, for always being there for me.

Alexandra Lemos, for being the most inspiring person I have ever met. I still wonder if
this book would be in our hands if it hadn’t been for you and your magic coaching
certification training. I haven’t even grasped the full impact of having you and your
teachings in my life.

Alexandra Rucznycka, for embodying tenacity, will, and perseverance in a soft and
elegant way. Thank you for being an inspiration.

My colleagues at the ICC coaching course and the course guest Luís Ferreira, for teaching
me so much. You are beautiful, amazing people, and I am honored to have your
friendship. Luis, my honorary coach, I can’t thank you enough.

Liliana Costa, for all the support and help you have given me. Thank you is not enough,
so I’ll just say that with you, I become the dream team. You are a true marketer, a
beautiful human being. The world doesn’t even know what’s coming.

Hannah Lo Bao, thank you for being you. It sets me free. The world is your oyster, and
you will be as successful as you want to be. I am forever your brand advocate. I just have
this to tell you—minister of transport!

To Rahul Bakrania, Genny Tap, Mark Booth, Bill Kelly, and Rob Dranitzke, for seeing in
me more potential than I saw in myself. The fact that you believed in me made my life
richer and better beyond my dreams. The effect still ripples on. I am forever grateful to
you.

All my colleagues who have help me do whatever job I had at hand. My professional
achievements wouldn’t be possible without you. I’m forever grateful.

149
Canva Design, thank you for being the coolest tool ever. You turned a CX designer
into a graphic designer. All drawings in this book, including the cover, were done using
this amazing tool, and may I add for free. If that isn’t an amazing customer experience, I
don’t know what is. You have a hardcore brand advocate in me.

Coursera and Edx, for the best idea ever. What great businesses you are. You more than
fulfill your business purpose and brand promise. I cannot explain to you what it meant to
me to be able to attend the amazing classes with the best professors and the best
universities in the world in the comfort of my own house. From Australia to
Copenhagen, it has been a ride that I will never stop. For a learner like me, you are the
best thing that has happened in terms of my personal development and professional
career in the last couple of years.

Olga, where would I be without you? Thank you for literally helping me write this. This
book is the proof of your generosity to myself and my children.

To my aunt Clotilde, uncle Luís and Barbara, for staying with my kids so many times so I
could actually have a career. I am beyond grateful.

To my mum, dad and brother, thank you for all the lessons. I love you.

All my friends and extended family, one way or another, your love for me has poured
into this book. I love you, and I am very lucky to have your love. You are always with
me!

Tiago, for our amazing children. I am forever grateful to you for opening my heart to a
love I only had imagined before.

My most amazing, adorable, precious, perfect children. You are all that because being
your mother is nothing short of a miracle to me. This book is for you, every single page,
every single word. Thank you for supporting me and giving me time to research and
write it. I love you much more than I can say or show. You are the energy behind my joy,
my happiness, my love, and my dynamism.

Finally, and most importantly, you, the reader, who hopefully became a brand advocate.
thank you for choosing this book out of the many things you could have invested your
precious time and money in. It has been a true pleasure sharing my passion for CX and
excellence with you through this book. My goal is to be your partner for success. You
have a brand advocate in me. If there is anything you believe I can do to support you in
being more successful in your career or your business, do let me, as I will be delighted to
assist you. You can reach out to me by e-mail at eliana@uirtusacademy.com or visit
www.uirtusacademy.com.

Always keep with you the wise words of an even wiser man, Abraham Lincoln: “The
best way to predict the future is to create it.” Now go and create your own.

150
 About the Author

Eliana Medeiros is a seasoned customer experience leader in the luxury industry. Her
passion for people, excellence, service, and strategic vision have allowed her to have an
extremely successful global career and collaborate with some of the top world
organizations.
An entrepreneur at heart, she is the founder of Living the E.Xperience a “collaboration”
boutique firm that focuses solely on helping startups and luxury companies be more
customer-centric and through that drive innovation, long-term sustainability, and
profitability. The goal of her organization is to help people and businesses be the best
version of themselves.

Currently, Eliana is the president of Uirtus Academy, the first global academy focused on
customer experience. Uirtus Academy’s mission is to help businesses and individuals
achieve business excellence through customer experience. The organization delivers its
purpose through its CX education + CX consulting + CX coaching services.
Eliana’s goal is to educate one million people about customer experience by the year
2022.

She is often invited to talk about her obsession with customer experience at corporate
events and conferences throughout the world. She absolutely loves it.

Eliana, a self-described avid learner and people lover, can always be found reading a
book about a new interesting topic, meeting different thought-provoking people, or
taking an online course on a subject she is curious about.

She has a degree in economics and is a certified ICC coach. When she is not working, you
can find Eliana baking and preparing desserts for her family in their pink house close to
the beach.

151

Notes

Notes to Welcome
i Peppers, Don, and Martha Rogers, Return on Customer (New York: Doubleday, 2005).

Notes to Chapter 1
ii JWT. “Consumer Trends 2014 & Beyond Report.” Last modified December 3, 2013.
http://www.jwt.com/blog/consumer_insights/10-trends-that-will-shape-our-world-in-2014-and-
beyond/
iii Oracle. “Global Insights on Succeeding in the Customer Experience Era.” 2013.

http://www.oracle.com/us/global-cx-study-2240276.pdf
iv “Vernon Hill: How do you create a growth company in a no growth world?” London Business

School. 2014.
https://www.youtube.com/watch?v=9MmgoIFY9aY
v Experience Matter Blog. “11 Customer Experience Trends for 2016 (The Year of Emotion).” Bruce

Temkin. December 15, 2015.

https://experiencematters.blog/2015/12/15/11-customer-experience-trends-for-2016-the-year-of-
emotion/

Notes to Chapter 2
Ignácio, José Luis, Elena Alfaro, Javier Velilla, Hugo Brunetta, Carlos Molina, Beatriz Navarro,
vi

Luis Martinez-Ribes, Jaime Castelló, Enrique Burgos, Fernando Rivero, Santiago Solanas, Jaime
Valverde, and Borja Muñoz. Customer Experience. www.customerexperience.es.

Notes to Chapter 4
viiAccenture and Forrester. Digital Transformation in The Age of the Customer. 2015.
https://www.accenture.com/_acnmedia/Accenture/Conversion-
Assets/DotCom/Documents/Global/PDF/Digital_2/Accenture-Digital-Transformation-In-The-Age-
Of-The-Customer.pdf
8 Wikipedia, s.v. ”Lehman Brothers.”

ix Fast Company. ” Content Curators Are the New Superheroes of the Web.” Steven Rosenbaum.

April 16, 2012.

https://www.fastcompany.com/1834177/content-curators-are-new-superheros-web
x Google. “Company”
https://www.google.com/about/company/
xi Globalization 101. “What is Globalization?” Accessed, March 12, 2016.

http://www.globalization101.org
xii Holt, Douglas, John Quelch, and Earl Taylor, “How Global Brands Compete”, Harvard Business

Review (2004).
xiii George Ritzer, Globalization: A Basic Text, (Wiley-Blackwell, 2009).

xiv Kevin Robins, Encountering globalization, The Global Transformations Reader – An Introduction to the

Globalization Debate, (Polity Press, 2003).

xv Chris Anderson, The Long Tail: Why the Future of Business is Selling Less of More, (New York:

Hyperion, 2008).

152

xvi Perriman Helen E, Rooma Roshnee Ramsaran-Fowdar, and Priya Baguant, “The Impact of the
Global Financial Crisis on Consumer Behaviour”. Paper presented at the Annual London Business
Research Conference, 12-14 July 2010, London, United Kingdom.
xvii Murasvka, Tatjana, and Gunnar Prause. European Integration and Baltic Sea Region Studies:

University-Business Partnership through the Triple Helix Approach Volume I, (BWV, 2012).
xviii Wikipedia, s.v. “Social Currency.”

xix Fast Company. “How to Measure Brand Value: Likes, Followers, Influencers, Views? No Social

Currency.” Kevin Randall. July 20, 2010. Accessed April 28, 2016.
https://www.fastcompany.com/1672153/how-measure-brand-value-likes-followers-influencers-
views-no-social-currency
xx Jeffrey Gitomer. The Little Red Book of Selling. (Austin, TX: Bard Press, 2004).

xxi Scott D Anthony, The little Black Book of Innovation: How It Works, How to Do It. (Harvard Business

Review Press, 2012).

xxii Goldman & Sachs. “Millennials Coming of Age Infographic.” Accessed April 15, 2016.

http://www.goldmansachs.com/our-thinking/pages/millennials/

Notes to Chapter 5
xxiiiPeppers, Don, and Martha Rogers, Return on Customer (New York: Doubleday, 2005).
xxiv Jeanne Bliss, Chief Customer Officer 2.0: How to Build Your Customer-Driven Growth Engine, (Wiley,
2015).
xxv BMW. “Strategy.” Accessed January 13, 2016.

https://secure.bmwgroup.com/e/0_0_www_bmwgroup_com/unternehmen/unternehmensprofil/strategie/strat
egie.html
xxvi Ritz-Carlton. “The Gold Standard.” Accessed, January 15, 2016.

http://www.ritzcarlton.com/en/about/gold-standards
xxvii Investopedia “What is Apple’s Current Mission Statement and How Does It Differ

from Steve Jobs Original Ideas?” Accessed January 15, 2016.

http://www.investopedia.com/ask/answers/042315/what-apples-current-mission-
statement-and-how-does-it-differ-steve-jobs-original-ideals.asp
xxviii Ostelwalder, Alexander, and Yves Pigner. Business Model Generation: A Handbook for

Visionaries, Game Changers, and Challengers (Wiley, 2010).

xxix Michael Porter, “What is Strategy?”, Harvard Business Review (1996).

xxx de Chernatony, Leslie, and Francesca Dall’Olmo Riley. “Modelling the Components of the
Brand.” European Journal of Marketing (1998).
xxxi de Chernatony, Leslie, and Francesca Dall’Olmo Riley. “Modelling the Components of the

Brand.” European Journal of Marketing (1998).

xxxii Bouchek, Mark, and Cara France, “Build Your Brand as a Relationship,” Harvard Business

Review (May 2016).

xxxiii Experience Matters Blog. “11 Customer Experience Trends for 2016 (The Year of Emotion).”

Bruce Temkin. Accessed December 20, 2015.

https://experiencematters.blog/2015/12/15/11-customer-experience-trends-for-2016-the-year-of-
emotion/
xxxiv Wikipedia, s.v. “Loyalty Business Model.”

xxxv Forbes, “What Is a Brand, Anyway?” Jerry McLaughlin. Accessed January 30, 2016

http://www.forbes.com/sites/jerrymclaughlin/2011/12/21/what-is-a-brand-anyway/#452b15822aa4
xxxvi Wiktionary, s.v. “Servitization.”

153

xxxvii Experience Matters Blog. “3 Responses to Customer Experience = Success + Effort + Emotion.”
Bruce Temkin. Accessed February 1, 2016.
https://experiencematters.blog/2014/10/17/customer-experience-success-effort-emotion/
xxxviii Entrepreneur. “Take a Tip from Jeff Bezos: Customers Always Need a Seat at the Table.” Bob

Thompson. Accessed May 30, 2016.

https://www.entrepreneur.com/article/234254
xxxix Simon Sinek. Golden Circle.

Notes to Chapter 6
xl Lietka, Jeanne, and Tim Ogilvie. Designing for Growth: A Design Thinking Tool Kit for Managers
(New York: Columbia Business School Publishing, 2011).
xli Bernd H. Schmitt, Customer Experience Management: A Revolutionary Approach to Connecting with

Your Customers (Wiley, 2003).

xlii Jeanne Bliss, Chief Customer Officer 2.0: How to Build Your Customer-Driven Growth Engine (Wiley,

2015).
xliii Experience Matters Blog. “The Yellow Brick Road to Customer Experience Maturity.” Bruce

Temkin. Accessed November 1, 2015. https://experiencematters.blog/2009/07/13/the-yellow-brick-

road-to-customer-experience-maturity/
xliv Wikipedia, s.v. “Customer Experience.”

Notes to Chapter 7
xlv Forbes, “Drucker Said 'Culture Eats Strategy for Breakfast' and Enterprise Rent-A-Car Proves it.”
Shep Hycken. Accessed January 2016.
http://www.forbes.com/sites/shephyken/2015/12/05/drucker-said-culture-eats-strategy-for-
breakfast-and-enterprise-rent-a-car-proves-it/#30b43a4474e0
xlvi TechCrunch. “Culture eats Strategy for Breakfast.” Bill Aulet. Accessed June 29, 2015.

xlvii Rob Fuggetta, Brand Advocates: Turning Enthusiastic Customers into a Powerful Marketing Force.

(Hoboken, NJ: Wiley, 2012).

xlviii Rob Fuggetta, Brand Advocates: Turning Enthusiastic Customers into a Powerful Marketing Force.

(Hoboken, NJ: Wiley, 2012).

xlix “Larry Smith: Why We Fail to Have a Great Career”, TEDx UW. November, 2011.

https://www.ted.com/talks/larry_smith_why_you_will_fail_to_have_a_great_career
l Walt Disney Animation Studios. “Studio Life.” Walt Disney. Accessed January 15, 2015.

https://www.disneyanimation.com/studio/studiolife
li Garton, Eric, and Michaels C. Mankins, “Engaging Your Employees Is Good, but Don’t Stop

There,” Harvard Business Review (2015).

https://hbr.org/2015/12/engaging-your-employees-is-good-but-dont-stop-there
lii CBSNews.com “Restauranteur Danny Meyer on 'The Power of Hospitality'.” 2013.

liii Heskett, James L, Thomas O. Jones, Gary W. Loveman, W. Earl Sasser Jr., and Leonard A.

Schlesinger, “Putting the Service-Profit Chain to Work,” Harvard Business Review (1994).
liv Jeni’s.com. “Our Mission-” Accessed 26 May 2016

https://jenis.com/about/

Notes to Chapter 8
Process Excellence Network. Robert W. Swaim. “Peter Drucker on Sales and Marketing.” Robert
lv

W. Swaim. Accessed March 2, 2016.

http://www.processexcellencenetwork.com/innovation/columns/peter-drucker-on-sales-and-
marketing

154

Forbes. “40 Eye-Opening Customer Service Quotes.” Ekaterina Walter 2014.
lvi

http://www.forbes.com/sites/ekaterinawalter/2014/03/04/40-eye-opening-customer-service-
quotes/#4f1bf1e34dc8

Notes to Chapter 9
lviiWatermark Consultancy. 2015 Customer Experience ROI Study. 2015.
lviiiSchmidt-Subramanian, Maxie, Harley Manning, Megan Burns, Dylan Czarnecki, and Kara
Hartig. “How to Measure Emotion in Customer Experience.” Forrester Research, (2015).
lix “Seth Godin: How to Get Your Idea to Spread.” TED Talk. 2003.

Notes to Chapter 10
Contently.com. “How Startup Birchbox Uses Content to Sell Tons of Beauty Supplies.” Shane
lx

Snow. Accessed April 25, 2016.

Notes to Chapter 11
lxi “Vernon Hill: How do you create a growth company in a no growth world?” London Business
School, 2014.
https://www.youtube.com/watch?v=9MmgoIFY9aY
lxii “Vernon Hill: How do you create a growth company in a no growth world?” London Business

School, 2014.
https://www.youtube.com/watch?v=9MmgoIFY9aY
lxiii “Chris Brindley, Managing Director at Metro Bank Customer Contact Expo 2015,”

CallCentre.co.uk, 2015
https://youtu.be/1SVggsZsYKg
lxiv “Chris Brindley, Managing Director at Metro Bank Customer Contact Expo 2015,”

CallCentre.co.uk, 2015
https://youtu.be/1SVggsZsYKg
lxv “Vernon Hill: How do you create a growth company in a no growth world?” London Business

School, 2014.
https://www.youtube.com/watch?v=9MmgoIFY9aY

Notes to Chapter 13
lxvi CBSNews.com. “Restauranteur Danny Meyer on 'The Power of Hospitality'.” 2013
lxvii Warren Buffet, “Announcement of Purchase of Executive Jet Aviation”. 1998
lxviii Forbes. “40 Eye-Opening Customer Service Quotes.” Ekaterina Walter 2014.

http://www.forbes.com/sites/ekaterinawalter/2014/03/04/40-eye-opening-customer-service-
quotes/#4f1bf1e34dc8
lxix Forbes. “This Leader’s Global Assignment in Her 20’s Catapulted Her into Roles Usually

Reserved for Man. Ruchika Tulshyan. 2016

http://www.forbes.com/sites/ruchikatulshyan/2016/05/26/this-leaders-global-assignment-in-her-
20s-catapulted-her-into-roles-usually-reserved-for-men/#5ac6cfe87822
lxx W. Edwards Deming

155

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