Latest / Customer Service Revolution | Customer Experience & Employee Experience for Business Leaders / 248: What Target's Decline Teaches Every CEO About Customer Experience

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248: What Target's Decline Teaches Every CEO About Customer Experience · Customer Service Revolution | Customer Experience & Employee Experience for Business Leaders

• 0:48
  Hello and-
• 0:49
  to the customer service revolution podcast.
• 0:52
  I'm Denise Thompson and I'm joined here by my co-host John DiJulius who has spent 30 years inside the world's most customer obsessed organizations, places like Ritz-Carlton,
• 1:03
  Chick-fil-A, Starbucks, Lexus, KeyBank, helping them all build cultures that turn ordinary transactions into extraordinary relationships.
• 1:12
  John's the founder of The DiJulius Group, author of multiple bestselling books on customer experience.
• 1:18
  and one of the most sought after customer experience consultants and keynote speakers.
• 1:22
  Welcome back, John.
• 1:24
  Thanks, Denise.
• 1:25
  How are you?
• 1:26
  How are you doing?
• 1:29
  Yeah, how's the shoulder?
• 1:30
  Coming along, coming along.
• 1:32
  We've started practicing and I'm getting there.
• 1:39
  Awesome, I'm so glad to hear that.
• 1:41
  I know how passionate you are about baseball.
• 1:43
  I'm glad that I'm glad that it's not over with.
• 1:45
  Well, I could have probably avoided five or six shoulder surgeries.
• 1:49
  Yeah, well, it's something if it's not that it's you know if you're active in other ways, I just saw.
• 1:58
  What's that?
• 1:59
  What are you doing?
• 2:00
  You getting outside?
• 2:01
  Yeah, yeah, yeah, yeah.
• 2:02
  You know, I love to walk.
• 2:03
  I love to be like at the park, walk, run, all of that as the weather starts breaking, just to be out and see the leaves budding on the trees.
• 2:11
  And it makes me feel like spring's really here.
• 2:14
  Yeah, but I wait until it gets a little bit warmer.
• 2:17
  It's still too cold for me to, I'm not as hardcore as I used to be where I'd go in the winter and that.
• 2:22
  Yeah, yeah.
• 2:23
  Well, good.
• 2:24
  Yeah, but now pickleball is the thing.
• 2:26
  Lots of people in the neighborhood playing pickleball.
• 2:30
  I've played it, but not serious, you know?
• 2:33
  And I'm still not, I don't understand all the rules in the kitchen and where you have to hit first and that, so I always need somebody to tell me.
• 2:41
  You need to move, you need to serve, whatever needs to happen.
• 2:46
  How about you?
• 2:47
  I tried it a few times, I like it.
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  Just, you know, gotta find people that want to do it.
• 2:52
  there you go.
• 2:53
  Yeah, well you play tennis too, no?
• 2:55
  Yeah, I mean, I wasn't good at it, but I liked tennis.
• 2:58
  Like, I really enjoyed it.
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  When you can find someone who's at your level, it's really fun.
• 3:04
  you know, but yeah, it's just hard to find.
• 3:07
  It's hard to find people that are free the same time you are.
• 3:10
  Yeah, that can be an issue, I guess.
• 3:14
  Hey, I want to talk to you today about an article that you wrote recently about Target.
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  And I know it's one that stopped a lot of leaders in their tracks, because you made the case that this isn't really a retail story.
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  It's a leadership story.
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  So can we dig into that today?
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  Please, would love to.
• 3:31
  Okay, I think what happened Target is happening in some form in companies of every size, every industry.
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  So let's let's talk about it from the beginning.
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  Most people following Target, following their story, have focused a lot on the DEI controversy, the pride merchandise, the boycotts, the reversal on all of that.
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  But you've said that was the spark, not the fire.
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  What do mean by that?
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  Well, I compare.
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  Target, you know this, every time we do a workshop where we do an opening exercise of what's a brand you can't live without, always was one of the top six to 10 answers that
• 4:13
  someone in the audience, if not more, always said.
• 4:16
  But I compare them to Starbucks, like they lost their way.
• 4:20
  And Starbucks has done that a couple times and gotten it back.
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  You know, now, their new CEO, it's been a year now, their theme this year is back to Starbucks.
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  it's, know, a couple of things, trying to get customers back to Starbucks, but back to what made Starbucks great.
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  And it's just really surprising.
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  In transition, think when one CEO leaves and a new one comes in in corporate America, that they could have just a totally different mindset.
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  And it seems to have happened to Target.
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  And like you said, the DEI things are potential landmines.
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  You know, if companies choose to take a stand, that's fine.
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  they had been slipping well before that, and that just added fuel to the fire of giving people more reasons.
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  But I think people forgive, forget.
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  you know, most on the political side to a certain degree.
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  But they don't forget what they're consistently experiencing.
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  And they had such a loyal following that, yeah, that they've just really, what's the term I'm looking for, diluted the experience that they were delivering.
• 5:32
  Yeah, I always felt like Target was the kind of place you could go in for paper towels, but you grab a cart because you know you're going to look for more than that.
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  It was always...
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  been a Target shopper.
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  So firsthand, I can't give, you know, I have my brands, I can't live without and whatever.
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  But yeah, I know Target was this, a loyal following.
• 5:55
  Yeah, I guess.
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  you know, what made you like them so much?
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  For me, a lot of it had to do with the merchandising.
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  The merchandising, the brands that they carried, easy to find things.
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  It was clean.
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  You didn't have to wait in line long.
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  It was convenient, I guess that's.
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  Yeah.
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  So when you look at what's happening in their stores, before the controversy even, longer lines, messy floors, employees hard to find, which hadn't been the case before, how long
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  do you think that had been building before it erupted?
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  You know, it's hard to put a number on it, but at least the last decade.
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  You know, yeah, they just got away from what made them one of the key things is friendly staff, enough staff.
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  that were educated and would help you versus being a lot of like a lot of other big boxes, AKA Walmart or wherever that, you good luck, you you're better off, you know, buying a
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  lottery ticket than thinking you're going to find an employee.
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  And if you do, they won't walk you there.
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  They'll tell you, I think that's down aisle 36 on the right hand side.
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  And then if you're going to provide me the same experiences as a cheaper competitor, well then why would I pay more here?
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  You use a phrase in your work, relationship capital.
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  Can you explain what that means and why you think Target had so much of it and then spin it down?
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  Yeah, I think great brands, you know, they're great for a reason.
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  The founder and then his or her successors just become, are so passionate about what a brand stands for.
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  Amazon, you know, they want to be the most customer centric company in the world.
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  And, you know, they have, you know, they've done almost achieved that.
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  And it doesn't matter that Jeff Bezos has left in a six or seven or eight years ago.
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  But I think a leader's job is to create such a crystal clear vision of what the brand stands for in the future.
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  You know, that the team
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  and customers rally around it.
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  They want to be part of it, obsessed with it.
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  And that leader has to constantly be talking about it.
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  They have to have everyone talking about it, reminding, revisiting, evolving as times change connecting to how each employee's direct impact shapes that reality to accomplish
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  that vision.
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  And somewhere along the way, they
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  lost that.
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  again, the outgoing CEO, I think he was their CEO for the last 11 years.
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  I think it feels like...
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  it's been eroding since then.
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  when you think of Target or when you used to, you immediately thought of the things that you describe when you think of Amazon, easiest company to do business with in the world,
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  Apple.
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  all have these direct, what I like to think, black and white
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  you know, brand that they stand for.
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  And now Tarjay has that identity crisis that they either try to start being all things to all people.
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  Even how they were wishy-washy about the DEI stuff.
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  You know, they took a stand and then when they got, you know, flack for it, they, you know, they pulled away, which, you know, they're already upset 50 % of it.
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  the public who didn't agree with their political stand.
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  And then they piss off the 50 % that they did agree with because they just waffled.
• 9:41
  It's hard.
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  It's so hard being a leader.
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  I think it's different than just being an individual.
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  You can stay at a party, a social gathering.
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  your political beliefs or your religious beliefs, you know, what you think about the, you know, current government.
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  It is a company.
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  It's dangerous.
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  And I remember, you know, back when all the, the, the negative media was on policing, law enforcement.
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  And I like to think that, most of these cases, that's the minority, small minority that's getting, you know,
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  it feels like it's the majority.
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  And so I remember I wanted to show my respect for how hard law enforcement policing is, you know, an offer at our salons.
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  Discounts something for all law enforcement.
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  I don't know if I thought about or someone said something to me of what that would look like that I was taking a stand against, you know, black lives matter or, know, what was
• 10:39
  happening to them and that and not at all.
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  like, my God.
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  And fortunately someone said it to me and I didn't do it because that wasn't my intention, but it's just really hard as a leader or as a company.
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  If you want to, you know, you know, take a stance, I,
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  have empathy and respect for people that do, no matter what side of the aisle they're on.
• 10:57
  Yeah, I think people are allowed to have a stance, have an opinion.
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  um we'll get into that.
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  I have some questions I want to ask you about that.
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  first, I want to go back to you mentioned Bezos being able to step away.
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  When a brand has the kind of equity that
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  Amazon does and by equity, mean we're talking about the relationship equity that we were speaking on before and that Target did have when customers genuinely love a brand Does
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  that make leadership more complacent like they stopped doing the work that earned it?
• 11:37
  Yeah,
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  I think, I don't think you consciously do that.
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  I think you get overconfident and all these companies are huge.
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  And I always say, we always say, you know, the faster you grow, nothing will ruin your, your, your customer and employee experience faster than rapid growth.
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  And that's so true.
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  And it's so depressing when you think about it, because
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  me, like every leader entrepreneur, want 10 times growth.
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  I want to build my companies, you know, for the right reasons, offer employees opportunities to be able to take care of customers, a larger segment of customers, all
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  those things.
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  But there's so much pain that comes with it because when you needed, you know,
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  a receptionist, a salesperson, a consultant.
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  Back in the day, you know, we would interview, you know, 20 to find the one that just fit our culture and that we can, you know, hire for the hard train for the part.
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  But now when you start growing really fast and you need 10 or 20 or these brands need hundreds.
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  You can't, you can't, it's just impossible to, to be that, you know, relenting.
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  And then you just start having people.
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  And I remember in the salons, we started off so good in the early nineties and, know, and, and it was, know, because 50 % of our staff was me and my wife and you had to get it.
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  And then as we started growing, we started compromising and we didn't realize we were compromising, but our customer experience went backwards.
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  And we're not even, I mean, 0.1 % the size of Walmart and Target and Amazon, but just in our world of 50, 100, 150 employees.
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  But like you said, we didn't realize it at first.
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  Because there's this lag.
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  When you build and you have a reputation and you build customer loyalty, and they then receive an inconsistent experience, experience roulette, employee roulette, where, whoa,
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  that was unusual.
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  They give you the benefit of doubt.
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  They trust you, right?
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  If we have a bad experience at Amazon today, I'd be surprised, but I wouldn't leave Amazon because that's so not like them.
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  But then you get another one, or the next 10, two or three weren't great, which was so unusual because maybe you haven't had two or three bad ones in, you know, ever.
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  And that's exactly what's happening.
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  So you're like, we're still busy.
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  We're still growing.
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  It's this lag.
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  And then all of a sudden, you you start getting more complaints and all of a sudden sales start going down and comp sales.
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  And you realize that you, you you have inconsistencies and whether you hired wrong or you didn't train as well, or you look the other way because you needed 10 more employees.
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  You don't want to need 11 and you, you know, make some excuse of, we can coach them up.
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  It's, know, whatever.
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  And then it's the other way when we thought we, it took us years.
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  know, or it seemed like years to get it back, but the sales didn't come back right away.
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  And you're like, what is wrong?
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  Like, we're doing everything right now.
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  And the sales are still kind of declining.
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  Well, it's still that lag.
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  It's now you've had a reputation for, you know, not being what you used to be.
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  And, you know, it's like a 12 to 18 month lag, at least in my experience of what you're doing today won't have anything to do with your sales today.
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  They're going to have, you know, something more to do with your sales, you know, down the road, good or bad.
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  what point does it become impossible to recover?
• 15:20
  Man, yeah, yeah.
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  mean, you know, that's
• 15:24
  And so that's, those are interesting case studies because you didn't go to the Spirit Airlines or the Walmarts or the McDonald's of the world.
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  And that's their identity.
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  Their identity is they're not going to be great at customer service.
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  So you know what you're going into.
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  So you're going to be less disappointed when the expectation, you you have realistic expectation if you're going to fly Spirit Airlines today.
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  but, but I don't know if I've heard as many companies that were so great.
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  at the experience that have fallen and they're trying to get it back is, the three most recently, Southwest, Starbucks and Target.
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  And I don't know, it's, you know, the best leader CEO is just so paranoid that someone's gaining on them, that, you know, they're asleep at the wheel.
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  I mean, you have to be paranoid constantly.
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  to try not to let these, you know, whether they're cyclical or taking the eye off the ball.
• 16:31
  Target's new CEO just cut 500 back office jobs and redirected the money to front line store staffing and training.
• 16:40
  And you said that's the right instinct, but you've also said you can't train your way out of a culture problem in a memo.
• 16:47
  So what's the distinction?
• 16:49
  Well, you know, in my first book, Secret Service, I wrote something that this reminded me of, I probably, and maybe I've said it differently, but this reminded me uh of that.
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  wrote, front line is your bottom line.
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  And like, it's so true.
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  And I also like, you know, last week I spoke in LA to a bunch of uh credit unions.
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  And I said, our most recent hired least trained lowest paid employees deal with our customers the most.
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  And then I said, you who's here?
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  And it was all senior executives and HR training and, you know, chief experience officers, none of which come in contact with the external customer.
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  And
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  I mean, we invest in our higher ups.
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  But another statistic from uh the Employee Experience Revolution book study that we found is that...
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  80-85 % of a typical employee's professional development at one company comes within their first six months.
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  So if you work for a company five years, the same company 10 years, whatever that is, 15 % of your professional development.
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  you get from six months to 10 years.
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  And it's just shocking, and apply that to the front line customer facing.
• 18:20
  mean, you have to have the unbelievable training upfront and then the constant um top of mind awareness of this is who we are, this is why it's important, this is the why.
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  The why is everything and constantly reinforcing um
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  who we are and what we stand for and the experience that we're providing.
• 18:42
  um Another quote I use too often is annual customer service trainings like deodorant, right?
• 18:50
  Within time it'll wear off and the smell will come back.
• 18:53
  uh You know, it has to be constant.
• 18:57
  In your experience, you've worked with companies like Ritz-Carlton and Chick-fil-A that have excellent training programs.
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  What does genuine frontline investment in training actually look like versus what most companies do?
• 19:09
  Well, it's training them.
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  It's making sure that the, so you have two types of training, I think every company does.
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  You have new onboarding, hopefully, which is...
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  you know, the first couple days, week, maybe, you know, sprinkled off the first 90 days.
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  And then you have ongoing, the atoma, top of mind awareness, reinforcing, you know, no one's going to learn everything and remember everything in their first 90 days or first
• 19:43
  week.
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  And that's why it's so important, but you want to make sure you give them a good foundation of that.
• 19:50
  But...
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  Now, part of that is there's operational.
• 19:54
  training and then there's you know service aptitude training and most companies are you know in the high 90s operational this is how you Process this is how you ring up.
• 20:04
  This is how you QR code.
• 20:06
  This is how you you know, you know, whatever the business model is book an appointment, you know, take an order would whatever that business make a you know, you know the Hundred
• 20:17
  thousand plus different ways you can make a drink at a Starbucks.
• 20:22
  That's all
• 20:22
  operational, very important, but too often it's all of it or 98 % and the 2 % is, we're also customer obsessed.
• 20:33
  We put customers first.
• 20:36
  Without any explanation, that's just a platitude and everyone's going to uh process it based on what they think.
• 20:45
  So the best companies, Amazon, Ritz-Carlton, Chick-fil-A's, they have a strong service app to do
• 20:52
  component in their training and ongoing curiosity, listening, uh empathy, making a brilliant comeback when we drop the ball, uh you know, building an instant rapport in that
• 21:05
  90 seconds or 90 minutes, depending on what type of thing is.
• 21:08
  So, you know, it doesn't have to be 50-50 uh operational technical versus service aptitude skills, but it has to have a strong representation and the best, and then the ongoing, has
• 21:20
  to revisit that.
• 21:21
  um
• 21:22
  And then, and certification and testing that no one's allowed to do it without knowing your non-negotiables, your reoccurring standards, the never's and always, your customer
• 21:32
  experience, and then the other part of it is that these companies remove personal interpretation.
• 21:43
  They just don't say deliver genuine hospitality or build an, they get tactical and say,
• 21:50
  this is how.
• 21:52
  know one of the buzz words now is you know make people feel seen and heard and that's a great...
• 22:00
  But if you don't show an employee, a 19 year old, a 25 year old, a uh 35 year old, what that looks like in this type of interaction on the phone, in an email, face to face.
• 22:12
  Like literally, what does making someone feel and seen, heard?
• 22:18
  Actionable, trainable, observable, uh measurable.
• 22:21
  um You're gonna get hundreds of interpretations and now we're back to experience, relate, employee, relate.
• 22:29
  You make an argument in the employee experience revolution book that you and Dave Murray wrote, the customers will never be happier than the employees who serve them.
• 22:39
  Is there a company you've worked with where you saw an employee culture be able to turn around and did it translate into a customer experience turnaround as well?
• 22:50
  Yeah, yeah, yeah, lots.
• 22:51
  um And so my favorite, you know, line to that is EX equals CX.
• 22:57
  The employee experience will always equal the customer experience.
• 23:01
  I've never studied a world class customer experience organization that wasn't world class to work for and with.
• 23:08
  For is top down, like how leaders take care of employees, but also how employees are trained to take care of each other and that every customer experience initiative
• 23:19
  to each other, the person that you're working with in your department and cross departments.
• 23:25
  That's so key.
• 23:26
  um But yeah, there was um great companies, uh Advanced Financial um and uh Charlotte Police Department.
• 23:39
  When they initially hired us, was to dramatically improve their customer experience.
• 23:45
  um And remember, uh
• 23:48
  you
• 23:48
  both of those companies hit the brakes and said, let's pause this and we won't achieve this if we don't improve the employee experience.
• 24:01
  And that became their number one priority, which was kind of the impotence of why me and Dave wrote the employee experience revolution.
• 24:10
  It really starts there.
• 24:12
  And then it's so much easier.
• 24:17
  that's felt on the inside is going to be delivered on the outside.
• 24:20
  We all know people who've worked for brands or companies that they might not believe what the brand represents.
• 24:26
  They'll come home and complain about them.
• 24:29
  When you have situations like that, maybe Target had people working for them who were...
• 24:35
  examples of DEI and then the company takes an opposite stance but they stay there because of the money, because of the benefits, whatever it might be.
• 24:44
  When you have employees that don't believe in the brand that they're working for, do the customers actually feel it or is that something that leaders also overlook?
• 24:53
  Yeah, I think we discussed this on a recent podcast, the six things that make a brand.
• 25:00
  um
• 25:01
  You know, an organization, brand customers can't live without.
• 25:04
  And one of the six was employee evangelism.
• 25:07
  And the employee evangelism part was that these brands, their employees love the industry, right?
• 25:15
  If you work for Apple, they, they're geeks, know, positive geeks about the technology and the Ram and this, and they get excited to share that with you.
• 25:26
  they also love, you know, the brand and you know, what they're
• 25:31
  selling.
• 25:32
  so, and there's several reasons why there could be a disconnect with what you're saying.
• 25:40
  One, you just, you know, might be hiring anyone and they don't love the industry.
• 25:45
  They don't love the brand or you haven't got them to fall in love with the brand.
• 25:51
  You know, whether, you know,
• 25:53
  It's not a brand you can fall in love with or you're not tying their jobs to the overall purpose and the why.
• 26:00
  And that's why all these brands, the great ones are storytelling brands.
• 26:04
  And they just tell stories and get you all excited and be a part of it.
• 26:11
  you know, use the Medtronics example, which I'm sure I've used before, manufacturer heart valves.
• 26:18
  You you could work in a warehouse that put pieces and parts together that can shipped off to a hospital and then gets put into a patient.
• 26:28
  But if you're in that, you know, on the assembly line in the warehouse, you know, what do you think your job is, right?
• 26:35
  Putting pieces and parts together is like when I worked at UPS in the middle of the night, loading trucks, you know, I didn't have any pride or didn't think I had any customers.
• 26:45
  Well, what Medtronics is not
• 26:46
  known to do is they have a gala where they bring in patients that have, you who survived and have metronic parts in their body.
• 26:55
  And they get to meet these invisible service providers, which are the back people who never come in contact with the external customer.
• 27:02
  And they get to talk about, you know, that they walked their daughter down the aisle last year, last month, and they didn't think they were going to make it.
• 27:11
  But because of the attention to detail I may have on the
• 27:14
  assembly line, they work.
• 27:16
  So now I have a different bounce in my step.
• 27:18
  I have a different perspective of what I do.
• 27:21
  I don't work on an assembly line.
• 27:22
  I help save lives, you know?
• 27:24
  And so, you know, it's being a storytelling company, but, you know, I might have gotten off track and not answered your specific question.
• 27:32
  No, that was good.
• 27:33
  But I'm going to bring you back to Target here.
• 27:35
  When, you know, back to school time, if you were in Target, you noticed this, they tried discounting.
• 27:41
  So they tried discounting 3,000 items with lower prices, back to school deals.
• 27:46
  None of it worked.
• 27:47
  Why doesn't price work when a brand loses emotional trust?
• 27:51
  Well, sometimes it works temporarily and you have, you know, organic growth and you have artificial growth and organic growth, go back to my earlier example of what I struggled
• 28:04
  with when we started growing too fast and trying to fix it, um doesn't fix it in the short term, you know, and, and, artificial growth.
• 28:16
  is a short term, you know, fixed by a competitor, by a market, by sales, um, slash prices or lay off, you know, a big percentage of your employees.
• 28:29
  And those things will, you know, have an impact in the short term.
• 28:34
  Um, but in six months, 12 months, 18 months, they usually worst for your brand where the organic growth of doing things, right, you know, hiring, right.
• 28:44
  training correctly, aligning everyone with it, all the things that we're talking about.
• 28:49
  um Initially, whether I train, whether we hire good employees today that match our culture or we don't.
• 29:01
  isn't going to change our sales today this week.
• 29:03
  If we train those employees on service aptitude skills, certify them and retest them and train, you know, this week, or we don't, we just train them operationally.
• 29:15
  isn't going to have an impact on sales this week.
• 29:17
  Our sales are still going to be the same, but in six months it's going to be a freight train going one way or the other and that's what most people aren't.
• 29:25
  So yeah, discounts.
• 29:27
  ah
• 29:28
  If that's not your number one strategy, ah is going to be a bandaid.
• 29:34
  But in this case, um they had already lost the trust of their customers.
• 29:40
  And again, if you're not the best, you better be the cheapest.
• 29:44
  And I'll just order on my Walmart or Amazon app if I think you're not any better than they are.
• 29:54
  Back to what you talked about earlier with their values.
• 29:58
  Target went back and forth on its values in a pretty public way.
• 30:01
  You've said the most damaging thing a brand can do is signal that its commitments are conditional.
• 30:07
  And I think that's so true.
• 30:08
  That's their integrity, right?
• 30:10
  So can you unpack that?
• 30:12
  Is there a way to recover from that?
• 30:15
  We've seen a lot of companies pull back on DEI and other commitments like that recently.
• 30:21
  Are they a preview?
• 30:22
  Is Target a preview of what's to come for some more of them?
• 30:26
  I'm not a DEI expert, but just seeing enough companies um step on it.
• 30:33
  uh And sometimes that's a short term thing.
• 30:37
  again, if that's what you believe in and that's what you support, going to take, you got to wear a bulletproof vest and know that you're going to take hits.
• 30:46
  And that's if you want to draw that line in the sand.
• 30:50
  Starbucks did that for uh
• 30:55
  trans supporting and they got a lot of flack and this is when Howard Schultz was in um you know
• 31:02
  the first or second time he's been there three times, you know, keeps it coming back to save it.
• 31:07
  But I loved what he said.
• 31:08
  You know, he was at a shareholder meeting, getting a lot of criticism and, he's, he, I'm not saying what's right or wrong.
• 31:16
  I'm just saying what he believed in.
• 31:18
  He said, this is the right thing.
• 31:21
  And if you feel that you could make a higher return that, you know, then what Starbucks provided you last year, which was incredible at the time in the twenties.
• 31:31
  You you're invited to do so.
• 31:33
  And I like that, you know, he stood behind his belief.
• 31:38
  um Again, I don't think everyone has to, you know, every company and every leader has to, you know, draw a line and choose a political side, you know, uh but if they do, you know,
• 31:52
  you better stick with it.
• 31:53
  um I think it makes you look worse when you're wishy washy and you can tell you are just trying to, you know.
• 32:00
  appease and get, you know, you're doing it for the business and not because it's truly one of your values as a company.
• 32:09
  Chick-fil-a I think is probably another example.
• 32:11
  Chick-fil-A now is a, I don't if I want to say a big supporter, but I believe a big supporter of the LGBT community.
• 32:23
  you know, yeah,
• 32:26
  There could be some reasons, right?
• 32:28
  Is it selfish motivating?
• 32:30
  Yeah, you know, that could be.
• 32:32
  I think Chick-fil-A is a great brand.
• 32:33
  Are they evolving?
• 32:34
  Could be.
• 32:36
  They're also on to their third president.
• 32:40
  kind of in that time.
• 32:42
  It's the same family.
• 32:44
  It went from Truett Cathy to Dan Cathy to now Dan Cathy's son.
• 32:49
  So that could be it with just a younger, fresher perspective.
• 32:54
  um I don't know what the, but I know it seemed to calm down and a lot of these things go over.
• 33:02
  Yeah, well, I guess we'll see what happens with Tarjay.
• 33:05
  In the relationship economy, you argue we've moved past the era where products and prices create loyalty, that it really is about genuine relationship.
• 33:14
  For any leaders listening right now that aren't you, that don't have your 30 years of experience with this, how do they even start building that?
• 33:23
  What's the smallest, most actionable thing a leader can do this week to start moving the needle on relationship capital?
• 33:30
  Decide or revisit what your brand stands for.
• 33:34
  And then just be relentless.
• 33:37
  I mean, be relentless, become obsessed.
• 33:40
  ah
• 33:41
  and align everything around that.
• 33:44
  So if you wanna be known for experience, ah develop a culture that's known for experience, speak about it constantly, story tell, make sure your hiring is based on that, make sure
• 33:56
  your training's based on that, make sure you're creating a signature experience that supports that.
• 34:02
  um
• 34:04
  service recovery, know, all those things that our methodology that we didn't invent, we just codified, um you know, helps, you know, leaders create that instead of flavor of the
• 34:17
  month.
• 34:17
  And I think so many people chase shiny objects.
• 34:21
  now it's about AI.
• 34:22
  AI is great.
• 34:23
  As long as it supports the brand you're you're you've wanted to build, you know, that replace the human interaction or, you know, go the other
• 34:33
  way and you know be the Spirit Airlines.
• 34:36
  They're not tricking you, ah you know, they're not telling you that they have a great experience, you know, you know what you're getting yourselves into if you go with Spirit
• 34:48
  Airlines.
• 34:49
  Same thing with Walmart versus Target.
• 34:52
  You've said Target Story isn't unique.
• 34:54
  You had a nice article about this in the e-service, which listeners, if you do not already receive John's weekly e-service, it's something great for you to get in your email box
• 35:06
  every week, great tips and information.
• 35:08
  Great tips and tricks.
• 35:10
  that the best in the business are doing, best practices being shared.
• 35:15
  You can get that by going to tdg.click forward slash e-service.
• 35:21
  There'll be a link for that in the show notes as well.
• 35:23
  So back to what I was saying, you said Target's story isn't unique, it's playing out in companies of every size right now.
• 35:29
  So what should CEOs be watching for in their organization?
• 35:34
  What are the early warning signs or signals the leadership team can start?
• 35:38
  are watching for so they're not taking their customers or culture for granted.
• 35:43
  I mean, you so your KPIs, a lot of them, most of them are lagging indicators, so they don't necessarily tell you, but, you know, it's everything from the voice, the customer,
• 35:55
  do our complaints going up?
• 35:57
  mean, complaints is a cost center.
• 36:01
  When you have a complaint, you are taking people and resources out of taking care of, you know, customers to putting out fires.
• 36:11
  returns, know, you know, um it being uh
• 36:17
  prioritized to corporate, all those things.
• 36:20
  So tracking, what the customers are saying and the complaints, having the right KPIs that measure what's happening, not just NPS and customer satisfaction, but repeat visit,
• 36:37
  referrals, average spend, average ticket,
• 36:41
  you know, annual spend, all those things, you know, when you start seeing them move.
• 36:46
  I know like in the salons, there's, I mean, there's a lot of things we, we, we, have up the track, but I know, you know, some, so we have three that kind of counter each other
• 37:00
  if, if, so you have, you know, you have sales growth.
• 37:04
  All right.
• 37:04
  We're up 5 % over last year.
• 37:08
  Well,
• 37:08
  That could be because of price increase, right?
• 37:11
  That doesn't mean, um you know, that might not mean we're doing better or, you know, we have more customers.
• 37:19
  Then we have number of tickets or number of customers coming in.
• 37:24
  So you want both of those um heading north.
• 37:29
  If you got more customers uh spending more, that's really good.
• 37:35
  And I forget the third one, but there was a third one.
• 37:38
  and I'm not involved as you know, in the day to day, but there was three that we had that, you know, help us because one can be lying to you.
• 37:49
  You know, one could be, you know, lying to you.
• 37:52
  Like I said, you know, if we raise our prices, you know, 10 % last year, well, you know, your average ticket, you know, is going to be higher initially, right?
• 38:05
  But if your number of tickets, number
• 38:08
  people coming in is starting to decline, well that means you piss people off with your price increase and you aren't justifying it.
• 38:15
  So you you have to have two or three KPIs that kind of you know keep each other in check that it's not you know kind of uh you know a mirage.
• 38:25
  Here's something interesting I have question for you.
• 38:28
  If you had the CEO of Target in a room right now, what would you ask him?
• 38:32
  What's his plan?
• 38:33
  um And how is he gonna do it?
• 38:40
  And how is he gonna make sure it's not flavor of the month and that he doesn't get distracted by it?
• 38:46
  that, um how is his plan gonna be his uh lieutenant's plans and his store GM's plan?
• 38:59
  um
• 39:00
  that it feels like I'm talking to him when I talk to anyone at any level, because when we say executive sponsorship is so important, it's the Walt Disney and Steve Jobs and Jeff
• 39:12
  Bezos of the world.
• 39:13
  Well, that's not who the mass is.
• 39:16
  They don't come in contact with uh Tim Cook at Apple.
• 39:21
  um
• 39:22
  they're coming in contact with their GM at the Apple store or wherever they're working for Apple.
• 39:28
  And that has to, um they have to articulate as close with the same passion as Tim Cook does.
• 39:38
  um So we're constantly drinking that Kool-Aid and seeing why it's so important that we do this.
• 39:47
  m yeah, just, whenever I say executives, it starts at the top.
• 39:52
  Then you have to make people realize you're the top.
• 39:55
  You know, if you're uh the champion, you know, the head of this department, call center, location, you are their top.
• 40:04
  And you can always tell which location, which department, you know, has the best leader and who buys into it because of their performance.
• 40:13
  Not everyone's going to buy into it.
• 40:14
  that's, you got to start holding them accountable to make the frontline be your bottom line.
• 40:19
  great information.
• 40:20
  And I was going to say, is it a mindset people have or they don't?
• 40:23
  But we've seen leaders change.
• 40:25
  I we've seen organizations where you've had leadership team in there that you think don't get it, or they're not customer experience focused, and they've been able to get on board.
• 40:36
  What do you think the big trigger for that is?
• 40:38
  it's the same also with employees.
• 40:39
  um We say this a lot.
• 40:42
  You can dramatically improve the customer experience you're delivering today, probably with the exact same employees you have.
• 40:52
  And that goes for the middle management you have.
• 40:58
  It's permission.
• 40:59
  It's, you know, the why it's, you know, the, you know, the focus, the obsession and everyone's come from different backgrounds and work environments and cultures and where
• 41:12
  they were, you know, brainwashed.
• 41:14
  had to be about productivity, efficiency, profitability, um, you know, quick, you know, average call times, all those things.
• 41:23
  And, know, you gotta, you gotta help people speed.
• 41:27
  the difference.
• 41:27
  And that's why we've seen, you know, average employees become rock stars, average managers become rock stars.
• 41:34
  When you give them the tools and you can't just do it once, you really have to break them out of that habit.
• 41:42
  Because they were brainwashed at their last job or jobs to only think about sales, or, you know, efficiency or productivity.
• 41:54
  And when they get a taste
• 41:56
  of it and they get celebrated for it, that becomes intoxicating.
• 42:02
  This is good.
• 42:02
  This has been one of those conversations that I think listeners.
• 42:05
  are going to come back to and revisit because it's important.
• 42:09
  Thanks for saying out loud what a lot of leaders probably know is true but aren't ready to face yet.
• 42:14
  For everyone listening, if today's episode made you look differently at your own organization, I encourage you to pick up the relationship economy book that John was
• 42:23
  discussing or even the employee experience revolution, the customer service revolution book.
• 42:29
  Both are available wherever books are sold or
• 42:32
  on our website, of course.
• 42:33
  And if you want to go deeper, you want to the kind of hands-on strategic work that John and his team do with some of the world's most customer obsessed companies, head over to
• 42:43
  thedijuliusgroup.com or check out the Customer Experience Executive Academy at cxea.org.
• 42:52
  Schedule a call with our team.
• 42:53
  We love to talk to people, find out where you are, where you want to go and give you free information.
• 42:59
  And you can schedule a call
• 43:01
  at tdg.click forward slash call.
• 43:05
  I'm Denise Thompson.
• 43:06
  This is the Customer Service Revolution podcast.
• 43:09
  Thank you, John and listeners.
• 43:11
  We'll see you next time.
• 43:12
  you.