Black Friday Lessons in Experience Adaptation

Black Friday provides terrific lessons for anyone looking to see service businesses at their best and worst, given the extreme conditions for all involved. On Black Friday, no one involved in a retail service encounter is their normal selves. Customers and the retailers that serve them are stressed, tired, and have sky-high expectations of success from their respesctive points-of-view.

From midnight through about 10:30 am yesterday, I hit walmart, Target, Costco, Best Buy, Toys ‘R’ Us, Office Depot and Office Max to see how some major retailers changed their behaviors to cope with the demand extremes while staying true to their service promise.

In too many cases, retailers reacted to their highest-stakes day without regard to experience component of the event – unresponsive to the extreme variances in customer composition, behavior, and the volume of demand for every service a store offers.

Most retailers approached the experience with the strategy of doing the same thing they do every day, only more: placing higher stacks of product in the normal locations and employing the “throw bodies at it” method of handling demand increases for all service types. They used the same check out process, just opening the maximum number of checkout lanes, forcing customers into lines literally hundreds deep. A number of major retailers could have taken a page from an airport Starbucks, and at least changed their checkout routine.

But there were some examples where companies changed their everyday service processes to adapt to the environment they faced:

• One retailer had premium product handed out through a manual control point. It instantly created an in-environment event, with the floor employee handing out high value electronics from a cage like he was Santa Claus himself. Reception to the tactic was so good, the retailer could have created an even grander spectacle. After all, he was already on a figurative stage; why not give him a literal one?
• Another retailer created an in-store Disneyland routing pattern, cordoning off some aisles, sticking arrows along the floor and reserving the route for shoppers as they checked out. Once in the line, the rest of the experience was blocked out by row after row of product not on sale.
  

Most evident whether in the midst of a good experience or a bad one, was that delivering on promises is even more important in periods of high customer stress & expectation than it is every other day. More than a few brands that tout everyday reliability were conspicuously short of product when customer expectations were at their highest. Retailers that won hearts were those that had sufficient quantities of the promotional product to ensure that no one felt like they lost out.

In short, they didn’t disappoint on their core service promise.

How well does your experience respond to its environment?

I see my share of airport terminal Starbucks, and always marvel about their dramatic demand variance. It seems I’m just as often to walk up to am open counter with three baristas attending to me alone as I am to join a line fifteen deep.

It’s the latter scenario where I tend to pay more attention, watching how teams react. Often, they’ll send one member, equipped with a headset and note-pad pre-printed with drink options, out from behind the counter and into the waiting line. She / he will then walk the line, taking orders, relaying them back to the counter via the headset, writing the Starbucks shorthand on the pad and handing the waiting customer a ticket to give to the cashier.

It’s an operational change that allows them to increase throughput, using time spent in line taking advance orders to eliminate the exchange that usually happens when the customer reaches the counter. I’ve heard a few fellow caffeine “enthusiasts” scoff at necessity of the high-tech headgear, but it’s great practice for both its real and perceptual effects.

The real operational impact is that the process makes Starbucks faster, allowing them to serve more customers (and take in more money) in a shorter amount of time. This in itself likely makes the practice worthwhile.

As tangible as those impacts are, the perceptual impacts may add up to something just as significant.

The approach divides the time between service activities and makes the line wait seem shorter. I don’t notice I’ve been in line 7 minutes if my order was taken 90 seconds ago.

They demonstrate process flexibility by modifying their operation to fit their demand minute-by-minute. While doing it, they provide tangible proof of their order customization by involving the customer in a direct role - providing the formatted order sheet to the counter staff.

Starbucks’ flexibility shows their responsiveness to their customers. Responsiveness is tough to measure at the best of times, usually incompletely measured as how fast a request meets a reply. It is that, but flexibility and customization also factor into responsiveness, and in modifying the service experience during heavy demand periods, Starbucks wins on all fronts.

Internal Service Themes from the 21st Annual Compete Through Service Symposium

I had the pleasure to spend last week at the 21st annual Compete Through Service Symposium (#CTSS). It’s been a few years since I’ve been back, and the experience has gotten even better since I last attended. Speakers as diverse as Fortune 500 CEOs, CNN Money’s Smartest People in Tech, a folkhero entrepreneur, a Cultural Evangelist for arguably the world’s hottest service brand, and the President of a professional sports franchise got together to talk about what makes services businesses successful.

While there was great diversity of perspectives and material, a number of themes remained consistent throughout. I have to caveat that #CTSS attendees generally don’t fall into the typical command & control model of organizational leadership. They’re a group that not only believes in the service profit chain that begins with internal service and ends in customer loyalty and long-term profit, they live it. In formal presentations and informal discussions, there was wide agreement on the principle that exceptional service starts with meaningful engagement of employees, and that only once the internal investment in employees has been made can the meaningful customer engagement occur through exceptional service.

Some other themes around internal service that remained remarkably consistent across speakers:

• Successful service businesses are made up of employees with a shared vision, understanding of and belief in the culture and the freedom (and responsibility) to make business-impacting decisions. In no fewer than three organizations, employees had a hand in creating core values through some consensus exercises. In one organization, they also prioritized those values.
• Best-in-class service organizations recognize the linkage between internal satisfaction and external satisfaction. They’re measuring internal customer satisfaction and loyalty and linking it to (and in some cases have successfully established it as a predictor of) external customer satisfaction measures across service touchpoints.
• We often talk about infusing voice of the customer into service design and experience management. Just as frequently at #CTSS, we heard leaders talk about putting the voice of employees into service design and experience management, though a challenge common to all organizations is to get employees to consistently advance those ideas.
• Despite being service industry leaders, many of the companies presenting faced financial challenges in the recent economic crisis. Each discussed as a separate topic the challenge of maintaining employee engagement through periods of financial trial and necessary force reductions. Not all approached it the same way, but all addressed the issue as though it was the most important challenge facing their business.
  

A few select highlights from a terrific week spent with some of the best in service business. Next, I’ll cover the external themes on service, customer satisfaction and loyalty that were present throughout the week’s speakers.