Making Routine Customer Experiences Fun
In recent years, many companies have attempted to make it more fun for customers to buy their products or use their services. Walt Disney Co. is the past master of this trend, having developed ways of making every aspect of the theme-park experience fun. Of course, people expect to have fun at a Disney park, whereas other experiences — a trip to the dentist, for example — are anticipated with mild anxiety or even dread. Even a very creative or entertaining dentist would have a hard time persuading his patients to associate fun with dental work.
Most services fall between these two extremes, however. They produce neither pleasure nor pain but rather are the routine stuff of life — filling the gas tank, grabbing a quick lunch. Such activities are so neutral that people often choose the provider with little thought and forget the experience in a matter of hours.
Some sellers of neutral services want to keep things that way. They want to be so convenient and reliable that people continue to use them unthinkingly. For certain mature service businesses, however, the addition of fun could be an important differentiator. Consider the experiences of buying furniture, going to the bank and purchasing groceries. Furniture stores are often full of products but deserted by customers. Banks, open mostly at inconvenient hours, seek to reduce customer interaction with bank employees. Grocery retailers, focused on lowering costs and increasing convenience, do little to reduce the drudgery associated with the weekly food shopping. Most people are happy just to get these activities crossed off the list. But three case studies taken from these industries show how fun can be turned to profitable advantage.
Jordan’s Furniture
Brothers Barry and Eliot Tatelman built Jordan’s, a Boston-area company with four stores, by breaking industry rules and injecting fun into everything associated with the company. Each Jordan’s store has a unique way of making the shopping experience positive. The small original location, established in 1918 by the Tatel-mans’ grandfather in Waltham, offers freshly baked cookies and serves coffee, tea or hot cider. In Nashua, New Hampshire, visitors are treated to live music and free balloons. The Avon site is home to the Motion Odyssey Movie — “MOM” —which boasts moving seats, laser shows, rock music and clouds of smoke. In Nat-ick, visitors are greeted with Mardi Gras beads and twice hourly are treated to a New Orleans-style street performance in a replica of Bourbon Street. The fog-filled, strobe-lit performance features singing robots of Elvis, Louis Armstrong, the Supremes — and the Tatel-mans. In August 2002, a giant IMAX 3-D theater was installed that drew 2,500 people on its first weekend.
Jordan’s sets its customers’ expectations with innovative advertising. Its zany radio and TV ads, starring Barry and Eliot, have achieved local fame by spoofing other popular ads and poking fun at the brothers themselves. Although the ads remain fresh — the company produces eight or so new ones every year — no formal process guides their creation. Ads are developed as good ideas bubble up. This informality is also true of other aspects of Jordan’s approach to making shopping excursions enjoyable. Instead of using formal processes, the company expects its employees to bring an attitude of fun to the job, and indeed they evaluate them accordingly.
These attitudes and ideas (and their careful execution) have made Jordan’s an extremely successful company of its type. As one of the most benchmarked furniture businesses in the United States, Jordan’s came to the attention of Warren Buffett’s Berkshire Hathaway Inc., which bought the company in 1999. The brothers were kept on as president and CEO, however. In 2002, Jordan’s had sales of about $300 million from its four stores. Its 1,400 employees sold $950 of furniture per square foot against an industry average of $150, and the company turned its inventory 13 times against an industry average of less than 2.
Commerce Bank
Vernon Hill, the CEO and chairman of New Jersey-based Commerce Bancorp Inc., or Commerce Bank, did not have a background in banking when he founded the company in 1974. Instead, he had worked in real estate and fast food, and he decided to focus on delivering a customer-oriented banking experience based on fast-food franchising principles. Ever since then, making a trip to the bank more fun has been at the center of Commerce Bank’s approach. Greeters welcome customers at every branch, creating a familiar experience for people regardless of the branch they are entering. Each site is open seven days a week, and most operate until 8 p.m. on weekdays. While most other banks do not give cash for unrolled coins, Commerce spent $10 million to install self-serve coin-rolling machines — called “penny arcades” — that are available for anyone to use.
Long hours and coin machines are more about convenience than fun, but Commerce doesn’t neglect that aspect of the customer experience. Free lollipops and balloons are staples, and even dog biscuits are available at all drive-thru counters. When opening new branches, instead of cutting ribbons, Commerce catches attention with a week of events featuring comedians, acrobats, hot dogs, massages and caricaturists. Branches continue to have special events at least once a month.
While fun at Jordan’s Furniture is an important but unmanaged affair, it is carefully overseen at Commerce Bank. Nevertheless, it shares with Jordan’s such characteristics as strong leadership, the careful selection and evaluation of people, extensive training of employees, well-managed reward and promotion systems, injection of the unexpected on a regular basis, and the use of external messages that tie into the fun image.
Commerce Bank has done extremely well over time. Between 1991 and 2001, its stock price increased 1,463%, well above Microsoft’s 1,121% for that period. In early 2003, at a time of layoffs, consolidation and bankruptcies in the banking industry, Commerce Bank was adding 35 new branches to its existing 225. Just when most banks were moving out of branch banking, Commerce was pulling large numbers of customers into its branches.
Stew Leonard’s Dairy
Stew Leonard’s Inc. of Norwalk, Connecticut, has been called the Disneyland of Dairy Stores. Founded in 1969 with seven employees near the site of the Leonard family’s original dairy farm, the company now boasts three large stores and some 2,000 employees.
Shopping for groceries is one of the more time-consuming, repetitive tasks facing most Americans. Stew Leonard’s tries to make the time go by happily. For example, it has its own milk-processing plant at which milk is packaged in front of customers while the Farm Fresh Five — a band of milk-carton robots — sing about milk. When kids tug on a rope, Clover, a wall-mounted cow, gives a great “Moo!” The parking lot even has a petting zoo.
A single serpentine aisle winds its way through each of the 100,000-square-foot stores, and aromatic, visual and auditory experiences meet the customer at every turn. The in-house bakeries and dairies offer abundant free food samples, often given by Wow the Cow, Stew Leonard’s mascot. Celebrations are common. For St. Patrick’s Day, local Celtic music groups and dancers perform. At Halloween there are hayrides, special displays, a pumpkin carving competition and a contest for guessing the weight of a giant pumpkin.
Like Jordan’s, Stew Leonard’s has few sites. But “the customer is always right” ethos is literally etched in granite — on three-ton rocks — at the entrance to each store. The company’s leaders believe the fun starts with its employees, and they work hard to ensure good attitudes and set high expectations. In 2001 and 2002, Stew Leonard’s was named one of the 100 best companies to work for in America by Fortune magazine. Its three stores, with revenues of $300 million in 2002, had a 2.5% return on sales against 1% for an average supermarket.
Fun Is Serious Business
Changing a neutral experience into a positive one isn’t easy, and there’s no guarantee of success for companies that make the attempt. In the early 1990s, Tandy Corp. failed to get traction with its Incredible Universe superstores. The stores featured music, karaoke, laser shows and door prizes. The company carefully selected and trained employees and emulated Disney’s approach to interactions between staff and customers. But after 17 super-stores had been built, Tandy pulled the plug on these money-losing ventures. The fun elements weren’t enough to make the stores profitable in the competitive consumer-electronics segment.
In addition to competitive dynamics, companies should consider several elements before moving to inject fun into their customers’ experiences.
Frequency of Customer Visits.
The challenge for companies like Commerce Bank and Stew Leonard’s, which are visited by the same customers frequently, is to keep their fun concepts fresh. Such businesses risk losing their initial investments in changing people’s perceptions if they let the fun become stale. That can be a problem at a busy site where managers do not have the time to plan new events and employees are too busy to engage with customers. In that case, a positive experience may again revert to a neutral one. To avoid that outcome, companies must change frequently and make sure that all their stores or branches deliver similar experiences to their customers.
On the other hand, a low frequency of use indicates that fewer changes are needed. Most people do not fly every day or shop for furniture every week, for example. For people who fly occasionally on Southwest Airlines, the games, jokes and generally friendly atmosphere may make traveling a pleasant experience. For those who fly Southwest regularly, however, the experience may become neutral unless the airline continually updates it.
Number of Sites.
Obviously, the more sites involved in a change, the more complicated the effort. The task for Jordan’s and Stew Leonard’s, with three and four locations, is simpler than that for Commerce Bank. The management tasks of communicating the vision, rewarding the right employee behaviors and coming up with new ideas become much more difficult in a multisite business. In addition, the organization faces the difficult task of creating a new culture while integrating it with the old one.
It is possible to take an ad hoc approach. For example, one McDonald’s Corp. franchise in Manhattan has resorted to the use of video and music to make eating there a positive experience, not just a neutral refueling. But the benefit from the added investment may not be worth the cost at every McDonald’s.
Components of Fun.
Jordan’s, Commerce Bank and Stew Leonard’s rely on a complex approach to create a fun environment: unscripted employee-to-customer interactions. The burden on management to hire and train people who are capable of succeeding in that environment, coupled with the persistent need for novelty, may deter many companies from adopting this form of fun. (The successful use of Disney-style scripted interactions is relatively rare. Organizations seeking to emulate Disney need well-defined procedures and centrally managed training, as employees must be taught not to deviate from the corporate script.)
Of course, environments can be interactive without requiring many employees to be involved. Washington Mutual has added play areas for children in its branches, a simple way to turn a neutral experience into a positive one. Likewise, adding wireless Inter-net access, as Starbucks Corp. has done, can enhance the routine of the morning cup of coffee. While Starbucks continues to add fun features, other venues continue to add coffee. Bookstores have been doing so for years now, but the trend is spilling over into the banking industry as ING Direct has introduced cafes into its retail space. Adding music or video is another increasingly common form of one-way interaction. Adding live entertainment can be even more effective, but it is also more complex and expensive to arrange.
A fun environment created with architecture and interior décor is an even simpler managerial proposition. Theme restaurants such as Rainforest Cafe and sports retailers such as Nike-town have used their physical spaces to good effect. Many of these concepts require considerable front-end investments, however, and may not be sustainable as drivers of positive experience over the longer term. One can go to the Hard Rock Cafe only so many times before it becomes routine.
Companies can shake up the routine frequently by adding a stream of new products. To entice repeat customers, the Spanish clothing retailer Mango completely changes the inventory in each of its stores every few weeks. But again, this approach to creating a fun environment cannot be undertaken lightly as it makes the manager’s task more complex and requires a good deal of thought and effort.
One final warning: What may seem like fun to some customers may be intrusive to others. Many people prefer to take care of their tasks efficiently and anonymously, and anything that detracts from their ability to do so will have an effect that is opposite to the one intended. Managers have to think carefully about the kinds of fun they are trying to add to the customer experience, always keeping in mind the main reason people keep showing up.
And the addition of fun elements is no substitute for the basics. Jordan’s, Commerce Bank and Stew Leonard’s all operate their basic business models at a very high standard of excellence. But they also have what it takes to make a routine experience into something positive: strong leadership, a clear vision, a discriminating filter for new employees, a focus on hiring for attitudes rather than skills and the ability to come up with the unexpected. These examples show that the addition of fun can be very profitable, even in the most neutral of environments.