One morning, with the snow piled high, 11-year-old Heidi O’Neill strapped on boots to trudge to school when her father had an idea. What if she skied to school instead?
In northern Michigan, USA, locals and tourists alike enjoyed watersports on the nearby lakes during the summer months. But snow was also the norm for a good part of the year in Heidi’s hometown of Charlevoix.
Heidi’s parents owned a sporting goods store, and Heidi’s father was always looking for a way to boost sales. With the boats stowed away and plenty of forest trails nearby, he had stocked up on cross country skis, but they just sat there on the shelves.
“What if I called the local newspaper to take Heidi’s picture?” Heidi’s father thought. That might be a friendly reminder to the townsfolk that Portside Sports was ready and willing to fulfill all their winter sporting needs.
“Dad always had a good head for publicity,” O’Neil recalls.
While Heidi’s classmates struggled to make it to school before the bell rang that snowy morning (some wouldn’t make it at all), a photographer from the Charlevoix Courier was waiting to snap a shot of her gliding right up to the front door. When the picture made the next day’s front page, ski sales picked up.
But the real coup came when Heidi’s father launched a cross-country skiing club out of the store. All of a sudden, Portside Sports wasn’t selling skis—they were selling skiing. You weren’t buying sports equipment for $50; you were developing a new skill, meeting new people, and you had something to look forward to each weekend. A once anodyne customer experience was imbued with emotion and human interaction.
Today, as president of consumer and marketplace at Nike, O’Neill says her star turn as a cross country skier continues to inform her “data-driven and personal approach to retail.”
Depth and breadth
Heidi’s father didn’t have access to new media or intelligent technology like machine learning, but he had enough sales know-how to realize moving merchandise depended on delivering a memorable customer experience. Some things never change.
A survey by the consulting firm PwC found that 82% of Americans “want to interact with a real person more as technology improves.” Or as O’Neill puts it: “It turns out, when you actually talk to consumers, they still want to shop by touching and trying on.”
While Nike executives can hardly maintain the same kind of direct relationships with customers as small-town shopkeepers, in 2021 technologies can help facilitate personal, humanized customer service at scale. Nike, which has spent recent years harnessing data, developing apps, and tweaking operations to add depth and breadth to CX, offers a meaningful case study.
“We know that digital is the new normal,” Nike CEO John Donohoe said on a recent earnings call. “The consumer today is digitally grounded and simply will not revert back.”
Nike’s shift towards using digital tools to scale-up personalized customer service began well before the COVID-19 disruptions. In 2018, they launched Nike by Melrose, a “live” concept store that stocks shelves with products generating the most buzz among the company’s membership club (called NikePlus). At their New York City “House of Innovation,” members schedule one-on-one consultations with footwear experts. Meanwhile, the Shanghai location hosts workshops, speakers and digitally-led trial sessions.
More recently, the company has also launched a variety of new online platforms. Nike SNKRS is an e-commerce hub for collectors, and fitness apps like Nike Run Club and Nike Training Club. Taking cues from its most loyal clients allows Nike to improve the customer experience for everybody else, and such memberships function much like that old cross country skiing club in Charlevoix. Nike customers aren’t buying running shoes, they are becoming runners.
“Digital is fueling how we create the future of retail,” CEO Donohoe says. But it’s not the future on its own.
Delivering the goods
While plenty of consumers were already acclimating to engaging with brands digitally, the COVID-19 pandemic and resulting lockdowns have accelerated those trends across sectors. One study by Oracle found that two-thirds of companies are already using a variety of emerging technologies to boost customer experience—including virtual reality, chatbots, and artificial intelligence.
And yet, technology is no panacea for delivering quality service, never mind memorable experiences. Some customer experiences are digital, others analog but companies are increasingly expected to fuse the two. Nearly one-quarter of Starbucks orders in the United States comes via mobile app, but that means very little if the coffee is cold by the time a customer picks it up. The Coachella music festival has an app that allows attendees to mark shows they want to see and set reminders, something that would be easily forgettable after a poor performance.
According to PwC, 73% of all customers point to experience as a major factor in their buying decisions. No matter the culture, just one bad customer experience can cripple your business. Globally, 32% of people say they would stop using a brand after a single mishap. Harsh as that is, customers are equally willing to reward companies for great experiences. People say they are willing to pay 16% more for a cup of coffee, 10% more for airline tickets, and 7% more for car insurance—as long as they come with things like high-end customer service.
A bit of the premium you pay for that Starbucks latte comes from the ease of ordering by app, part comes because the barista makes sure it comes with soy milk and part comes because the person serving it addresses you by name. Slick apps and smooth digital interfaces with customers increase convenience and facilitate customization while cutting out unpleasantries like long waiting lines or complicated billing procedures. But no matter how cool the app, technology is a poor stand-in for service or experience on its own.
Sure, machines can meditate communications—as they very clearly do these days—but true communication is also about connection. Even the most sophisticated AI-learning machines are limited in the amount of subtle empathy and psychological support they can provide. This is especially true in situations of crisis or distress, where there may not be a set precedent (or programming subroutine) to follow.
Technology on its own doesn’t irritate customers: it’s the distance and dissonance created through screens and algorithms that leads to frustration. Complex problems call for bespoke solutions, which (for now) are still best delivered by human beings.
In many industries, the rate at which technology has been adopted has swiftly outpaced our full understanding of its impact. Anything worth doing is worth the extra time to really interrogate and analyze the best approach for everyone involved. If current trends are anything to go by, business leaders would be well-advised to think about the second-order effects of machine-human interactions, especially when applying a technology layer to business-to-consumer communications.
“The simple question is: how do we allow consumers to get what they want, when they want it, how they want it?” Nike CEO Donohoe says. “Whether it’s digital, whether it’s physical or any blend of the two.”
There’s the question. What’s your answer?