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A Startup's Secret Sauce: Customer Experience

By Special Guest
Lucy Norris, Executive Vice President, Global Leader of Customer Success at Genesys
November 17, 2016

Every entrepreneur dreams of founding the next unicorn, and the Internet offers no shortage of advice on how to cook up that $1 billion valuation. Start in your 30s. Go mobile first. Raise lots of cash. Tips like these are always questionable, but there is one common ingredient most flourishing new businesses really do incorporate into their recipes for success: a great customer experience strategy. From Pinterest to Postmates to Plated, one of the defining characteristics of virtually any successful startup is an obsession with perfectly calibrated customer experience.

It’s not hard to see why. Companies like Uber or Handy don’t typically manufacture a proprietary product or provide a uniquely specialized service. Both companies operate in spaces that have long been occupied by incumbent institutions, which offer similar services, often at a lower price point. Rather than compete on cost, many startups bank on the proposition that their services are so convenient and gratifying, customers will opt to pay more for that premium user experience.

For many, it’s a gambit that pays off.

Here’s what Bayard Winthrop, CEO of startup clothing brand American Giant, told Business News Daily: “We’ve put our customers first by building a high-quality, amazing product, and as a result, have created an organic and unfaltering loyalty to the brand. Through this model, our current devoted customers have made their enthusiasm known on social media and beyond, generating new, organic fans of the brand. It’s a virtuous cycle with love of product and the American Giant brand [is] at the center of it.”

American Giant is best known for what it bills simply as “The Greatest Hoodie ever.” At first glance, the garment isn’t dissimilar from other zip-up hoodies on the market, except for its relatively steep $89 price tag. But look closer and you’ll find the sort of attention to detail that many successful, young brands have leveraged to race ahead of more established competitors. From the heavyweight cotton to the tailored silhouette, the sweater reflects the care that went into making it.

Instead of creating something radically new, American Giant elevated something classic and sold it at a premium. “We sort of set a standard for ourselves with the sweatshirt,” Winthrop said in Fast Company. “We now feel like we owe it to our customers to exceed that expectation.” That laser-like focus on customers is at the center of the growing venture’s efforts.

Such a strategy is a recurring theme among many startups. New York-based Plated, of Shark Tank fame, isn’t the first or cheapest meal-kit delivery service on the market. But CEO Nick Taranto says the company stands out through its disproportionate investment in customer experience. “We want to be that trusted friend who helps take you on a dinner adventure. That doesn’t happen when you treat customers as transactions. We’re trying to build relationships, and that means going beyond pure service, to treating folks with hospitality,” Taranto said.

The company employs the popular customer support system Zendesk to achieve that aim, but issues with scaling plagued the company’s bold CX efforts as its popularity grew. So Plated simply took its centerpiece strategy to the next level by investing in an innovative cloud contact center to track average handling time, hold time, abandonment rate, and call volume per day/per agent. Analyses that would take days became available in real time, instantly enhancing engagement capabilities. The Plated customer experience department knew the solution was working when they reduced call abandonment rates by 30 percent within the first week of deployment. Over time, they managed to slash call abandonment rates by 80 percent, cut hold times by 90 percent, and boost already solid customer satisfaction scores by 20 percent.

In addition to sourcing only the highest-quality ingredients for its chef-designed meals, Plated proactively interacts with thousands of customers each week through this robust cloud contact center, which emphasizes customer journey over transactions and user experience over products. The approach has enabled the company to foster the sort of rarefied brand experience that helps justify paying a premium for a commodity. (One happy customer drove over 200 miles, two days in a row, to visit the Plated team at a gourmet roadshow last summer.) A Plated customer isn’t buying groceries — they’re buying a lifestyle product. Cultivating a positive experience around every touchpoint for that product is the secret sauce.

There are also startups devoted to cooking up improved customer experiences for other businesses. Chicago-based Belly started up in 2011 with the premise of enabling locally owned businesses to enhance customer relationships by tracking in-store experiences and extending them though mobile apps. As noted in Fast Company, businesses use Belly to “launch brand-specific rewards programs allowing customers to earn points for purchases. Users can then redeem them for something they want, whether that's a discount on a product, or something a little zanier, like having a local deli name their favorite sandwich after them for a week.” Its first customer was a small comic book store in the Windy City, but Belly has grown to serve thousands of merchants across the country and is now moving into enterprise loyalty programs.

The commonality among all these companies and countless other startups is a sharp focus on the sorts of details others have neglected. Even the most innovative brands in the world have competitors, and even the most established enterprises have customer experience weaknesses that can be improved upon. It just goes to show that whipping up a unicorn is perhaps less about creating a singular product than a singular experience.

About the Author

Lucy Norris is executive vice president, global leader of customer success responsible for end-to-end customer and partner enablement and support -- from strategy to execution incorporating revenue, delivery, and profitability. She is responsible for customer implementations, education and ongoing support of Genesys products and solutions in the cloud and on premises. This remit includes Genesys Care, the Genesys customer care program; Professional Services focused on customer realization of Genesys-based business outcomes; Genesys University focused on customer and partner enablement; and Customer Success Managers who represent the voice-of-customer — all of which are designed to drive customer loyalty evidenced by customer retention and expansion.

Edited by Alicia Young

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