This week we feature an article by Brad Birnbaum who writes about how important it is for companies to deliver great service and create amazing experiences in order to compete with the big retailers and resellers. – Shep Hyken
Amazon’s success over the last two decades has permanently reshaped retail. Their intuitive shopping interface, wide selection, one-click ordering, and fast shipping have become the industry standard. However, this has also opened huge opportunities for brands to innovate and differentiate themselves. New Direct-to-Consumer companies are flourishing by focusing on building strong relationships with their customers that they own directly, bolstered by better experiences.
Companies that are creating exciting new products and going straight to the customer using digital technologies or new business models can create an amazing experience because they don’t need to rely on other parties to deliver it. To stand out, these brands need to rely on service. It is a crucial aspect of the experience, and one where big retailers and resellers can’t compete nearly as well. With top-shelf service, support, and experience, young and modern DTC brands can come out on top.
“Driving repeat business and higher lifetime value should be the goal of the modern CX department,” says Brad Birnbaum, CEO and Co-Founder at Kustomer, “Increasing lifetime value requires a real experience, not just transactional service. Loyalty isn’t just about recurring business, which Amazon is great at encouraging, it’s about driving recommendations and exceeding expectations with incredible service.”
“To do that, DTC companies can differentiate themselves by having a full view of every customer—from purchases and service to sentiment and engagement—so the entire experience can be personal and personalized.”
Amazon customers are spoiled by choice, but they are also overwhelmed by it. If you search the word “soap” on Amazon, you get 57,325 results—picking a simple product becomes paralyzing as you try to weigh price, benefits, ingredients, and other factors all at once. A study from 2009 in the journal Psychology & Marketing revealed that when people cannot easily determine which option is preferable, they are more likely to leave a store empty-handed. A few, clear choices is better for businesses than a huge range of undifferentiated options.
On the other hand, DTC brands can deliver a great experience by offering a tailored selection that suits the needs of their customer base without overwhelming them. Tuft & Needle started with only one mattress model, and after years now only offers one more—a far cry from the overwhelming process of buying a mattress at a retail store. LOLA, a direct-to-consumer personal care brand, built their business on a single organic tampon, and have grown their selection based directly on input from their audience. Burrow still only offers a single sofa with a few customization options, opting to engineer a single sofa that meets all of their customers’ needs, rather than several that only meet a few.
Succeed With Experience
DTC brands know that experience reigns supreme and is crucial to setting their brand and business apart. Owning every part of this process gives them a distinct advantage.
To replace the experience of trying on makeup at a department store counter, Glossier creates an immersive, digital journey that anyone can take part in online. Customers can get a personal consultation from a member of the gTeam over chat, email, or the phone. And, these support agents have all the necessary context and information about customers’ shopping history. That means they can deliver even more insightful advice than even a well-trained associate who doesn’t have access to every customer’s background. With abundant tutorials on social for all of their products, there is a thriving community of fans to pull from for advice and guidance—something you just don’t get from Glossier’s competitors.
Many of Amazon’s customers may use their services regularly, but most probably wouldn’t say they have a strong relationship with them. When convenience is the foundation of your relationship with a brand, then you’re only going to stay loyal until you find a more convenient option.
Rent the Runway has built their company culture into their customer experience, which helps them build strong relationships with millennial shoppers. “Culture is in the fabric of our brand,” says Tyler Nicoll, Product Manager at RTR, at Kustomer’s recent Direct-to-Consumer Summit. “Millennials choose brands based on social consciousness.” Creating a strong brand built on solid principles makes it easier to form relationships with your customers, especially if they’re millennials.
This focus on relationships drives repeat business, which should be the goal for every modern CX team—lifetime value requires experience, not just transactional service. But loyalty doesn’t mean just repeat business, it requires a deep connection and service that consistently wows customers. That level of surprise and delight is what encourages them to tell all their friends or shout out your brand on an Instagram story. “As customer expectations evolve, so too must the way we treat our customers,” remarked Kustomer’s Brad Birnbaum, “While Amazon has moved the bar for convenience, focusing on your customers’ Lifetime Value means you can always identify where to invest in your experience to make up the difference. But doing so requires a single, holistic view of the customer.”
Quick checkout times and pure convenience are good, but they aren’t enough for the changing tastes of modern customers. If you want to beat Amazon, don’t play their game—play your own, and create an incredible and totally unique customer experience.
Brad Birnbaum is the Co-Founder and CEO of Kustomer.
For more articles from Shep Hyken and his guest contributors go to customerserviceblog.com.
Read Shep’s latest Forbes Article: Woof! Woof! Bark And Zoom Disrupts The Competition With Convenience