Published in the San Diego Union-Tribune, March 26, 2018
Why do we remember things? And how does memory influence customer retention and satisfaction?
When my daughter was younger, and I was still CEO-ing at full tilt, I would gather the junk that the vendors/booths were giving away when I went to a conference. I was really good at scoring pocket calculators (1996-8), which I would send to my daughter who was 11 at the time. She loved them. Now here it is 21 years later and when I get junk from a conference, I send it to her with a note telling her “that there were no pocket calculators available.” She loves it (the last item I sent was a rubber shrimp, since I am now in the sustainable fish racket).
The point of the story is a simple one. We had created “a moment” that informed our relationship forever. Meet Chip and Dan Heath, MBA graduates of Stanford and Duke, who have written a book, “The Power of Moments.” They did some research and found that the top hotels in Los Angeles on TripAdvisor are the Beverly Hills Hotel ($875/night), the Hotel Bel Air ($1,120/night) and the Peninsula ($815/night). The fourth one is the Magic Castle Hotel ($209/night). Heath describes it as “a converted two-story apartment complex from the 1950s, painted canary yellow with an Olympic size pool, if the Olympics were held in your backyard.”
How does this happen you might ask? Heath says that the hotel creates “defining moments.” The hotel has the “Popsicle Hotline.” You pick up a red phone at the pool and you hear “Hello, Popsicle Hotline.” You then request a Popsicle in the flavor of your choice, and an employee wearing white gloves delivers it to you on a silver platter. That’s it — just a Popsicle.
Now think this one through carefully. The Popsicle costs 10 cents, the employee is already on a salary, the white gloves are washable, the silver platter is not sterling, so the total cost of this extravaganza, this defining moment, this “are you kidding me” experience on a unit-cost-basis is well under $3 — all in. Yet, the customer is nutso, over the top, wow, and the hotel runs 95 percent occupied and is No. 4 on TripAdvisor. You gotta love America.
The Heath brothers had discovered the power of “elevation moments” that transcend ordinary experience. The “I didn’t see that coming” moment — a special glass of wine on the house, a surprise at work, where the cost of the surprise, or the over-the-top delivery is de minimis compared to its effect. They call this the “Power of the Free Popsicle.”
Heath then goes on to mention three other kinds of defining moments — “insightful moments,” (e.g. the discovery of Velcro), moments of pride (think employee recognition) and moments of connection (think weddings and graduations).
The key is that all of these need to be in the service of the customer or your employee. Heath says, “You don’t have to excel at everything, you only have to excel at a few things that are going to be memorable.” He calls these “peaks.” We know that getting a customer is hard, but once gotten, you should never lose one, never. Whatever it takes. Think about your own relationships with vendors. There are some that you would never switch from. They own you, they have a “connection,” because they never let you down, and occasionally, they just dazzle you. Heath tells of a bank manager who personally delivers the deed to your house when you have paid off the mortgage.
Heath also looks at the power of “pits,” what he calls negative experiences, put downs. He tells the story of Sara Blakely, whose dad would ask at dinner, “What did you fail at today?” And a few years later, when the old white guys told her that footless panty hose was stupid, she went and started Spanx and became the youngest self-made billionaire in history. I love these stories.
You can learn from experiences (pits) and you can create them for others (peaks). But in the end, Heath focuses on one word — delight. You do not need to be perfect, you can apologize for mistakes, but every once in a while, if you just blow their doors off, they never leave you.
Rule No. 554: Surprise! It’s the little things, stupid.