2014 Annual Conference Inspired Marketing

PROPRIETARY AND CONFIDENTIAL
Michael Million
mmillion@fullsurge.com
Tutorial: Optimizing the customer experience
2014 Annual Conference Inspired Marketing
Brand-Driven Growth Strategy

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2AMA 2014 Annual Conference - Tutorial
You’ve got to start with the
customer experience and
work back toward the
technology – not the other
way around
Steve Jobs

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We see our customers as
invited guests to a party, and
we are the hosts
It’s our job everyday to make
every important aspect of the
customer experience a little
bit better
Jeff Bezos

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Starbucks spent less than
$10MM on advertising from
1987 to 1998 yet added over
2,000 new stores to
accommodate growing sales
Starbucks' popularity is based
on the experience that drove
its customers to highly
recommend their store to
friends and familyHoward Shcultz

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A trio of anthropologists
recently published an article based on
observations at three independently
owned coffee shops and three
Starbucks locations around Boston.
Their intention was to determine how
effectively Starbucks are able to
provide the same community-based
social environment associated with
traditional coffee shops.
How Starbuck’s drives loyalty - a study in customer experience

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The biggest surprise was that
Starbucks actually provided a more
welcoming environment than any of
the three local coffee houses.
They credited one Starbucks with
having the most vibrant sense of
community, and observed that the
baristas there knew many patrons by
name and could anticipate their orders.
The anthropologists also noted that the
Starbucks baristas were friendlier to
new customers than the bespoke
hipsters behind the counter at the local
places.
Same everywhere, but we still make you feel special

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Agenda
• Warm up Exercise 15
• Foundational Terms & Focus for Today 15
• Inspirations & Examples 15
• Methodology Applied to a Case 30
• Break-outs & Report-backs 45
• Conclusions

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What are some of examples of great customer experiences?

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What makes them so great?

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Where does customer experience sit in your company?
How much of a priority is it?
How is it viewed in the
organization?

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Where does customer experience sit in your company?
Who’s responsibility is it?
How is it managed?

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Agenda
• Conclusions

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What is customer experience?
Cumulative Impact Definition
Multiple touchpoints over time, which
result in a real relationship feeling, or
lack of it.
- Wikipedia
A set of expressions, impressions, and
interactions between a customer and
company that result in certain
perceptions of that company that, in
turn, drive some type of action in the
near or long long-term
- M. Million

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Distinct Economic Offer Definition
A personal and memorable experience
that creates a distinct economic offer
different from the goods sold and
services delivered
A company's ability to deliver an
experience that sets it apart in the
eyes of its customers serves to
increase the amount of consumer
spending with the company and,
optimally, inspire loyalty to its brand
- Pine and Gilmore, Experience Economy

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Psychological Underpinning Definition
An interaction between an organization
and a customer as perceived through the
customer’s conscious and subconscious
A blend of an organization’s rational
performance, the senses stimulated and
the emotions evoked and intuitively
measured against customer expectations
across all moments of contact
• Not just about the rational ”what” but also about
the emotional “how”
• More than 50% is subconscious, or how a
customer feels
• Factors such as the emotional, cultural, social,
and physical aspects are often over-looked

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Different approaches toward customer experience
Like segmentation, the right approach depends on knowing
specifically what the business challenges are and objectives you
seek
• Financial – how do we squeeze costs out
of the system, get customers to pay more
(e.g. airlines charging for pillows), or
expedite transactions (path to purchase)?
• Operational – how do we streamline
operations to make it more efficient from
end to end (e.g. process reengineering)?
• Technical – how do we enable the
system to be more productive,
manageable, and interconnected (digital
enablement)?
Internally Oriented Externally Oriented
• Functional path – how do we make
customers’ journeys easy, informative,
and helpful throughout?
• Emotional path – how do we address
customers’ changing psychological or
emotional needs as their decision-
making evolves (e.g. decision anxiety,
confusion, frustration, boredom)?

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An argument for a “Brand Experience” Approach
The world is growing increasingly complex and fast-paced
We are inundated by more and more marketing messages (and yet, we
don’t trust them any more than we used to)
Technology improvements are enabling more and more companies to
get the basics right (e.g. convenience, reduced wait times)
Copying is becoming increasingly easy – “sameness” of more and more
products and services / making differentiation ever more difficult
Brand experiences will drive tomorrow’s success and allow companies
to stand out (products, services, and even “good” experiences aren’t
enough anymore)
We look for and value what is personally meaningful to us -
experiences we have with companies seem to matter more

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So, what is a “Brand Experience”?
Interactions so impactful and uniquely identifiable to a particular
company, that they define the brand in customers’ minds,
distinguish the company far and away from its competitors, and
have a high influence on future behaviors
• Nordstrom's sales representatives going above and beyond
• Tumi’s lifelong repair policy
• Apple’s Genius Bar
• Uber’s payment system
• Others????

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Benefits of a “Brand Experience”
According to studies by McKinsey,
brand experiences are the most
powerful form of word of mouth driving
activity - accounting for 50 to 80
percent in any given product category.
Brand experience is inherently social,
it's built on ideas that people want to
spend time with and that people want to
share.
50% to 80%
of word of mouth -
driven by brand
experience

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70% of consumers trust brand
recommendations from friends, but only
10% trust advertising.
UK Energy supplier, E.ON developed EON Open
House, a store in Nottingham, UK that educates
local customers about smart meters, which are
being fitted for free across Nottingham.
The project proves the power of brand experience
by delivering positive advocacy when traditional
methods had previously failed the brand; Net
Promoter Scores of +88% vs. E.ON Customers
control of -17.7%.
- The Guardian
70%
trust brand
recommendations
from friends

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The Keller Fay Group research shows
that good brand experiences are three
times more likely to spark
conversations than an ad.
Furthermore, over 50% of
conversations triggered by an in-person
experience account for pass along and
purchase.
>50%
Account for pass
along and purchase
3X
More likely to spark
conversations than
advertising

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I don’t want to be sold to
when I walk into a store.
The job is to be a brilliant brand
ambassador. Don’t sell! No!
Because that’s a turn-off.
Build an amazing brand
experience, and then it will just
naturally happen.
Angela Ahrendt

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A great brand experience is about knowing and interpreting
Know thyself
(inside-out)
• Who you are
• Where you’re going
• What your brand
stands for
Know thy customer
(outside-in)
• Who they are
• What’s most
important to them
• What their
journey is like
InterpretInterpret Brand
Experience
• WHAT can we do for
customers that makes
their journey better
• HOW can we do it in a
way that is uniquely us

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Great brand experiences have six things in common
1. Brand first, transact second
2. Distinguishes customer types
3. Focuses on what matters most
4. Makes people feel special in some way, at some point
5. Designs for continuity and intent (across channels, platforms,
and path to purchase)
6. Measures, manages, and continuously improves

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Agenda
• Conclusions

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https://www.youtube.com/watch?v=Y1nzWY3JFJQ

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How would you characterize the Virgin America experience?

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Grab a pillow, take a nap
The Swedish manufacturer of hand-
made luxury beds, strives to make
consumers’ experience
transformative, from the first time
they lay on the bed until the bed
arrives in their bedroom.
Guests are encouraged to take off
their shoes, pick their own personal
pillow, and even take a private nap on
the bed of their choice.
This simulation coupled with the
highest level of hospitality
distinguishes Hästens and burnishes
the brand like no other form of
marketing can.
Winner of Sweden’s prestigious Signum award
for quality of long-term branding in 2013

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I’m here to take care of you
Each customer service representative
is available around the clock and
empowered to act on customer issues.
They are assigned to customers, stay
with them throughout their problem
resolution process, and get to know
them as individuals.
They often provide a personal touch,
like occasionally sending flowers to a
customer or their partner to mark a
birthday.
These gestures turn a faceless and cold
experience into something more special,
and give the brand a real heart and
soul.

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Non-stop coffee
Through remote diagnostics each
Nespresso machine is technologically
enabled to feed up-to-the-minute
information of its status including rate of
consumption, water temperature,
pressure, extraction, etc., so local
Nespresso service offices get warning
to proactively address issues vs.
waiting for a service call.
This preventative maintenance has
significantly increased the uptime of its
machines and allows Nespresso to
more continuously brew great coffee for
discriminating guests.

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Agenda
• Conclusions

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Roadmap to build a brand experience
DIAGNOSE (customer, journey, brand)
• Know thy customer, their journey, and their contexts
• Know thy customer pain points / improvement opportunities throughout the journey
• Know thy brand, what makes it special, and what type of experiences it should provide
CREATE & BUILD (messy innovation, front-end design, engineering)
• Interpret what you know about the target customer and your brand
• Envision the impression and interaction / look, feel, etc.
• Build out how things fit together to turn the vision into a reality
STRATEGIZE (business, brand, prioritization, plan)
• Clarify business objectives and growth strategy
• Determine brand intent / role of brand in driving business objectives
• Pinpoint interactions that matter most (what, when, and where you should spend efforts on)
• Determine “your” CE principles
EXECUTE & OPERATIONALIZE (systematize / routinize, manage,
monitor)

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Decimated by the financial crisis, a miracle was needed
In 2005, the US power boating industry
was 307K units …. by 2011 it was 139K
units – a decline of 55%
24’-36’ Sport Cruisers (Sea Ray’s core)
was down even more – the hardest hit
The 50’-70’ yacht class ($3M boats -
custom homes that float) represented
the best opportunity for Sea Ray to
begin growing again, as it was expected
to recover the fastest, but ….
Sea Ray had very little presence or
product in the category, and …..

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Opportunity in the small yacht class, but so much was unknown
…. the organization knew very little
about the market from a consumer
perspective:
• Who were the consumers for these
products?
• How did they perceive Sea Ray?
• What kind of experience did they
expect and weren’t receiving from
strong competitors?

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Approach
DIAGNOSE (consumer, journey, brand)
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In-depth research with target consumers around the world
• Industry reports
• Boating life social media
• Competitor websites
• Executive interviews
• Product development plans
• Ethnographic interviews at the
world’s largest Marina’s
• Dealer / broker interviews

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Know thy customer
Observations Traits What they Value Expectations
Buyers are
surprisingly
grounded
Wealthy people
Who also
Work hard
In it for the long haul
Sharp, quick studies who understand
customer service. Those who keep them
from wasting their time will earn credit.
Responsive
Buyers are
restless and
driven
Self-made
Who also
Respect their roots
What has been earned
They’re not famous and they’re not
blue-bloods. They’re searching for
‘superior’ things have true merit.
Real
Cruisers are
emotional
amplifiers
Stretched thin
Who also
Crave relationships
Their time, above all else
Boating gives them a meaningful way to
connect with who they are, with those
they love, and with the natural world.
Connected
Every buyer is
unique in
personality and
expectations
Characters
Who also
Appreciate details
Cultivating rapport through
graciousness
Treating them with same thoughtfulness
and attention to detail that they strive to
uphold matters to them a great deal.
Personal
Genuinely
rooting for Sea
Ray
Nostalgic
Who also have
Discriminating tastes
Familiar things reinvented Evolutionary

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Know thy customer journey
Service Area Pain
Prep & Strike • People just want to get out on the water—prep tasks take up valuable time for
owners and their guests
• Even the smallest issue discovered during prep can spark frustration when
people are waiting to leave the dock
Maintenance • Owners have little faith in the quality of maintenance and suspect corners are cut
Repair • The repair process feels opaque and lacks responsiveness
• Owners don’t know who they are supposed to call when certain boat parts fail
Enhancement • Pricing for a post-production change is often a negotiation that feels like being
“nickel and dimed”
• There is very little support from the manufacturer, most of the load is on the
owner
Hospitality • Taking a boat out isn’t a spontaneous adventure—it requires significant planning
to account for things out of a boater’s control (e.g., weather)
• People want to enjoy themselves on the boat with food, drinks, and various other
provisions, but it requires a lot of time
Crewing • The responsibility of operating a boat isn’t something people want to take on all
the time—there are many ways to enjoy a boat, and some owners feel locked into
one

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Know thy brand
PARENTAGE
“Who” is behind the
business
PURCHASER
“Who” buys it
PURPOSE
What it’s
designed for
PROCESS
Custom vs.
Production
PLACE
Where it’s built
draws heavily from
parent LMVH to give
the brand a “luxe hotel”
feel
long-standing association with
007 solidifies position in the
market - British quality with
polarizing attitude
the romantic side of old Italy
the modern, flashy, sexy side of Italy
draws heavily upon
its roots in fishing /
known for tank-like
construction and
sports car-like
muscle
Opportunity
for Sea Ray

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Roadmap toward brand experience
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Know thy brand intent
Purpose
• To re-energize the business by establishing a strong foothold in the luxury yacht class
• Drive $X in revenues at %Y margins over the next three years
• Engage consumers who historically wouldn’t have considered Sea Ray for a purchase in
the class level
Positioning
• For those who have earned it along the way and are never satisfied
• Sea Ray L-Class provides both the style and substance they seek in a 50’–70’ yacht
class
• By being responsive, real, connected, personal, and authentically Sea Ray
Persona
• ARCHETYPE: The Warrior King
• Relentless progress
• Confident outlook
• Passionate about craft
• Connected to what’s important
• “Bring it on” attitude
• Respectful and respected

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Know thy brand intent
Grit & Grace
Here’s to those who started small. To the
ones who made it to the top without
putting people below them. The ones
who climbed the corporate ladder, or just
built their own. Here’s to the best of us,
who never think themselves better than
anyone. To ones who put class in the
working class. The ones who started
small. But have gone big. This is the
yacht for people who’ll simply call it a
boat.
Essence

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Determine “your” Customer Experience principles
Service Area Promise
Prep & Strike Easy
Arrive at the dock, get in your boat and go. When you’re finished, throw your keys
to the valet, and they will take care of the rest. It’s that simple.
Maintenance Dependable
Owners can trust their maintenance crew to keep the boat safe, pristine and
ready for use.
Repair Responsive
Owners experience no hesitation around how to get something fixed. Repairs are
as fast as possible, very transparent, and resolve every issue entirely.
Enhancement Adaptable
Direct manufacturer support to make sure owners are confident in their ability to
make changes without negatively impacting the quality of the boat.
Hospitality Informative
The boat isn’t just ready for operation, it’s ready for enjoyment and comfort.
Owners step on to the boat understanding the most pertinent information about
their trip before they leave and know there’s someone they can trust.
Crewing Liberating
Owners, particularly operators, can easily hire a trustworthy captain, first mate or
any other support person to fill in when operation feels like a burden.

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Determine “your” overarching Brand Experience principle
From To
SCALED PERSONALIZED
This guided the entire customer experience including awareness,
web site, events, manufacturing plant, customer care & service,
delivery, personal touches, ongoing management

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Examples of how “scaled” to “personalized” will play out
AWARENES
S
Special interactions vs. a broad campaign / let the new boat be
discovered by targets vs. blasted to the masses
WEB SITE Concierge service that put prospects directly in touch with a Sea Ray
representatives to do a proper job of introducing the new yacht and
inviting users into a dealer where both would meet with them
EVENTS Intimate, luxury-filled settings of ~100 attendees at unique locations
along the coast.
DELIVERY Sea Ray captain to come with boat / walking customers through
vessel in detail, dealer training
PLANT Turning it into a design / experience center where prospects can tour
the site / hands-on selection of materials (vs. picking out of a
catalogue – getting the “feel” of the material)
BUILDING
PROCESS
VIP parties, emailed pictures of progress, extending into a bound
book, construction manager attention
PERSONAL
TOUCHES
• Anniversary of purchase celebration
• Scaled models
• Stocking refrigerator

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The Coastal Tour
Events that let boaters experience these
boats in a personal, familiar setting to
paint a picture of the brand and how it will
fit in with their lives.
A variety of casual cocktail parties on the
back of a boat to larger gatherings at
yacht clubs and posh private residence.
Hosted in a way that highlights each
region through food and culture but offers
a hint of signature Sea Ray style (Maine
lobster in Montauk, stone crab in Miami).
Sotheby’s to coordinate parties at multi-
million dollar homes one the coast; other
partners included Aston Martin, and Merril
Lynch to make events about luxury, not
only Sea Ray

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Tours of the Design Center (annex of the manufacturing plant)
Reception
Grab a drink and get to know each other
Current Models/ Options Gallery
A seasonal and customized approach for
each customer visit and model they are
interested in
The Lab
Give customers an inside
look at customization
possibilities or new ideas
that the design team is
experimenting
Test Drive
Give them an in- person
at how it all comes
together

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The Design Center – Getting There
Make the entire experience surrounding
the factory tour as seamless and
enjoyable as possible, while maintaining
‘our version’ of luxury. It should feel more
like a courtship and less like a traditional
sales experience.
Arrange for all the travel to and from the
facility. Treat them to the kinds of
privileges they are used to receiving in
when they make other purchases at this
scale.
Entertain them beyond the facility. The
relationships built will create meaningful
connections that Sea Ray needs with this
group.

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Pop-up Showroom
Creating a portable showroom is an
efficient way to bring the best of Sea Ray
(and this new sub-brand) on the road in
an impactful and immersive way.
Mobile pop-up container can be quickly
setup at marinas, dealer events or
anywhere else SR has opportunity to
connect.
Coffee, wifi and iPads available to view
and/or download SR app.
Build a brand gallery that echoes the
platform of Determined Spirit: product,
lifestyle, innovation, etc

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Boat Shows
Approach boat shows from a more
conceptual standpoint. Certainly the
boats themselves are on stage, but we
are selling the Sea Ray lifestyle too.
This is not just an opportunity to show a
huge inventory of boats and short period
of time. This is a time to tell the story of
Sea Ray’s future.
Consider a genius bar approach where
customers interact with Sea Ray experts
in a controlled environment and explore
the boat of their dreams.
General rules of authentic hospitality go
a long way at crowded places like this.
Consider unexpected drinks and
refreshments.

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Digital
Leverage digital as much as possible
during this time. Put off publishing print
material until the full fleet is launched in
2014. Leverage digital now in order to
get out ahead and spread your message
farther faster.
1. A dream app built for bragging
2. An owner’s app built for use

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Yacht Delivery
A Sea Ray expert/captain should meet
the owner at their slip and deliver the
boat, complete with stocked fridge and
snacks. Every boat should be delivered
with a tablet featuring an interactive
owner’s manual.
The captain should stay with the owner
and take them for an expansive test
drive making sure that they are
comfortable with every aspect of their
new yacht at the helm, below deck and
in the engine room.

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monitor)

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Execute & Operationalize
CUSTOMER
CARE
• Best in class warranties, prioritization of issues – rise to the top of
first handled
• Sea Ray individual assigned to resolving issue / seeing it through
- accountability
ONGOING
MANAGEMENT
• Dealer certification
• Elaborate customer surveys

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Results, so far
• Launch at the 2014 Fort Lauderdale International Boat Show (FLIB)
was extremely successful
• Sales have exceeded goals by +25% to date
• Business is sold out until next year
• Interest generated for next new models carrying the L-Class brand
and experience

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Agenda
• Conclusions

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Break-out Exercise (30 minutes to discuss / 15 minutes to report)
1. Pick one of your session mate’s company
2. Flip chart what the company’s brand stands for / what makes it special
3. Flip chart a profile of the company’s target customer
4. Flip chart the primary phases in the customer journey
5. Select 1 – 2 touchpoints that provide good opportunities to improve the
experiences and inject the brand
6. Brainstorm ideas for making the touchpoint a brand experience

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Agenda
• Conclusions

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Three things to remember from today’s session
1
2
3
Brand experiences will become increasingly
important in driving business outcomes
You must know your customers from the outside
in, know yourself from the inside out, and interpret
both to build an effective brand experience
Establishing ”your” customer experience principles
that stem from a brand-driven business strategy is
key in guiding developments and operational
change

2014 Annual Conference Inspired Marketing

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