Manifesto: Customer Service as profit center

I spent 25 years in the advertising industry. I worked on the client side as VP marketing of a $200 million retail chain, and at an educational-software startup. I worked on the agency side as a creative director, managing teams of ‘creatives’ and contractors specializing in everything from composing music to conducting social media influence campaigns. I worked with market-leading brands and introduced new ones.

My work worked, too – judging from my clients’ results and my compensation. But in 2011, I traded that career for a 12 buck-an-hour job, to learn how Trader Joe’s built one of America’s most valuable brands, virtually without advertising.

Over the next year, I realized that Trader Joe’s was no better at its business than my old clients were at their business. Trader Joe’s is probably no better at its business than you are at yours. And despite the company’s fabled secrecy, the secret to Trader Joe’s cult-like brand, fanatical customer loyalty – and by the way, category-leading profitability – was hiding in plain sight. It was built on millions of face-to-face interactions between TJ’s customers and the company’s famously chatty front-line customer-service staff.

Revolutionary Old Idea is dedicated to this simple idea: Your company can build its brand the Trader Joe’s way. We know how they did it, and we know why it works; we can show you how, and it will work for you.

“Culture eats strategy for lunch”

Trader Joe’s hiring and training are entirely devoted to finding crew members who are empathetic natural extroverts. The company on-boarding process encourages them to engage customers at every opportunity. The quality of interaction – the CX each crew member delivers – is the single most important item in employee evaluations.

The beauty of building your brand this way is, there’s no risk of raised expectations. Sure you could go about it the traditional way, by spending a fortune reaching the right customers with a perfectly pitched brand promise through paid media. Or the new-traditional way, by carefully cultivating an audience on social media. But either way, if Customer Experience is shitty, the customer will be more disappointed than he or she would have been if you had not spent a cent on marketing.

They say, “You only get one chance to make a first impression,” but the truth is that the impression that lasts is the last impression you make. Customer Experience will always make or break your brand.

Is this a scary idea? Maybe.

Look, for years you’ve placed responsibility for your brand in the hands of some of your highest-paid executives and most expensive consultants and suppliers. And now we’re telling you to place it in the hands of your lowest-level front line staff. But here’s the thing: You’ve always empowered those people to devalue your brand, so why not also empower them to increase its value?

Go ahead. Try to talk yourself out of it.

Tell yourself, “It works for Trader Joe’s but they’re a completely unique brand.” They’re not, and the same techniques work for Quick Trip, Best Buy, and many others. We use Trader Joe’s because they’re the best example, not the only one.

Tell yourself, “Trader Joe’s can find those employees, but I never could.” The truth is that at a time when many employers are focused on hard skills, building a brand this way involves hiring people with the softest skill of all. And because you’ll be hiring for attitude and training for aptitude (exactly the opposite of what most companies do) you’ll be surprised how easy it is to find the people. You will probably be surprised to learn how many of them already work for you. 

Imagine hiring a branding expert whose first advice isn’t, “Throw out your old brand”

Although Trader Joe’s built its brand on a CX cornerstone, spending almost nothing on advertising, new or old media, or public relations, we’re not suggesting that you should throw out your old brand or abandon a traditional strategy. We’ll help you layer in extraordinary CX, to improve the return on all your branding and marketing investments.

The best thing about adding brand value, and building a culture of profitability this way is, it’s permanent. You’re never going to create an expensive campaign around a celebrity spokesman, only to have the #MeToo movement out him as a douchebag. And it’s the strongest defense in categories that are being disrupted by e-commerce.

Ad industry ageism is bullshit

It’s time to rethink what you know about consumers in the 21st century. That, I admit, sounds like more ad agency bloviage. But this time, I’m not giving you an opinion, like, what color your logo should be this decade or, how often you should Tweet. 

There’s a market almost twice the size of California that most ad agencies just don’t get. And it’s not way over there on the left side of the continent. It’s all around you; it’s consumers 55 and older. If you want that demographic to snap into focus, all you have to do is realize that they look different now than they used to look.

I was born right at the peak of the Baby Boom. My generation came of age, influenced by the counter-culture and the spirit of revolution. But eventually, we all cut our hair and got jobs; we got married and had kids. We sold our Honda motorcycles and bought Accords.

Even though it was inevitable that we’d grow older, there was a big part of us that refused to grow up. The Boomers never really stopped challenging accepted wisdom. When our kids left home, we bought motorcycles again. 

The average age of buyers of new motorcycles in the U.S. is 52.

This unwillingness to ‘think’ our age isn’t just true for Boomers. If anything, Gen Xers — the first of them are now approaching 50 — are even less willing to make their self-image conform to their chronological age. 

On it’s own, this phenomenon is just another cultural change for marketers to adapt to... The problem is that ever since guys like Don Draper wrote the book on brand strategy, marketers have believed that the time to build strong brand loyalties is when consumers are young — before they become set in their ways. 

In 1986, tobacco companies paid a 200 billion-dollar settlement, and agreed they’d stop using cartoon characters to imprint their brands on children.

Whether you're a brand manager on the client side or a planner on the agency side, the next time you sit in on a creative presentation, take a look at the people responsible for doing the work. Yeah. One of your problems is that the people responsible for executing your strategy learned all they know about strategy on their X-Box. (Want to know why almost all ED drug ads are cringeworthy? Because they're conceived by kids whose biggest turnoff is imagining their parents having sex.)

So we have an overwhelming cultural fact — that a huge chunk of the population is aging differently than any previous cohort. And that fact has collided with an entrenched belief — more than that, an entire advertising industry structured on the premise — that it’s a waste of time to market to anyone to old to conform to Nielsen's 18-44 demo. Ad agency creative departments are youth cults — to the point that, usually, they’re not just trying to reach young consumers, they’re actively alienating everyone else.

Big. Mistake

The first baby boomers just hit what for any previous generation, was a ripe old retirement age. Guess what? They’re not retiring. Some of that, I admit, is because after 2008, their retirement funds no longer offer the promise of comfortable retirement. But it’s mostly explained by the fact that they’re not tired. How often have you heard that 70’s the new 50, or 60’s the new 40? Redefine themselves? Sure. Maybe even full-on reinvent their lives. But retire? Not yet.

As for those buying habits that were going to be formed in youth and carried on until old age... Yeah, the facts are in. Over the last 20 years, Young & Rubicam — ironically one of the big ad agencies that promulgated the youth cult — has spent millions of dollars interviewing tens of thousands of consumers for its Brand Asset Valuator study.

What have they found? That over their study period, the number of brands consumers rate as ‘trusted’ has fallen by half.

Trust. Cut. In half.

It’s not as if all brands lost out equally over that period. Some — Apple and Red Bull leap to mind — built huge equity. So actually, the losers lost even more.

I’m reminded of George Carlin, who quipped, “You know how stupid the average person is? Well, half of them are even stupider than that.”

The first thing I take from that statistic (the Brand Asset Valuator’s, not Carlin’s) is that the idea that brand loyalties formed in youth would become unbreakable lifelong purchasing habits was obviously crap. What interests me even more however, is that when the number of brands people trusted fell by half, the amount of spending didn’t fall with it. In fact, spending’s as high as it’s ever been. 

This suggests that consumers — including middle-aged ones — are more than capable of changing their minds. You can confirm this with direct observation. The second half of the Baby Boom — my generation — grew up knowing that American cars were under-engineered gas guzzlers and bought Toyotas and Hondas their whole lives.  Yet people my age just resurrected the American car industry. Trader Joe’s — a company that I’ve studied from the inside and which has a devoted following of customers over 55 — but the chain hardly existed when those people were forming their grocery-buying habits.

Baby Boomers and Digital Technology from Pew Research Center's Internet & American Life Project

While Boomers lag behind Millennials in SM use, their rates of adoption are higher. There are now so many parents and grandparents on Facebook that they're presenting the company with a strategic challenge; younger users are dropping off FB, because they don't want mom and dad seeing all their posts.

What we know, now, is that consumers who are 55, 65, or even 75+ years old are doing a lot more than rethinking retirement. They’re redefining purchasing habits and brand preferences. They’re ready to try your brand, again or for the first time. And you’re welcome to keep selling to their kids, but if you ignore the parents (or even grandparents) you’re leaving money — a lot of money — on the table.

So now what do you do? You could tell your creative department to rethink that old strategy. But look at them. Can they connect with consumers who are twice their age? Not without some expert coaching. It's almost as if you need a special kind of creative director — someone you could bring in to work in parallel with your existing team, either to ensure that your 'A audience' message to millennials isn't alienating your 'B audience' of Boomers; or even to create a complementary campaign that calibrates your brand message specifically for mature consumers — you may already be doing something like this to leverage brand strength in the Latino community, for example.

If you think it’s time to rethink your attitude towards that market that’s twice the size of California, you'll want to bookmark this site, because over the next few months, I'll be presenting some object lessons from brands and agencies that get it and (sadly, the majority) who still don't.

Or, if you're in bigger hurry, you could just call and set up a meeting.