You probably recognize this situation.

Imagine you’re a pretty loyal client in a certain bank. You have some accounts, some savings, a loan, some insurances… so according to your standards, you consider yourself a good client of this bank. Well, the moment you need an additional loan, obviously, you will go to this bank first. Because your loyalty, you expect them to give you the best possible interest rate available in the market, not?

At that point there is a 100% certainty that you will NOT get the best rate. There is even a close to 100% certainty that the next person that walks into your bank, but isn’t a client yet, gets a better deal. And if you will go to a bank where you don’t have any money, changes are again almost close to 100% that you will get a better deal than at your existing bank.

Strange vision on customer loyalty if you think about it.

Same goes for their additional benefits for bringing in new money in the beginning of the year. If you leave your money on your account, you get less interest rates than when you bring in new money. And I can live with a bonus for new money, of course. On the other hand, what is the consequence if you play this smart as a customer. You keep moving your money around from bank A to bank B in the beginning of the year to have an optimal return on your savings.

Maybe it would be a quite unique position if one of the bigger banks suddenly goes for customer happiness. If they would do whatever it takes to make their existing clients happy, this would probably be the best acquisition strategy there is.

Unless you have other experiences?

It’s brilliant: the CEO that speaks directly with its clients to explain the objectives of the merger. The story started really good: “Dear passenger, you will be so happy with the plans we have with our new airline (the merger of United & Continental. It will be a differentiating offer which will make all our passenger so happy.’ I was sitting at the edge of my chair, waiting for the unique positioning these airlines were about to reveal.

And then, time for a big disappointment. This is the description of this new unique concept: “we will be a reliable, safe airline with good customer service.” And…. And… And… nothing came. Wow, great, a reliable, safe airline with good customer service, that is really differentiating…

It’s such a missed opportunity. You let the CEO speak directly to all your passengers and you have the opportunity to ‘wow’ them. And then you present such a boring and 1000times heard before positioning. A real pity.

And then, during lunch, they bring you their napkins. And just look at the text. On their own napkins they are still competing with Continental, their current sister company.

The art therefore is for companies to tell a story. Preferably a story with the necessary ‘juicy’ elements to motivate people to tell the story to others.

It can be funny, but it works better if it comes from your heart

The day started with a duo presentation of the ‘Kitchen Sisters’. The duo is apparently quite well known here in the U.S. They host a popular radio show. To be honest: after an evening with perhaps a little too much wine, I had hoped for a presentation with more power to start the day. It was a bit like watching a radio show – and that at 8 o’clock in the morning… The message of their story was of course very pertinent: people are looking for stories. Their most important tips in this story are about visualising and defining stories. Make sure a story has a face. Later that day I listened to a great story about Ben & Jerry’s. The nice thing is that their story has the face of the two founders. Furthermore, people are always looking for a secret and something that is not actually directly related to the brand. This seemed to be an interesting conclusion. If you start thinking that way, a Facebook page can take on a much sexier role than is currently the case for most companies. Yesterday, the Sales Director of Facebook explained that the Coca Cola fan page has 12 million fan visitors per month (versus 270,000 website visitors). Sharing any number of ‘secrets’ through this page creates a good story. Stories do not require inventing, every company has them. Stories are everywhere, so say the Kitchen Sisters. Do not invent fake stories; just use the existing stories of your people. I liked their final tip the most: a story may be funny, and will work, but it will work much better if the story comes from the heart.

Ben & Jerry’s manage the story very cleverly

During the introduction to their presentation, the people of Ben & Jerry’s introduced their brand as follows: “We are not a brand, but a company with unique values that bind people together”. That was the start of a good story. Their whole philosophy is about giving people something to talk about. Only recently have they begun traditional advertising, something which I think is unnecessary. Someone asked what the ROI of their Twitter activities was. I think the pertinent question was: ‘what is the ROI of your above the line advertising?’ I fear it generates little added value since their story is already so beautiful and strong in itself.

Sampling is in the culture of their brand. Their Free Cone Day is of course iconic. It started in the 70s as a day to thank their customers. In 2010, they gave away more than 1 million ice creams! The next step is to involve social media in this story. Via their Twitter account @benjerrystruck they asked their followers who was in the mood for free ice cream. In the New York area, they then planned a route to give people their ice cream. In doing so, they deliberately looked for digital influencers. The more followers they had, the more likely they were to pay them a visit. They generally visited companies. One part of that visit was proclaiming the sender of the Tweet a hero. Everything was done to create maximum buzz. You can hear the importance of ‘location based’ tools in many stories too. Foursquare has suddenly offered a third dimension for companies to trigger consumers. According to Ben & Jerry’s, the structure of their programme is one of their factors for success. For example, they did not travel the entire country with ice cream, but began in New York and only did so one day per week. After all, they had no idea how many calls they would get. When they discovered that it was actually quite manageable, they added Boston and went out with their Truck on a daily basis. They started on Twitter and only added Facebook later on. When I heard this great story, I thought how much other brands could learn from this. Ben & Jerry’s is such a strong brand, and if the number of tweets and posts was manageable for them, how could other brands possibly complain about a lack of resources to get started with social media? This has more to do with lack of guts than a lack of resources if you ask me.

Give the influencers a story

Hotel and casino group Harrah’s presented a strong story about leading the conversation with influencers. Their problem was a wrong perception about their hotels. Most people associate Harrah’s with gambling alone. While they want to be something much broader: a romantic place that offers top-notch entertainment. To change the existing perception, they created an influencers programme. In it, they used three categories (similar to the model from yesterday’s session): social/digital influencers (e.g. Gary Vanerchuck), opinion leaders within the category (travel blogs), and finally their own customers. They invited these people to events and happenings. They gave them all possible support to facilitate the conversation. In a few months time, this programme resulted in more than 800 tweets, hundreds of photos and fifty blog posts by influential people. Together, this resulted in research showing that 85% of visitors to Las Vegas would now consider their hotels. Before this programme, this was only 17%. Impressive!

Gillette had another challenge: increase the number of shaves per week of the average man. It truly is incredible – if every man were to shave once more per week, their sales would increase by about 600 million U.S. dollars. Truly food for thought, right? They accepted the challenge with a viral video. Again by turning to influencers and giving them something to talk about.

Owned media as a steppingstone

Your own media are becoming increasingly important. If you want to tell stories to the world, it can be quite handy to have your own media. In the case of Ben & Jerry’s, the importance of their own website and mailing list was emphasised once more. If you look at what Unilever is doing with Yunome in the Benelux, creating own media is a brilliant move. Advertisers pay millions to the media to reach (half) their target audience. If at some point you have your own media, which fans will by definition be attracted to, this is an incredibly strong channel.

Today has been fun: I heard a lot about storytelling, and the link to your influencers and the role your own media plays in it. Good cases and ideas. Tomorrow is already the last day; I’m especially looking forward to the final presentation of @jowyang.

As a bonus: a quick look back at today’s most hilarious presentation. The story was about the promotion of safe sex in New York. These people created an account @NYCondom (unfortunately it no longer exists). On it, they went looking for people who send Tweets about nightlife and sex. The condom gave them some good advice like ‘don’t forget me tonight’ and entered into conversations. Hilarious!

The campaign involves surprising travellers with unique gifts (little acts of kindness) based on their social networking profiles and sharing behaviour.

How it works

When passengers check in at KLM’s Foursquare locations, the KLM Surprise team (two conversation managers) then use social networks such as LinkedIn, Twitter, and Facebook to find out information about the passenger. Odds are, anyone who uses Foursquare will have a presence on other social networks, providing the team with information about the person and their trip.

The KLM Surprise team then uses this information to come up with a personalized gift to surprise the passenger with. They already surprised travellers with champagne, notebooks, a watch, and traditional Dutch foods. One passenger, Willem van Hommel, was going to miss one of his soccer team’s most important matches of the year due to his trip to New York. KLM surprised him with a Lonely Planet guide to New York with all the best soccer bars in the city marked out for him. Another traveller,Tobias Hootsen, was surprised with a package to remind him of home during his long stay abroad.

Conversation management

The team follows up after surprising a passenger by monitoring the conversation generated on social networks by that person and their friends. They also take photos of the people they have surprised and post them to the KLM Facebook page.

Furthermore, KLM is keeping tabs on the conversations generated through social media due to this campaign, and actively feeds conversations via their @KLMsurprise and @KLM twitter accounts and their Facebook page. A pretty impressive piece of conversation management.

A story I love, because it proves my point that you don’t need unique products to change the world, you need a unique and strong vision to do so. The Zappos CEO Toni believes that managing his company culture is key to his success and the foundation of the company growth. Zappos has been profitable since 2006 and was sold to Amazon.com for 1.2 billion dollars during 2009.

I have preached a lot about Zappos & Toni in the last few months, but I wanted to learn more. This week I am speaking in Las Vegas and combined it with a look behind the scenes.

Did you know that Zappos has 4 guided tours per day and each tour is fully booked? The tours are completely free and they pick you up with the Zappos mobile at your hotel: free of charge.

What strikes me is the extreme level in which the culture lives in the company. I’m not just talking about the crazy stuff you find on all people’s desks, but rather about the way Zappos facilitates employees to really act upon the culture. A small example: the customer loyalty team gets the objective to connect with people while calling with them. Once they feel they are connected, they get the advice to write a small handwritten post card to this client saying ‘I was happy I could help’ + some customization. How do they make sure people send these cards? Simple, by placing a bunch of cards & envelopes on everyone’s desk.

The culture lives at Zappos, that’s the least you can see. Just take a look at these pictures. I love these examples:

• The stairway to culture: in one of the stairways, employees can write on the walls what they feel as the Zappos culture. The wall is full with all kind of weird and fun messages. All of them explaining in their own words what the Zappos culture means to them.

• And their offices: they are just crazy. They are probably also the messiest offices I have ever seen, but there is fun everywhere. When you are walking around, each department has its own instrument (or at least something that makes a lot of noise). As soon as the tour walks by, they start to make noise and talk to you. It is amazing how Niels and I were walking around with a big smile on our faces. This is REAL fun.

• The ‘wow’ wall: on this wall people stick post it’s with messages about a ‘wow’ experience one of their colleagues gave them. If you’re positively surprised by someone, just let it know to the world and share it on the wow wall.

However, Zappos is not just about fun, it’s also about business and making things happen. They have big white boards in different rooms that follow up on objectives. One of their key objectives are happy clients, the daily measurement of the NPS score is part of the white board. O…the guy on the picture, that’s our guide: Jonathan Wolske and he is full of passion, great guy. Thanks again Jonathan!

It’s also about growth and sales @zappos. They have different ways of bringing sales into the company as something everyone should be proud of. First of all, they have a real time screen on which you can see where people are buying shoes. Every 4 seconds you get a sales update. Further, they are celebrating it when they break a new ‘day sales record’. The last record is from 2009, when they sold more than 7 million dollars on one day. It’s just a matter of weeks before they hit the 8 million. When it happens: the entire company gets a t-shirt saying ‘my company sold for 7 million dollar shoes on one day and all I got was this lousy t-shirt’. Focus on client happiness and sales are the combination of Zappos’ success.

My moment of glory: I could sit in the chair of my personal hero Toni. I don’t know who the other people were helping me out to make it a nice picture, but I guess it were the 2 other owners of the company. Have fun and be a little weird, it sure is. Thanks Zappos for inspiring me and many others.

So, a message to companies who give incentives to new clients: consider to stop it as soon as you can! Use the energy and the budget to surprise your loyal customers. Wouldn’t it be great to get a message from your bank, saying: ‘Hi, great that you have been around for 5 years. To thank you, we give you…’. It can even be simpler: send them a card on their birthday with a small surprise attached to it.

The core is: show loyal customers that you care and that you appreciate their loyalty. The effect will be great: they will change from loyal customers into brand advocates that will drive your business.

Anyone with some good, pragmatic ideas on how companies can show their appreciation towards loyal customers?

1. Happiness is about 4 things:

• Perceived control: being able to decide if you want to learn and grow yourself
• Perceived progress: feeling like you move forward
• Connectedness: focus on company culture
• Vision / meaning: being part of something bigger rather than financial performance

2. Maslow’s hierarchy

Once the basic needs of an employee are met, money is lower down the list compared to professional growth opportunities or the quality of the relationship with the manager.

3. Three types of happiness: pleasure, passion and higher purpose 

• Pleasure: always chasing the next thing 
• Passion: where peak performance meets peak engagement and time flies by
• Higher purpose: being part of something bigger

Some other ingredients for the success: 

• Stop chasing the money, start chasing the passion (when Tony decided to leave LinkExchange earlier than agreed with MS and leaving a lot of money behind!)
• Don’t outsource your core business
• Don’t focus on buzz as marketer but focus on building engagement & trust
• Deliver a WOW-experience through service 
• Don’t put traditional KPI’s on your call centre such as number of calls they can handle because that leads to getting off the phone with the client as fast as possible.
• Have Core Values you can commit on as a company
• A strong culture and committable core values are important because they create alignment among employees
• Build good relations with vendors, don’t position yourself as a client but as a partner. Work together with them!
• In terms of social media (strategy): be real and use your best judgment
• When presenting be real, be passionate and use personal stories

I especially liked the idea of the Face Game. At LinkExchange Tony realized he did not know everyone’s name anymore as the company was getting so big… At Zappos you get a picture of a colleague after you login and you have to tell his/her name. This increases the changes of serendipitous employee interactions.

Personally I love the mentality of doing a random act of kindness (or WOWness) and I find myself already doing it. And I have to share the core values, just listing them, while in the book (or on the links) they are explained in detail:

1. Deliver WOW Through Service
2. Embrace and Drive Change 
3. Create Fun and A Little Weirdness 
4. Be Adventurous, Creative, and Open-Minded 
5. Pursue Growth and Learning 
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less 
9. Be Passionate and Determined 
10. Be Humble

Overall conclusion? The book is fun and easy to read and I recommend it to everyone. It is not ground breaking or new, if you follow Tony and Zappos, but it gives you a good vibe, a good feeling and is teasing you to do things different in the future. If you haven’t seen or heard about Zappos before … it is a must read!

In terms of social media and conversation management Tony tells his people: be real and use your best judgment. The way Steven is spreading his conversation management philosophy also has similarities with Tony: be passionate and use personal stories.

The book is an easy read and goes from selling lemonade and self made newspapers as a kid to selling Zappos to Amazon for 900 million dollars. In between these, Tony sold his company LinkExchange to Microsoft for 265 million dollars. Successful you could say, but the path to success was not an easy one. You might think that the selling of LinkExchange and having that much money is the only reason why Zappos could be so successful, but that’s not the case.

Let me try to summarize the story for you.

The road to Zappos maries Amazon

After selling LinkExchange to Microsoft Tony had a lot of money in the bank, together with some others he started Venture Frogs and invested in a lot of companies (more than 27 to be correct). The idea was that they would invest once and then be an advisor to the companies if they needed the advice. One of the companies was Zappos, originally named shoesite.com.

While running Venture Frogs, Tony had a lot of time and started playing poker to kill time. In the book Tony makes a comparison between running a business and poker. A very interesting comparison on evaluating market opportunities, marketing & branding, strategy … My favorites among the list are:

• Table selection is the most important decision you can make, and it is okay to switch tables if you discover it’s too hard to win at your table. 
• Remember that it’s a long-term game. You will win or lose individual hands or sessions, but it’s what happens in the long term that matters. 
• Stick to your principles 
• Hope is not a good plan
• Learn by doing. Theory is nice, but nothing replaces actual experience. 
• Don’t be afraid to ask for advice. 
• You’ve got to love the game. To become really good, you need to live it and sleep it! 
• Share what you’ve learned with others.

When investing in companies and playing poker became a bit boring, Tony started to go to raves and organize parties. Here he got inspired about how important the feeling of a tribe is. Later this would be the base for the focus on company culture. In the meanwhile, Venture Frogs became an incubator and some of the companies they funded in where moving in the building Tony was living in. The .com crisis has been very hard for start-ups and of all the companies VF invested in, only Zappos was left. Tony tried to get funding for Zappos for the future, but as they were not profitable they could get no funding. The main focus in the next two tough years was becoming profitable.

To keep the company going Tony started investing personal cash in the company. At a certain point he only had some properties but ran out of cash. In order to become profitable, Zappos has changed their business model with success. At the start of Zappos they only worked with brands who could work in a drop ship model. This means people buy on Zappos.com, the order goes to the brand and they ship to the customer. This resulted in only specific brands being offered on Zappos.com. And not the brands the customers really wanted. In order to change this they had to have a brick-and-mortar shop, start a warehouse AND find 2 million dollars to pay the inventory.

And so they did. They changed their business model. Finding 2 million dollars was the most difficult thing to do! Tony believed that Zappos had a future and decided to sell everything he had, except his loft, to get the money. The switch worked, sales went up but they still were not profitable.

The next thing they did was moving closer to the UPS distribution center to be able to ship faster. They partnered with eLogistics in Kentucky. But eLogistics oversold their capabilities and Zappos ran into operational problems. In the meanwhile they also ran out of cash … Tony, while climbing the Kilimanjaro, decided to sell his loft. And even that was not an easy sell at that time. He lost 40% on the value doing this.

Zappos had cash and was saved, for now.

eLogistics became a big problem and at that time Tony and co realized that running their own warehouse was core to their business. This switch boosted the sales again and at that time the BHAG of 1 billion dollar turnover was set for the future, together with the focus on customer experience. But still, not profitable meaning no investments. The future of Zappos depended on the go or no go of Wells Fargo to give Zappos a loan.

June 2003, that day, it happened … they had a go and Zappos was saved and became the success we all know. They moved to Las Vegas and focused on culture, customer service and employee development. Although in 2008 they had to lay off 8% of the staff, the company was later sold to Amazon for 900+ million dollars.

Later this week I’ll share some more insights on Delivering Happiness, talk to you soon!

In my book, The Conversation Manager, I use the example of top restaurants to describe the difference between product management and experience management. Restaurants like Oud Sluis understand the importance of great experience and storytelling.

As Sergio Herman’s restaurant is an example in my book, I handed over a copy to him. The story sounded interesting to him I’m looking forward to hear his ideas about the philosophy of The Conversation Manager.

When a guest is asking for directions to a Disney cast member, they are trained to point directions with 2 fingers or with an open hand. They will never point with just one finger, because this is very impolite in certain cultures.

It’s one of those details that you will never notice, but it could create a negative experience to some guests if you don’t take it into account.

Details can make or break your total experience and so influence the conversations people are having about your brand.