Put customer centric thinking at the heart of your business model

One of the great entrepreneurs of the C20th, Ingvar Kamprad, the founder of IKEA, died last month. He created a business, founded when he was just seventeen, that today has commercial reach and a cultural impact that very few consumer products could hope to attain.

Kamprad was an entrepreneurial schoolboy. He bought pencils and matches in bulk which he resold to classmates for profit, moving onto fish then Christmas cards trading. When he was seventeen, he borrowed money from his father – who was convinced that he was giving money for Ingvar’s’ studies – and opened IKEA, hatching the plan at his Uncle Ernst’s kitchen table.

Initially it was a mail-order furniture business, but facing a price war against his business, he flummoxed rivals by opening a showroom – the first IKEA furniture showroom opened in 1953 in Älmhult, Sweden, so customers could see and touch IKEA home furnishings before purchasing them.

To attract prospective customers, he also promised a free cup of coffee and a bun to everyone. Imagine his surprise when this modest event attracted more than a thousand people! Nevertheless, everyone got a cup of coffee and a bun. The idea of opening a fast food restaurant in each store was born.

Kamprad focus was customer centric, but specifically on a do-it-yourself ethic for customers – the company’s name was a do-it-yourself job, too, it stands for Ingvar Kamprad, from Elmtaryd (his family’s farm) in Agunnary, a village in the Smaland region of southern Sweden. His own motto, based on a strong work ethic, was that most things remain to be done, and he built this into the ethos of his customer offering too.

Kamprad’s impact on everyday living has rivalled that of Henry Ford and his mass-produced motor car. Furniture used to be costly, clunky and heavy, and you kept it for many years. For the cash-strapped and newly nesting, fitting out a home could cost many months’ salary. IKEA made domesticity not just affordable and functional, but fun.

Out went the hand-me-downs and junk-shop make-dos, in came the cool, tasteful, egalitarian look and feel of modern Sweden. Airy, sparse, uncluttered – a little bland maybe, but hard to dislike. The Billy bookcase is perhaps the archetypal IKEA product, dreamed up in 1978 by designer Gillis Lundgren. Now there are 60-odd million in the world, nearly one for every 100 people – not bad for a humble bookcase.

Light and bright, basic but cheerful, like the furniture, IKEA’s 400-plus outlets also run on the same central principle: customers do as much of the work as possible, in the belief they are enjoying the experience and saving money. You drive to a distant out-of-town warehouse. Inside, you enter a structured journey through a busy maze – the route is controlled, no shortcuts allowed – where every twist reveals new furniture, artfully arranged with cheerfully coloured accessories to exude a contemporary relaxed lifestyle.

The low prices make you buy, so you load up your trolley with impulse purchases that you don’t really need – a clock, a bin, plants, lampshades and more tea lights than you will ever use. You lug heavy cardboard boxes holding flat packed furniture into your car and reward yourself for your thrift and good taste with meatballs slathered with lingonberry jam. Then you drive home and assemble your prizes. You rejoice in the bargains and the variety of purchases.

There is no doubt that Kamprad reinvented the shopping experience with the product and the store, but Kamprad’s biggest innovation, and the cornerstone of his value proposition, was that consumer inconvenience was a problem worth solving. However, he approached it the opposite to most brands that build their reputations around a set of distinguishing positives and unique differences they provide for their customers.

By 1952, Ingvar already had a 100-page furniture catalogue, but had not yet hit on the idea of flat-packing. That came as he and his company’s fourth employee – designer of the Billy bookcase, Gillis Lundgren – were packing a car with furniture for a catalogue photo shoot. This table takes up too much darn space, Gillis said. We should unscrew the legs.

Kamprad realised that furniture could be flat-packed to significantly reduce the cost of delivery, which were among the product’s largest cost drivers, to make the customer self-service journey complete. Table legs are unwieldy, so why not just take them off?

Except, now every customer buying furniture has to assemble it – and there are many moving parts to some of IKEA’s complicated furniture items. From personal experience, there can easily be fifty or more steps involved in the construction of the piece, with an instruction guide that remains as confusing as ever. I’ve assembled many cupboards with nothing but an Allen key, metal bolts, baffling instructions and sweat. And swear words.

But Kamprad and his team knew that with the right price, product mix and user-centered focus, consumers would see IKEA as a destination shopping experience. Given the locations, they had to bring their cars anyway, and having self-selected their pieces, taking their purchases home made an attractive and complete transaction cycle.

They also understood that unlike a grocery store, furniture shopping is not a daily or weekly occurrence, and so people were comfortable investing significant time at the store when they finally did make the trip. That’s one of the reasons that IKEA has restaurants serving meatballs as simply, the more time consumers had in the store, the more they spent.

It seems trying to cram flat-pack furniture into your car, missing screws, and the ensuing marital tensions, haven’t been enough to put people off. IKEA has a 12% market share in the UK, outstripping rivals such as Argos, John Lewis and sofa retailer DFS.

So, Kamprad’s IKEA experiment focused on a simple, core value proposition – well designed, reasonable quality furniture at reasonable prices, supporting his vision ‘to create a better everyday life for many people’. He consistently developed and scaled, but the fundamental premise was to make customer experience the brand differentiator. Having grounded his business model around the customer, what are the other aspects of Kamprad’s entrepreneurial flair that we can learn from?

1.     Give your customers context

IKEA offered a completely new concept. It wasn’t just what they were selling that was different, but how it was selling it: You come here, you walk through this maze this way round, then you pick it up in the warehouse, and then you take it home, and you build it. It is a really prescriptive way of doing stuff where the customer has to invest time, contrarian ever more so with the advent of online shopping, but dictating a customer’s journey in this way had never been done before.

It’s this very journey of course that frustrates many of its customers, with the baffling warren of mocked-up rooms, floor arrows, and no glimpse of the outside world to help you orient yourself – is far from accidental. But the key to IKEA’s strategy is suggesting to the customer that they are in charge – they give you your own pencil, paper and trolley, there’s only a smattering of staff, and there’s no hard-sell from sales assistants.

Every IKEA store is a showroom, where not only sofas and cupboards are exhibited, but any little things of everyday life too – tablecloths, curtains, towels and candle holders. The visitor can see ten children’s rooms, and then twenty-five dining rooms or living rooms and so on.

Having imagined what a particular furniture set-up would look like in their own home, a customer can then go for it to the self-serve warehouse. The customer then transports the furniture in comfortable packages to his home and then assembles it by reading clear and sensible instructions.

As e-commerce scales, shoppers need incentive to come into stores. With its elaborate showroom and cafeteria, IKEA has become a unique destination for shoppers. While many retailers enter shopping centres hoping for traffic, IKEA is a standalone store that shoppers seek out with a specific goal in mind, as the context is made clear for them.

2. Understand the experience your customers want

Kamprad said that his vision for IKEA was a company that would make life easier for its customers. He built a furniture company, which acted like supermarket.

Most of us have gone to one of IKEA’s unmistakable giant blue and yellow stores, wandered through its carefully-designed if somewhat labyrinthine paths, tasted its Swedish meatballs and bought and assembled its modernist furniture. They attract us in the thousands. How? They understand the customers and the experience brilliantly.

IKEA designers are among the foremost anthropologists of home life. Designers create rooms for eight types of people, from four stages of childhood, through to ‘living single/starting out’, ‘living single/established’, ‘living together/starting out’ and ‘living together/established’. IKEA does endless research on each category.

IKEA also has ethnographers who conduct field research into the domestic life of different regions through home visits, interviews, and panels. While the researchers’ ‘Life at Home’ consumer insights research goes to the development of new products.

This makes the IKEA brand different. When you’re authentic about your distinctiveness, your passion will attract those who love your products and going to be a lot easier to build up your audience.

3.     Focus on getting good, not making it big

Kamprad focused on getting good at business before he tried to get big at business.  Many people want growth as their objective. The new web design agency wants to work for major companies, not work in relative obscurity while mastering his craft.

But if you only focus on short-term wins and results, then it can be very easy to get distracted from doing the work required to build the skills you need to grow and scale, and it’s the ability to scale that matters. The process is more important than the outcome at early stage startups. Focus on getting good before you worry about getting big.

Research of over seventy famous composers and revealed that not a single one of these musical geniuses produced a famous musical piece before year ten of their career. This period of little recognition and hard work – referred to as the ‘ten years of silence’ is very similar to the period that Kamprad spent selling matches before launching his IKEA vision.

4.     Don’t let your business model become stale

IKEA is beginning to respond to some of their most recognised customer frustrations. For example, you can now order some bulkier items online for home delivery, and they recently bought US start-up Task Rabbit, which helps you hire people to do flat-pack furniture assembly.

Responding to the growth in online shopping, it has also started experimenting with selling through other online retailers, and running directly counter to its original out-of-town model, also testing a smaller, city centre store format as well as order and pick-up points in town centres, as part of a wider push to become more accessible to shoppers.

Travelling to the out-of-town store, plus the long queues are, ironically, part of IKEA’s winning strategy. The experience is so time consuming that we tend to buy more to avoid having to return in the near future. However, giving the customer online options with the convenience, simplicity and control offers a different shopping experience, backed by the same product sentiment.

5.      Innovation can be about efficiency

The Billy is a bare-bones, functional bookshelf if that is all you want from it, or it is a blank canvas for creativity. It demonstrates that innovation in the modern economy is not just about snazzy new technologies, but also boringly efficient systems.

The Billy bookcase isn’t innovative in the way that the iPhone is innovative. The Billy innovations are about working within the limits of production and logistics, finding tiny ways to shave more off the cost, all while producing something that looks inoffensive and does the job.

Thrift is the core of IKEA’s corporate culture, you can trace it back to the company’s origins in Smaland, a poor region in southern Sweden whose inhabitants, like Kamprad, are “stubborn, cost-conscious and ingenious at making a living with very little”.

Innovation in IKEA is about efficiency, economy and effectiveness – recently designer Tom Dixon has joined forces with IKEA to offer a 28-piece modular furniture collection, perfect for adapting compact city homes to your needs – and all about the customer.

Kamprad’s forward-thinking customer focused strategy made IKEA the top furniture seller in the world, maintaining the customer-centric concept from its original foundations in every part of the company and its business model. It is the entrepreneurial eye for this business model innovation, and scaling the execution, that are Kamprad’s legacy for other entrepreneurs to admire.

The importance of fika time to a startup

My newest venture, thestartupfactory.tech, https://thestartupfactory.tech/ has been up and running for three months now, and we’re in good nick, building our confidence, rhythm, spirit, cadence and culture. We’re a team of passionate folk who work with tech startups to turn their vision into a reality, enabling innovation and customer-centred thinking into their new tech product and business.

We’re entrepreneurs, software engineers, designers, analysts, and agile practitioners. We’re also bloggers, explorers, speakers, swimmers, dog lovers, coffee addicts, campers, walkers, musicians, gamers, footballers, readers, travellers, gardeners, parents, and optimists.

That list is about ‘who we are’. We bring our true selves to work. Our business is defined by who we are, our values and the culture we create. More grit than glamour, we’re built on the spirit and down-to-earthiness of Manchester, ‘factory’ being an acknowledgment of the industrial heritage of what made Manchester special, and also taking the disruption, innovation and ethos of one of the city’s most evocative businesses, Factory Records.

With an attitude of graft and guile, we are factory workers, we get our hands into the machinery of building a startup, we roll our sleeves up, get dirt under our nails and get stuck in.

The essential moving parts of any startup are the people capital, not the venture capital, as Drucker said, culture eats strategy for breakfast, and we’ve spent time thinking and building our culture ahead of any rush to market.

When setting out on our venture, we looked to other entrepreneurs for a steer as to what makes for a happy and healthy business. We found this quote from Jeff Bezos: Find the things that are important to you and invest heavily in those things.

So we created the Five Pillars, to stay focused on a list of meaningful things that created and sustained intimacy and interaction between us, and connected us at a personal level. I spend more time with the team that I do with my dog, so there had to be reason to be here.

So here is the list of Five Pillars, it’s on our web site.

Vision & Values

  • Our business is about people capital, not venture capital
  • Reach beyond your expectations, every day
  • First names are important, job titles are not
  • Trusting each other is the platform for everything we do
  • Everyone practices humility and self awareness, but also self-esteem
  • We know the mentality to be successful and we have it in abundance

Culture

  • No office hours, but minds always open
  • 40 hours a week maximum; 32 summer hours – 4 day weeks, July & August
  • Weekend starts 1pm Friday
  • We pay for one weekend holiday a year for everyone
  • Fresh fruit breakfast in the office every day; pay for a weekly ‘Hello Fresh’ shop once a month
  • Team social last Thursday of every month

Knowledge

  • Everyone has a personal R&D project
  • Host Lunch & Learns third Thursday in the month
  • Run four hackathons a year
  • Wednesday afternoon is your personal learning time
  • Everyone goes to one event a month; everyone has a monthly book allowance
  • Performance of the business is transparent to everyone

Social impact

  • Lead a Code school in Manchester for under 11s
  • Provide a platform for unemployed people to get back into work
  • Sponsor & help the homeless in Manchester
  • Mentor a Social Enterprise
  • Provide paid internship opportunities
  • Be an active contributor to Manchester Tech Trust

Success

  • We will keep our company small and intimate, with reasonable expectations
  • Our place of work is a welcoming oasis, not a chaotic kitchen
  • Anxiety is not a pre-requisite for progress
  • We are calm by choice and practice
  • Everything is about having a reasonable day, going home, and living your life
  • Success is looking at a visible horizon, and getting there in the long run

We’ve not done everything yet, there’s a few wrinkles and edges to sort as we’re not doing some things as well as we can, but the Five Pillars gives us clarity and purpose about our direction.

I’ve long been interested in entrepreneurial cultures and the underlying philosophies, how you create the conditions to spark a startup based on the emotional intelligence and connectivity of the people. We’re more reflective than rebels, and on crafting the Five Pillars came across a concept from Ikea, ‘fika’, which we’ve implemented.

At 9.45am every day, we have ‘fika’ time. We each stop what we are doing and huddle around a table, have a cup of tea or coffee, and just be with each other. We chat about anything and everything but work. Friday was about Chuck’s pending house move; James neglecting his desk cactus; Jake’s obsession with 3D printing; and my ridiculous new waistcoat wardrobe. We also get loud about curating our tsf.tech Spotify list.

What we sample is an experience and unique word at the heart of Swedish life and work – ‘fika’ (pronounced ‘fee-ka’). According to the Swedish Culture website it is described in this way:

Swedes prefer not to translate the word fika. They don’t want it to lose significance and become a mere coffee break. Fika is much more than having a coffee. It is a social phenomenon, a legitimate reason to set aside a moment for quality time.

Coffee is traditionally at the heart of the fika. When coffee arrived in Sweden in 1685, it became so popular that it upset the rest of the import business. So much so that it was banned five times in Swedish history!

Fika is a combination of the Swedish colloquial word for cafe – fik – and coffee – kaffe. Who knows, perhaps the term fika served as a kind of code for those who took part in this once illegal activity. It is said that during the bans, Swedes were forced to drink their coffee secretly, out into the woods

Making time for fika is so sacred to Swedes that it’s built into many employee contracts. Some even say that the best ideas spring from fika breaks. We use fika time to cultivate an almost tactile sense of connection, here’s what we are trying to bring into our business.

Communicate frequently and constantly In tsf.tech we are always active on collaboration tools like Jira, Zoom and Slack instant messenger. Besides work content, we post links to interesting items, videos, learnings and stories. The point is that in the physical workplace we know we can relax and chat to people when we see them, but when we’re away from our work space and operating in the more detached digital world, we need to work harder at connecting, talking and feeling close. Fika gives us this.

Be open, vulnerable and honest Not every day is intense, but what works in the digital workplace is to reveal what matters to each of us. Speaking in your own authentic voice is essential. Honesty creates intimacy in digital worlds just as much as it does in the physical. Connecting becomes a deliberate rather than assumed experience. In tsf.tech we say that you do not need to be present physically but you do need to be present digitally, so if you can’t make fika face to face, connect using the tools.

Place your leadership front and centre The beauty of the digital workplace is that it has qualities that are impossible in the physical world. So take IKEA for example. In the physical world, their leaders cannot be everywhere in person having coffee and chatter with colleagues. But in the digital world, through real-time and other collaborative services, they can be ‘felt’ across far more frequently and with a much greater reach. But you have to invest time and authenticity in making it happen.

Use all the technology you can to bring you closer In tsf.tech we grab every new tool that may make us slicker and faster, as well as strengthen our bonds and connections. There is also a level of curiosity and experimenting. We do this because we like to be a ‘digital workplace lab’, we are in a position to experiment and innovate with new digital services in a way that large companies may not be. With all the team save myself under twenty-six, they are ‘digital natives’ and have a natural instinct for UX and gamification.

Make the social side of connection richer and deeper I dislike the term ‘social media’, it’s an oxymoron, because it drives isolated experience and consumption, it connects but doesn’t create engagement. Social for me is sitting next to someone and talking, and the things we talk about and do that are explicitly not work – they are social. Yes, we use social and online tools and the ways in which we use them are clear and distinct, engendering personal connection and relationships inside and outside the company. The point is we share our lives – issues, pets, families and homes. This generates the culture of closeness that the Swedes so value.

Use your own voice to talk and listen I mention voice particularly because on a phone call, Zoom or Webex we are talking and listening in reality. So far the only aspect of me as a human being that can be communicated digitally in the same way as if we are sitting together is my own voice, tone, intonation. I believe how we listen also matters hugely and when someone is listening to another person attentively, the talker can see that quality of listening. This is a key underpinning of fika.

We also have a ‘Your Voice’ item on our fortnightly team meeting agenda, when I encourage sharing ourselves with each other about how work ‘feels’. We also challenge each other and have debates and even arguments when needed at fika time, but we do that using our own voices because our vocal cords and tone of voice are such a powerful and distinct part of who we each are.

Meet in person when you can and make it matter Sometimes for some meetings this is not possible, but using opportunities to meet face-to-face does make a difference. It’s easy to default to the smart tech tools, but if we can meet in person, it adds to the richness of relationship, looking people in the eye and getting a sense of their body language is of much more value to see how we are.

While fika is good for mental and physical wellness, offering a period of calmness in a busy working day schedule, it can also help us to stay focused in the long run. Research has shown that taking breaks increases productivity. Sometimes, during the middle of a task, you might be stuck. With fika, you can have a break, come back refreshed and look at things from a different perspective. We insist that work talk is prohibited in fika. It forces you away from your work so you can re-evaluate things, come back refreshed and prioritise tasks when you do return.

So another year, another Scandinavian lifestyle trend. In 2016, the UK was fascinated by the Danish practice of hygge (finding the simple pleasure everyday life). For me, fika is an opportunity to slow down, come together for a face-to-face and interact. The social aspect of work is incredibly important.

The essential part is making a little space in your day to take a break. In our modern, hectic lifestyles, this is the part that is important: that we take a few moments to slow down in our day and make time to just sit and appreciate the moment.

So, perhaps there are aspects of the IKEA fika around coffee and cake that you can create inside your own digital enabled workplace, like we have in tsf.tech, to enable you to enjoy that atmosphere and chemistry of connection the Swedes love so much. The only part missing so far for us is the cake, but I guess we’ll just have to wait for Jake’s 3D printing of food and add that to the digital workplace menu at tsf.tech fika meetings.

You don’t need to control the conversation to get people talking about you.

Breakfast cereal boxes are generally poor works of art and don’t really trouble the judges for annual literature prizes with their prose. However, I suspect that I’m just one of many people who sit at the breakfast table munching away, reading them over and over again. Last year Kellogg’s realised it could make its packets more entertaining, and guessed that people also had their phones to hand – anything beats talking to grumpy teenagers at 7am!

The cornflake maker put 2D codes, the squares of black and white patterns better known as QR (quick response) codes, on its Crunchy Nut Cornflakes boxes in America. When scanned with their smartphones, these took cereal-munchers to a video of dawn in some picturesque part of the world. The idea was to push cereal as an all-day snack: It’s morning somewhere.

QR codes have much to recommend them. They store far more information than plain black-and-white bar codes, for example, they can fit in web site addresses and logos. One reason for the increase in the use of QR codes is the rapid uptake of smartphones with high-quality cameras and the corresponding decline in data charges. It also took time for people like me to realise why adverts contained mutant crosswords.

By using QR codes and SMS on cereal boxes, Kellogg drove more than 40,000 QR scans and 6,000 texts during its Crunchy Nut cereal promotion. The aim of the campaign was to create more engagement with the brand via mobile. Utilizing the back of the cereal box is a highly engaging static media touch point that allows users an intimate setting to try mobile and turn the static media into a rich media experience said a clever marketing executive who obviously gets up earlier in the morning than I do to eat his cereal.

In the UK, Random House, a large book publisher, will begin testing a new mobile strategy on July 1 that will see them placing QR codes on children’s menus in 139 restaurant locations, including T.G.I. Friday’s. The four-page black-and-white menus contain various activities for children’s and include Random House content promoting the publisher’s award-winning picture book Wild About Books.

The back covers of the menus feature three different QR codes linking users to a mobile app for video, information about the author and illustrator of Wild About Books and to an interactive portion of the book. A whole new experience for family mealtime beckons for all amidst the flying ketchup.

For marketers, QR codes bridge the gap between offline and online worlds. Customers who use them are in effect ‘opting in’ and asking to be told more about the company, whilst he success of a campaign is easy to measure by the number of scans. Expect to see a lot more of those funny little black-and-white patches as we further embrace digital lives and companies seek to attract, retain and engage you in the battle for customer loyalty.

But let’s call a spade a spade. What most companies are seeking is not loyalty but repeat purchases from existing customers time after time. They may call it loyalty but it’s not really and today’s sophisticated customers see straight through loyalty marketing campaigns and customer experiences designed to get them to part with their hard earned cash.

Actually achieving customer loyalty is like trying to herd cats – impossible! Customer loyalty sounds great in marketing journals and business books, and it’s also big business – an entire industry of consultants and loyalty scheme companies convince their clients to spend millions each year to implement CRM systems and loyalty reward programmes. But don’t be fooled, these initiatives will no longer deliver loyalty.

Business strategist Dean van Leeuwen (http://www.deanvanleeuwen.com/) has researched customer loyalty based on the premise of ‘herding cats’ and identified the following insights:

  • Customers have changed, it’s not just the recession, there has been a values shift in attitudes towards business and consumerism, triggered by the collapse of Lehman Brothers on14 September 2008;
  • Top companies have a deeper understanding of values-focused marketing and how, by connecting with personal values, meaningful relationships with customers can be cultivated.
  • Social media is about creating relationships, not sales
  • Business needs to demonstrate a more human persona to their brand – businesses should be more personable, fallible and approachable
  • Understand that technology has given customers a sixth sense in their ability to find information, seeks user testimonies and comparison searches

Customers have a growing ability to determine seamlessly and in real time which company is offering the best benefits, price and experience. The combination of the Internet, social networks and mobile devices has dramatically shifted the balance of power in favour of customers. Companies are now more transparent than ever before. With a click, customers can compare your product offering and hear what other customers are saying about you and your competitors.

Leeuwen also identifies an interesting counter to all this ‘customer love’ -recognise that you don’t always have to delight your customers, in fact, sometimes you can even inconvenience them providing the real moment of truth delivers amazing value and creates a connection. He illustrates the point with reference to IKEA, the Swedish home products and lifestyle business that designs and sells ready-to-assemble furniture and home accessories.

Now consider the average IKEA shopping experience. You typically have to drive out of your way to a semi-industrialised retail park to go shopping. You enter an enormous, dusty warehouse and get corralled like sheep around a labyrinth of furniture. You have to contend with screaming kids, tired mothers and bored dads, and of course there is the quintessential stop at the hostel styled canteen for Swedish meatballs and chips.

You finally make your way out of the maze to find stacks of heavy boxes each with their own confusing codified system telling you where your items can or can not be located, only to frustratingly find out that at least one or two of the items you hunted down in the labyrinth have already been sold out.

Too tired to head back into the maze to find a replacement item, you collect what boxes of furniture you can find and, wait for it, you have to queue up for a minimum of 45 minutes to pay. You then have to squeeze the boxes into your car, which seems to have shrunk so that you can take the boxes home and build the furniture yourself.

What is satisfying about that experience? Very little, and yet IKEA is now the world’s largest furniture retailer. And it’s not because of price either, because there are cheaper ready-made alternatives to IKEA. The reason IKEA is successful is that they understand intimately the emotional connection they have with their customers and have ingeniously recognized that one crucial moment of truth – the one that matters more than all of the other moments of truth put together – when they do need to wow their customers.

They are looking at that point when you step back and call in the family and go See, I am the man (or woman) who built this. Time and time again, IKEA delivers consistently at this primary moment of truth – their furniture represents the precision of DIY engineering. Once you get the logic of the build, every piece fits together easily and it looks really good. IKEA have identified a business model that goes against all customer experience conventional wisdom and yet still delivers happy customers.

They are not alone in this either. Have you ever visited an Abercrombie & Fitch or Hollister store? You have to queue outside, sometimes for hours, and be prevented from going inside by bouncers. Once inside you have to contend with dim lights, loud music and an overbearing smell of perfume and deodorant. Now of course this experience appeals more to a certain younger generation but their business model works well because they understand the moment of truth is in wearing the A&F brand: feeling the soft material against your skin and knowing that the trauma you went through to get the top was worth it.

Compare this, for example, to the travel industry offering lower priced seats to customers, but then penalises the customer if they need to make a change. What happens if the customer is ill or has a genuine need to change the date of travel? Under their rules it is tough luck, the only way to gain flexibility is to pay an exorbitantly high price. The airline and rail industries believe this is the only way they can be profitable but is this policy fair? Contrast this to Zappos, which offers a 365-day returns policy, previously unheard of. This has won them a lot of happy customers.

Finally, happy customers become advocates of brands that are quirky or have a personality – it’s nothing to do with QR Codes, twitter or Swedish meatballs. My favourite example of this currently is Prufrock Coffee (http://www.prufrockcoffee.com/)

Prufrock is a successful boutique coffee shop in London, run by ex-World Barista Champion Gwilym Davies. He has come up with the world’s first disloyalty card. The idea is simple: you get a stamp on a card for visiting eight different quality coffee shops. After visiting the eighth ‘friend’, which of course are actually his competitors, he will say thank you by making you a cup of his own coffee for free. There is no catch. Gwilym just wants people to try different quality coffees and become as passionate about the different flavours of coffee as he is. And of course, your next paid for coffee is at Prufrocks, and you tell all your friends about this experience.

A sale is not something you pursue, it is something that happens to you while you are immersed in serving your customer. In business, you get what you want by giving other people what they want. Ignore technology and social media, simply be everywhere, do everything, and never fail to shock the customer, in the nicest possible way. Sometimes marketing folks get too smart for their own good: you don’t need to control the conversation to get people talking about you.