Customer Service Vs. Customer Experience

Summary

This video script emphasizes the importance of understanding customer loyalty by analyzing the reasons behind repeatedly choosing certain businesses. It outlines six key factors: speed, quality, affordability, luxury, user-friendliness, and customer service. The script distinguishes between customer service, which is reactive, and customer experience, which is proactive and builds VIP relationships, ultimately driving business growth and word-of-mouth marketing.

Takeaways

• 🧾 Make a list of businesses you frequently revisit and analyze why, which could be due to factors like speed, quality, price, luxury, user-friendliness, or customer service.
• 🏎️ Fast service is a draw for many businesses, especially in the food industry, where customers prioritize quick transactions over dining experiences.
• 🏅 Quality is a significant factor, with customers willing to pay more for superior products or services, indicating a value for durability and craftsmanship.
• 💰 Affordability attracts customers to businesses like Wal-Mart, which markets itself on everyday low prices, showing the appeal of cost-saving options.
• 👑 Luxury is a selling point for brands like Mercedes and high-end restaurants, where customers seek an exclusive and prestigious experience.
• 👍 User-friendly services or products, such as easy-to-navigate websites or intuitive apps, enhance customer satisfaction and encourage repeat business.
• 🛎️ Customer service is often underrated but is crucial for business success. Exceptional service can define a brand, as seen with companies like BMW and Nordstrom.
• 🤝 The difference between customer service and customer experience is highlighted, with the former being reactive and the latter proactive, focusing on creating memorable interactions.
• 🤔 VIP customers are identified as valuable assets, and businesses should aim to convert regular customers into VIPs by providing superior experiences.
• 💼 The importance of treating customers well is underscored, as loyal customers can become the best recruiters for a business through word-of-mouth referrals.
• 💭 The script encourages entrepreneurs to reflect on their approach to customer service and experience, and to consider how they can elevate these aspects to build a stronger business.

Q & A

What is the main purpose of the exercise suggested in the script?

The main purpose of the exercise is to help individuals identify the reasons they repeatedly choose certain businesses, which can provide insights into what makes a business successful and can be applied to one's own business.

What are the six reasons typically given for repeatedly choosing a business?

The six reasons are: Fast service, Quality, Cheap prices, Luxury, User-friendly experience, and Excellent customer service.

Why is customer service considered an important aspect of a business?

Customer service is important because it can significantly affect customer satisfaction and loyalty, and it can distinguish a business from its competitors.

What is the difference between customer service and customer experience according to the script?

Customer service is reactive, addressing issues as they arise, while customer experience is proactive, focusing on creating a positive and memorable interaction with the customer.

Why are VIP customers important for a business?

VIP customers are important because they often become loyal and can act as recruiters for the business, promoting it to others and contributing to its growth through word-of-mouth.

What is an example of a company known for its exceptional customer service?

Nordstrom is an example of a company known for its exceptional customer service, as illustrated by the story of returning a tire without a receipt.

How does the script suggest building a business that customers will return to repeatedly?

The script suggests focusing on aspects such as speed, quality, affordability, luxury, ease of use, and outstanding customer service to build a business that customers will return to.

What is the significance of the dating game analogy used in the script?

The dating game analogy is used to illustrate the progression from one-time transactions to building long-term relationships with customers, emphasizing the value of loyalty and customer experience.

How does the script define 'fast' in the context of customer preferences?

'Fast' is defined as a service that is quick and efficient, where customers can get what they need without delay, such as in the case of fast food restaurants.

What role does customer service play in the reputation of a business?

Customer service plays a crucial role in a business's reputation as it directly affects customer satisfaction and can influence whether customers choose to return or recommend the business to others.

How does the script relate customer experience to the concept of VIP customers?

The script relates customer experience to VIP customers by suggesting that a positive customer experience can convert regular customers into VIPs, who are more likely to be loyal and promote the business.

Outlines

00:00

🔑 Understanding Customer Loyalty Factors

The speaker encourages viewers to analyze the reasons behind their repeated patronage of certain businesses. Six key reasons are identified that drive customer loyalty: Speed, Quality, Affordability, Luxury, User Friendliness, and Customer Service. Each reason is explained with examples, emphasizing the importance of understanding these factors to improve one's own business. The paragraph also highlights the significance of customer service, using examples like BMW and Nordstrom to illustrate exceptional service experiences.

05:01

🤝 The Distinction Between Customer Service and Customer Experience

This paragraph delves into the difference between customer service and customer experience, defining the former as reactive and the latter as proactive. Examples of customer service interactions are contrasted with proactive customer experience strategies employed by companies like American Express, Amazon, and Apple. The importance of converting customers from mere service users to VIPs through exceptional experiences is underscored, with anecdotes about personalized treatment and recognition of loyalty.

10:07

💍 Building Long-Term Customer Relationships

The speaker uses the metaphor of relationships to illustrate the progression from one-night stands to marriages to emphasize the value of cultivating long-term customer relationships. VIP customers are likened to marriage partners, who become advocates and recruiters for the business. The importance of treating customers well to foster this loyalty is highlighted, with a call to action for viewers to reflect on how they can enhance their customer service and experience to create more VIP customers.

15:11

🎉 Celebrating Subscribers and Engaging the Community

In the final paragraph, the speaker announces a celebration of reaching 100,000 subscribers and invites viewers to participate in a contest for a chance to be mentored personally. Details of the contest are provided, encouraging viewers to submit videos explaining why they value the channel. The paragraph serves as a call to action for viewer engagement and a reminder to subscribe for more content.

Keywords

💡Customer Loyalty

Customer loyalty refers to the consistent patronage of a particular business by customers due to satisfaction with products or services. In the video, loyalty is tied to the reasons customers repeatedly choose certain businesses, such as quality or customer service, and is a cornerstone of building a successful business.

💡Fast Service

Fast service is a concept where businesses provide products or services in a quick and efficient manner. The video mentions fast food as an example where customers return for the convenience and speed of service, valuing the time-saving aspect.

💡Quality

Quality in the context of the video denotes the superior attributes of a product or service, which can include better materials, workmanship, or performance. Customers are willing to pay more for quality, and it is a reason they return to certain businesses, as illustrated by the script's mention of better fabric or materials.

💡Affordability

Affordability is the degree to which a product or service is cost-effective and accessible to customers. The video uses Wal-Mart as an example of a business that attracts customers due to its 'everyday low prices,' emphasizing affordability as a draw for repeat business.

💡Luxury

Luxury in the video represents a level of opulence and exclusivity associated with certain products or services. Customers may choose to return to businesses like Mercedes or high-end restaurants for the luxury experience, which is a significant factor in their decision to engage repeatedly with a brand.

💡User-Friendly

User-friendly describes products, services, or interfaces that are easy to use and navigate. The video highlights the iPhone and certain websites as examples of user-friendly design, which can lead to customer preference and return business due to the ease of interaction.

💡Customer Service

Customer service is the assistance and support provided to customers before, during, or after a purchase. The video discusses the importance of customer service in building business reputation, using examples like BMW's service reputation and Nordstrom's return policy to illustrate the impact on customer retention.

💡Customer Experience

Customer experience encompasses all interactions a customer has with a company, aiming to create a positive and memorable engagement. The video differentiates customer experience from customer service by describing it as proactive, personalized, and detailed, using examples like American Express Black Card services.

💡VIP Customers

VIP customers are valued individuals who receive special treatment or recognition from a business due to their importance. In the video, VIP customers are associated with loyalty programs like Amazon Prime or Sephora's Beauty Insider, and they are shown to be crucial for business growth through word-of-mouth referrals.

💡Proactive

Proactive refers to taking initiative and anticipating needs before they arise, rather than simply reacting to situations. The video uses the term in the context of customer experience, emphasizing the importance of businesses being proactive in their approach to enhance customer satisfaction and build long-term relationships.

💡Reactive

Reactive describes a response to a situation or problem after it has occurred. In the video, the term is used to contrast with proactive measures, highlighting customer service as a reactive function where businesses respond to customer issues or complaints, such as in the example of AT&T's customer support.

Highlights

Creating a list of companies you frequently revisit can reveal key reasons for customer loyalty.

Six main reasons for customer retention include speed, quality, affordability, luxury, user-friendliness, and customer service.

Fast service is a primary reason for returning to certain businesses, especially in the fast food industry.

Quality products made of superior materials can drive customer return rates and willingness to pay more.

Affordability attracts customers to stores like Wal-Mart for their everyday low prices.

Luxury is a draw for customers seeking high-end products and experiences, such as with Mercedes or upscale hotels.

User-friendly services and products, like iPhones or easy-to-navigate websites, increase customer satisfaction.

Customer service is often underrated but is crucial for businesses like BMW and Nordstrom known for exceptional service.

BMW's reputation for excellent service is a significant factor in customer loyalty.

Nordstrom's legendary customer service story of accepting a tire return without a receipt exemplifies going above and beyond.

Amazon and Zappos are praised for their attentive and personalized customer service experiences.

Southwest Airlines differentiates itself with a customer service approach that includes humor and personal connection.

The difference between customer service and customer experience is crucial for business growth.

Customer service is reactive, addressing issues as they arise, while customer experience is proactive, anticipating and preventing issues.

VIP customers are integral to a business's success, and converting regular customers to VIPs can significantly boost business.

Creating a memorable customer experience can lead to loyal VIP customers who act as brand ambassadors.

Zappos' success is attributed to its exceptional customer service rather than the products it sells.

Entrepreneurs should focus on creating positive customer experiences to foster long-term business growth and reputation.

The importance of not adopting a 'wam bam' mentality in business to ensure sustainable growth and customer retention.

Transcripts

One of the best exercises for you to do is make a list of companies or businesses that

you go back to over and over and over again, and ask yourself why.

For instance, list five companies and to the right say, "I go to this restaurant at least

once a week.

Why do I go back?

Because of . . . " I go to this fast food place every week.

Why.

. . I go to this store to shop for clothes every month.

Why do I go back again?

I go here for groceries.

Why do I go back here over and over again?

What is the reason?

And the reason will generally be one of these six reasons that it's going to give you a

lot of clues for your own business.

#1: Fast

You're either going back there because it's fast.

Why?

Fast food - I don't want to sit down.

I just want my food and leave.

That's all I want.

I don't want anything.

I just want a fast service.

So you go back to a place because it's fast.

#2: Quality

One could be quality.

What is quality?

It's better material.

It's better fabric.

It's better whatever.

The quality is better and I'm willing to spend more money but I go back for quality.

#3: Cheap

Another reason could be because it's cheap.

You may say, "Hey, I go to Wal-Mart because Wal-Mart has what?

Everyday low prices.

It's the cheapest place, that's where I want to go to.

No problem.

That's their play.

#4: Luxury

I go there because of luxury.

I've been buying Mercedes all my life because it's a luxury.

I like to go to this restaurant because it's luxury.

I like to stay at the W because it's luxury.

I like to go.

. . because of the luxury feeling you get.

#5: User Friendly

Another one could be user friendly.

I go back to this place, it's so easy.

I go back to this website because it's so easy to use.

I like to use this app because it's so easy to use.

User friendly.

It's so easy.

I like iPhone; it's user friendly.

I like this, it's user friendly.

#6: Customer Service

And the other one is customer service.

Now most of the time businesses say, "we have the cheapest, we have the fastest, we have

the best, we have the most luxury, we have the most incredible quality, we have user

friendly, it's so easy" or best customer service.

Now, customer service is generally boring.

And generally entrepreneurs, we don't necessarily pay that much attention to customer service

because it's kind of like, oh my gosh, customer service?

C'mon, give me a break.

This is boring!

Watch, this video isn't going to get that many views.

You'll see it.

Because this is not an exciting topic.

But this is a very, very important topic.

By the time I'm done explaining this to you.

When you about customer service, what companies do you think about?

Watch this.

People buy BMW.

Do you know why?

Because of their service.

You simply drop off a BMW, take another one, and you go back.

So BMW has a reputation of being incredible service.

Now.

Range Rover may be Luxury, but it doesn't have the best service.

But they're known for luxury.

So what is the play?

You go to another car and it may be cheap.

Hey, I'm going to buy a Ford Focus.

I'm going to buy whatever.

Because it's cheap.

There are things you can think about.

Tesla user friendly.

It's easy.

Right?

Customer service.

Nordstrom.

You go to Nordstrom, I don't care what it is.

One time an old lady goes back to Nordstrom and this is a story you can find all over

online.

It's written about in books, etc. etc.

This person goes to Nordstrom and says, "I bought this tire from here."

The cashier says, "We don't sell tires."

"No, I bought it here, and I want to return it."

"Do you have a receipt?"

"I don't have a receipt."

Do you know what Nordstrom did?

They took the tire!

And the person said how much it cost and Nordstrom said, "Okay, we'll take it back."

And the person went on to say we returned the tire, they're going to throw that tire

in the trash, but customer service to them is extremely important.

Now there are some places you buy something from, no return policy.

We don't take it back.

We don't.

. . they don't care having one star reviews because their policy is, I don't care to return

it.

You buy it, you got it, it's gone, we're not taking it back.

Mattress companies sometimes do that.

Some of them do certain - no, you've already laid on it.

You've already done this.

We're not taking any of it back.

Customer service.

If you think about Amazon, Amazon's got great customer service.

I think about Zappos.

We went and got a private tour of Zappos headquarters.

They'll stay on the phone with you and talk to you.

They literally will talk to you, how things are, hey let me order pizza for you.

Hey, let me do this for you.

It's constant customer service that people talk about them.

Apple's known for great customer service.

Southwest Airlines, when their attendants tell the jokes that they say, "hey, if you

have to do this, make sure you put the mask on yourself and if you have two kids, choose

which one you like more.

. ." These things hahaha, it's funny; but that's customer service.

You kind of connect with it.

This is a very, very, very valuable way for you to build your business.

So now the question becomes, what is the difference between customer service and customer experience.

Pat, what is the difference?

Isn't it the same thing?

Absolutely not.

Why?

Let me explain.

And I'll simplify it for you and it will stay in your mind.

Think about customer service as reactive.

And think about customer experience as proactive.

What does this mean?

For instance.

Here's customer service.

"Thank you for calling AT&T.

How may I help you?"

Yes, great.

Is there any other issues that you have?

Have I fulfilled your service request you've asked here today?

Okay, please take this recorded call and survey that we have going on . . . Reactive.

Customer service could be a client is upset, you handle it, you react, you solve.

All good.

Customer service is thank you, please, may I please put you on hold?

Thank you for your help.

Thank you for listening.

Thank you for understanding.

Thank you.

. . it's customer service.

Customer service could be, "I totally understand where you're coming from.

I totally feel your pain.

I'm sorry."

It's apologetic.

It's customer service, because it's reactive to something, right?

A customer buys, here's your receipt, thank you so much, have a great day, would you also

like to buy this?

Would you like to upgrade your service?

Customer service.

That's customer service.

And by the way, very important, customer service.

Now a few are very good at customer experience.

That's kind of when you go from here [customer service] and you graduate over here [customer

experience].

Let me explain what I mean by customer experience.

Look, whatever business you run, if you have more than 100 customers, you will generally

be able to tell me that you have some VIP customers.

Everybody has VIP customers.

This is not about discrimination.

VIP customers to American Express is called Black Card.

VIP customers to American Airlines is called Executive Platinum or Executive or Gold Member,

that they get priority seating, right?

A VIP customer for Sephora makeup for ladies could be called Beauty Insider.

Sephora does very well because they have this Beauty Insider group where the girls who are

part of Beauty Insider get samples sent to them before everybody else.

That's Sephora.

They do a phenomenal job with Beauty Insider that's worked very, very well.

They get it before all the other customers.

Your VIP, VIP Amazon is Prime.

There are many of them that I can give you.

The VIPs, you're hoping to get many of them here [customer service] to be converted in

to VIPs and they only get converted here, based on what?

Customer experience.

So what is customer experience?

Proactive.

Proactive is the way you treat them.

The details.

Customer experience is all about details.

So if I call American Express Black Card, or if I call Visa Black Card, Mastercard Black

Card and they'll tell me, "Hey, we just want to remind you, your anniversary is coming

up.

Your wife's birthday is coming up.

Any plans?

We see that last time you went to Bacara Hotel.

Do you want to do the same thing?

Do you want me to look for something?

How about you give me this afternoon and let me look for something and get back to you."

Customer experience.

Then they send me an email and they call me.

When is a good time for us to get on the phone?

15 minutes.

So let me tell you what I found.

If you want to do something very extravagant, we found this one place and we can do this

experience and . . . and it's do unique and let me tell you what it is.

You're wife's really going to like it.

Tell me what things your wife likes.

Experience.

Experience.

Amazon could go out there and find exactly what things you buy and see your buying trends

and they give you a better experience.

It doesn't matter what it is.

it all goes to the experience part.

Or you go into Apple and you talk to one of the guys at Apple and they talk to you like

you are a regular human being.

You don't feel like you're scripted -- too much.

Although they have a script as well that they've got to follow.

But it's just talking to you.

Zappos the same way.

They're talking to you.

They're listening to you.

Tell me about.

. . how's your day?

You don't hear too many "regular" customer service people companies saying, "So tell

me about your day."

Think about that small little side question that you call somewhere, you call Chase for

customer service.

Yes, I'm trying to handle this.

. . Okay, great, let me place you on hold.

Let me see what I can do.

Do you have a case number for this?

Okay, thank you.

Okay, have a great day.

Bye bye.

Done.

Instead, okay, Patrick Bet-David, thank you so much.

By the way, Patrick, how was your day today?"

And I'm going to say whatever I'm going to say.

I'm going to give them, "It's okay.

It's great" And then I'm going to ask what?

"How was your day?"

"Oh, my day's great.

Thank you for asking.

By the way, thank you for your loyalty.

I can see you've been with us for 10 years.

We appreciate your loyalty with us."

Hey!

Somebody appreciates my loyalty.

I'm a loyal human being.

No problem, I've been a loyal customer.

We're proud to put, "I've been an American Express cardholder since 1998" whatever it

is.

Loyalty, right?

Hey, we appreciate you.

Thank you.

This [customer service] goes to here [customer experience].

And the more you can take people from here [customer service] to here [customer experience]

the better off you're going to be with your business.

Let me help you think about it maybe in a way that will make sense to you a little bit

more and we'll wrap up this episode is this.

So when it comes down to the dating game.

Just think about it this way.

There are a lot of people that just [snap] boom.

They want to go out and be promiscuous.

All good.

It's a philosophy, if you want to do that, that's good.

In business, if you treat your customers like that or even women like that, your reputation

spreads.

If you treat customers like that, or anybody like that, reputation spreads.

And it's not always the best reputation to not treat people properly.

So then there is just one-night stand philosophy.

Then there's dating philosophy.

Then there's marriage philosophy.

Your VIPs are marriage.

Your VIPs are marriage.

Your VIPs are people that go from dating to marriage.

They're kind of trying your product.

They like it.

Ah, um, great.

Wow, they treat me so well, I want to marry these guys.

And I want to go there regularly.

And then I want to tell other people.

They become your best recruiters.

VIP members become your best recruiters.

Best recruiters.

They recruit for you for free.

All that million dollar ad on T.V. that you're trying to do or whatever it is you're trying

to do, you don't have to do it.

Because they're doing it for free - if you convert people into VIPs.

They are so valuable.

This is why some companies, there's nothing different Zappos does except for the fact

that they create incredible customer service.

They don't make shoes.

They don't make shoes.

Zappos doesn't make shoes.

They're not Toms.

They don't make shoes.

It's service.

It's purely service for them.

They give incredible service.

They send you return, you don't have to pay for return if you don't like it, they'll pay

for it.

It's purely a service game.

They're not playing the cheap game.

They're playing the service game with you.

It's so valuable and then all of a sudden, Zappos gets valued at, it was bought for a

couple billion dollars, whatever the number is.

Tony Hsieh is a customer service guy.

So I know a lot of times especially startup entrepreneurs are people that you want to

become a millionaire yesterday.

I get messages, "I want to be a billionaire by the time I'm 35 years old."

That's great, you know.

Maybe don't tie it to, believe me, if you tie it for more people being happy doing business

- I had a conversation this morning with a friend of mine who's one of our executives

in our company, he's a doctor, Dr. Cooper.

He and I were having a conversation together and he said, "Pat, somebody came and told

me something about why I chose to work with you, and he said, all I said is my entire

experiences of working with you, how it's been.

And he's going into this whole story what he's telling me on this call we're having,

early, early call that we're having here this morning, which was a fascinating call.

I'm sure he appreciates that call, but that's a shout out, he and Tasha just had their 20th

anniversary.

So we're having this call together and all he was telling me, while I'm listening is

our experience together, why he's still here.

He left a six-figure job to come here.

He was a principal, the youngest principal in the San Bernardino Valley area.

But he came because of the experience he had and he is my customer.

Now we've become very good friends, so it's past a VIP.

And the more we have of that, that we treat people properly, the more they tell everybody.

Your business gets stronger.

You can't have this wam bam type of a mentality and your business isn't growing because you're

not paying attention to your customers.

So go back, again, the initial exercise, make a list of the five businesses that you go

to regularly and ask yourself why do you go back.

You will be amazed how all of them will generally have one of these things here.

One of these things here.

Now you may say, convenience, it's very close.

That's part of fast.

So any of that stuff that you write down is going to be part of one thing.

And then for your own business, ask yourself, "What can I do to take my customer service

to a whole different level, to add customer experience to my business and to give birth

to more VIP customers?

And what can I categorize as a VIP customer for me?

What do you categorize as a VIP customer for you, and what can you do to promote more people

from regular to VIP customers?

That in itself is going to make you a ton of money, depending on how big you want to

build, it will do you very, very well growth-wise, word of mouth, people want to do business

with you regularly over and over and over again.

So, that's my message today for you on customer service and customer experience.

Mario, where's our pillow?

Do we have our pillow?

I can no longer say 100,000 subs because we are now at 100,000 subs.

What is exciting is we already got many hundreds of emails of people that said they're making

that video on why I love Valuetainment and if you don't know about the video, we just

crossed 100,000 subs and Mario asked me to announce a contest to be able to privately

mentor three of you here in my office in Dallas, Texas for three hours to go through your business

plan and put a strategy plan together for 2017.

We're planning on doing it sometime in the month of December, but you'll need to submit

a 3-minute video and all the details - let's put a link somewhere here, where people can

see it.

You can go to PatrickBetDavid.com as well, boom!

And you'll see the details as well.

So 100,000 subscriber celebration contest, you can find out more details about that.

But if you haven't subscribed yet to the channel, please do so, click on the link below here,

and if you have any questions about customer service and customer experience, post your

comments and thoughts on the bottom.

Take care everybody.

Bye bye.