Strategy 2020 11 19 Delighting customers can lead you astray

How Focusing on Delighting Customers Can Lead You Astray

How Focusing on Delighting Customers Can Lead You Astray

Paul Haun started his company, Nack, determined to spread kindness around him through “random acts of coffee”. He was inspired by the tradition of “suspended coffee” that started in Naples, Italy, where you can pay for two coffees — one for yourself and the other paid forward for someone who could use a random act of kindness.

I first met Paul over coffee when he told me about Nack with his characteristically infectious enthusiasm. He had read case studies on Zappos finding success by delivering happiness and how the iPhone was an iconic product because it delighted customers. Armed with these lessons, Paul built Nack as a mobile app and designed his features to consistently delight users.

The app allowed users to find suspended coffees around the city and pay it forward. His users were engaged and using the app almost daily. Nack also had a high Net Promoter Score (NPS) with users frequently inviting friends to join the app.

Despite the delighted users and metrics that pointed up and to the right, Paul’s enthusiasm gave way to dismay as he shared his finding: his strategy of focusing on delighting his customers had backfired.

The goal of delighting the customer can lead you astray

Nack users were delighted by the free coffees. They were logging in every day to search for free coffees and driving distances to claim them. They weren’t, however, engaging in paying it forward and creating random acts of kindness through the app. Despite delighting customers, the product wasn’t creating the change Paul wanted to bring to the world.

Paul had learned that delighting customers isn’t enough — it’s only a means to an end. You must have a clear purpose in delighting them and be able to articulate why you want to delight customers.

To build products, you test your hypotheses with customers and get feedback on what resonates with them. The customer feedback you get is like the wind that powers your sails — it drives your product to be better. But as the captain of the ship, you have to set a clear destination.

Without a clear purpose for delighting customers, setting your goal as delighting customers means your boat can end up wherever the strongest winds take you.

In Paul’s case, his loudest customers were the ones who complained that there were no free coffees in the vicinity. In trying to continue to delight customers, Paul had spent over $1,500 of his own money in funding suspended coffees through Nack. Yet, he was no closer to spreading random acts of kindness (except his own).

Delighting customers without a clear purpose can lead to wasted investment. Organizations often feel that delighting customers requires every aspect of the business to do so. But both the investment required and the impact to the customer is not equal across all areas of your business. For example, at a utility company, delighting the customer through the call center by making each call a good experience isn’t going to significantly impact the user experience. Instead, upgrading to automated meters is more likely to delight users so they never need to be contacted for a meter reading in the first place.

Even when you identify where you need to delight customers, without a clear Why, the team executing those changes often lacks conviction for making fundamental changes. It’s easier to make superficial changes to the look and feel of your website or app to make it customer-friendly. But if it requires an overhaul of internal processes, without alignment on the Why, it’s hard to get the needed buy-in for a cross-functional or sustained effort. Delighting customers becomes a phrase that’s used often without making the organization any more customer-centric.

Defining your Why

Before setting out to delight customers, we need to start with a clear vision for the change we want to bring about. This purpose gives us a clear compass so that we’re delighting users as a means to achieve that purpose.

In shifting to a purpose-driven approach, Paul defined his product vision as promoting kindness among coffee drinkers and Nack was his mechanism for bringing about his change. To deliver on this vision, Paul rebuilt Nack with a new set of features: whenever users received free coffee, they would always receive two — one to consume and the second to gift.

Brands wanted to be part of this movement to promote kindness and offered to fund suspended coffees. Users learned to give coffees that were funded by brands, but it created a fundamental change in user behavior. Users found joy in giving and 27% of the users who gifted coffees funded by brands used Nack to buy someone a coffee using their own money!

Instead of delighting users because they received free coffee, the new Nack made users feel good because they were sending someone a coffee. The app was delighting users with the goal of creating the change Paul had envisioned.

Lessons you can apply in your business

Here are three lessons from Nack can are generalizable to any organization, from consumer-facing product companies to large B2B SaaS companies:

  1. Delight users in the context of the change you want to bring through your product: Your product vision articulates the change you want to create and your rationale and context for delighting users. This is where Radical Product Thinking comes in. Radical Product Thinking is a methodology for systematically building successful products that improve the world. In the RPT way, you develop a vision for the change you want to bring about and translate it step by step into a strategy, priorities, and hypothesis-driven execution. You can download the free Radical Product Toolkit to help you craft your vision in a fill-in-the-blanks format — this approach makes it easier to align on the vision through a group exercise.

  2. Prioritize where you want to delight users: Zappos popularized the idea that every touch point must be delightful. While that’s ideal, in reality, you’re going to need to prioritize where you are going to invest in creating delight. You can align the team on priorities by taking a visual approach to prioritization, balancing progress towards your vision for change against everyday business needs.

  3. Measure what matters: Looking at popular metrics such as daily active users, NPS scores, and revenues, Nack seemed like a successful product. But each of these popular metrics comes with assumptions that may not hold true for your business. At Nack, it’s the percentage of users who were spending their own money on gifting coffee that indicated progress towards the vision of spreading kindness. Once you have a clear vision and strategy, you can derive the metrics that indicate progress towards your purpose.

By taking a Radical Product Thinking approach, you can do more than just delight customers; you can build successful products that make the world a little more like the one we want to live in.