by Shaun Smith
The user group evolved and with the advent of social media and the expansion of digital technology it became an even more populous and creative community. So valuable were these super users in both product development and brand advocacy that LEGO named them ‘ambassadors’ and created the LEGO Ambassadors programme for them.
Listening and working with them, the company understood that its brand was not restricted only to real ‘bricks’. The essence of LEGO branded product is not the brick but the ‘shape’ of the brick, a distinctive visual style that actually translates well into digital design because of its slightly ‘pixellated’ appearance. And the essence of the brand itself lies in the unlimited imagination of constructive play. Users would make their favourite superheroes or famous people out of the bricks and then plunge them into an exciting world of adventure. This world might look like the kitchen table to you and me but to the user it is a plateau of fantasy. So it did not take too much imagination for the company to realize that its customers would appreciate LEGO versions of superheroes and villains and electronic games in which they could play. The franchise deals that the company made with Star Wars and Harry Potter not only fuelled sales; they also brought the brand into the modern era.
In 2014, the company redeveloped the Lego Users Club into a new type of network community whose aim would be more explicitly to create, collaborate and share ideas. The new ‘LEGO Ambassadors Network’ even has its own ‘charter’ with the following purpose and objectives:
Purpose:
A community network for both the LEGO Group and influential adult fans of LEGO (AFOLs) to provide valuable dialogue and initiate activities of relevance to the success between the LEGO Group and the AFOL community.
Objectives:
To provide a central communication network for the LEGO Group and user-group ambassadors to: 1) collaborate and share information with the wider AFOL community; 2) to strengthen best-practice sharing within the AFOL community.
To provide a point of contact between the recognized LEGO User Group and the LEGO Group in all support programmes and related activities.
To be task oriented, by having clearly scoped activities and discussions that benefit the LEGO Group and AFOL community.
To provide valuable insight on ad hoc business decisions and intelligence.
You can find more about it here: http://www.brickwiki.info/wiki/Ambassador.
An early example of how LEGO collaborates with its customers was its Mindstorms range. Mindstorms was conceived as a way of offering electronic LEGO to a new generation of children who were growing up in a world dominated by electronic gaming such as Nintendo Game Boy. Mindstorms, developed together with the Massachusetts Institute of Technology (MIT), were LEGO bricks containing software and sensors that allowed customers to programme their creations to move – effectively creating LEGO robots. Within weeks of it being launched, an estimated 100,000 people had ‘hacked’ into the software and were reprogramming it. LEGO understandably feared that this illegal hacking would be malicious, aimed at disrupting the programmes or stealing the software codes. In fact, they soon realized that these ‘hackers’ were intent not on destroying the product but on improving it: 100,000 LEGO fans with software program skills had spontaneously collaborated to create an even better experience for themselves and for all LEGO users. Think of that: 100,000 computer programmers working for free to build you a better product. It was one of the earliest examples of open-sourced innovation. And LEGO has continued to embrace this mindset of openness to direct customer creation of the experience in all its developments since.
The latest innovation is called LEGO Fusion. It responds to the twin trends of increasing digitalization and desire for personalization (see Image 5.2 opposite). It allows you to take your favourite LEGO toy – your own creation from real LEGO bricks in the real world – and then to scan it digitally and upload the image into a world of gaming. The 3-D image of your toy then becomes a ‘lifelike’ character in a virtual world, interacting with other pre-existing characters or ones created by other customers.
LEGO’s closeness to its customers and its openness both to listening and to allowing customers to create their own experience have helped drive business growth. By September 2014, LEGO had become the world’s number one toy maker, with just over $2 billion of sales globally in the first half of that year alone.
KPMG and McLaren
It is not just in the world of consumer products that exciting innovation can happen. It can happen in the business-to-business (B2B) market. It can even happen in the field of accounting audits and business advisory services.
McLaren Motors is one of the leading brands in motorsport. Dynamic engineering and rigorous technical expertise drive its high-performance technology. Data analytics are key to everything it does. Every element, every detail of every aspect of its Formula 1 cars, the drivers and the crew are meticulously analysed and that analysis is translated into real-time information that improves performance, often shredding valuable micro-seconds off the time it takes to complete a lap.
Image 5.2 LEGO encourages anyone to come up with an idea for a product
Source: LEGO
McLaren makes money from multimillion-dollar partnerships with business-to-business (B2B) and business-to-consumer (B2C) brands that want the awareness and image enhancement that come from association with Formula 1 globally. Household brand names such as Diageo’s Johnny Walker whisky, Vodafone and Santander benefit from the excitement, thrills, sexiness and raw drama of the track.
KPMG is one of the leading accounting and management-consulting firms. It is also a partner of McLaren’s. However, their partnership is a unique and innovative one. KPMG’s purpose is ‘To turn knowledge into value’. So, rather than simply benefit from the glamour and high-performance image of an F1 team, KPMG use the access to McLaren’s technology to benefit their customers’ experience.
In November 2014, KPMG and McLaren announced a 10-year strategic alliance whereby KPMG will have access to McLaren Applied Technologies (MAT) predictive analytics and technology programmes. This can be used to improve the quality and impact of auditing and of business advice. Businesses who have large mobile workforces where speed of response is important (such as telecom firms or utilities companies whose employees are often driving around cities and towns in vans) can benefit from the kind of predictive analytics that help McLaren to turn around their F1 vehicles in pit stops within seconds.
Simon Collins, UK chairman of KPMG, said of the deal:
‘Our alliance with McLaren gives us the opportunity to accelerate the transformation of our audit and advisory businesses. McLaren has honed sophisticated predictive analytics and technologies that can be applied to many business issues. The same is true of our advisory services, where we believe applying McLaren’s predictive analytics and know-how to, for example, a complex international supply chain, could help our clients make a step change in the service they provide to their customers.’
Formula 1-powered accounting? Now, that is innovative.
Hointer – changing the way people shop
One of the most innovative brands we have come across in a while is the Seattle fashion retailer Hointer. The brand’s purpose is to change the way that people shop. The company’s CEO, Dr Nadia Shouraboura, is a retail revolutionary. She has extensive retail experience and was the former head of supply chain and fulfilment technologies for Amazon.com. She melds these experiences into a totally new concept in the Hointer brand.
http://youtu.be/O_G8m4FLk6g
Let’s hear the story in her words.
Our purpose is to change the way people shop in physical stores. I think it is long overdue. We have made enormous progress in online in the last 15 years, but very little has been done in physical stores. I am actually more excited about physical stores than online, because our community is bigger.
Sta
nd out
For many years I have been reinventing the e-commerce experience, and I thought it was the answer to everything. I was absolutely convinced that we can get online experience to a point where you don’t need physical fulfilment at all, you just click and you are done. It was only when I encountered apparel that I started to think that it would be nearly impossible to create a phenomenal customer experience online for apparel, or some of the other products that we want to touch and feel. So I started to think about the perfect shopping experience, and that brought me back to the physical store.
It is very easy to say that you are going to be great at everything. But it’s just impossible because you don’t know what to focus on. I think just as important as thinking about who you are, is thinking about who you are not; what you are not going to be good at, because you cannot be great at everything. You cannot be great to your customers, to your employees, to your suppliers, to your shareholders and to the community. So you need to decide who is your primary focus, whom do you care most about, and what is your primary purpose? After that, everything becomes very simple. It’s not that you physically want to suck at some things; it’s just that you prioritize them below other areas, so they are not your strengths.
Distinctive customer experience
We put the customer experience above all. For us, employees are definitely secondary, and we all know that. Let me give you an example. If it is midnight and we just realized that we missed a customer order, the question is do we wait until the morning, or is one of our employees going to put it in his or her car and deliver it? We consciously make a decision that for us the customer experience is the most important priority, so yes, we will do things like that.
Also, what we don’t do is put technology first. We actually don’t think about technology at all, even though we are a technology company. We first think about the experience. How do we really want our customers to shop? What do we want to happen when you come in? How do you want to search for your products? Where do you need information about a product? What is the easiest way to request a different size? So we write down how we want the experience to be, and then we try to make it happen through various means. It can be technology, it can be the process, it can be employees, and it can be even be via robots. It can be whatever it needs to be, but it’s definitely not the technology.
Continuous innovation
We try to make sure that our mobile experience looks and feels very much like our in-store experience. Our in-store actually looks a bit like the website, so when you tap an item when you are in store, you get information and you get pictures, you get exactly the same thing when you shop from home. Then we try to make sure that when you shop in the store, we learn as much from your shopping experience as possible. When you shop from home using your mobile experience, we use that information. For example, we show all the items that you viewed in store, those that you liked and those that you didn’t so you can recall your experience. If you are trying to buy items online that you already tried in the store in the past and didn’t like, we will remind you of that.
Image 5.3 The Hointer retail experience
We continuously experiment with our displays; it is part of our innovation. We make sure it’s easy for customers to look at displays, but what we try to do is make displays disappear so that customers really, really focus on the product. So when customers walk around, that’s what they see. They don’t really see displays, because they are so minimalistic. If you are a customer your focus is to buy the product, you don’t have to look at the display. So, you want to see every detail of the product.
Infectious communication
We try to pool customer feedback on the product, and provide that to our customers. I think the reason it is very important is because when you are in a store as a customer, you have an experience with the product as it is now, but you don’t know what is going to happen with it in three months from now, and customer feedback frequently gives you that. It tells you not only what the product is like now, but also how it has performed. So we are trying to get customer feedback online and make that available to customers in store. When you type in a product, you land on a product page and it gives you the information from the manufacturer but it also gives you feedback from other customers. You use the information in very different ways because you want the manufacturer to tell you what the product is made of, but you really want customers to tell you how it will perform a month from now.
Then we went even further and we started to integrate the customer feedback with social media. So for example when we added the ‘Prince Harry’ range, we added the most frequently pinned image to our product page, and for our docker pants, the most frequently pinned image by the customer community was Prince Harry wearing the product. The results were phenomenal. From being one of the least frequently tried products in the store it became the most frequently tried, literally overnight. Everybody wanted to try it, so I think the connection with social media in a physical store is very, very important because when I pick product images to show, I could be very wrong, but crowdsourcing the most relevant images works phenomenally well. We continue to double down on that, because it worked so well for us. We are spending more and more time trying to figure out the smart way to integrate social media content with our physical store experience.
Our purpose is not to sell jeans or groceries; our purpose is to change the way people shop. So for us, the fastest way to change the way people shop is to create the largest possible community of retailers who are innovating with us and using our technology. So, that is our business model.
Stand out – a summary
So what can we learn from these examples about how to stand out?
Purpose driven: you have to have a crystal-clear vision of your purpose and drive this through your customer experience ensuring that everything is aligned with it. Hointer is an example of a brand with a big idea.
Purposeful leadership: leaders have to ‘walk the talk’ if they are to make the tough strategic choices and appropriate investment in the experience, and also the conviction to instil the culture to deliver it. O2 did this by channelling investment to those areas that the customers valued most.
Decide where to over-index your customer experience: this is so that you create pleasure peaks associated with your brand promise. Making savings at those touchpoints that matter less to your customers or your differentiation can fund these. Lush did this by saving on packaging to spend more on ingredients and the store experience.
Distinctive customer experience: people do not buy Innocent smoothies simply because of the woollen hats; Lush is not the most highly recommended retailer simply because it doesn’t use packaging; Metro Bank providing dog bowls in the branches is not the reason that people bank there; customers do not choose to stay in Best Western purely because of their stories; consumers do not flock to Burberry because of their fitting rooms, but these are the things that they became famous for. All of these things are hallmarks of the brand and a manifestation of their purpose. They serve to dramatize the experience just as IKEA’s inconvenient self-assembly reinforces the consumer perception that what they are paying for is well-designed furniture at a low price point.
Ensure that the brand experience is consistent across all channels: so that irrespective of how the customer chooses to interact with you, the hallmarks and their perception of the brand are the same, and the experience they deliver is just as good. This requires a consistent tone of voice and a single view of the customer across all channels. Best Western ensured that the ‘personality experience’ was delivered across all media.
Having looked at the elements of stand out, infectious communication, distinctive customer experience and continuous innovation, let’s illustrate all of these principles with a couple of example brands that have embraced most of them.
We wrote a book a few years ago called See, Feel, Think, Do: The power o
f instinct in business in which we argued that business was becoming too formulaic, too left brain, too analytical and that it needed to move back to being more visionary, right brain and instinctive. Tim Wade touched on this when he spoke about Best Western and the ‘personality experience’. Let’s return to our other hotel example – citizenM that we introduced in Part One.
Whereas Best Western has its origins in the United States – is large, long-standing and has many old, individually owned properties – CitizenM is Amsterdam based and is small, young and innovative. So, two hotel brands with very different business models. This book is written on the premise that starting with your brand purpose (providing that it is unique) leads naturally to creating a distinctive customer experience and a unique culture. Rattan Chadra spoke passionately about his desire to create a new business model for the hotel sector. But how do you go about translating that into a distinctive customer experience so that you really stand out from competitors?
citizenM
Stand out
Let’s hear directly from Robin Chadha, citizenMarketing.