Experience - the ultimate differentiator
But what really started me thinking about innovation and the Fresh Market was their slogan. Experience the Food. Not, for example, "Taste the Food" or some argument about how you shop or the freshness of the produce, or the lowest prices. In fact they say nothing about the quality of the food, whether or not it is organic, or the prices of the food. Locally, we know that Fresh Market is on the more expensive side. But what they choose to focus on, at least with some of their marketing messaging, is Experience. They are innovating the grocery store model to focus on the shoppers' and the customers' experience of the event, and of the food.
Now, the Fresh market isn't the first to focus on the "experience" of the food for the consumer. Forbes Magazine and other periodicals have suggested that Whole Foods has a "food porn" strategy, telling stories about the food, how it was raised and the life stories of those who grew the apples, raised the cows, fed the chickens. But Whole Foods was ultimately about a lifestyle that rejected the pre-packaged ways of traditional grocery stores and was about embracing a new, and sometimes counterculture way of doing things.
Both of these firms understand that Customer Experience is one of the most compelling differentiators in the market. Even in the financial environment we have in 2009, Fresh Market and Whole Foods are holding their own, while traditional grocery stores struggle. People identify and are willing to pay more for Experience, even in what should be a commodity like groceries. Apple (the electronics manufacturer, not the food) understands this and has always had excellent Customer Experience, to the point that it ships its iPhone with no evident user manual. Nordstroms understands this, offering customer service and experience that's not found anywhere else in the clothing retailers.
Yet, the few examples I provide above indicate that while Customer Experience is powerful as an innovation opportunity and differentiator, few firms focus on Customer Experience. It appears to be too expensive, too labor intensive, too different for their situation or industry. Let's look at retail banks as an example. Does any retail bank offer a unique customer experience? Most interact with customers at branches through bullet proof glass at the drive up or in those velvet roped lines inside the branch. Most require that you fill out antiquated forms and recite 15 digit numbers to access your money. Most branches feel like a cross between a prison and an elementary school, with the really important executives in hushed offices at the back, while tellers and greeters act as the guards on the watchtowers. Could there be a different experience than this? Absolutely. The only bank I've see experimenting with its customer experience is Umpqua Bank in the Northwest. How many bank branches do you think get written up in Architecture Week Magazine? Banks are just one of many industries that have yet to recognize the sustaining power of innovating around Customer Experience.
Think about the airline industry. Can you name a recent positive experience you've had with the airlines? Only Virgin Atlantic seems to be paying attention to innovation around Customer Experience, while the rest of the industry seems focused on driving costs down and driving away customers with terrible service and experience.
Why would a grocery store take as its motto "Experience the Food"? Why would a bank radically alter its branches? Why would an airline examine how its customers are treated? Because they understand that what appears to be a commodity can be innovated, especially around customer experience.